Carolina Blue. Clemson Orange. U of M Maize and Blue. Selling sports-themed apparel is big business, and it's a business that can be a huge profit center for a decorator. The problem is that such business also has its pitfalls and problems. What regulations and protections exist regarding who can produce items with the team colors and how do you find that information? When duplicating the colors how close is close enough to be a violation? What level of tolerance exists for variations and at what levels? Do you need to be licensed to produce such apparel and how do you secure the proper licensing? There's a lot to navigate if you want to sell apparel on the collegiate or professional level.
Let's start with the prevailing law on the subject. In 2008, The U.S. Court of Appeals for the Fifth Circuit upheld a prior judgment awarding damages and lost profits to universities that had their trademark right infringed upon by Smack Apparel in the case of Board of Supervisors of Louisiana State University Agricultural and Mechanical College v. Smack Apparel Co. The clothing retailer had made and sold shirts featuring the colors of the universities and slogans referring to their football programs. This decision made it clear that school colors can be protected as trademarks. The ruling was based on the idea that many universities had used their colors for more than a century, and that fans closely associated those colors with the university in question.
It seems odd to think that a color could be trademarked, and that's really not the case, color can't be trademarked, but a combination of colors can under certain circumstances. For a color combination to be eligible for a trademark, the organization in question must demonstrate that their particular color scheme has obtained “secondary meaning.” This means that through marketing and advertising, volume of sales, and the use of the mark in the media, consumer survey evidence shows that the colors have become associated with their particular organization. The trademarks for sports teams are not generally obtained formally through the U.S. Patent and Trademark Office. Despite this fact, they are still accepted as trademarks via common law and will be upheld if challenged in court.
What this means for decorators is pretty simple. Don't use color schemes for university or professional sports teams unless you are licensed to do so, or the designs or transfers must be from a licensed vendor. Yes, many decorators would probably be small fry compared to the total sales of logowear that a professional or college team makes in a year. That doesn't mean they won't pursue stopping those companies that do create such gear. As we know from the many cases where Disney has sought protection of their copyrights and trademarks, large organizations can be very aggressive in shutting down those who are using their trademarked colors or images. The easiest way to handle such situations and avoid any problems is this: if you aren't licensed to do so, or haven't purchased designs or logos from a licensed vendor, don't produce the gear.
HOW TO KNOW IF YOU'RE INFRINGING
The law is still being written on sports apparel and what infringes and what doesn't. One thing we do know from the 2008 ruling is that university colors can have common law trademarks (trademarks not awarded by the U.S. Patent and Trademark Office) and that those trademarks will be upheld in court. So, the best thing to do is to make sure that whatever apparel is being made doesn't use the exact colors of the organizations in question.
For universities, one way to do that is to search online for the university style guide. Most will have them on their website or will provide one if you contact the university. The style guide will generally show what colors are standard for team apparel and will give Pantone numbers. It will often also call out any symbols or trademarks that are germane to the university and which are protected.
Keep in mind, in a lot of cases, the standard judgment of whether something infringes on an established trademark or copyright would be whether or not a reasonably knowledgeable person could be confused by the item being offered. Could a customer looking for officially licensed team merchandise think that the unlicensed product being offered is in that category? If either of those questions could be answered yes, then it's likely the product you're offering is in violation. You should also keep in mind that the violation is considered to have occurred only if the item being made is also being sold. If you want to create a shirt for your child that touts his favorite NHL player, it's probably not going to raise any red flags. Creating the same shirt and selling it online might.
It should also be noted that creating and selling merchandise using designs or logos purchased from a vendor licensed to sell those items would not put a company in violation of a trademark. Some logos or designs purchased may have specific restrictions on how and where they can be used, but those will generally be listed in the information for the item. So, buying from a licensed vendor is one way to avoid potential problems with infringement, as long as due attention is paid to whatever use restrictions may be placed on the design or logo purchased.
A license to produce sports apparel for a particular team or teams can essentially be a license to generate money, but such licenses are not easy, or inexpensive, to get. There may also be confusion about what sort of license and from which organization is needed.
Take college sports for example. To produce merchandise related to a specific university, you would need to contact the university for a license. Those who want to produce merchandise for an NCAA Championship event would have to contact the organization that handles licensing for the NCAA. It can quickly get time-consuming and expensive to apply for and pay application fees for all the licenses that may be necessary. Of course, the payoff is the fact that having such a license allows the production of merchandise that will likely sell easily and quickly for a premium price.
Many companies will also have requirements regarding potential level of sales or market size. There will also be requirements of royalty payments to the organization granting the license. For most smaller- to medium-size decoration businesses, the costs and conditions may be too much of an impediment. In those cases, another option would be to buy transfers or designs from a company that has a license to sell such things. This offers all the advantages of selling sports team merchandise without the headache and expense of having to apply and pay for a license or to maintain a certain level of market share. There are design sites, like Custom Ink, which have licenses and will allow you to create apparel using their licensed designs. You can also buy transfers from companies licensed to produce them.
The big thing to remember when selling sports team gear of any kind is to always err on the side of caution. The reasonable person standard is used in most trademark cases, and it assesses what an average person with average knowledge would think in a particular situation. If you're not licensed, and not sure whether or not the gear you're producing would be confusing, your best bet is not to produce it. The penalty for violating a trademark can range from an injunction being placed to stop the product from being produced to monetary damages needing to be paid to the trademark owner. Organizations can be very aggressive about protecting their trademarks. There are ways that a decorator can get a piece of the sports merchandising pie, but it should be done legally and through the proper channels.
This article appears in the September issue of Printwear. To ensure you don't miss out on other industry know-how, subscribe today