The Australian Olympic Committee (AOC) is urging the public to support “true, valued Partners” after it lost its last minute bid to prevent ambush marketing ahead of the 2016 Summer Olympic Games. Australian Olympic Committee, Inc. v. Telstra Corporation Limited  FCA 857 (29 July 2016). The decision by the Federal Court of Australia highlights the unique value proposition provided by sponsoring major events as well as the vulnerabilities of such agreements. Although the Olympics is the gold standard of sports sponsorship the same principles apply to events of different scales.
Australian Olympic Committee v. Telstra Corporation Limited (2016)
The AOC made an application to for injunctive relief against Telstra Corporation, Australia’s largest telecommunications company and a previous Olympic team sponsor from running a “Go to Rio” campaign. Telstra had been advertising its association with the television network which had secured broadcasting rights, as the “official technology partner of Seven’s Olympic Games coverage.” The campaign used footage of sports enthusiasts with Peter Allen’s “I Go To Rio” as a soundtrack alongside the phrase, “Get free premium access to the ‘Olympics on 7’ App.” The AOC relied on causes of action under Australian Consumer Law (ACL) and the Olympic Insignia Act 1987 (Cth) to argue consumers could be misled into believing Telstra was an official sponsor or otherwise associated with the Australian Olympic team. Competition and Consumer Act 2010 (Cth) sch 2, ss 18, 29(1)(g), 29(1)(h), 29(1)(l); Olympic Insignia Act 1987 (Cth) ss 23, 28, 30(2), 36, 38. The Court ultimately found all the advertisement did was suggest Telstra sponsors the television broadcast of the Olympic Games and promote the ability of its customers to access the premium version of that channel’s app.
Value in sponsorship
Sponsoring sports events is hugely lucrative as it offers an avenue through which to boost customer goodwill, to generate sales leads and opportunities for cross-promotion. It is mutually beneficial in that both the Olympic movement and professional sport, can be described as a sophisticated debt engine reliant on fuel in the form of commercial sponsorship. For this reason under the Olympic Charter host countries and National Olympic committees are required by the International Olympic Committee (IOC) to protect particular Olympic expressions. It is also why the AOC’s application against Telstra was decided on the basis of the scope and effect of approvals by the International Olympic Committee. The value of sponsorship lies in exclusivity and herein lies the thorny issue of ambush marketing.
Ambush marketing is the deliberate attempt to associate a brand or product with an event, club or league to receive the benefit of official sponsor without having paid for it through advertising, marketing, promotional activities. It confuses the public, dilutes the value of sponsorship, may affect a country’s bid to host international events and ultimately damages professional sport. The key is to refer to an event in a descriptive manner without using official logos. As with Telstra, savvy marketers will not risk infringement of trade marks or Olympic insignia.
Utilization of technology
The digital space affords ambush marketers with new and varied opportunities to ensure their campaigns coincide with major “activations” of official sponsors. To combat the wealth of ambush marketing opportunities arisen on new media, legislatures in Australia and overseas have enacted sweeping major events legislation including the Major Sporting Events (indicia & Images) Protection Act 2014 (Cth). The technological proficiency of consumers is a boon to marketers and a headache for sponsors as evidenced by the context of this dispute which involved an Olympic themed multi-platform campaign weeks out from the Games promoting streaming the official broadcasts on mobile and tablet devices. Justice Wigney’s decision has led some commentators to suggest the floodgates have been opened to ambush marketers.
Protecting your investment
Most Australians cannot recall which airline sponsored the Sydney 2000 Olympic Games. If asked, most will reply it was QANTAS. In fact it was QANTAS’ now defunct rival Ansett who sponsored the Australian Olympic team. QANTAS pulled off one of the greatest ever feats of ambush marketing, circumventing the restrictions on use of Olympic insignia to upstage Ansett by featuring the then world champion Australian swimming team in advertising leading up the Games. As a sponsor your rights are limited by what’s contained in the sponsorship agreement.
It is important to include provisions aimed at brand protection and anti-ambushing strategies.
- negotiating a wide category of exclusive sponsorship;
- imposing restrictions on competitors with regard to merchandising and promotion;
- restricting the use of tickets as prizes; and
- requiring the event owner to use its ‘best endeavours’ to restrict ambush marketing and provide a ‘clean’ venue which may necessitate: (1) employing security to police the event specifically for ambushers; (2) prosecuting instances of trademark and copyright infringement or dilution, unfair competition and consumer deception; and/or (3) controlling all outdoor media in a specified area around the event.
This post was written by Graduate Sorrel Palmer (AU).
 Richard Pound quoted in International Olympic Committee, Marketing Fact File 1998, 7.
 Enacted to protect commercial interests in intended to protect the Asian Football Confederation (AFC) Asian Cup 2015, the International Cricket Council (ICC) Cricket World Cup 2015, and the Gold Coast 2018 Commonwealth Games.
 Marc Trachtenberg, ‘Basic Principles of Drafting and Negotiating Event Sponsorship Agreements’ (2013) The Licensing Journal 15, 19.