Football fan's fate could spell trouble for online traders

European Union

A football club's dispute with a fan who sold unofficial souvenirs close to its stadium could also have implications for online traders in unauthorized sports merchandise.

The European Court of Justice (ECJ) is soon expected to give its final judgment in the trademark infringement case of Arsenal Football plc v Matthew Reed. While the decision seems likely to win favour with some of Britain's largest clubs, much of whose profit comes from the sale of goods carrying registered trademarks, it will come as bad news to traders who make their money from selling unofficial products bearing club names and logos from shops and stalls, or via fan websites.

The dispute began after Arsenal Football Club, which had registered ARSENAL and ARSENAL GUNNERS as trademarks (together with two graphics featuring a crest and cannon), brought claims for passing off and trademark infringement against Arsenal fan Matthew Reed. For 30 years, Reed had been selling souvenirs and clothing featuring the club's marks.

The claim for passing off failed since the club could not prove that anyone had been confused by Reed's products. There was evidence that the public knew the goods were unofficial.

Before making a final judgment on whether this type of use constitutes infringement, Justice Laddie referred the matter to the ECJ for guidance. In response, Advocate General Ruiz-Jarabo stated that, in most cases, consumers are not aware of who produces the goods they buy; rather they see the trademark as an indication of quality, reputation and, sometimes, as representative of a particular lifestyle. He said that all these functions of a trademark should be protected.

Ruiz-Jarabo also said that the consumers' feelings towards the trademark owner are irrelevant when considering infringement, but those of the traders who use the same marks are. If they attempt to exploit the sign commercially, they can be said to be using it "as a trademark" and, in doing so, infringing the owner's rights. He added that professional sports clubs were within their rights to object to third parties using an identical sign with the purpose of commercially exploiting and profiting from it.

While the opinion of an advocate general is not legally binding, it is often followed by the ECJ and can therefore be seen as a strong indication of the final decision. On this basis, it will then be down to Laddie to rule on the trademark infringement point, likely finding Reed guilty of infringement. This will mean that sports organizations can relax in the knowledge that the law will offer their merchandising activities strengthened protection in the United Kingdom in future.

For traders of unofficial goods, however, the future looks bleak. Just as Reed's stall sign indicated that the goods he was selling were unofficial, it seems an online trader's defence of a website disclaimer stating that the products being sold are unofficial will be unreliable as a defence against a claim for trademark infringement.

Louisa Albertini, Field Fisher Waterhouse, London

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