Telstra Allowed to 'Go to Rio' as Marketing Campaign Held Not Misleading by Federal Court

Wednesday 3 August 2016 @ 10.59 a.m. | IP & Media | Trade & Commerce

On 29 July 2017, Justice Wigney of the Federal Court of Australia handed down the decision in Australian Olympic Committee, Inc. v Telstra Corporation Limited [2016] FCA 857, holding that the Australian Olympic Committee (the AOC) had not demonstrated that any of  Telstra Corporation Limited's (Telstra's) advertisements, marketing or promotions, or indeed Telstra’s overall marketing campaign known as, “Go to Rio”, conveyed a misleading or deceptive representation, or involved misleading or deceptive conduct, and that the AOC had accordingly failed to demonstrate that Telstra contravened either section 18 or paragraphs 29(g) or (h) of the Australian Consumer Law (the ACL - made under Schedule 2 of the Competition and Consumer Act 2010 (Cth)). Further, the decision found that Telstra had also not been shown to have contravened section 36 of the Olympic Insignia Protection Act 1987 (Cth) (the OIP Act).

Background and Facts

The case was based around allegations of what has become known as “ambush marketing” against Telstra. The allegations arose out of various promotions and advertisements themed around the forthcoming August 2016 Summer Olympic Games in Rio de Janeiro, Brazil.

At previous Olympics, and for many years, Telstra had been a licenced “team sponsor” of the Olympic Games and, as such, was permitted to promote itself ". . . by association with the Australian Olympic Team and the Olympics". Such rights were no longer held by Telstra who, however, had entered into an agreement with Seven Network (Operations) Ltd (Seven), pursuant to which it sponsors or is a “partner” of Seven’s Olympic broadcast. Following on the Seven arrangement, Telstra commenced an extensive marketing and advertising campaign which was focused on or themed around the Rio Olympic Games. As a result, the AOC sought through the case to halt Telstra's campaign, claiming that Telstra's promotions and advertisements contravened the OIP Act and were misleading and deceptive and so contravened section 18 and paragraphs 29(1)(g) and (h) of the ACL. In response, Telstra claimed that there was nothing illegal in its campaign and refused to stop its promotions.

The Issue(s)

Two key issues arose for decision.

The first is described at para [4] by Justice Wigney as follows:

"The central question in resolving this dispute is this: do the Telstra promotions and advertisements suggest to a reasonable person that Telstra is a sponsor of, or provided sponsor-like support to, bodies and teams associated with the Rio Olympic Games? Or do they simply suggest that Telstra sponsors Seven’s broadcast of the Rio Olympic Games and promote the ability of Telstra customers to access the premium version of Seven’s 'Olympics on 7' app?"

The second arises with respect to the OIP Act and whether Telstra's conduct breached section 36 of the OIP Act by using protected Olympic properties in advertisements and promotional material to indicate the existence of sponsorship or "sponsorship-like" relationship to a “reasonable” person.

The Reasoning

Dealing with the OIP Act claim first, Justice Wigney found that the critical question in this respect was whether the Telstra advertising made it sufficiently clear that Telstra's "sponsorship-like" arrangements were with Seven and not the IOC or the AOC. See at para [91] where Justice Wigney says:

"The critical question in relation to the advertisement is whether it makes it sufficiently clear that Telstra’s sponsorship-like arrangement is with Seven, not any Olympic body. Does it make it sufficiently clear that Telstra customers can watch the Rio Games on their mobile devices using the Telstra network because Telstra is Seven’s partner or sponsor, not because it has any arrangement with any Olympic body?"

Justice Wigney then concludes the required representation of a relationship which is "sponsorship-like" does not exist because Telstra's ads made it clear its relationship was with Seven. See at para [93]:

"The nature of Telstra’s connection with the app and the Olympic Games broadcast is, however, clarified to an extent in the last few seconds of the advertisement. That is when the words 'Official Technology Partner of Seven’s Olympic Games Coverage' and 'Olympics on 7', using Seven’s logo, appear. Those words tend to suggest that Telstra’s relationship in relation to the broadcast is with Seven, not any Olympic body."

On the issue of whether Telstra's campaign conveyed a misleading or deceptive representation, or involved misleading or deceptive conduct by Telstra that contravened either section 18 or paragraphs 29(g) or (h) of the the ACL, Justice Wigney took the view that  merely demonstrating that Telstra's ads had an Olympic theme was not enough to establish a breach of section 18 or paragraphs 29(g) or (h) of the the ACL. See para [138]:

"There could be no doubt that Telstra’s campaign was themed around the forthcoming Rio Olympic Games. It is, however, not enough for the AOC to prove that the advertisements were Olympic themed . . ."

In Justice Wigney's view such would cast the net unfairly to wide, or as stated in the judgment, would mean that:

". . . any advertisement over the next month that used Peter Allen’s 'I Go to Rio' song (and it is not difficult to imagine that everyone will be heartily sick of that song by the end of the Rio Games) or images of people playing or watching sport, might equally be accused of misleadingly associating themselves with the Olympic Games or Olympic bodies. It may also be readily accepted that the fact that the advertisements, marketing and promotions did not expressly refer to any Olympic body, or use any Olympic symbols or emblems is not determinative. An association can be conveyed by subtle, emotive or pervasive suggestion."

On the ACL question, Justice Wigney concluded that Telstra's promotions legally promoted its relationship with Seven and the App jointly developed by them. See para [140]:

"The long and the short of it is that conduct by Telstra which amounted to nothing more than Telstra advertising or promoting its relationship and arrangements with Seven, including with respect to the Olympics on 7 app, could not fairly be regarded as misleading or deceptive."

The Outcome

Ambush marketing is not new in terms of the Olympics with a previous instance being the matter arising between Qantas and the now defunct Ansett Airlines at the 2000 Sydney Olympics and the notion that only one airline could claim to be the "Official Olympic Airline". It is interesting that the decision does tend to try and limit the width or extent of what can be prevented by way of peripheral or related advertising and tends to make it clear that not all peripheral advertising or associated advertising can be prevented by reliance on the ACL or even the OIP Act.

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