An investor and I have started a discount retail store, and with my connections in the world of television have been given a free month worth of commercials on TV.
Basically the idea behind the store; we buy salvage from the big 10 retailers and resell at a quarter of their price.
Now, with that information how legal (or wise) would it be to say something like “We buy liquidations from Wal-Mart, Target, Costco, Rainbow, and more!”
And for brands, how legal is it to say “Our special this week is Nestle’ Pure Life water, $2.50 per case!”
In my experience working with branding, the people making the videos are always really careful to cover up logos of products. I only know a few people personally that own brands that are regionally well known, and they really don’t care who mentions their brand, free publicity is good publicity.
I’m just looking for the legal ramifications of mentioning a brand of soap, or canned vegetable that we are advertising this week.
You are talking about going against the marketing and brand-protection agreements of the largest corporations on earth, who will cut off a 100-store chain because they price something below an agreed floor in a newspaper ad.
I suggest you need better, more expert advice from a lawyer specializing in retailing agreements, lest Nestle, General Mills, PepsiCo and others come cut off… something you might want.
No, I don’t believe that buying the stuff salvage or second-hand keeps those marketing conditions from applying to you… but it’s your lawyer against theirs if you want to argue it. May the force be with you.
Do your agreements with Wal-Mart, Target, et al allow you to mention them in your advertising? Specifically do NOT allow you? If they make no mention of it all, you might want to clear with your suppliers, to keep them from becoming your former suppliers.
Similarly, you might want to make sure your supplier of Pure Life water hasn’t signed some marketing agreement. Not that it would affect you, but again, you don’t want to annoy your suppliers.
A co-op advertising agreement, of course, will have its own stipulations.
Besides all the marketing stuff mentioned above, I wonder if there might be a problem of trademark infringement.
I know about the “fair use” exception for copyright laws, but is there anything comparable for trademarks? In simple English, can this board get sued by Nestle or Ford simply because we used their name without permission? Let’s that they theoretically could but never bother to — The OP’s case might be the thorn that suddenly bothers them.
If they are selling new Fords and Toyotas, they are doing so under an agreement with Ford or Toyota that spells out, in interminable detail, what they can and can’t do. One thing they are usually prohibited from doing is advertising new cars below a set floor price (although dealer cost usually imposes its own economic limit there).
If they are selling used cars, they don’t have an agreement with anyone and can say or price or market the cars any way they like, including specific mention of the brand, model, condition etc.
Selling retail goods, which are assumed to be “new,” is a different case. Legitimate sellers are under sales agreements like the above. Secondary sellers may not be, directly, but whomever they are getting their secondary-sale or salvage goods from is, and if Joe’s Salvage Foods keeps advertising a brand-name product at an absurdly low price, the maker will follow through to plug the marketing hole.
If Joe’s is selling *used *food, well, all bets are off.
No. It’s only an infringement if you’re using the same name for the product or for one that was manufactured by someone other than the trademark holder. If you’re actually selling a product made by them, there is no infringement.
The question here is if there is any stipulations when you purchase the products for resale.
There is a chain called Dirt Cheap which is exactly the type of store the OP is describing. They advertise “name brands at 30-90% off” but don’t mention any of the brands. A large percentage of their merchandise obviously comes from Target but they make no mention of it in their advertising. http://www.ilovedirtcheap.com
Just to give an update for anyone that is curious.
Called several companies today that i have an interest in advertising:
Church & Dwight, seems to be too big of a mess, they want to lawyer up, and have all sorts of paperwork signed. (Not mad at me by any means, but they said it is typical for when they do commercials)
Purina: Can’t get a hold of anyone about it
3 other ones transferred me to corporate headquarters where i was met with a lot of we will think about it.
Canned food brand: Totally cool with it, and even offered to supply me with any stock photos i might need
So i guess it is a very individualized thing. The bigger companies weren’t thrilled by it, but they didn’t turn me away either, they just want to make sure their brand looks good.
The canned food company knows me personally as i have done business with them for years, and green-lighted it almost immediately.
I’ve wondered about the brands on Mad Men. They’re all real. Even the ad campaigns – many of them I remember. But some of the brands are presented in a negative light. There was a cigarette-company official portrayed as a bullying sexual predator. How does the show guard against any legal action?
Name a *brand *that was portrayed negatively. Having a fictional owner/board member/manager that was a jerk is not the same thing.
And the answer is Goldwyn’s Law: “All publicity is good publicity. Good publicity is better.” - even when apparently separated by decades. Just how much do you think being reminded that Brand X has been around since you were a kid is worth?
And think about this one: where is the line between MM’s fictional portrayal and actual cigarette advertising on TV?
The show made light to some extent of the cigarette brands the agency was representing. It’s not inconceivable that the rel-life companies could have been annoyed to the extent of consulting their lawyers. I’m not complaining, I think it’s great. It just struck me that they chose to go with real brands and not made-up names.
Its these guys you don’t want to upset.
They don’t have to sell to you.
They can say you slandered them or misrepresented the facts… its too easy to make an implication…
You also don’t want to encourage your competitors to do the same thing as you do, your purchasing strategy is your secret ! If everyone turns up to buy from your source(s), then because of law of supply and demand, prices go up… where’s your profit margin then? Also, why do you want to make a devalue yourself by saying you only get their scraps ??