Dealing in freebies?
22 Jun
Perfume houses do it… Clothing manufacturers do it… even car manufacturers do it…
Free.
Businesses that give away some product as a marketing exercise, with the express hope that it will lead to extra sales. What rights does the brand owner have over those products that it gives away, however?
A recent case gave some insight. Coty manufactures and markets a ranger of perfumery, including the DAVIDOFF brand. They provided companies in their distribution system in Singapore with testers, which are the bottle used by sellers to allow you to try the fragrance and are not intended to be sold. In the case in issue, Coty had said that ownership of the testers never actually passed to the distributors – they were Coty product throughout. Somehow, some of these bottles made their way onto the European market for sale.
The European court decided that in the present case it could not be said that Coty had consented to the testers being sold into Europe and had reserved their rights. However, it underlined that it is possible to come to the conclusion that the products could be sold into Europe where the trade mark owner didn’t warn the first trader of the limits on their rights, where the products do not bear any warning against resale into Europe and where full title to the products passes. It isn’t relevant that the purchaser in Europe does not know that the product was not to be sold into Europe, nor that somewhere along the commercial path someone forgot to tell the eventual exporter into Europe that the goods should not be sold there.
SO.. if you are buying products be careful as to whether they should be sold into Europe (the products can be seized and you can be found to be an infringer) and if you are providing products to a company outside Europe that you do not want to come into Europe make sure that you make that clear in discussions with the purchaser (and put a notice on the products).
