Licensee buys Licensor – model for succession

Many media reported about PVH acquiring Tommy Hilfiger. And some mentioned the existing relationship of licensee and licensor. For years PVH has been the Tommy Hilfiger licensee for the core product group, menswear.

Another case of licensee buying the licensed brand got much less attention, except from PMA. Since 2007 RCP Technik has been the licensee of the iconic Rollei brand, see here. Now RCP acquired the brand.

In our opinion, what so far probably has been happening by chance or for a lack of other options, should be considered as a strategic alternative for proprietors of companies and trademarks.
Many entrepreneurs looking for solutions how to pass on their companies should consider a licensing model first with the possibility to sell the company and the trademarks later to the licensee.

European Court of Justice – Adword ruling

The use of trademarks in Google Adwords kept courts busy for years. We wrote about here and here.

Now the European Court of Justice ruled as follows (Quote):

Article 5(1)(a) of First Council Directive 89/104/EEC of 21 December 1988 to approximate the laws of the Member States relating to trade marks and Article 9(1)(a) of Council Regulation (EC) No 40/94 of 20 December 1993 on the Community trade mark must be interpreted as meaning that the proprietor of a trade mark is entitled to prohibit an advertiser from advertising, on the basis of a keyword identical with that trade mark which that advertiser has, without the consent of the proprietor, selected in connection with an internet referencing service, goods or services identical with those for which that mark is registered, in the case where that advertisement does not enable an average internet user, or enables that user only with difficulty, to ascertain whether the goods or services referred to therein originate from the proprietor of the trade mark or an undertaking economically connected to it or, on the contrary, originate from a third party.

The court also ruled, that Google, as provider of the ” internet referencing service” and marketer of keywords, does not use the trademark:

An internet referencing service provider which stores, as a keyword, a sign identical with a trade mark and organises the display of advertisements on the basis of that keyword does not use that sign within the meaning of Article 5(1) and (2) of Directive 89/104 or of Article 9(1) of Regulation No 40/94.

But once Google has learned or was notified of trademark infringement, it has to delete or block access:

Article 14 of Directive 2000/31/EC of the European Parliament and of the Council of 8 June 2000 on certain legal aspects of information society services, in particular electronic commerce, in the Internal Market (‘Directive on electronic commerce’) must be interpreted as meaning that the rule laid down therein applies to an internet referencing service provider in the case where that service provider has not played an active role of such a kind as to give it knowledge of, or control over, the data stored. If it has not played such a role, that service provider cannot be held liable for the data which it has stored at the request of an advertiser, unless, having obtained knowledge of the unlawful nature of those data or of that advertiser’s activities, it failed to act expeditiously to remove or to disable access to the data concerned.

Can the risk of a brand license be evaluated?

In an article here, Ian D. McClure, writes about the risk of brand dilution through a license, how to evaluate that risk and how the risk should be a factor in calculating royalties.

In our opinion the risk of failure of the (licensed) new product(s) and the resulting “damage to goodwill” cannot be calculated.

About 90% of all new product launches fail. Failure is the norm, not the exception. Even big companies with the best reputation and all the market power fail. Do you remember Burn, an energy drink The Coca Cola Company introduced? It was backed with all of the might of the global market leader in carbonated drinks. And it tanked.

In general, licensed product launches are more successful.

And consumers allow brands to make mistakes. The Harley Davidson perfume or their cake decorations were bad ideas. They failed miserably. Did it hurt Harley Davidson? Yes, it did. Did it damage the goodwill with consumers? No, consumers are forgiving, if you do not repeat your mistakes over and over again.

Trussardi Brillen

Der bereits reichlich gefüllte Markt für optische und Sonnenbrillenist um eine weitere Lizenz reicher.
Die Italienische Modemarke Trussardi, die ursprünglich mit Lederhandschuhen gestartet ist, vergab seine Markenlizenz an die Charmant Group, den Lizenznehmer von Puma, Elle, Lacoste und Esprit.

Der Markt ist bereits eindeutig zu voll, als das alle Lizenzen erfolgreich sein können.

Neue Heimtex Marken Lizenzen

Der Amerikanische Heimtexmarkt füllt sich mit Marken. Nach der Lizenzvergabe durch Stetson folgt nun Elizabeth Arden mit einer Lizenz an London Luxury.

Und Kate Spade lizenziert an CHF Industries, die fast zeitgleich eine weitere Markenlizenz von Marc Ecko aufnahmen. CHF hat zudem bereits Lizenzen von Quiksilver, Donna Karan, DKNY, Hemingway, Dockers, Roxy und anderen.