Uncertainty and the Brand Protection Landscape:

Brian Winterfeldt
Principal, Winterfeldt IP Group

Griffin Barnett
Associate, Winterfeldt IP Group

Francisco Cabrera
Associate, Winterfeldt IP Group

Seven months after the World Health Organization declared COVID-19 a pandemic, there is one thing that businesses around the world know for certain: the global economy is in the midst of a profound transformation. Almost every aspect of consumer behavior has changed, from where and how consumers purchase their products to what goods and services they are prioritizing (Carufel, 2020). Businesses large and small have had to adapt their strategies to new market trends and reinforce those that have allowed them to survive until now. 

Unfortunately, businesses will have to carry out these efforts while also facing the additional challenges posed by cyber-criminals and counterfeiters who have been capitalizing on the significant increase in e-commerce and on the consumer fears and anxieties brought about by the pandemic (Winterfeldt et al, 2020). The first quarter of this year alone saw a 350% increase in phishing websites, according to the United Nations Counterterrorism Chief Vladimir Voronkov, and despite the relative reduction in cybercrime in recent months, cybercriminals continue to evolve their tactics to take advantage of new victims (Lederer, 2020). Covid-19 related cyberattacks hit a peak of 200,000 a week on or around April 20 and threat actors continue to try and capitalize on circumstances caused by the pandemic, including imitating large technology and logistics brands (Scroxton, 2020).  

Unchecked intellectual property abuses can seriously threaten the success of any business by misdirecting legitimate sales away from the business, eroding consumer confidence and goodwill and increasing operational costs to address increases in abuse. Therefore, a robust and proactive brand protection strategy is now more crucial than ever. Any brand protection strategy moving into 2021 must consist of both proactive and reactive elements, and for businesses that conduct commerce online (pretty much everyone), must also ensure adequate focus on the digital ecosystem. Below we outline some key components of brand protection strategy that can be used to shore up a traditional trademark enforcement program— particularly to lay the foundation for a meaningful brand protection strategy in the digital space.  

The foundation of any effective brand protection strategy starts with a comprehensive watch service that can detect and alert brand owners of potential abuse early on. In addition to more traditional watching services that monitor developments in national and regional trademark offices, brand owners should implement a comprehensive digital watch service to monitor domain name registrations, website content, social media platforms, and online e-commerce marketplaces, and potentially other key digital spaces (e.g. app stores, alternative digital naming spaces such as Ethereum Naming Service, etc. depending on whether these spaces may be used to target your particular brand). Detecting and addressing infringement and other malicious activities in early stages is often crucial to minimizing damage to the brand and consumer harm, and sends a message to bad actors that they will not be rewarded by continuing to target your brands. Early detection and response can also help businesses manage enforcement costs, and can in some cases prevent further proliferation of abuses.   

In addition to ensuring proper monitoring, there are some important preventative measures brand owners should consider investing in to reduce the opportunities for infringement and abuse in the first place. One of these key preventative strategies is ensuring a reasonably robust defensive domain name portfolio. Online infringement and abuse often relies on domain names that are confusingly similar or even identical to a particular brand. Strategically registering certain domain names with common or obvious misspellings of key brands in addition to identical matches of the brands across multiple gTLDs and ccTLDs will prevent a great number of online infringements from ever happening in the first place. The particular TLDs to target will depend on the nature and scope of the brand. Even a relatively modest investment in defensive domain name registration can yield substantial cost savings for a business that would otherwise be spending greater resources on reactive enforcement (see BPP, September, 2020, Professional Pointers: Domain Name Strategy to Protect Brand Identity). In a similar manner, brand owners can usually secure social media profile and usernames in addition to their primary accounts that might otherwise be used to imitate the brand presence on these platforms (this may depend on each platform’s individual terms of service).  Depending on the brand— and particularly for brands with an active social media presence and following— this can be a very useful addition to overall digital brand strategy. 

Of course, it is impossible to completely prevent infringement and other abuses of trademarks. That is why reactive enforcement measures will always be necessary in addition to preventative efforts. Businesses should partner with experienced and creative IP professionals with particular expertise in the digital space to implement enforcement measures tailored to the business’s particular needs and that will be most likely to succeed in addressing the particular issue, whether it be domain name cybersquatting, selling counterfeit goods, email phishing, or some other form of abuse. Measures might include cease and desist letters, notice and takedown letters to website or email hosts, abuse reports to domain name registrars and registry operators, complaints through domain name arbitration mechanisms, complaints to government cybercrime or consumer protection agencies, or even litigation in the most extreme cases. For advisors, it is always important to understand a particular brand owner’s commercial priorities, budget limitations, and business and consumer vulnerabilities and to assist in development of enforcement strategies accordingly.  

These are very uncertain and challenging times ahead for businesses and brand owners. While many are optimistic about an eventual economic recovery, businesses must still adapt to new realities while facing economic uncertainty and heightened threats to their customers and IP assets (McKinsey, 2020). A holistic brand protection strategy that combines preventative and reactive approaches with comprehensive traditional and digital monitoring and partnership with competent counsel in these areas will help ensure that the business is in the best position moving forward. Although these programs do require an investment of resources, which are especially precious in these unpredictable times, having a solid foundation in place can ultimately maximize enforcement results and improve the overall efficiency and cost-effectiveness of these vital brand protection efforts in the long run.