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German courts set advertising stage for the 2020 Olympic Games in Tokyo

Although the opening ceremony of the next Olympic Games in Tokyo is still more than a year away, recent decisions of the German courts are already preparing the stage for commercial and advertising activities evolving around them. The courts are defining to which extent non-official advertising partners may use the Olympic designations “Olympiade”, (“Olympics”) “Olympia” (“Olympics”) and “olympisch” (“olympic”) or similar signs in a commercial context.

German Law – OlympSchG

In Germany, the Olympic designations and the Olympic symbol (the five interlocking rings) are protected by a specific law, the “Gesetz zum Schutz des olympischen Emblems und der olympischen Bezeichnungen” (Law on the protection of the Olympic symbol and the Olympic designations – OlympSchG).

This law entered into force in 2004 for two main reasons: Firstly, the German Patent and Trademark Office was reluctant to grant protection to the Olympic designations as trademarks, arguing that they would lack distinctiveness as elements of common parlance. And secondly, the International Olympic Committee (IOC) had made it clear that future Olympic Games would only be awarded to countries in which the Olympic designations and Olympic symbol enjoy specific protection. Leipzig at the time had applied for the Summer Olympics 2012 with the support of the federal legislator, which tried to increase the chances of the bid specifically by enacting a law satisfying the IOC’s condition as follows:

Third party use in trade

Sec. 2 provides that the exclusive right to exploit the Olympic designations as well as the Olympic symbol vests with the IOC and the German National Olympic Committee (NOC). According to Sec. 3 para 1 S. 1, third parties are prohibited from using the Olympic symbol in trade

  • to brand goods or services,
  • in advertisements for goods or services,
  • as company name, special designation of a business or as name of an event,
  • as club emblem or club flag

Sec. 3 para 1 S. 2 states that the same applies to the use of a sign similar to the Olympic symbol, provided that the use leads to the danger of confusion or without due cause takes unfair advantage of, or is detrimental to the repute of the Olympic Games or the Olympic movement.

According to Sec. 3 para 2 S. 1, third parties are prohibited from using the Olympic designations or similar signs in trade;

  • to brand goods or services,
  • in advertisements for goods or services,
  • as company name, special designation of a business or as name of an event,

if the use leads to the danger of confusion or without due cause takes unfair advantage of, or is detrimental to the repute of the Olympic Games or the Olympic movement.

Remedies

Sec. 5 & 6 grant NOC and IOC claims for cease & desist, damages and destruction in case of infringement according to Sec. 3, 4.

The OlympSchG, due to its unique character of protecting a few very specific designations by means of a trademark-like law has been much discussed in Germany, even branded unconstitutional by some voices. These voices have not prevailed though and the OlympSchG is hence widely considered constitutional nowadays.

Earlier landmark case

A balance between the interest of the IOC / NOC to enforce a wide field of application for the provisions of the OlympSchG – not least in the interest of maximizing the commercial exploitation of the Olympic Games themselves – and meeting third parties’ interest to freely use the terms at issue in a commercial context has not yet been struck. This, in spite of a number of decisions of the German courts already, most notably, in a landmark decision concerning the OlympSchG from 15 May 2014. Here, the BGH denied a violation of Sec. 3 in the case of an advertisement for contact lenses using the claims “Olympische Preise” (“Olympic prices“) and “Olympia-Rabatt” (“olympia discount“) during the 2006 Olympic Games in Beijing. By doing so, it set the basic guidelines for the application of the OlympSchG.

With the following recent, key decisions from November 2018 and March 2019, the BGH and the OLG Frankfurt further sharpened the scope of the provisions of the OlympSchG.

Case 1: Acceptable association in the fitness studio

(Decision of the Higher Regional Court of Frankfurt a.M. (OLG Frankfurt) of 01.11.2018 – 6 U 122/17)

During the 2016 Olympic Games in Rio de Janeiro, the operator of a fitness studio ran a discount campaign according to which customers were rewarded for multiple visits in the fitness studio by counting their visits in “medals” and offering personal “medal tables”. The campaign was advertised under the buzzword “Olympia Special” and additional explanatory claims “Wir holen Olympia in den Club” (“We take Olympia into the studio“) and “Training bei … wird olympisch” (“Practise at … becomes olympic“) were used.

The OLG Frankfurt agreed with the District Court of Frankfurt in its first instance decision, rejecting the claims brought forward by the Deutscher Olympischer Sportsbund (DOSB).

The OLG Frankfurt held that the average consumer would not conclude from the advertising campaign that the fitness studio operator was an official sponsor of the Olympic Games or otherwise maintained commercial relations to these. The court highlighted that any official partners of the Olympic Games would usually disclose their relationship through indications such as “Official sponsor…”. As such an indication was missing in this case, the relevant public would not assume any kind of commercial relationship with the Olympic Games or its organizers. Consequently, danger of confusion would not exist.

Likewise, the OLG Frankfurt rejected the DOSB’s claim that the use of the terms “Olympia” and “olympisch” would take unfair advantage of, or be detrimental to the repute of the Olympic Games or the Olympic movement.

According to the court and in line with the findings of the BGH in its 2014 decision, a line had to be drawn between (legitimate) mere associative references to the Olympic Games and (illegitimate) unfair image transfer. In this regard, the court stated that the mere timing of the discount campaign with the Olympic Games in Rio de Janeiro would not be sufficient for an unfair image transfer. This would only occur if the relevant public perceived the use objected to as directly transferring the goodwill of the Olympic Games or the Olympic Movement to the goods or services in question.

Applying this standard, the OLG Frankfurt held that the use of “Olympia Special” was not infringing, as it would only serve as a reference to the Olympic Games happening simultaneously and hence had to be considered a mere associative reference. The OLG Frankfurt also rejected the claims against the use of “Wir holen Olympia in den Club” and “Training bei … wird olympisch“, stating that the phrases simply explain the discount-campaign in a playful way, rather than leading to an unfair image transfer.

Case 2: Words and pictures in online sportswear advertising

(Decision of the German Federal Court (BGH) of 07.03.2019 – 6 U 122/17)

During the 2016 Olympic Games in Rio de Janeiro, a textile wholesaler advertised sportswear on its website, using the terms “olympiaverdächtig” (“olympia-worthy”) and “olympiareif” (“olympia-ready“) and displaying a sportsman with a medal in his hand.

The DOSB considered this an infringement of its rights under the OlympSchG and filed a court action. After the Higher Regional Court of Rostock had dismissed the claims, the DOSB lodged an appeal with the BGH.

The BGH confirmed the decision of the Higher Regional Court of Rostock and rejected the NOC’s appeal. According to the BGH press release (the full decision has not been published yet), in order to deem use without due cause had taken unfair advantage of, or was detrimental to the repute of the Olympic Games, it’s not sufficient for the use to restrict commercial exploitation of the Olympic designations.

However, the threshold to infringement would be passed if by means of a close reference to the Olympic Games, the repute of the Olympic Games had been taken advantage of to advertise third party goods or services in a way which was only available to an official sponsor of the Olympic Games or to an official manufacturer of sports clothing for athletes of the Olympic Games. The BGH considered such references in particular in a situation where products functionally close to the Olympic Games or the Olympic Movement, were advertised not only by use of the Olympic or similar designations, but in addition to this by an explicit reference to the Olympic Games or the Olympic Movement in word or picture.

Applying these principles, the BGH denied the claims in the case at hand. While it considered sports clothing was functionally close to the Olympic Games, the BGH pointed out that:

  • The defendant had not made explicit reference to the Olympic Games or the Olympic Movement in word or picture.
  • The use of the terms “olympiaverdächtig” and “olympiareif” had only been made in the sense of synonyms for a “particularly good performance”
  • And the display of a medal in the hands of a sportsman in the advertisement could not per se be exclusively considered as an Olympic motif as the practice of awarding good performances in sports with medals is wide-spread outside the Olympics.

Outlook – No carte blanche

The recent decisions show that the courts are cautions when interpreting and applying the provisions of the OlympSchG. They aim for a balance between the legitimate interests of IOC / NOC and its official partners to exclusively exploit the Olympic designations and symbol commercially, while acknowledging the general public’s legitimate interest to use the Olympic designations as part of the common parlance, and for reasonable commercial purposes.

The track record seems to suggest that the courts take a tough stance on IOC and the NOC / DOSB when they try to enforce rights against third parties under the OlympSchG law. That is not the full picture however: The cases decided by BGH and OLG Frankfurt just like the 2014 decision of the BGH were cases in which the argument of the use of Olympic designations as part of the common parlance weighed particularly strongly. The cases concerned advertising speech only, in which the products’ characteristics were not directly described using the Olympic designations. While it is true that in such scenarios the German courts have taken a liberal view, the recent decisions should definitely not be taken as carte blanche to freely advertise using the Olympic designations or even the Olympic symbol, which enjoys an even stronger protection under the OlympSchG.

Quite the contrary, the BGH in its 2014 decision already stated that the use of terms with direct connection to the goods in question such as “Olympic care set” or “Olympic lenses” could well be considered as taking unfair advantage of the Olympic Games or the Olympic Movement. Hence, the closer the used designation comes to actually describing certain characteristic of the goods or services in question, the higher the risk that infringement will be found.

The two step approach outlined by the BGH in the press release concerning the decision of March 2019 is also useful in order to assess legal risks. It lays out that an illegitimate close reference may in particular be assumed in a situation where:

a) products functionally close to the Olympic Games or the Olympic Movement are advertised using the Olympic or similar designations

and b) in addition to this by an explicit reference to the Olympic Games or the Olympic Movement in word or picture.

If for example the sportsman depicted in the advertisement subject to the new BGH decision had been depicted with a medal recognizable as an Olympic medal in his hand, that alone could well have turned the matter in the DOSB’s favor.