Roger Federer recently announced a new ten-year, US$300 million sponsorship deal with Japanese clothing company Uniqlo, bringing an end to a long association with Nike following the expiry of his deal with the US sports giant in March.
However, the tennis star appeared to open up a potential dispute with his previous sponsor by continuing to wear Nike trainers, most crucially embossed with the famous RF logo, together with his new Uniqlo matchday clothing. Uniqlo do not manufacture trainers and after his first match at Wimbledon Federer confirmed that he did not have a shoe deal in place with anyone for the tournament.
Nike has so far declined to comment in any detail on the issue, whilst Federer lashed a powerful backhand to his former sponsor by claiming: “It’s also something that was very important for me, for the fans really. They are my initials. They are mine.” Adding that he hoped the RF logo would come back to him at some point.
In legal terms, Nike is the owner of the trademark in the RF logo in various registries across the world in classes of use covering clothing and footwear. Separately, Federer is the registered owner of trade marks covering his full name and signature, so these are not in dispute.
In the absence of any commercial agreement between the parties permitting continued use of the RF logo by Federer, he could be held to be infringing Nike’s trademarks, despite them being ‘his’ initials, so the sportswear giant appears to be in a strong bargaining position.
Roger Federer revealed his new sponsorship deal with Uniqlo at Wimbledon
The commercial reality is that the sponsorship contracts between the parties may have provided for continued use by Federer of Nike’s trademarks in the event of termination or expiry of the deal or it may be the case that there is already a mechanism in place to transfer the ownership of the logo back to Federer for a price. Alternatively, there could be deal to be struck now.
Federer first signed deals with Nike when he was 13, so in negotiations the parties will have partly been predicting what level of success may be achieved in the future; it was impossible to predict that Federer would go on to become the most successful male tennis player of all time, winning 20 grand slams. The current situation is perhaps a lesson in brand management and the contracts that underpin it; parties should keep their commercial terms under review and ensure that future events are covered as far as possible, to reduce the scope for IP disputes later down the line.
A similarly high profile case arose some time ago when Karen Millen sold her business (which was intrinsically linked to her name) and there were restrictions in the business sale contracts prohibiting Millen from using her own name in connection with any similar business in the future, on a global scale. This included using confusingly similar names, such as ‘KM’ or ‘K Millen’.
Several years later, Karen Millen attempted to use her name in connection with new business activities, including a homeware range, in several territories such as the US and China. Trademark disputes arose as a result of this over the words “Karen”, “Karen Millen” and “KM”. Ultimately, Millen could not use the name “Karen Millen” or any of the related names, without breaching the terms of the business sale contracts she had previously entered into. Although the facts were different in that case to Federer’s, it reinforces the general principle that a name that has been used in connection with business ventures is an asset like any other; which parties are free to negotiate and commercialise.
Aside from all of this, whatever the strict legal and contractual position is, there is no doubt that branding linked to Federer retains its commercial value due to its connection to the athlete and the public support which this endears. If he stops endorsing Nike products by no longer wearing them, or Nike insists on invoking its legal rights and prevents him from doing so, the commercial value in the relevant trademarks, and public support for the brand, is likely to diminish.
The details of the commercial arrangements between Nike and Federer are, and will remain, confidential to the parties. However, it seems more likely that the current deuce will be resolved by reaching agreement as to what branding Federer can continue to use on Centre Court, rather than battling this out in a court of law.