Governments banning use of brands is a troublesome trend

Blank aluminum cansThe brand names and logos emblazoned on your wristwatch, the laptop on your desk, the foods stocked in your pantry and the car in your garage are more than just mere names. They are vital consumer educational tools. Brands enable consumers to instantly understand the origin, quality and attributes of a product and thus, inform their purchasing choices. For goods makers, brands provide comfort that their wares cannot be mistaken for, or exploited by, inferior products.  In essence, brands are both protective and liberating.

Although brands help educate consumers, we are seeing worrying signs across the globe, of governments banning the use of brands and trademarks and curtailing intellectual property rights in an effort to direct consumer choices.

A clear example, is the policy on plain packaging of tobacco products. The WHO has requested governments around the world to follow the lead of Australia, and require that all legal tobacco products be stripped of their branding and sold in government-designed drab, generic packaging.

We understand governments have a responsibility to protect the health of their citizens and therefore, should regulate harmful products.  However, there is no compelling evidence that restricting the use of brands will improve public health.  On the contrary, it tends to increase illicit trade and moves consumers from legal and normally heavily regulated goods sectors to the black market where there are no taxes, no rules and no quality standards.

ASIPI has expressed concerns about packaging regimes that ban the use of existing brands and prevent the adoption of new ones. We believe that undermining branding and intellectual property in such a severe fashion, would confuse consumers by eliminating, or significantly reducing, their ability to differentiate among competing products in the marketplace. The standardized packaging of tobacco products also sets a dangerous precedent for other goods and services, including alcoholic beverages, soft drinks, snack foods, fast foods and even baby formula, a number of which are already being targeted with severe packaging restrictions, including tobacco style plain packaging. These industries not only provide products in demand by billions of consumers, but are also vital to many economies, creating billions of dollars of economic activity and millions of jobs worldwide.

ASIPI has requested governments not to introduce extreme measures, such as plain packaging, and pursue a variety of other proven-to-be effective solutions for achieving laudable public health goals.

Governments have a diverse set of tools to choose from if they wish to encourage consumers to move away from certain products, such as: public education campaigns, health warnings and increased taxation. All represent excellent choices and stand in stark contrast to attempting to educate consumers by depriving them of branded goods, the most basic educational tool of global commerce.

Our association wishes to call upon governments to understand that a balanced and properly functioning intellectual property system can protect consumer freedom, respect the rights of intellectual property holders, serve the public interest and continue to foster innovation and economic growth.

The protection of intellectual property does not impede the ability of governments to protect public health. Indeed, intellectual property protection can only help governments in this respect. Depriving consumers of information is an odd road to travel if the destination is to improve consumer awareness.

The Author

Maria del Pilar Troncoso

Maria del Pilar Troncoso is the President of the Inter-American Association of Intellectual Property – ASIPI and a partner with Troncoso Leroux. Maria published articles on topics of Industrial Property including "Trade Name and Company Name: Defense of Difference", "Protection of Plant Varieties," "The Bad Faith in Conflict Trademark".

Warning & Disclaimer: The pages, articles and comments on IPWatchdog.com do not constitute legal advice, nor do they create any attorney-client relationship. The articles published express the personal opinion and views of the author as of the time of publication and should not be attributed to the author’s employer, clients or the sponsors of IPWatchdog.com. Read more.

Discuss this

There are currently 34 Comments comments.

  1. Anon July 31, 2016 10:18 am

    Not buying the (desired) “trend” from tobacco products – a clear health hazard with no redeeming attributes – and any other government directed efforts at controlling a citizen’s choice of general (non-hazardous) goods.

    Maybe if you had a few other examples (let’s start with one example), then maybe your furtive plea would find a receptive ear.

  2. Gene Quinn July 31, 2016 11:05 am

    Anon-

    While not the same issue, let’s not forget Mayor Bloomberg in NYC. He wanted to play nanny to everyone and prevent sodas of a certain size from being purchased in certain locations (not all locations… some must have had better lobbyists I guess).

    I am not going to defend tobacco. I’ve never used it and I don’t care to be around anyone who does. But as long as the product is legal it would seem to be a very slippery slope to allow this type of plain packaging law to go into effect. Where do you honestly draw the line?

    If tobacco is this risky and something needs to be done then the product should be outlawed. For starters I’d be happy enough if people weren’t allowed to smoke in public.

  3. Anon July 31, 2016 11:18 am

    Gen,

    Sorry, but I give no credence whatsoever to the assertion of “slippery slope” for a product – while being legal – is a known health risk with no redeeming qualities.

    It is just not a slippery slope. I honestly draw the line at something that is not an evident health risk with no redeeming qualities.

    Seriously, is there such a thing as a “safe” tobacco product? If there were, I would surely allow the labeling of that safety aspect, but let’s be grown-ups here and realize that this is solely about the money that advertising can generate for a product and nothing else.

  4. Raina July 31, 2016 12:18 pm

    Excellent, thought provoking article!

  5. PatDuch July 31, 2016 12:55 pm

    Plain cigarette packaging does just the opposite of “depriving consumers of information.” Scientific evidence shows that depriving cigarette packs of the misleading and distracting branding elements (with the exception of the brand name) makes consumers more receptive to the information about the real nature of the product communicated by textual and pictorial health warnings which occupy the greatest part of the packaging area. This is the way to go with harmful products such as tobacco if one wants to avoid their prohibition.

  6. Gene Quinn July 31, 2016 4:39 pm

    Anon-

    It is not you drawing the line that worries me. Look around you. The emperor isn’t wearing any clothes!

    If tobacco is such a health risk then ban the product altogether.

    I think you are being naive to think that a victory here would end here. Just like the anti-patent crowd who doesn’t want an end to software patents or gene patents, what they want is an end to all patents.

    -Gene

  7. Anon July 31, 2016 6:00 pm

    Gene,

    IF money were not already in play (and lots of it), the product WOULD be banned.

    As I said though – when (or perhaps IF) we see any real creep, then one might find a receptive ear here.

    As it is, and with the singular nature of the example, I am just not moved.

    I do not see this as in any way a reflection of those that want to end software or gene patents. Those using “arguments” in their quest to end such can be seen to be using plain anti-patent arguments already (the “arguments” cannot pass a “first principles” critical evaluation). Such is just not the same with products that are known to be hazardous with zero redeeming qualities.

  8. PatDuch July 31, 2016 6:14 pm

    @Gene Quinn: Congratulations, you succeeded in squeezing two well-known fallacies in just three short sentences: false dichotomy (tobacco should be either unregulated or banned) and slippery slope (of course opponents of gene patents want to end *all* patents). Note that such types of sophism can be applied to just about anything and they mostly fool only those who use them.

  9. Curious July 31, 2016 9:22 pm

    IF money were not already in play (and lots of it), the product WOULD be banned.
    I agree 100%. Actually, I take that back. I think that history has shown that banning products such as this doesn’t work. However, where a dangerous product is to be made legal, it should be taxed and regulated so that its costs to society are paid by those who use it.

    As someone who has lost a close family member for reasons directly attributable to tobacco use, I have zero sympathy for the tobacco industry. The same held true even before my loss. It is a filthy habit pushed by a filthy industry — this is one of those instances in which the government should step in.

  10. Curious July 31, 2016 9:27 pm

    of course opponents of gene patents want to end *all* patents
    I have read many of the writings of the “anti-patent” side over the years. There is no legitimate argument for banning one type of technology over the other. As such, I find that many of those looking to get rid of a particular type of patent are also fine with getting rid of them all.

    Speaking of false dichotomy, isn’t one of the arguments of the anti-patent side that progress happens without patents, and hence patents are not necessary for progress? This false dichotomy ignores that patents (and the pursuit of patents) accelerate progress.

  11. Benny August 1, 2016 7:31 am

    Anon,
    In our industry we are nearing the bottom of the slippery slope. I could provide you with a list as long as your arm of items which are banned for use or sale by government decree, including nickel cadmium batteries for power tools, mercury thermometers, flame-retardant plastics…it goes on. It is for your own benefit, of course. Rather than bemoan the restrictions (not ban) on the sale of a known carcinogen, the tobacco companies should reflect on how fortunate they are to remain in business.

  12. Curious August 1, 2016 7:40 am

    a list as long as your arm of items which are banned for use or sale by government decree, including nickel cadmium batteries for power tools, mercury thermometers, flame-retardant plastics
    How could we forget asbestos?

  13. Mark Summerfield August 1, 2016 7:44 am

    First, I am Australian, so I know something of the effects of plain packaging on commerce more generally. There are none. There is no “slippery slope”. There is a minority pushing their pet health agendas who have no political traction, and there are the apologists for Big Tobacco who have an interest in raising this bogeyman. But there is absolutely no serious prospect of plain packaging being extended to other products.

    Second, it is early days yet for plain packaging, but it is not, in any case, a sole strategy for reducing rates of smoking. In Australia it is just the most recent of a series of measures that have seen smoking rates decline from around 25% in the early 1990s to below 14% today.

    Third, I have never smoked, but my parents did. In the past two years they both died, at just 75 years of age, from smoking-related diseases (most notably, my mother of lung cancer last year). So I don’t much care what the rest of the world thinks, I strongly support the moves of successive Australian governments to tighten regulation of this poisonous and deadly product.

    Finally, adults should, within reason, be free to make their own choices. I am not in favour of simply banning addictive substances, and creating a black market for them along with all the other social evils that brings. But there is a power imbalance between huge multinational nicotine peddlers and ordinary individuals. Regulation merely levels the playing field, and gives future generations a better prospect of living long and healthy lives. If you have kids, take a good long look at them and ask yourself: whose side am I on?

  14. Prizzi's Glory August 1, 2016 7:54 am

    When I purchase prescription drugs at CVS, they are not branded. Why should non-prescription poison manufacturers be allowed to brand? Why is tobacco a non-prescription poison?

  15. Ceruleanverde August 1, 2016 9:24 am

    Government stepping in to regulate and/or discourage the use of a product and government prohibiting the use of branding of legal products to aid consumer recognition and choice are two entirely different things. No government should prohibit the use of branding for legal products to aid in consumer recognition and choice.

  16. Anon August 1, 2016 10:43 am

    Ceruleanverde,

    You have not been paying attention.

    “Legal product” simply is not – and never has been – synonymous with zero regard for safety and with zero government regulations.

    Your decidedly empty “edict” is not compelling.

  17. Benny August 1, 2016 10:45 am

    Ceruleanverde,
    What is your stance on prohibiting the advertising of said legally marketed carcinogen? In many countries, such prohibition or restriction has been in place for many years.

  18. Night Writer August 1, 2016 10:53 am

    I think tobacco is so bad that I don’t care if they can’t brand it. And there aren’t many products that fall into the same class as tobacco. Actually, alcohol is probably in the same category.

    I remember in criminal law, the professor showed us crime statistics pre and post prohibition. The crimes caused by alcohol consumption were like 10 to 100 times greater than all the crimes from the underworld of selling alcohol.

    Crazy that pot is illegal and alcohol is legal.

    And patduch: you are out of your mind. The problem I have with your arguments is that you attempt to accomplish your goals via the courts with misrepresentations of law and fact.

    So, to sum up. No brands for alcohol or tobacco to my mind. And mandatory Sunday school for all.

  19. DC August 1, 2016 12:32 pm

    “A clear example, is the policy on plain packaging of tobacco products.” Is there any other example? Or is this specific to tobacco, and tobacco only? If there are other examples, with products that have clear beneficial uses, then maybe there is a slippery slope. If there are no other examples, there is no slippery slope.
    Is this an extreme measure? Not as extreme as prohibition. Does anyone argue that the prohibition against heroin, cocaine, etc. “sets a dangerous precedent for other goods and services, including alcoholic beverages, soft drinks, snack foods, fast foods and even baby formula….”

  20. xtian August 1, 2016 1:00 pm

    How is our public health policy consistent when we want to ban smoking tobacco (making a legal product illegal) but at the same time promote smoking marijuana (making an illegal product legal)?

    Now back to IP. I think the author’s point is valid. Notwithstanding your take on tobacco, why should the IP community allow the restriction of branding (and thus potentially implicating trademark laws) when there are other legitimate, and (as argued by the author) better alternatives to influence public consumption of a legal product?

  21. Curious August 1, 2016 2:23 pm

    How is our public health policy consistent when we want to ban smoking tobacco (making a legal product illegal) but at the same time promote smoking marijuana (making an illegal product legal)?
    Our health policy is inconsistent already. Tobacco use isn’t going to get banned because of big money interests. Moreover, outright banning of products creates different problems. I would prefer heavy regulation — paid ultimately by the users of the product.

    Notwithstanding your take on tobacco, why should the IP community allow the restriction of branding (and thus potentially implicating trademark laws) when there are other legitimate, and (as argued by the author) better alternatives to influence public consumption of a legal product?
    Because it is the right thing to do? While it is a “legal product,” the benefits to the public of smoking is vastly outweighed by the detriments to the public. While you may think “branding” is just a way of distinguishing one product over the other, branding (or marketing) is also a way of introducing new consumers to the product. Reducing the number of new smokers is a laudable goal, and hence, I’m perfectly comfortable eliminating one mechanism (i.e., branding) used by tobacco companies to achieve that end.

  22. Anon August 1, 2016 7:32 pm

    xtian,

    I will take the point you offer*** and use it as my own (and in direct opposite of the apparent direction that you want to use it).

    First and foremost, please realize that not all IP law is “equal” or comes from the same roots of jurisprudence. To wit: patent and copyright come from Article 1 Section 8 Clause 8. Trademark law on the other hand does not. At the very root of trademark law is the protection of the consumer. That is the fundamental driver. Yes, trademark law does have benefits for the manufacturer. But those are not the fundamental driver.

    That as the foundational difference, it simply does not matter whether multiple avenues are available to the State (or whether more than one of those multiple avenues are taken in order to advance the fundamental driver.

    Yes, one does have to be aware of basic human nature and how outright prohibition may actually make things worse. But the points advanced by the author here are simply not true – leastwise as I first posted in that with only one example – and that of a toxic product with zero redeeming features.

    Show me some actual trend where the fundamental legal foundation is not met, and that do not act to protect citizens, and then – then – we can discuss “slippery slopes” and whatnot.

    Until then, I think that you are without a solid legal foundation when it comes to the singular example of tobacco.

    .

    ***Your split between branding and trademark law seems a little odd – Did you have a different point to make? As is, I am presuming that the legal basis of your argument is only in trademark law.

  23. xtian August 2, 2016 9:36 am

    Anon – My point was whether the IP community was “OK” with allowing the usurpation of trademarks rights as one arrow in the quiver to shape public health policy. The FDA prohibiting a company from using lawfully obtained trademarks from branding their product causes me concern. The slippery slope argument appear far-fetched until it happens. Night Writer would do the same for alcohol – and I would have to agree with him based on the rationale.

    Some commentators here are fine with public health policy trumping trademark law. Others – Ceruleanverde – are not. I think this was the point of the author. My opinion is that the FDA shouldn’t be allowed to usurp trademark rights. I would prefer they use other means (taxation, higher health care premiums if on public health exchanges, and the like) to shape public behavior. Actually, I have more of a libertarian streak and leave it up to the individual whether they wish to engage in smoking or not. However, just don’t expect my taxes to pay for your poor health as a result of your choices.

    Yes – trademark law protects the consumer. But it protects the consumer’s buying choice, not health. Trademarks ensure that the consumer knows the product s/he is buying is of a quality that the consumer has learned to associate with the brand. It is not meant to protect the consumer from product itself. How does plain packing protect the consumer’s choice when the consumer wants to purchase Marlboro Reds. How will the consumer know what type of product s/he is buying? I am not familiar with the FDA’s proposal so will the plain packing just say “Marlboro Reds” or “Pal-Mals” in black Times New Roman font size 12? Or, will it just says “smokes” or “cancer sticks?”

  24. xtian August 2, 2016 9:42 am

    Anon- I see branding differently from trademarks. To continue my example, I remember from my college roommate (who smoked) that Marlboro Reds were in a red package and that Salems were in Green. By the end of college, I could recognize a Marlboro pack even if I could see the”Marlboro.” Now, unlike U-Haul, I don’t think Altria (is that the owner of Marlboro?) trademarked the color red for cigarettes. So, I see the red color, package design, etc as “branding” (having a consistent product image that the consumers at one recognize and which may not be protected by trademark law), whereas pure trademark law I see as the registration of words or symbols and designs. This may be a distinction without difference.

  25. Benny August 2, 2016 9:55 am

    If I understand the FDA suggestion correctly – and maybe I don’t – there is no suggestion of an outright ban on the use of a trademark, but only an extension of the restrictions – already severe – on where it can be displayed. (Assuming that displaying the trademark on the product can be construed as a form of advertising)

  26. Anon August 2, 2016 11:24 am

    Xtain,

    Your point is moot because of the fundamental nature of Trademark law – as I pointed out – is aligned with the government’s actions.

    You are still looking at the situation with far too much emphasis on the side benefits to business.

    Further, I do not buy “seems far-fetched until it happens” because the only example here IS something that is “lucky” to be on the market in the first place – the legal “poison” that it is.

    It is just NOT a matter of one policy “trumping” another as you continue to view it.

    You need to take a step back and look anew at the fundamentals.

    The distinctions you are looking at – the brand to brand information is simply far less important in the present example.

    And no, brand identification is not eradicated – but branding – the marketing aspect – is constrained.

    Now, to your second reply. While you see branding as separate (and in truth, branding is merely another part of the marketing mechanism), I am talking here of the legal nexus – you may have made a distinction (in your own words one without s difference), but you have provided no other legal nexus to which to trace your views. Thus, I can only use the default of trademark law.

  27. xtian August 2, 2016 12:32 pm

    Anon – “the brand to brand information is simply far less important in the present example..”

    So say you. I say not. We are arguing about policy. You have not cited to any authority (other than general public policy statements) that allows the FDA to negate use of a lawfully registered trademark on a legally approved, heavily regulated product.

    “And no, brand identification is not eradicated – but branding – the marketing aspect – is constrained.” Again, this is a health policy related argument. You believe the public policy of curtailing branding/advertising of tobacco products outweighs the rights of the tobacco companies from advertising and marketing their brands. I do not.

    Looking anew at the fundamentals – of trademark law.

    The Lahnam Act:
    15 USC 1052 states that no trademark by which the goods of the applicant may be distinguished from the goods of others shall be refused registration on the principal register on account of its nature unless it… immoral, deceptive, or scandalous matter, disparages or falsely suggests a connection with persons, etc. (see (a)-(f)).

    Trademark law is all about brand to brand information. It is not a consumer health law. Unless my mark falls within one of the enumerated exceptions, my mark shall not be refused registration and I can use the mark in commerce in association with my goods.

    That said – smoking is still bad for you!

  28. Curious August 2, 2016 2:02 pm

    This is really a First Amendment issue. I pulled this off the Cornell law school website:

    Commercial speech has been defined by the Supreme Court as speech where the speaker is more likely to be engaged in commerce, where the intended audience is commercial or actual or potential consumers, and where the content of the message is commercial in character.

    Commercial speech, such as advertisments [sic], has been ruled by the Supreme Court to be entitled to less protection under the First Amendment than noncommerical [sic] speech. Under the First Amendment, noncommercial speech is entitled to full protection, and any sort of content-based regulation is only valid if it can withstand strict scrutiny. However, commerical [sic] speech is not given such deference. For a content-based regulation of commercial speech to be valid, it only must withstand intermediate scrutiny. (Someone needs to take a spellcheck to their writings)

    As for intermediate scrutiny:
    To pass intermediate scrutiny, the challenged law must further an important government interest by means that are substantially related to that interest.
    Important government interest = less people smoking (and all the benefits that entails). I would think that a law banning branding (i.e., commercial speech) on the cigarette packs would pass intermediate scrutiny.

    If in doubt, check the Constitution. Now if we could only get the Justices to realize that Article I, Section 8, Clause 8 refers to “exclusive Right to their respective Writings and Discoveries.” The Supreme Court appears to have forgotten that “exclusive Right” does not mean mandatory licensing and “Discoveries” also includes the discovery (and application thereof) of natural phenomena.

  29. Anon August 2, 2016 3:05 pm

    Xtain,

    But I HAVE pointed to authority: the fundamental reason why we have trademark law to begin with.

    I am not sure why you are not recognizing this. This is a classic “miss the forest for the trees.”

    Curious – kudos on the First Amendment angle. I concur.

  30. xtian August 3, 2016 11:01 am

    Anon – i don’t mean to be rude, I am probably just thick in the head. Can you again point out the fundamental reason. In the thread above, you mentions “At the very root of trademark law is the protection of the consumer.” I responded to your point by saying that I understood the “protection” to be the protection that trademarks give the ability of the consumer to identify the source and origin of the goods. I went to the Lanham Act to see if there were any exceptions to getting a TM registration based upon the harm that the good may impose on the consumer, but i didn’t find anything. Can you let me know what I am missing? Thanks.

  31. Anon August 3, 2016 1:49 pm

    Xtain : search for “align with”

    If you are searching for something ver batim, you are missing the forest for trees.

  32. Mark Summerfield August 3, 2016 7:54 pm

    A lot of opinions here, but not many facts. This is not helped by the fact that the original article is a bit thin on detail – probably intentionally so, because if you look at how existing and proposed ‘plain packaging’ laws actually work it’s harder to get quite so outraged about the supposed taking of manufacturer and/or consumer rights.

    So, here’s how it works in Australia, which forms the model for most laws that have been passed or proposed elsewhere.

    First, the only thing ‘plain’ about the packaging is the rather dull olive green background colour. In fact, packaging is dominated by the required photographs of some of the awful things that can happen to people as a result of smoking.

    Second, ‘branding’ is not banned, it is simply regulated. A consumer who wants a packet of Killboro Dead, for example, still asks for their preferred brand by name, and they receive the product they request in its olive green pack with gory photograph of late-stage esophageal cancer, and the words KILLBORO DEAD printed in a standardised font, and in the prescribed location.

    Third, the protection afforded to brand-owners (and consumers) by trademark law has not been rescinded. Not only is it still possible to register and retain trademark rights in relation to the KILLBORO DEAD word mark, it remains possible to register, defend and enforce trademark rights in relation to the complete branding (including logos, colours and so forth) that was used in Australia prior to the introduction of plain packaging and/or new branding that might be used elsewhere in the world.

    To be clear, no restrictions have been introduced to prevent registration of trademarks in relation to tobacco products. On the contrary, the plain packaging legislation includes provisions to ensure that tobacco brand owners can continue to obtain and maintain registration of trade marks that they will not use, or cannot continue to use, as a result of the plain packaging laws. In particular, upon application they are deemed to have an intention to use the trademark, and in the case of a challenge on grounds of non-use the regulatory prohibition on use is an affirmative defence to removal.

    Big Tobacco challenged the plain packaging laws under the takings clause of the Australian Constitution. They argued that they had been deprived of property in the form of trade mark rights, and that the government therefore owed them some ludicrous amount of compensation. The High Court ruled that they had not been deprived of property in the relevant sense, and denied compensation.

    Contrary to what the fear-mongers told us, the world did not then end, we have not been inundated as a result of any floodgates having opened, and we have not found ourselves careening out-of-control down a Teflon(R)-coated slope. Smoking rates, particularly among younger people, have, however, continued to decline. The jury is probably still out on the extent to which plain packaging has contributed to this, given the many other measures in place, but certainly it has not done any harm. Clearly enough, plain packaging alone is not a cure for nicotine addiction, it is just one measure among many to discourage consumption of a product that is not only harmful to the individual, but also costly to society (and I do not mean only in monetary terms).

  33. xtian August 4, 2016 9:37 am

    Mark – Thanks for the view from down under. One interesting distinction is that US trademark law requires use. So if I try to register Killlboro Reds in a stylized font or the stylized image and the FDA does not allow me to use the stylized mark on the cigarette pack, I won’t have a specimen to give the US trademark office to show proof of use in class 34. Now I could get the mark registered in other classes, but not the one for the goods – e.g., tobacco products. Just one unintended consequences that may result.

  34. Anon August 4, 2016 6:13 pm

    Xtain – or that just might be an intended consequence.