Authored By: Gulsheen Sodhi
Birla Global University
ABSTRACT
One of the most jurisprudentially contested terrains of intellectual property law remains the realm of olfactory in luxury fashion, referring to the scents that are woven into haute couture collections and multimillion dollar perfume lines. While, design patents and visual trademarks have doctrinal frameworks protecting their identity and uniqueness, a precarious position is held by jurisdictions across concerning the legal protection for fragrance compositions. The legal challenges that are faced by olfactory markets and scent as trade dress in the luxury law industry, have been examined in this manuscript, an interrogation of the tripartite doctrinal tensions among copyright, trademark law and unfair competition principles has been conducted. A further evaluation and dissection of various landmark cases, such as Sinanide v. La Maison Kosmeo, Chanel’s litigation history, and the Dutch Supreme Court’s landmark L’Oreal v. Bellure decision, has been presented, using which this article argues that the Intellectual Property structure that exists and remains predicated on visual as well as textual notions of differentiation is inherently not equipped to accommodate the olfactory differentiation. A comparison has been drawn of the frameworks that exist in European Union, United Kingdom as well as United States framework, after which it is understood that fashions olfactory economy demands doctrinal reframing or legislative intervention in judicial interpretation. This article is framed with regard to attention to the policy implications for consumer deception, luxury brand integrity as well as the chilling effect that legal uncertainty exerts on olfactory innovation.
Keywords: Olfactory Marks, Luxury Fashion Law, Scent Trademarks, Trade Dress, Intellectual Property, L’Oreal v Bellure, Chanel, EU Trademark Law, Unfair Competition
I. INTRODUCTION
Coco Chanel famously instructed Ernest Beaux to create a perfume that ‘smells like a woman,’ following which she could not have anticipated that the resulting composition, called Chanel No.5, would along with gaining wide success become a jurisprudential mystery. In today’s fashion law economy, scent and fragrance is constitutive of a brands identity and not only incidental to it. Fragrances are employed by luxury houses as instruments of consumer loyalty, brand extension and marketing. However, the law fails to recognize the same, it has failed to translate the registration of olfaction under the jurisprudence of Intellectual Property.
A global revenue of roughly $350 billion is generated by the fashion law industry annually, among this, the fragrance industry alone accounts for a large share. Luxury brand houses such as Chanel, Hermes, Guerlain invest heavily in the creation of proprietary scent compositions that are commercially valuable along with becoming a cultural phenomenon. Often times these highly invested in scents, that are made with time and expertise are then ripped off and sold as ‘smell-alike’ or ‘inspired-by’ products and sold at a fraction of the price, yet to this, the laws response has been a permissibility of such conduct at worst.
This article, has used a doctrinal-analytical methodology which is complimented with comparative insights from United States, European Union and United States jurisprudence. The author does not claim that a uniform global solution is desirable, rather the author aims, to expose the contradictions that exist within the existing laws and frameworks, and further suggest a coherent approach to olfactory IP in the luxury context.
II. BACKGROUND AND CONCEPTUAL FRAMEWORK
A. Scent as Commercial Identity in Luxury Fashion
Luxury fashion brands operate in an economy wherein every sensory element, such as visual, tactile, auditory and olfactory is codified in order to signify exclusivity as well as desirability. The vast literature available, recognizes that sensory branding is capable of generating emotional responses and further deepening consumption attachment. To a luxury fashion house, their signature fragrance is more than a product, it is an intangible asset which remains as important and significant as a brands logo.
It is known, that Chanel No. 5, on an estimate sells a bottle every thirty seconds worldwide. Further, Dior’s Sauvage and Hermes’ Terre d’Hermes command a premium pricing that is an accumulation of the quality of raw materials as well as the brand identity. Thus, when a fragrance is ripped off, and introduced like a ‘dupe’ product, often mimicking the packaging of the original perfume, the luxury house suffers through a disaggregation of its brand identity as well as a commercial loss.
B. The IP Taxonomy Problem of where scent belongs
The most prominent challenge of olfactory Intellectual Property is taxonomic. The foundational knowledge on which Intellectual Property operates is that copyright protects original creative expression, while trademark protects the distinctive commercial origin and while patents protect inventive processes as well as products. Herein, scent compositions do not find a spot in order to protect themselves.
Most jurisdictions around, have rejected for the copyright protection to be given to scents, on the grounds that olfactory expression lacks the fixation requirement for copyright doctrine. However, occasionally gestures have been shown by the French and Dutch courts towards the copyright protection of fragrances, but they merely remain outliners. For a Trademark protection to be given, the scent should be graphically representable as well as distinctive, the fulfilment of both these criteria’s is not permissible technically or conceptually for the fragrance industry. A Patent protection, can be applicable to the underlying chemical formula of the scent, however it comes with an expiration date of 20 years and offers absolutely no protection against the products that smell like the original using different compositions. The law herein has left meaningful gaps precisely where the commercial harm is most acute.
III. LEGAL ANALYSIS
A. Trademark Law and the Olfactory Mark
The registration of scent as a trademark has been recognised in principle across major jurisdictions, however the practical obstacles with regard to registration still persist. In the Trade Marks Act of 1994[1] in the United Kingdom, a sign is considered to be registerable only if it is capable to represented graphically or can differentiate goods or services. In Ralf Sieckmann v. Deutsches Patent- und Markenamt[2], the Court of Justice of the European Union (CJEU) had held that graphical representation must be clear, precise, self-contained, easily accessible, intelligible, durable, and the objective criteria remained that a scent composition can satisfy only with great difficulty.
The approach of the United States seems to be more accommodating but has produced comparatively little results. The USPTO recognises scent marks in principle, such as the recognition of fresh cut grass has been registered for tennis balls by Vennootschap onder Firma Senta Aromatic Marketing[3]. The doctrine of functionality remains as a significant barrier, wherein if a scent is an inherent attribute of the product itself, it cannot function as a trademark. In products wherein the scent is the product, this doctrine is a hindrance. It has further been held by courts that fragrance cannot be a source identifier, which means that it could possibly be a product characteristic but not a brand indicator.
B. Copyright in Fragrance Compositions
The question of whether olfactory expression constitutes an original literary or artistic work within the meaning of the Berne Convention[4] and its implementing legislation is brought forward considering the copyright analysis of scent composition. For work to be expressed in a fixed, tangible medium is what is required by most jurisdictions, however the olfactory experience remains of transient nature, it cannot be fixed in a manner like a text or a painting.
In the Lancôme Trésor case (2006)[5], the Dutch Supreme Court seemed to entertain and support the fact that a perfume composition should have the same copyright or trademark rights as an original work of art, provided it had the imprint of its creator. However, this idea or thought was completely shut down by the CJEU in Levola Hengelo BV v. Smilde Foods BV[6],wherein it was expressly held by the court that any sensory expression that lacked visual or aural fixability could not be protected by copyright, under the laws of the European Union.
C. Passing Off and Unfair Competition
Due to the absence of trademark and copyright laws protecting fragrances, the tort of passing off and unfair competition statutes are what has been used by Luxury fragrance houses to protect themselves. In English Law, trinity of goodwill, misrepresentation and damages as established in Reckitt & Colman Products v. Borden Inc[7]are required to prove passing off. The main challenge arises with the element of misrepresentation, as to whether a consumer who purchases a ‘smell alike’ fragrance, truly believes they are purchasing the original luxury product? Or as courts are sceptical, these smell alike fragrances are brought because they are sold at a discounted price.
The framework that exists in the European Union, which was partially harmonised through the Misleading and Comparative Advertising Directive[8], offers an additional avenue. In Article 4 comparative advertising is permitted, provided it is not misleading, does not discredit competitors, and does not take unfair advantage of their reputation.
IV. CASE LAW DISSECTION
A. L’Oreal SA v. Bellure NV[9]
The CJEU’s ruling in L’Oreal SA v. Bellure NV is a landmark ruling with regard to European Union’s Olfactory Intellectual Property jurisprudence and a highly important decision on the intersection of intellectual property and luxury fragrance. Bellure was a Belgian manufacturer who produced a range of fragrances, which were ‘smell alikes’ of various well-known L’Oreal perfumes, including Trésor, Miracle, and Anaïs Anaïs. Bellure’s packaging also was a replica of the originals aesthetic and it also distributed a comparative list to consumers, signalling which products matched with which original luxury perfumes.
The matter when reached the Court, was confronted with the question as to whether Bellure’s act was a violation of L’Oreal’s trademarks under Article 5(1)(a) of the First Trade Marks Directive[10] , wherein the traditional prerequisite for infringement is consumer confusion as to the origin of the product. It was held by the court that where a third party uses a sign that is identical and similar to trademark, and the intention to do so is taking unfair advantage of the distinctive characteristic of the trademark, in such a case infringement may be established without any proof of confusion. This expansion in the definition of trademark harm, rooted in the dilution and tarnishment doctrine developed most fully in US law which has mostly extended the scope of protection that is available to luxury marks.
However, a distinction was drawn by the Court that would prove commercially limiting, in the provision of the comparison list, it was included that just because a product is a ‘smell alike’ of the original, it does not automatically cause infringement, a prerequisite is that the advertisement should tarnish the mark, and present the imitating product as an imitation. This ruling was the Courts attempt to draw a balance between brand protection and the principle of freedom of competition.
B. Sinanide v. La Maison Kosmeo (1928)[11]
The English case of Sinanide v. La Maison Kosmeo remains relevant for being one of the earliest judicial cases with regard to olfactory creativity. Herein, the plaintiff was a performer who claimed copyright for the formula of a scent composition alleging that the defendant had copied it. The Copyright claim was rejected by the Court of Appeal as the formula is not in legal terms, an original artwork or piece of literature, rather it is a utilitarian set of instructions.
What remains relevant today is not the outcome of the case but the reasoning for the case, revealing a hesitance from the courts end in recognizing olfactory creativity as a matter of cultural reality and the resistance in turning these into cognisable legal rights. The Court further acknowledged perfumery as an art form a decline to afford that art form the protections accorded to other creative expressions referring to a contradiction that has never been satisfactorily resolved.
C. Levola Hengelo BV v. Smilde Foods BV [12]
Lenova Hengelo was a case with regard to food flavour, but its reach and applicability extends to the olfactory Intellectual Property domain. This case was about a cream cheese product which had a distinctive taste and the manufacturer alleged a copyright infringement when a similar tasting product was introduced by a competitor. The CJEU herein ruled that sensory experiences are not applicable for precise identification and cannot be protected by copyright, as a firm outer boundary on the extension of copyright to include olfactory expression has been set.
This case remains significant for the luxury fashion industry due to its constitutional implications which is that the requirement of precision and objectivity is not just a formal technicality but a prerequisite for copyright protection, it is rooted in the need that exists for legal certainty and the rights that a third party has to know what can and what cannot be protected, therefore olfactory Intellectual Property had been removed from the copyright domain by the laws of European Union.
V. CRITICAL ANALYSIS
A. The Representability Paradox
The graphical representability requirement which is applied to olfactory marks through Sieckmann further reflects a broader representational bias which lies within the Intellectual Property law, a preference is given to visual and textual modalities which shows the historical contingencies of print culture over any principled normative commitment. The EUIPO’s 2017 reforms had replaced the graphical requirement norm with a technologically neutral standard, requiring for a sign to be ‘represented in a manner which enables the competent authorities and the public to determine the clear and precise subject matter of the protection,’ this had opened a pathway for the non-conventional marks, which includes scent. However, in practice of law, no scent has successfully been registered under the reformed framework.
B. The Policy Contradiction in Free-Riding
A fundamental policy contradiction has been introduced by L’Oreal, courts have acknowledged that luxury fragrance embodies creative and commercial value, it establishes that fragrances are sufficiently distinctive to function as a trademark, which permits competitors to present their product as the replica of the original. Herein, if the identity of Trésor is sufficiently distinctive to attract trademark protection it is bound that a competitor may lawfully identify its product as a Trésor imitation.
The free-riding doctrine has been elaborated in L’Oreal, and tries to resolve this dispute, drawing a distinction between confusion-based harm and dilution-based harm. Confusion-based harm, is when consumers mistake the replica for the original and Dilution-based harm refers to when the originals unique and distinctive nature is exploited.
The Court has provided protection against dilution-based harm, however it declined to extend the same to informational comparative statements which is a differentiation that in the olfactory context is commercially artificial. It is understood that on comparison if an individual understands that perfume A smells exactly like Chanel No 5, they purchase perfume A and not Chanel No. 5, been induced to do so by reference to Chanel’s olfactory equity.
C. The Innovation Chilling Effect
One of the most serious policy consequence is the current legal frameworks ability to chill olfactory innovation within the luxury sector. If a luxury house cannot protect its olfactory creativity through Intellectual Property or its mechanisms, the incentive to invest in high-cost, high-risk olfactory research and development automatically shall gradually expire. Haute perfumeries require years of inquiry, research and refinement. If a legal framework provides no first mover advantage, it takes away the economic benefits from the original and redistributes it to the competitors, which is precisely what Intellectual Property law seeks to prevent.
VI. CONCLUSION
The way scent is treated in the realm of intellectual property and the domain of luxury fashion law represents one of the grave failures of the IP doctrine. The law has time and again prejudiced the visual and textile industries that its historical architecture was designed to accommodate, while leaving olfactory creativity out of this protection, which ill-reflects either the commercial importance and the creative significance of fragrance in the luxury economy.
The doctrinal analysis offered in this article points toward three conclusions. First, the graphical representability requirement for olfactory marks, as applied through the Sieckmann criteria and its successors, is a historically contingent rather than normatively necessary constraint, and its replacement with a technologically sophisticated standard of precision and objectivity is both feasible and desirable. Second, the copyright exclusion of olfactory works, while normatively defensible in the abstract, has been applied with insufficient sensitivity to the specific characteristics of haute parfumerie, which involves a form and degree of creative authorship comparable to other applied arts that attract copyright protection. Third, the free-riding doctrine established in L’Oreal, while a positive development in the trajectory of luxury trademark law, stops short of providing the comprehensive protection that the olfactory dimension of luxury fashion requires.
Reference(S):
[1] Trade Marks Act 1994
[2] Case C-273/00 Ralf Sieckmann v Deutsches Patent- und Markenamt [2002] ECR I-11737, EU:C:2002:748
[3] In re Clarke 17 USPQ2d 1238 (TTAB 1990)
[4] Berne Convention for the Protection of Literary and Artistic Works (as amended on September 28, 1979)
[5] HR 16 June 2006, ECLI:NL:HR:2006:AU8940, Nederlandse Jurisprudentie (NJ) 2006, 585 (Lancôme Parfums et Beauté & Cie S.G. v Kecofa BV)
[6] Case C-310/17 Levola Hengelo BV v Smilde Foods BV EU:C:2018:899
[7] Reckitt & Colman Products Ltd v Borden Inc [1990] 1 UKHL 7, [1990] 1 WLR 491, [1990] 1 All ER 873
[8] Directive 2006/114/EC of the European Parliament and of the Council of 12 December 2006 concerning misleading and comparative advertising [2006] OJ L376/21.
[9] Case C-487/07 L’Oréal SA v Bellure NV [2009] ECR I-05185, EU:C:2009:378
[10] First Council Directive 89/104/EEC of 21 December 1988 to approximate the laws of the Member States relating to trade marks [1989] OJ L40/1.
[11] Sinanide v La Maison Kosmeo (1928) 44 TLR 574
[12] Case C-310/17 Levola Hengelo BV v Smilde Foods BV EU:C:2018:899
