The impact on brands when brands are used in military strategy | Faegre Drinker Biddle & Reath LLP

Western companies with trademark rights in Russia are feeling the ripple effects of the Ukraine conflict. In response to economic sanctions and boycotts imposed by the United States and other Western countries, Russia has threatened to suspend the intellectual property rights of companies that have ceased operations in Russia. Additionally, there has recently been an increase in bad faith trademark filings for various brands across a wide range of industries, from Chanel to Audi. Additionally, it appears that Russian courts may allow counterfeiting and misappropriation of trademarks held by Western companies in light of a recent ruling involving the character of Peppa Pig, in which the court cited penalties as grounds for refusing. to recognize the intellectual property of the company based in the West. rights to the popular cartoon character.

Even companies with longstanding ties to Russia don’t seem safe. Some companies closing sites in the country in response to the conflict in Ukraine are finding third parties filing trademark applications for blatant replicas of their trademarks. What is even more troubling is that if the Russian government decides to completely remove trademark protection for Western companies, then a third party could step in and offer goods and services under identical marks. Depending on how things go in Russia, Western brand owners are at serious risk of losing their intellectual property investments in the country. The problem for these brands is exacerbated by the fact that it can be extremely difficult to find a local lawyer willing to help them. Fear for personal safety and the threat of retaliation may cause many trademark attorneys in Russia to avoid cases involving firms from “unfriendly” countries.

While most brand owners may view these moves as ruthless, Russia’s tactic is not new as wartime intellectual property seizure is not a new phenomenon. During World Wars I and II, the US government and its allies seized the intellectual property of companies associated with countries like Germany. For example, Bayer, the German company, lost its rights to aspirin as a result of the Treaty of Versailles in 1919. Therefore, it should not be very surprising that Russia considers the actions discussed above as tools in its arsenal during this recent conflict. .

Only time will tell what the landscape will look like in Russia for brands keen to return in the future. In the meantime, Western-based companies should anticipate an increase in counterfeit and/or gray market products from Russia and if trademark registrations are issued in Russia in connection with bad faith filings, the world could also see an increase in the subsequent registration of domain names and the creation of websites and social media accounts based on these national rights. There is a lot of uncertainty, but it seems that many Western brands are taking the position that their responsibility to be good corporate citizens outweighs the potential loss associated with the diminishing or even evaporation of their rights. intellectual property in Russia. Unfortunately, it’s unclear what the long-term repercussions might be for brand owners and the Russian economy, but for now it appears to be a “no way out” situation for all parties involved.