Outside View: At Trademark Conference, Talk of NFTs, Metaverse and Counterfeiting

·5 min read

WASHINGTON, D.C. At this year’s International Trademark Association conference, held April 30 to May 4 in the nation’s capital, intellectual property lawyers from around the world, including war-torn Ukraine, converged to discuss a range of legal issues affecting brands, from new legislation to NFTs and the metaverse, customs protection and counterfeiting.

Barbara Kolsun, a leading fashion industry attorney in New York and the director of the Cardozo School of Law’s FAME Center (fashion, arts, media and entertainment), was at INTA to participate in a panel on the pending New York Fashion Sustainability and Social Accountability Act. The legislation, sponsored by Democratic Sen. Alessandra Biaggi, is in committee. If enacted, it would require fashion retailers and manufacturers that do business in New York State and have over $100 million a year in revenues to “map their supply chains, disclose the environmental and social impact of their activities, and set targets to improve those impacts,” according to the bill’s sponsor memo.

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The new law “puts fashion to the test,” Kolsun said, in a good way. “The fashion industry is pretty much self-regulating and there has been a lot of push to add more regulation.” Ultimately, she said the law will require companies to work harder on supply chain transparency and to “hire more people to manage enforcement, but that’s happening anyway.”

INTA had 6,700 registrants this year from 130 countries, the organization reported. While numbers were down compared with pre-pandemic gatherings — 11,500 intellectual property professionals attended the conference in 2019 — participants seemed eager to resume in-person networking. INTA staff, Chief executive officer Etienne Sanz de Acedo noted, had planned the event “on a compressed timeline, doing in four months what we usually do in a year.” He also said the group had worked hard “bridging the gap between live and virtual.”

Floriane Codevelle, an attorney at Paris-based intellectual property firm Casalonga, attended several seminars related to NFTs, an emerging legal area with opportunities and risks that many brands have not yet considered.

She said panelists recommended explicitly mentioning NFTs in any trademark coexistence or licensing agreement and creating mandatory guidelines for their use. “For example, you have to make sure the NFTs are going to be used on marketplaces that have a good reputation and that are consistent with the brand’s, or the IP owner’s, values,” she said. “You also have to ensure that to the extent a third party is creating the NFT, the brand retains all related IP rights.”

Other topics included registering dot-nft and dot-bitcoin domain names to fend off web infringers, as well as applying for trademark rights in class 9.

Sylvie Benoliel-Claux, founder of Benoliel Avocats in Paris and president of the French Association of Trade Mark and Design Law Practitioners, said she had a lengthy discussion at INTA with a Portuguese attorney on “the question of originality” in copyright law, with reference to the European Court of Justice ruling on Cofemel v. G-Star Raw, which pitted two fashion labels against one another in a protracted dispute over designs appearing on clothing.

As for NFTs, Benoliel-Claux said legal chitchat touched on artists’ liberal use of brand trademarks in the metaverse. “There was talk of what rights holders can do in response to ensure the best protection of their brands, but also of the fact that artists are asserting their creative freedom,” she said. APRAM will host a conference on NFTs in Paris on June 22, together with INTA.

Gian Paolo Di Santo, a partner at Pavia & Ansaldo in Milan who frequently works with luxury and fashion clients, said many INTA attendees were strategizing with their international counterparts about parallel imports and counterfeit goods.

The gray market, he said — in which authentic products are sold outside authorized channels, damaging a brand’s distribution network — is resurging, which he attributed to differences in the structure of retail markets. In Italy, he noted, time is of the essence when seeking legal recourse against an unauthorized retailer, as judges view inaction as indicative of consent.

Di Santo also said he has noticed an increasingly sophisticated form of brand infringement, with infringers registering their own, distinctive trademarks but so carefully mimicking the trade dress of higher quality brands that consumers cannot readily distinguish originals from imitations.

“In Italy there are major counterfeiting operations, not all of them are flying under the radar,” he noted. “But what’s good in Italy is we have a highly efficient system of injunctions, so that if you have an urgent situation, you can block those goods quickly. Then, to get damages you would have to prove your case on the merits.” In addition to actual damages, brands can seek to recoup an infringer’s profits under the Italian Industrial Property Code.

Anna Mikhailyuk and Elena Koliedina of Mikhailyuk, Sorokolat & Partners, an IP firm founded in 1992 with a main office in Kharkiv, Ukraine, described how most of the firm’s staff of about 200 had relocated to Ivano-Frankivsk in the country’s west to escape the heavy bombardments in the east.

“We had to accept the new reality and to change our lives,” said Koliedina, who has 10 years’ experience in IP enforcement throughout former Soviet Union territories. Work, she said, gives her “power to survive, to stay optimistic and to do my best in order to support my country, my economy, my family and so on. I spent three weeks under bombing, working remotely, sometimes in [the] basement, sometimes on the third floor of my apartment.”

Koliedina added that the Ukrainian Intellectual Property Institute, which handles patent and trademark registrations, is still operating, and that she and her colleagues felt that by continuing to work, “we are fighting on our own field in IP.”

Cynthia Martens, a former Milan correspondent for WWD, works at The Nilson Law Group, PLLC in New York

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