Ambush Marketing: Its Offsides in the Philippine Pitch

I. The act of a trademark owner or a company that associates itself with the event, without paying the sponsorship fee constitutes “Ambush Marketing”

 Big and prominent sporting and cultural events  like  the  Olympic  Games,  FIFA  Soccer  World  Cup, FIBA Basketball World Cup,  etc. with their popularity on the rise, generate  huge earnings  and  attract  the  attention  of  not  only  billions  of spectators,  but  also  of  businesses.[1] The association with the events which are telecasted live worldwide can create publicity, revenue, valuable goodwill, prestige and reputation for the sponsor’s business.[2]

In the given scenario, a company or a trademark owner pays to become an official sponsor of an event and another competing mark associate itself with the event, without paying the sponsorship fee. The latter gives tickets to said event for its promotions, provides shirts and other paraphernalia bearing its mark, among others. This act of the non-sponsor competing mark is referred to by marketing specialists as “Ambush Marketing”.

The  term ambush  marketing  was  first  coined  by  Jerry  Welsh, former  Marketing  Director  at  American  Express.  His original understanding  of  ambush  marketing  had  nothing  to  do  with  the nowadays negative connotation given to the term, which is now frequently  associated  with commercial  theft.[3] His original perception was the idea of healthy competition in a climate of expensive and often ill-conceived sponsorships.[4]

As it is define now, Ambush marketing refers to a company’s attempt to capitalize on the popularity of a well-known property or event without consent or authorization of the necessary parties.  It is a marketing strategy in which a competing brand associates itself with the major events without paying the sponsorship fees. It is an attempt by a third party to create a direct or indirect association with an event or its participants without their approval, hence denying the official sponsors , suppliers, and partners, part of the commercial value due to their “official designation”. Ambush marketers do not use trademark of third parties but rather creatively allude to an event and use their own trademark to suggest a connection or affiliation with that event.[5]

II. Ambush marketing may be committed in various forms, directly or indirectly

 Ambush marketing may be described in a wide range of marketing activities by which a business seeks to capture or leverage-off, the goodwill surrounding the event for which it is not a sponsor.[6] It may be committed even by the famous and internationally-known marks.

Most notable incidents of ambush marketing first occurred during the 1984 Olympic Games in Los Angeles, when Fuji film was the worldwide sponsor of said event. Its rival, Kodak sponsored the ABC’s television broadcast of the event and became the ‘official film’ of the US track team. In the same event, Converse was one of the official sponsors. However, Nike created murals near Los Angeles Coliseum featuring their sponsored track athletes. Thereafter, in the1988 Olympic Games in Seoul Korea, Fuji film exacted its revenge. This time Kodak secured worldwide category sponsorship while Fuji concentrated on an aggressive sponsorship of the US swimming team.[7]

Nike again ambushed the 1992 and 1996 Olympics. During the Barcelona Olympics in 1992, Nike held a sponsor’s press conferences with the US basketball team despite Reebok being the official sponsor. One of the most audacious ambush marketing feats occurred when both Michael Jordan and Charles Barkley, accepted the gold medal for basketball and covered up the Reebok logos on their kit. Both athletes were individually sponsored by Nike.[8]Further, in the 1996 Atlanta Olympics, Nike bought an old building in the city centre of Atlanta and turned it into a Nike museum, which they called “Nike Village”. The official sponsor in the event was Reebok.[9]

In the 2000 Sydney Olympic Games where Ansett was the official airline partner, Qantas ran a marketing campaign in the lead-up to the Games that included advertisements featuring Olympic athletes such as Cathy Freeman and using expressions such as ‘we welcome the spirit of competition’ and ‘Australia wide Olympic sale’. Qantas was also said to have associated itself with the Games through individual sponsorship deals with athletes, and sponsorship of pre-Olympic meets and selection trials. Later polling  indicated many more Australians believed Qantas was a sponsor of the 2000 Olympics, rather than Ansett.[10]

In the World Cup 2010, Budweiser was the official beer sponsor. However, Bavaria Brewery went for a cheeky ambush marketing tactic to get media and fans attention at a game between Denmark & Holland, by sending 36 models to the match all wearing orange clothing which World Cup officials claimed was promoting Bavaria beer. The ‘fans’ certainly got the crowd going and put the spotlight on them.[11]

Recently, in the 2012 Super Bowl, where Pepsi was its official drink sponsor.Coca-Cola put up an online site where it made it appear that animated polar bears were reacting in real time to the event while chatting with the site’s subscribers.[12]

Kshitij Parashar (2013) enumerates the impacts of ambush marketing. These include, threat to corporate sponsorship, transgression on the intellectual property rights, confusion as who is the real sponsor, back door entry and unethical but not illegal, riding upon the competitors back, nurturing  unfair trade practices and  spoils traditional marketing[13].

The first case in the world to deal with marketing is the case of National Hockey League vs. Pepsi–Cola Ltd[14] in 1990. National Hockey League (NHL), an affiliated service company with 21 ice-hockey teams, entered into an agreement with Coca-Cola (Coke) where the latter shall be the official drink for the tournament in consideration of USD 2.6 Million. However, the advertising rights were given to a certain company, which tied up with Pepsi-Cola (Pepsi), the rival of Coke. Consequently, Pepsi advertised a show with a famous celebrity implying that the same is the official drink of the tournament. NHL contended that Pepsi is liable for passing-off for making it appear that the latter was the official drink of the tournament. Pepsi countered that it was just exercising its right to do advertising and promotional campaign. The Canadian Court ruled that Pepsi, in misrepresenting the public that one or more of the plaintiffs approved, authorized, or endorsed the contest, and by implying that their products or that there was some business connection between them and the tournament, has committed ambush marketing. However, the Court continued that, there was nothing that could be done to protect NHL and Coke.

However, there are some cases where injunction was granted against acts of ambush marketing as in the case of MasterCard International Incorporated v. Sprint Communications Co. v. ISL Football.[15] In this case, Mastercard in sponsoring the World Cup in 1994, received an exclusive right for the use of said event’s logo on and in association with “all card based payment and account access devices’.  Sprint was also one of the sponsors but  was allowed only to advertise on long distance communications.  However, the Sprint started advertising in pre-paid telephone calling cards with World Cup logos despite objections of Mastercard. The latter sued the former under Section 43(a) of the Lanham Act, which prohibits false and misleading description or misrepresentation of the fact in commercial advertising and campaign; and under the Federal Trademark Dilution Act. The Federal Court ruled in favor of Mastercard and granted the injunction it prayed for. The Court held that, the consumer would, in seeing Sprint bearing the World Cup logo, will mistakenly assume that the same has rights to that category, which belonged exclusively to Mastercard.

It can be noted that the two marks in this case were official sponsors. The decision implies that ambush marketing can also be committed by a co-sponsor who does not have a right to advertise to a certain category made by the event organizers.

The aforementioned foreign jurisprudence are just some of the prominent cases as regards ambush marketing. However, in the Philippine milieu, no case of ambush marketing is ever presented.

III.  Philippine laws and jurisprudence do not explicitly address ambush marketing, parallel laws however provide remedies

In the issue of whether or not Ambush Marketing is a violation of the Intellectual Property Laws, this paper argues on the standpoint of the organizers and official sponsors of the event, who consider that ambush marketing is in contravention with statutory laws and the law of equity.

Article XIV  Section  13 of the  1987  Constitution mandates the State to “protect and secure  the  exclusive  rights  of scientists,  inventors,  artists, and  other  gifted  citizens  to  their intellectual  property  and  creations,  particularly when  beneficial to the  people,  for  such period  as may be provided by law.”

With this directive, the State, in enacting the Intellectual Property Code, recognizes the effective intellectual and industrial property system is vital to the development of domestic and creative activity, facilitates transfer of technology, attracts foreign investment, and ensures market access for our products.[16]

With the lacking of cases and unknown incidences of ambush marketing in our jurisdiction, the legislature might seem to have not deal with this phenomenon. The Philippines has no specific law or statute that explicitly addresses the issue of ambush marketing[17]. With the meagerness of laws sanctioning the same, an event organizer or an official sponsor in the event is left with no remedy. Provisions are embedded in the Intellectual Property Code, Civil Code, and Consumer Act to be sufficient bases for a claim against ambush marketing.

It can be inferred from the given instances that ambush marketing has the goal of creating the impression that the enterprise is associated with the event without paying any sponsorship fee. It thereby creates an uncertainty among consumers in that, they identify the goods or services in the advertisement with the event.  Accordingly, there is a confusion or likelihood of confusion as to affiliation, connection, or association of the goods or services of a person to another as to its origin, sponsorship, or approval, which constitutes a violation of Section 169.1 of the Intellectual Property Code of the Philippines, which provides:

Section 169. False Designations of Origin; False Description or Representation.–

169.1. Any person who, on or in connection with any goods or services, or any container for goods, uses in commerce any word, term, name, symbol, or device, or any combination thereof, or any false designation of origin, false or misleading description of fact, or false or misleading representation of fact, which:

(a)    Is likely to cause confusion, or to cause mistake, or to deceive as to the affiliation, connection, or association of such person with another person, or as to the origin, sponsorship, or approval of his or her goods, services, or commercial activities by another person; or

(b) In commercial advertising or promotion, misrepresents the nature, characteristics, qualities, or geographic origin of his or her or another person’s goods, services, or commercial activities, shall be liable to a civil action for damages and injunction provided in Sections 156 and 157 of this Act by any person who believes that he or she is or is likely to be damaged by such act.

In the same vein, in posing to be as if it is one of the official sponsors through its advertisements, an ambush marketer misleads its customers  and make them believe that it was in fact one of the sponsors. Ambush marketing constitutes false, deceptive or misleading advertisement which is sanctioned by the provisions of the Republic Act No. 7349, otherwise known as The Consumer Act of the Philippines. Article 110 thereof states that:

Article 110. False, Deceptive or Misleading Advertisement. – It shall be unlawful for any person to disseminate or to cause the dissemination of any false, deceptive or misleading advertisement by Philippine mail or in commerce by print, radio, television, outdoor advertisement or other medium for the purpose of inducing or which is likely to induce directly or indirectly the purchase of consumer products or services.

An advertisement shall be false, deceptive or misleading if it is not in conformity with the provisions of this Act or if it is misleading in a material respect. In determining whether any advertisement is false, deceptive or misleading, there shall be taken into account, among other things, not only representations made or any combination thereof, but also the extent to which the advertisement fails to reveal material facts in the light of such representations, or materials with respect to consequences which may result from the use or application of consumer products or services to which the advertisement relates under the conditions prescribed in said advertisement, or under such conditions as are customary or usual.

Additionally, the catch-all provisions of Articles 19, 20, and 21 of the Civil Code on human relations may be bases for prosecuting ambush marketing civilly. The provisions state:

Art. 19. Every person must, in the exercise of his rights and in the performance of his duties, act with justice, give everyone his due, and observe honesty and good faith.

Art. 20. Every person who, contrary to law, willfully or negligently causes damage to another, shall indemnify the latter for the same.

Art. 21. Any person who wilfully causes loss or injury to another in a manner that is contrary to morals, good customs or public policy shall compensate the latter for the damage.

Collectively called the “Abuse of Rights Doctrine”, they were intended to expand the concept of torts in this jurisdiction by granting adequate legal remedy for the untold number of moral wrongs which is impossible for human foresight to specifically provide in the statutes.[18]

Ambush marketing may be regarded as an unethical business practice. Its main objective is to advance the enterprise’s goods or services and simultaneously to undermine the impact of the advertisements of the official sponsors. [19] Further, this practice affects the economic interests of the organizers in that it jeopardizes its ability to retain their sponsors.[20] It ultimately cuts into profitability– the property rights not only of the organizers but of the official sponsors. While it may be argued that an enterprise, in the exercise of its rights, may advertise in an event, it should be mindful that in exercising the same, it should observe fairness, honesty and good faith in dealing with other enterprises i.e. the official sponsors.

For non-sponsors, ambush marketing is a cost-effective way of associating its brand with the event. While the official sponsor shelled a huge amount of money for the entire event, non-sponsor competing marks only rides to the event without or with less expense. With this, ambush marketers are unjustly enriched. Thus, Article 2142 of the Civil Code which provides that “certain lawful, voluntary and unilateral acts give rise to the juridical relation of quasi-contract to the end that no one shall be unjustly enriched or benefited at the expense of another” is applicable. Unjust enrichment is a principle which provides that every person who, through an act or performance by another, or any other means comes into possession of something at the expense of the latter without just or legal ground shall return the same to him.[21]

Finally, an ambush marketer cannot interpose the defense of freedom of expression. As held in the cadena of cases decided by the Supreme Court, while the Constitution commands that freedom of expression shall not be abridged[22]. Over time, however, the Courthave carved out narrow and well-defined exceptions to this rule out of necessity. Expression may be subject to prior restraint, apply in this jurisdiction to only four categories of expression, namely: pornography, advocacy of imminent lawless action, danger to national security, and finally, false or misleading advertisement.[23] Ambush marketing is a form of false and misleading advertisement.

[1] Lundgren, F.D. (2010), Event Marks: A Necessary Form of Protection against Ambush Marketing? Retrieved last 25 August 2013 from network/universities/felipe_danneman_lundgren_miplc.pdf

[2]Khon, T. L. and Chan R.,  (2008), Asian Patents Attorney Association , Hong Kong – Anti-Counterfeiting Committee Report 56th Council Meeting, Retrieved last 25 August 2013 from _council_meeting/anticounterfeitingcommittee/Special_Topics_Report_of_Hong_Kong_Anti-Counterfeiting_ Group.pdf

 [3]Lundgren, F.D. (2010), Event Marks: A Necessary Form of Protection against Ambush

Marketing? Retrieved last 25 August 2013 from network/universities/felipe_danneman_lundgren_miplc.pdf

[4] Amsterdam Printing (2010), 5 Companies Launch Ambush Marketing Attacks, Retrieved last 27 August 2013 from

 [5]Seth, R. (2010) , Ambush Marketing –Need for Legislation in India. National Law University. Retrieved last 25 August 2013 from

 [6] Chan, T. et. al., Ambush Marketing Legislation Review (2007),Retrieved last 25 August 2013 from Ambush_Marketing_Legislation_Review.pdf

 [7]Kaur, B. et. al. (2010), Apprehending an ambush – how to defend against ambush marketing Retrieved last 25 August 2013 from

 [8]Supra Note 4

 [9]Blackshaw, I. (2011),  Combatting ‘Ambush Marketing’: The 2010 South Africa FIFA World Cup experience, Retrieved last 25 August 2013 from

 [10]Supra Note 6

 [11] Our 5 Favourite Ambush Marketing Campaigns, Retrieved last 25 August 2013 from category/guerrilla-marketing/

 [12] Ferrer, J.W. (2012) IP Views: A Threat To Goals and Glory: Ambush Marketing in the Philippines, Retrieved  last 25 August 2013 from

 [13]Ambush Marketing: An Insight, Retrieved last 25 August 2013 from

 [14] 92 DLR 4th 349

 [15]A. G., 30 U.S.P.Q. 2d 1963 (S.D.N.Y. 1994); aff’d per curiam 23 F3d 397 (2d Cir. 1994)

 [16] Sec. 2, RA 8293

 [17] Supra Note 12

 [18]Philippine National Bank vs. The Court of Appeals, et al., 83 SCRA 237, citing Commissioner’s Note, Capistrano, 1 Civil Code of the Philippines, 1950 Ed., p. 29

 [19] Supra Note 6

 [20]Seth, R. (2010) , Ambush Marketing –Need for Legislation in India. National Law University. Retrieved last 25 August 2013 from

 [21]Marsman& Co. v.First  Coconut Central Co ., G.R. 42151-R, September 16, 1974.

 [22] Section 4, Article III of the 1987 Constitution

No law shall be passed abridging the freedom of speech, of expression, or the press, or the right of the people peaceably to assemble and petition the government for redress of grievances.

[23] Chavez vs. Gonzales, G.R No. 168338, February 15, 2008