Feb 4, 2021

Brand Stumping – Legal Positions On Comparative Advertising | Abimbola Balogun


I was in my office one fine day when my good friend Mr. B paid me a short friendly/business visit. While we had our usual chat exchanging pleasantries, he would take occasional pauses when he spotted anything new and interesting to show me and as usual I could not but look; as I like gist like that. One of the interesting topics he showed me was a new Pepsi advert featuring the famous female rapper Cardi B. In this advert (in summary), the customer at a restaurant/bar requests for a coke to which the waiter replied, oh we don’t have coke; but is a Pepsi ok? Cardi B in dismay asks the waiter “what do you mean is a Pepsi okrrrrr, of course a pepsi is okrrrr.. etc”. While we both found this advert hysterical, Mr. B’s question quickly turned our entertainment into an academic journey.

 

He asked with the remnants of laughter “is this legal though?”. Being the lawyer in the room, I knew I had to give a cogent answer even if this was not a topic that I had really done any research on. I was able to use my sharp girl common sense to give a semblance of an answer with plenty English so that I didn’t look completely empty.

 

Now this new topic brought back memories of other similar adverts of Pepsi, mentioning Coca-Cola and using their logos in Pepsi adverts with seeming disregard. Mr. B believed very strongly that this act had to be illegal in many ways or could at least lead to some sort of legal liabilities. He also wondered why the Business Giant Coca Cola have never sued or retaliated in any way or, at least none that we know of.

 

This topic also brought my mind to the similar and most recent advert play stunt or “bank wars” on social media between Sterling Bank Nigeria and other banks, where sterling bank played a subtle card by using logos of other banks to show superiority while also casting subtle insults, i.e. indicating sluggishness or low performance[1] of its competitors to which the other banks fired back in their individual smart ways.

 

I’ll give a brief summary of my answer to the Pepsi-Coca-Cola Saga, (I hadn’t done any research at the time so don’t judge me) I believed the fact that other companies don’t engage in what I describe as brand bashing is due to simple advertising ethic. This opinion was more based on the fact that Coca Cola cannot possibly be afraid to take Pepsi on in a brand war or legal suit over trademark issues. This argument helped me get by that day, but I definitely knew that this was the shallowest of answers and I got away with it by sheer luck.

 

Moving smartly along, a few weeks after I finally overcame the spirit of procrastination, I discovered that the issue of Brand Bashing is quite a serious matter globally and has been dealt with over the years in different ways regionally, essentially meaning different countries have their own laws and registers for trade mark and brand protection. There have however been a concerted effort to make intellectual property and brand protection laws  more uniform through international treaties  and international intellectual property rights systems/platforms and forums such as the 1886 Berne convention, 1996 WIPO[2] copywrite treaty (WCT), 1883 Paris Convention, TRIPS Agreement[3] (To be discussed in another Paper) [4]. It should however be noted always that only party countries are bound by such systems and conventions. Furthermore, the majority of rules created are for the protection of registered marks and not the economic activities among competing brand owners.

 

But before going any further, I have to first practice the age long culture of defining brand bashing.

 

Definition

Advertising is defined as ‘any message, the content of which is controlled directly or indirectly by the advertiser, expressed in any language and communicated in any medium with the intent to influence their choice, opinion or behavior.’[5] Brand Bashing on the other hand also known as Comparative or competitive advertising is therefore any advertising or promotional technique which directly or indirectly identifies a competitor, goods or, services offered in order to claim the superiority of its product over that of the competitor by direct or indirect comparison[6]..

 

TYPES OF COMPARATIVE/COMPETITIVE ADVERTISING.

There are generally 2 types of comparative advertising

a.       Direct comparative advertising: this occurs when other products are mentioned by their name (and not as 'brand X,' 'brand Y,' etc.)

b.      Indirect comparative advertising: Here no other brand names are mentioned. The Brand X and Y analogy is used here to contend that one brand is superior to all or most others.

 

There are generally 2 schools of thought on this issue. One school in favor of the use of competitive advertising, and the other is against it. Those that are in favor believe that competitive advertising will have the effect of pushing manufacturers to improve their products in order to avoid embarrassment from the public and competitors; while those against argue that consumers may be duped by unscrupulous advertisers who either fail to present fair and truthful comparisons, or overload customers with false information[7]. Whichever direction we may lean in; the fact remains that the use of comparative advertising has a potential to lead private lawsuits globally as regulations to control comparative advertising are still in evolutionary stages. This therefore means that without clear cut rules, there are many legal issues that may arise out of comparative advertising when advert practitioners get carried away in search of creative ways to boost their brand. Such legal issues may include infringement of intellectual property rights, Libel or slander, passing off of brand logos etc.

 


With such a globally controversial issue it is seen that many regions have developed similar laws to tackle this matter with national specificity. Nigeria is no exception to this phenomenon as there are no known laws directly dealing with the issue of comparative advertising. The closest I got to dealing with these issues are:

a.        Section 5 of the Trademarks Act[8] which generally safeguards the registered brands of trademark holders giving the right to sue for passing off.

b.      The Nigerian Communication Commission Guidelines on Advertisement and Promotion (NCCGAP) which (as the name implies) deals only with communication practitioners. and provides for fairness in advertising practices among communication practitioners. It states thatcomparative advertisement must not unfairly disparage, discredit, or attack other products, services, advertisements or companies, or exaggerate the nature and importance of competitive differences[9]”. But this deals only with communication practitioners

c.       The Federal Competition and Consumer Protection Act[10] protects consumers from false misleading or deceptive representation concerning a material fact.

 

While the Trademarks Act gives the right to sue for passing off, this article touches on issues that involves also the use of the said brand mark to gain economical advantage by a competitor who is/are largely at par with one another on the economic playing field; I’ll easily put this topic on the same line as cyber bullying but for commercial brands. Sort of like cyber bullying a cyber bully.

 

Having established the fact that competitive advertising can become quite messy due to inadequate guidelines and possible overzealousness and or of advertising practitioners; the question here is (focusing on the advantages of comparative advertising) how best can comparative advertising be executed without attracting a lawsuit. A few general rules for comparative advertising can be followed. For example, fairness; A balance mut be struck between competitiveness and minding your business so to say. Fairness as it relates to comparative advertising means carrying out comparative advertising without disparaging the products or services of the competing brand. To be accomplished, certain elements must be observed as a guideline as follows:

 

·         The advert must be truthful and verifiable: The facts stated in the comparative advertising must be factually correct so as not to deceive or mislead the potential customers. This means that the facts should not only be true on the face of it, they should be verifiable.

·         Use of trademarks and logos: the use of a competitor’s product, logo, or motto is more common in direct competitive advertising. This makes this form of advertising much bolder and more dangerous for advertisers as such acts could entitle aggrieved brand owners to damages for the unauthorized use of their marks. It is therefore advised that the use of competitor’s brand name, initials or mark must not be unjustifiable nor the goodwill attached to the trademark or symbol of another brand be unfairly taken advantage of.

·         Products must be similar: goods or services must meet the same needs and for the same purpose. The yard stick for similarity could be that the product or service must have one or more material, relevant, verifiable and representative features, and must be with the same designation of origin in order to stand as competitors.

·         Must not be misleading: The consumer should not be misled as a result of the comparison being made, whether about the product advertised or that with which it is compared.[11]

·         No Unfair disparagement: While engaging in comparative analysis the advertisers must ensure that their advertisements observe fairness in competition. By this I mean that the advert must not unfairly denigrate attack or discredit other products. An advertiser can say that his goods are better than his competitors. For example, the advertiser is allowed to glorify his goods as good, better than all others, or the best in the world, but cannot say the other goods or product x, y, z are bad. Comparative advertisements are limited to mere puffs. Any statement indicating that a competitors' goods are bad may amount to slander/ defamation of competitors and their goods, which is not permissible[12].

 

Now going back to the Pepsi and Coca-Cola saga as well as the bank wars which seem like brutal advertising strategies defying all my story on fairness being the fulcrum of comparative advertising, it still leaves the question of how come no major lawsuits have sprung up from these ongoing advert wars. My personal take is that the concerned brands have practiced what I call permitted comparative advertising; by this I mean that either by agreement or complacency, parties allow the stare up of drama in order to gain joint publicity. Brilliant don’t you think? There is no such thing as bad publicity as some wise person said. In these circumstances such advertisements are more of cooperation and collaborations, encouraging one another to practically go crazy on each-other’s brands up to whatever limits parties may have set. Publicity stunts like this have been adopted by many brands in the past and used as tools to attract public curiosity and popularity in the long run. This tactic I believe, was used in the bank wars stated above, and if I may say so myself, it worked like a charm. There can be no legal liabilities where parties strictly adhere to their agreement on comparative advertising.

 

 

 



[1] #BankWars: Access, Sterling, other banks in entertaining ‘supremacy battle’; jully 22, 2018Oladeinde Olawoyin; premium times June 21 2019; https://www.premiumtimesng.com/business/277325-bankwars-access-sterling-other-banks-in-entertaining-supremacy-battle.html

[2] World Intellectual property Organization

[3] The Agreement On Trade Related Aspects Of Intellectual Property Rights

[4] Registering and protecting foreign intellectual property rights in Nigeria; o. marx ikongbe; 22 August 2016; https://www.mondaq.com/nigeria/trademark/521264/registering-and-protecting-foreign-intellectual-property-rights-in-nigeria-copyright-trademark-patent-and-designs; viewed 1st June 2020.

[5] Nigerian communication commission guidelines on advertisement and promotion

[6] Federal Law Gazette I, 1374; the Government's memorandum of legislative intent concerning the draft law, at: Bundestags-Drucksache 14/2959 dated 20.3.2000 (Bundesrat's comments and Government's response at Bundestags-Drucksache 14/3433); Berlit, BB 2000, 1305 et seq.

[7] Comparative Advertising: a Review With Implications For Further Research; http://acrwebsite.org/volumes/6143/volumes/v10/NA-10

[8] Chapter 436 Laws of the Federation of Nigeria 1990

[9] Section 3d.

[10] Section 125.


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