Manchester United are suing the makers of the popular Football Manager series for allegedly infringing their trademark by using their name “extensively throughout the game”.
The Premier League side have taken legal action against Sega Publishing and Sports Interactive (SI) - the publisher and developer of the football management simulation.
The club also argue Sega and SI have infringed their trademark over their logo by not using the official Manchester United crest in the game, instead “replacing the club crest with a simplified red and white striped logo”, claiming this “deprives the registered proprietor of its right to have the club crest licensed”.
Sega and SI say the use of the club’s name is “a legitimate reference to the Manchester United football team in a football context” and has been used in Football Manager and its predecessor, Championship Manager, since 1992 “without complaint by the claimant”.
The companies have accused the club of trying to “prevent legitimate competition in the video games field by preventing parties not licensed by the claimant from using the name of the Manchester United football team within such games”.
At a preliminary remote hearing on Friday, Manchester United’s barrister said, “the name ‘Manchester United’ is one of the world’s most valuable and recognised brands”. He added the money clubs make from licensing their names and logos is “very significant” and “the products and services that are licensed by the claimant benefit from an association with the club’s winning culture and its brand values”.
Sega and SI said preventing them using Manchester United’s name “would amount to an unreasonable restraint on the right to freedom of expression to restrain the use of the words ‘Manchester United’ to refer to a team in a computer game”.
They pointed out that “copies of the game have also been sent by SI to a number of officials and players at the club for a number of years and there have been a number of positive press comments and tweets about the game by them” and that “the claimant’s staff working in the data analytics and scouting teams have contacted SI on various occasions asking for access to the Football Manager database for scouting and research purposes.”
The QC concluded “there is no likelihood of confusion or damage to the claimant’s EU trademarks ... caused by the defendants’ activities” and Mr Justice Morgan reserved his judgement on Manchester United’s application to amend its claim to a later date.
What is intellectual property?
Intellectual property (IP) is a work or an invention triggered by an individual’s creativity. It might be a manuscript, an invention, a product design, a symbol, name or image used in commerce, or a piece of literary or artistic work.
Creators - those who have the rights to the IP - can apply for legal protection in the form of patent, copyright and trademarks. This enables people to earn recognition or financial benefit from their creation.
Understandably, businesses will do everything they can to protect their IP from the prying eyes of competitors. In recent years, the global importance of IP rights and their related expenditures – lawsuits revolving around infringement of IP – have risen significantly. As a result, the benefits of intellectual property insurance are garnering more attention.
How can intellectual property insurance help?
IP insurance covers companies for the legal costs associated with pursuing infringement or theft of IP. It also covers legal defence costs for policyholders accused of IP infringement or theft.
There are two basic types of IP insurance: Infringement defence is the most popular type of IP insurance. It covers policyholders for infringement claims brought against them.
Abatement enforcement coverage gives IP owners - the insureds – the financial resources to enforce their IP rights and pursue infringement claims. And this can be an expensive area.
According to the International Risk Management Institute, “the cost of IP litigation can be astronomical, and continues to increase each year. In certain cases, the high stakes of IP litigation can pose a very real threat to the company itself”. Simply put, IP litigation costs could have a substantial, material impact on a business, making risk transfer an absolute necessity.
Preparation is key when managing IP litigation risk. It is much easier to protect IP that’s registered with a patent, copyright, or a trademark than it is for an unregistered creation. In addition to formal registration, companies can make use of written agreements to further protect their IP assets.
These written agreements can include: employment contracts, non-disclosure agreements, non-competitive agreements, and licensing agreements. Essentially, keeping a documented trail and keeping track of people involved in that trail is very important.
Intellectual Property Insurance from Towergate:
About the author
Mark Brannon Cert CII is a respected industry leader with over 17 years’ industry experience in a variety of roles within the business insurance sector. He works across a wide spectrum of insurance product and policy development, delivery and optimisation for clients, including claims, insurer relationships, marketing and communications, and risk management.
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The information contained in this bulletin is based on sources that we believe are reliable and should be understood as general risk management and insurance information only. It is not intended to be taken as advice with respect to any specific or individual situation and cannot be relied upon as such. If you wish to discuss your specific requirements, please do not hesitate to contact your usual Towergate Insurance Brokers adviser.