The Provincial Court of Barcelona has condemned the company Nosko Europa S.L. to pay Nike 90.000 euros of damages and to withdraw from the market all the commercialized T-shirts since considers that there exist acts of unfair competition in the commercialization of the T-shirts imitating certain football team’s official T-shirts.
This is the headline but, is the judgment really so favorable to Nike?
The reported conduct was "the commercialization by the defendant of football equipments that considered as a whole were clear imitations of the well-known official equipments of football clubs sponsored (and equipped) by NIKE"
The proven facts were that Nosko marketed, during the 2009-2010 season, T-shirts imitating the official equipments of the Manchester, Arsenal, Celtic, Barcelona football clubs and the Brazilian national league. Nike holds the exclusive sponsorship for the equipment of the cited clubs and the Brazilian national league outside Brazil.
Nosko T-shirts reproduced colours and emblems very similar to those of the cited football teams, included an inside label with the defendant data and an outside label indicating the size and the statement "FOOTBALL ACTION. This is not an official product".
The controversial T-shirts did not include the NIKE brand but the defendant's own brands consisting of the initials "JNO" or "WTJ” and a device consisting of a shield (evocative of the particular football club) and sometimes, even the name and number of a player on the back.
Nike describes those activities as acts of unfair competition based primarily on (i) acts that are objectively contrary to the requirements of good faith, (ii) acts of unfair imitation and (iii) acts of exploitation of the reputation of others that fall within the scope of arts. 4.1, 11.2 and 12 Unfair Competition Act (UCA) respectively.
Well, the judgment considers that:
- There not exist acts of unfair imitation by using the efforts of NIKE(art. 11.2 UCA) because the defendant has borne the costs for the design, preparation and manufacture of the T-shirts. The judge considers that this article tries to impede that the imitator saves the most significant costs of the production bearing in mind that the said Article 11 UCA establishes the general clause of the lawfulness of imitation.
- There is not exploitation of the reputation of NIKE provided that the sign NIKE is not used by the defendant. The imitation of the signs that identify the clubs or football team (club colors, name of sponsor advertising, sign identical or similar to the shields protected as a trademark of the clubs) can be an instrument of exploitation the reputation of these but not the reputation of the plaintiff, NIKE (art. 12 LCD)
- For the judge, Nosko conducts do not fall within the aforementioned special types of the UCA but its prosecution it is only justified under the general clause of Art. 4 LCD
Indeed Nosko T-shirts are not the result of the integration of elements belonging to the defendant but of someone else’s elements combined to create the appearance of an official product without the indication that it was not an official product can be considered sufficient
The judgment acknowledges that Nosko hinders ordinary development of the activity and has altered the normal functioning of the market being unfair because it is contrary to the good faith, as per art. 4.1 UCA.The conclusion is therefore that although Noskos’ practices are contrary to the good faith and Nike has to be compensated, there is not exploitation of Nike’s reputation and there is not unfair imitation for unfair exploitation of Nike’s efforts.
Is then the judgment really so favorable to Nike? Probably not.