Character merchandising is defined as the adaptation or secondary exploitation by the creator of the fictional character or by one or several authorized third parties. This exploitation is in relation to the essential personality features of the character such as name, image or appearance and is done to create an association between the products and such personality traits so as to create a desire in the minds of the customers to acquire such product or avail such service because of customer’s attachment with the character 1.
The personality features are, for example, the name, image, appearance or voice of a character or symbols permitting the recognition of such characters by public at large.2 Similarly, the secondary exploitation refers to a different way of using the character than its primary use or activity but such secondary exploitation will be dependent upon the primary use in a way that it will be impossible for secondary exploitation without the primary use.
Moreover, the term “character” includes both, fictional characters and real persons. Whereas in the case of real persons, there exist a problem of dual reputation, it means a person having a reputation of his own along with the character that is portrayed by him which has left a lasting impression on the minds of the people at large. Thus, it involves both celebrity as well as image merchandising.
When it comes to commercial exploitation, fictional characters have “promotional, advertising and recognition functions” may come as their primary function or secondary function. But in case of real person, both the commercial value of the real person as a celebrity and that of the character portrayed by him can be exploited.
In essence, merchandising is a marketing technique by which an advertiser by which an advertiser associates a product or service with a desirable personality or fictional character in whose reflected light it will appear more pleasing 3.
Put very simply, character merchandising means, the use of the name, picture, voice and statements of a real or fictitious personality to promote the sale and use of certain products or services.
Origin of Character Merchandising
The concept of character merchandising evolved with the creation of cartoon characters of Mickey mouse by Walt Disney and the subsequent exploitation of the character done by one of their worker by selling goods including shirts and other goodies bearing the images of the cartoons4.
This concept of such secondary exploitation of the reputation of a character existed much before in India but is not credited to them because it was not commercial in nature. In India, for example, the religious characters of ‘Ramayana’ such as Rama, Vishnu, Sita and other characters which are fictional in nature have been represented in the form of sculptures, puppets or toys and were sold.
In recent times, the industrialist, with a view to popularizing the goods they decide to create fictional characters which would be represented on the goods, the packaging and would be used to generate revenue from selling of decorative plates, articles of clothing, clocks, puppets etc. The exploitation of literary characters started with the works Alice in Wonderland, the characters of which also became soft toys and were later adapted into a motion picture cartoon5.
Reasons for the Growth of Character Merchandising
Character merchandising has seen a rampant growth in the last two decades, due to the development of technology which has resulted in the electronic medium becoming accessible to a large mass, including television, films as well as radio content.
Also character promoting is being seen as an instrument for expanding the viewership for the entertainment sector with which it is connected. Seen through this viewpoint, the intended interest group of character marketing is not the client who is a vigorous adherent of the character being referred to; the client is uninformed of the said character and who might build up a distinct fascination in the character in the wake of seeing the merchandise and lastly it is seen as a very effective tool of growing the T.V. programs or movies and taking them to the next level where the marketing agencies never let the consumers forget about their production by introducing such merchandise and thus also surpassing their competitors who are limited to only the visual medium.6
Types of Character Merchandising
There two main categories in character merchandising depending upon the merchandising of fictional character or real person, referred as merchandising of fictional character and celebrity merchandising respectively, however, a third hybrid category exist which is known as image merchandising.
The success of merchandising depends upon the characters which are either are popular inherently or through promotion. The subject of merchandising should be appropriate for the corporate image so that it allows easy recognition. The main sources of fictional characters include characters from cartoons, artistic works, buildings and statutes, films, logos of international organisations and events 7.
The rights attached to a fictional character can be categorized as property rights which include economic and exploitation rights. This means that the owner of the fictional character has the right to receive benefit from its use as well as has the right to dispose it. 8
The fictional characters are divided in to 4 categories on the basis of their origins-
- Pure characters i.e. those characters that do “not appear in an incorporated work”.
- Literary characters which arises out of novels or scripts with description and action and thus creating the character.
- Visual characters, as found in live-action movies (Krish, James Bond etc)
- Lastly, Cartoon characters, a broader term than just animation, but used in reference to all line drawings of a perceived simplicity9.
Merchandising of fictional characters involves the use essential personality features of fictional characters in marketing of the goods. Character merchandising of cartoon characters involve the use of their image and the appearance of the character and such an appearance can be 2-D involving stickers or drawings as well as 3-D involving key rings etc.
In personality merchandising the celebrity licenses his persona to be used for enhancing the image of the goods in the eyes of the prospective customers or consumers. The term persona refers to the characteristics which make up the person’s outward being and by which third parties identify an individual. Films, music, sports, business are the sources where the real persons take up the role secondary role as merchandisers of their personalities.
However, there is further division regarding the celebrities10
First refers to those who are in films, music etc, here the product is not of much importance but the image or the name of the celebrity it bears is the main advertising vehicle.
The second category involves a situation when specialists of certain field appear in the advertisement in relation to the goods or services. In this category, the main attraction for the potential consumers is that the celebrity endorsing the product is considered as an expert in the field.
It involves the use of fictional film and television series played by the real actors in the advertising or marketing of goods and services. In these cases, there is a difficulty faced by the public at large in differentiating the real actor from the role portrayed by him, this is because in the minds of the public there is complete association of the real actor to the character played by him which is to the extent that the actor is known by the name of the character.
Protection offered to character merchandising under the Copyright and Industrial Design
A work enjoys copyright protection if it is expressed and constitutes an original work of the author. Such protection is not dependent upon the quality of the work and the purpose for which it is intended. The main reason behind obtaining a copyright protection is to protect the work of the author form unauthorised use and to derive profit out of his creative effort.
The protection under copyright is given during the lifetime of the author and after his death for certain period which extends to 50 years after which it falls within the public domain, thereby creating a balance between the economic right of the society as well as the right of society for cultural expression.
Copyright protection is awarded to fictional characters only if they have acquired distinctiveness in the eyes of the public and have a separate reputation from the work they have been featured in. However, the names of the characters are not entitled to protection under the copyright independent of the work as a whole11.
The courts usually apply the ‘character delineation test’ which was given by the case of Nichols v Universal Pictures12 to determining if such protection exists is whether the particular character is sufficiently and distinctively delineated so that it warrants protection.
Moreover, the 2D works are protected if they fulfill the requirements for copyright protection with emphasis on originality of the work and it is irrelevant whether the work is new. Further, in case of the cartoon strips and the animated work the copyright protection extends to every original and different pose of the character. The protection awarded is also entitled to the 3D and Audio Visual representation of the fictional characters and extends to the pictorial representation of the fictional character including costumes, disguises etc.
The Indian Copyright Act categorizes artistic works to include a painting, sculpture, drawing, engraving, photograph and work of architecture or any other of artistic craftsmanship. However, a character is not protected but only what protected are the explicit drawings whether of a character, a cartoon or whatever it may be. Similarly, under the definition of “literary works” the work which is written down is copyright able. However, a character’s characteristics are not copyright able as it remains in imagination of reader and thus the entire story which if read in entirety gives a hint of the character. 13
Recently, it is the use of fictional characters performed by real actors for marketing and advertising of goods and services. It becomes difficult to differentiate between the actor and the character, as there is such an alliance that the real actor is identified by the character he plays 14. This establishes fictional characters as an enviable property which initiates legal action for modification of his work which are prejudicial to his reputation.
The first Indian case in which a character was recognized to be protectable though indirectly is Malayala Manorma v. V.T. Thomas15 where the court allowed the author of the cartoon character Mr. Thomas to carry on with his drawings even after leaving the employment of the publishers. The Hon’ble High Court opined that since it was Mr. Thomas who had created the character before entering into employment of the publishers, he is the one who should be allowed to carry on the exploitation of his work even after leaving employment. The publishers had no role in creation of the character and hence they are not entitled for any rights whatsoever upon the character. Their rights are limited only to the extent of the cartoon strips created by the author during the course of his employment and published in the news paper. The court explicitly differentiated between the drawings made using the cartoon character and the cartoon character separately. It can be inferred that, copyright over the drawings made using the character would vest with the publishing house (as an artistic work) while copyright over the character would remain with Mr. Thomas. Thus the publishing house was restricted from employing others to create new episodes using the same character.16
The copyright is restricted with respect to personality merchandising, because it does not cover the real person but the person through whose work the essential personality of features of the real person became noticeable, example, in painting or sculpting the artist will get the copyright protection and not the real person whose personality traits are being depicted
However, when it comes to the films, actor also have certain rights which are performer’s right17 and they are only applicable if their country is a party to the Rome Convention’1961.
Besides, the performer’s right, Copyright also involves ‘moral rights’ which involves protection to the authors under Section 57 of the Copyright Act. It provides for protection of author’s work irrespective of the allocation of copyright. It involves those acts of distortion or modification of his work which are prejudicial to his reputation.
In order to be protected under Industrial Design Act, there are certain essentials which need to be satisfied-
1. Refers to the ornamental aspect of a useful article including shape or colour etc;
2. Appeals to the sense of sight.
3. Must be reproduced through industrial means 18.
If the last condition is missing then the creation will be governed under the sections of the Copyright act rather than Industrial Design act.
Industrial Design protection is mainly relevant for cartoon characters represented in the form aesthetic designs for 3D articles which belong to the toy and jewellery fields like pins, brooches, and action figures etc. which usually originate in the cartoons but sometimes in real persons as well19
Clash of laws between Copyright and Industrial Designs
The section 1520 of the Copyright Act, read with the Section 2(d)21 of the Industrial Design Act has eliminated the possibility of dual protection for the work under copyright and design act so as to prevent the overlapping under both the laws. Therefore, in India both these intellectual property rights are mutually exclusive of each other 22
A Copyrighted work which has been exploited23 as an Industrial Design without applying for its registration under the Design Act, then such work loses protection under the Copyright Act and is also not entitled to get protection under the Industrial Design Act. This is because it lacks novelty or originality having been published prior to filing an application for its registration as an Industrial Design24.
Trademark Licensing in Character Merchandising
The essential features of the character can be are subjected to the protection under trademarks provided they fulfill the requirements of registration. However, when such a character enables differentiating its goods from that of other it becomes a common law trademark without even registration. The license must clearly state the following characteristics-
– Which feature of the character has been licensed, like name, image etc,
– The field of activity for which the character has been licensed along with the territorial scope of exploitation.
– The products or services for which the licensing has been acquired and the legal form which has been used to gain licensing. 25
There are three types of trademark as described under the trademark law
A character used on a variety of goods, such as Tarzan having no independent trademark significance.
The use of a well known trademark on goods which are different from its primary identification, for example, coca cola being printed on shirts.
Use of marks which are not only to decorate the goods but also to identify the source of the goods as well.26
Importance of character merchandising contracts under the trade mark
Quality control by the proprietor of the trademark over the use of licensed mark is an independent requirement both under the common law as well as statutory requirements as to trademark law. Under this requirement, the licensor has to control the quality of goods and services of the licensee. This however, does not mean that the licensee has to obtain highest possible quality standards but it means that the standard of the quality can be altered by the licensor from time to time on the basis of the licensing contract27.
The importance of the quality control can be determined from the fact that trademark is not primarily an indicator of the source but it becomes valuable property itself. Hence, the emphasis of the quality control is not on tracing the source of the product but to enhance the proprietary interest of the licensor/ proprietor of the trademark. Therefore, quality control takes the shape of enforcing high quality while avoiding confusion to the public remains only secondary or non- existent source28.
Trademark and Passing off
The ability to license the commercial value of one’s persona is an intellectual property29. The law of trademarks could be used by a person to restrict the use of his persona in association with any product, it is similar to the right of publicity claimed by the celebrities to enforce false affiliation. Such a protection is provided under Section 14 30 of the trademark Act.
In Irvine v Talksport Ltd.,27 the plaintiff was a successful Formula I driver, his picture was used by the defendant on one of their brochure covers. The right to use the picture had been legally obtained, but the defendant had tampered the picture, removing the mobile phone that the plaintiff was holding and replacing it with a radio with the words ‘Talk Radio’. The plaintiff brought an action for passing off. The court stated that it was common for famous people to get exploitation of their names and images by way of endorsement, held that the plaintiff did have a substantial reputation or goodwill and the defendants had created a false message and so were liable. It was held that there was no requirement for t he plaintiff and defendant to be engaged in a common field of activity.
If the actions of the defendant produced a false message which would be understood by the market to mean that his goods have been endorsed or recommended by the plaintiff, then the plaintiff can succeed in passing off.28
Similarly, in Bi-Rite Enterprise v. Button Master,31 the right of publicity was held to grant a person an exclusive right to control the commercial value of his name and likeness and to prevent others from exploiting that value without permission. The right of publicity is available only to human beings and is not available to non-living entities.32
In India, the right of publicity is yet to develop as an independent legal right. So, the publicity right is a function of various legal doctrines such as privacy, defamation, trade mark, copyright which are discussed below. In case of unauthorized use of a celebrity’s persona,recourse could be made to any of these laws depending on the facts of the case.
In Sahara One Media and Entertainment & Ors v. Sampat Pal & Ors33 , Sampat Pal, the plaintiff filed a suit for permanent injunction and damages in the Delhi High Court claiming infringement of privacy and defamation against the defendant. The suit was filed to restrain Sahara One Media & Entertainment & Ors for releasing the film Gulabi gang which she claimed was her life story which was converted in a move. She claimed that the portrayal of the characters in the film defamed her and degraded her along with the others members o f the organization. She further alleged that the film defamed her and portrayed her work in bad light and in a horrific manner with swords and sickles. The Court allowed the release of the film with a condition in the Disclaimer that Sahara Media a nd Entertainment can show the film by stating that it has nothing whatsoever to do with the life and works of Sampat Pal and her organization.
Similarly, by licensing the trademark element of the character, the owner of the character can prevent the unauthorized use of the character, in Twentieth Century Fox Film Corporation v. South Australian Brewing Co. Ltd34 , an application was made by the producers of the show ‘Simpsons’ to restrict certain breweries from using the word ‘Duff’ which was the drink used by the protagonist of the show. Moreover, the producers had granted licenses for character merchandising activities which involved the depiction of the duff beer. Further, according to evidences both the consumers as well as the breweries association were aware about the association of the beer with the show. Hence, it was concluded, that the breweries had engaged in misleading and deceptive conduct and therefore committed passing off.
Dispute between Character Merchandising and Trade mark Law
Trademarks do not have merchandising properties because they do not have inherent value of their own apart from the goods or services they are associated with, with their primary function being the identification of goods by the public at large. It means that the mark would not protect the fictional character in its entirety but only in its association with the goods or services it is used for. This raises a question, if a trademark owner can protect its trademark from unlicensed use, for example if a trademark can be used for some other purpose by an unlicensed user. In this regard, the courts have various opinion, some courts have ornamental uses of trademark protectable under the current trademark law with relevant test to be consumer confusion as to the sponsorship rather than the source 35, however other have held trademark’s business interest to be basis of such protection36, whereas others have cited acquisition of secondary meaning and trademark dilution as the basis for such protection37.
However, in the case of Chorion Rights Ltd. v. Ishan Apparel & Ors.38., where the plaintiffs were engaged in merchandising activities o f trademark ‘Noddy’ in India as well as the world. however could not bring an injunction against the defendants as they could not establish their claim as prior user and dilution could not be sustained because the defendants had registered and used the same trademark Noddy in respect of apparels prior to the plaintiffs. In this case it was concluded that if a trademark owner wants to go for merchandising he has to accordingly protect his mark for relevant goods and services so as to provide an extra protection.
Further, there is a dispute between character merchandising and trafficking mentioned under the 1958 Act. The term trafficking refers to trading of the trademark as a commodity without attaching any reputation to the marks for the goods concerned. Similarly, character merchandising involves decorating goods with a character which may have reputation different than that of the goods it is being used for, this may lead to trafficking which was prohibited under the trademark 1958 Act.
However, the 1999 Act which repealed the 1958 Act has removed any prohibition in relation to the trafficking. This is because the trademarks in 1999 Act can be treated as commodities with the owner licensing it to the extent that that the mark can sustain itself 39.
Product liability under character Merchandising
The product liability under character merchandising makes any one including manufacturer, distributor etc or any such person who makes the goods available to public is liable for the injuries that is caused due to that product. Some of the US courts have held the licensor liable under the theory of apparent manufacturer which means that the licensor by allowing the use mark which represents his goodwill as well as exercising control on quality of goods are indicative to the consumers that the goods are of adequate quality. 40 But where there are adequate indications that licensor is not manufacture of the goods then his chances for being liable are less.
In India there are no clear answers as yet to this issue of the liability of celebrities for having lent their persona41.
The paper analyses the concept of character merchandising under Copyright, Trademark and Industrial Design Act along with the case laws from US, UK and India and how they have contributed in giving the shape to the concept of character merchandising.
Emphasis has been given on the growth of the concept of character merchandising in India with the help of case laws in the Intellectual Property Rights Domain. It is stated that the concept is though young with respect to the Indian jurisdiction yet, it has incorporated the essential features and protection which have been provided by the different countries. The concept of personality merchandising under the Indian Copyright Act though provides limited protection but when it is read with the doctrines of defamation and privacy, the necessary protection can be availed.
Character Merchandising is a new concept which has gained importance in the last few decades and it is still growing with the licensors being able to merchandise different aspects of the characters, therefore, laws will have to keep pace with the changing nature of the concept so as to prevent exploitation and unauthorized use.
Edited by Sakshi Raje
1. Wipo, Report on Character Merchandising 6(World Intellectual Property Organisation., Geneva, 1994).
2. Definition as given in the report of WIPO on character merchandising as published in report WP/NF/108, December 1994
3. Shoshana Pte Ltd. v. Tenth Cantane Pvt Ltd 1988 ATPR40-851.
4. World Intellectual Property Organization, Introduction to Intellectual Property, Theory and Practice, 308,(1st edition,1997)
5. Ibid at 309
6. Rahul Bajaj, An Analysis of the Burgeoning Character Merchandising Industry in India, Ipleaders, available at http://blog.ipleaders.in/an- analysis-of-the-burgeoning- character-merchandising-industry -in-india/( last visited 24th February)
7. Character M erchandising in Japan- The first eight decades , Helen M carthy wordpress.
8. World Intellectual Property Organization, Introduction to Intellectual Property, Theory and Practice, 308,(1st edition,1997).
9. Leslie A. Kurtz, The Independent Legal Lives of Fictional Characters, Wis. L. Rev. 429, 440 (1986)
10. World Intellectual Property Organization, Introduction to Intellectual Property, Theory and Practice, 308,(1st edition,1997).
11. Du BOoulay v. Du Boulay (1869) LR 2 PC 430.
12. 45 F.2d 119 (2d Cir. 1930).
13. Sourav Kanti De Biswas, Copyrightability of Characters, Journal of Intellectual Property Rights, Vol. 9, M arch 2004 , p .148-156
14. The following examples can be given to illustrate this notion: from the film industries, Laurel and Hardy, the Marx Brothers, Crocodile Dundee, James Bond 007 played by Sean Connery and Roger Moore, Frankenstein’s monster by Boris Karloff and Tarzan by Johnny Weissmuller; from television series, Colombo played by Peter Falk, the character J.R. in “Dallas,” played by Larry Hagman, or the character MacGyver played by Richard Dean Anderson. In the case of the latter, a T-shirt bearing the image of R.D. Anderson would be referred to as a “MacGyver T -shirt,” while packs of dairy products reproducing the image of R.D. Anderson would mention the name MacGyver, the purchasing of such product giving the possibility of winning secondary “MacGyver” products such as T -shirts or travel bags. In the case of image merchandising, goods or services will be marketed with the merchandising of distinctive elements of a film or series, appearance and dress of the actor when playing the character coupled with memorable aspects of a scene, for example, introductory scenes of the James Bond films, the appearance and weapons of Rambo or the “knife scene” in Crocodile Dundee. Available at: (last visited on 2 nd January, 2014)
15. AIR 1989 Ker. 49.
16. Biswas Supra note 13, available at: (last visited on 2nd January, 2014).
17. See s. 38, Copyright Act, 1957: Performer’s Rights- (1) Where any performer appears or engages in any performance, he shall have a special right to be known as the “performer’s right” in relation to such performance.
(3)During the continuance of a performer’s right in relation to any performance, any person who, without the consent of the performer, does any of the following acts in respect of the performance or any substantial part thereof, namely:
(a) makes a sound recording or visual recording of the performance; or
(b) reproduces a sound recording or visual recording of the performance, which sound recording or visual recording was –
made without the performer’s consent; or
ii. made for purposes different from those for which the performer gave his consent; or
iii. made for purposes different from those referred to in section 39 from a sound recording or visual recording which was made in accordance with section 39; or
(c)broadcasts the performance except where the broadcast is made from a sound recording or visual recording other than one made in accordance with section 39, or is a re-broadcast by the same broadcasting organisation of an earlier broadcast which did not infringe the performer’s right; or
(d)communicates the performance to the public otherwise than by broadcast, except where such communication to the public is made from a sound recording or a visual recording or a broadcast, shall, subject to the provision of section 39, be deemed to have infringed the performer’s right.
18. Sec 2 (d) of Industrial Designs Act, 2000.
19. WIPO, Report on Character Merchandising 20(World Intellectual Property Organisations, Geneva,1994).
20. Special provision regarding copyright in designs registered or capable of being registered under the 1 [***] Designs Act, 1911. —(1) Copyright shall not subsist under this Act in any design which is registered under the 1 [***] Designs Act, 1911 (2 of 1911) 2 .(2) Copyright in any design, which is capable of being registered under the 1 [***] Designs Act, 1911 (2 of 1911) 2 , but which has not been so registered, shall cease as soon as any article to which the design has been applied has been reproduced more than fifty times by an industrial process by the owner of the copyright, or, with his licence, by any other person.
21. Section 2(d) in the Designs Act, 2000(d) “design” means only the features of shape, configuration, pattern, ornament or composition of lines or colours applied to any article whether in two dimensional or three dimensional or in both forms, by any industrial process or means, whether manual, mechanical or chemical, separate or combined, which in the finished article appeal to and are judged solely by the eye; but does not include any mode or principle of construction or anything which is in substance a mere mechanical device, and does not include any trade mark as defined in clause (v) of sub-section
(1) of section 2 of the Trade and Merchandise M arks Act, 1958 (43 of 1958) or property mark as defined in section 479 of the Indian Penal Code (45 of 1860) or any artistic work as defined in clause (c) of section 2 of the Copyright Act, 1957 (14 of 1957);
22. Raman Mittal, Licensing Intellectual Property, para 10.3.3, Satyam Law International, 382 (2011).
23. Exploited as Industrial Design means that the article to which the design has been applied has been reproduced more than 50 times by some type of mass production not necessarily production by machines and may include mass produced by the hand objects.
24. Shaping the Future: A Guide on Intellectual Property Rights for the Indian M achine Tool Industry, V. 4 (UNIDO and WIPO, 2005).
25. Raman M ittal, Licensing Intellectual Property, para 10.4 pg 390 (Satyam Law international, Ed., 2011).
26. White paper, “Reform of the trademark law”, Cm 1203 (1990) para 4.41.
27. Bostitch Trademark (1963) RPC 183.
28. Wilkof J. Neil and Daniel Burkitt, Trademark licensing 113 ( Thomson, II Ed., 2004).
29. Acme Circus Operating Co. v. Kuperstock 711 F2d 1538 (11th 1983).
26. 555 F. Supp . 1188 [S.D.N.Y.] 1983. See also Krouse v. Chrysler Canada Ltd. (1971) 5 C.P.R. (2d) 30.
27. See ICC Development (International) Ltd. v. Arvee Enterprises and Anr., 2003 (26) PTC 245 (Del). The court reasoned that copyright law, trade-mark law, dilution law and unfair competition law provide full protection against all forms of appropriation of property to such legal entities.
28. CS(OS) No. 638 of 2014, Delhi High Court.
29. ( 1996) 34 IPR 225.
30. National Football League Properties v. New Jersey Giants, 637 F.Supp . 507 (DNJ 1986).
31. Boston Professional Hockey Association v. Dallas Cap & Emblem Manufacturing, 510 F. 2d 1004 (5th 1925).
32. National Football League Properties v. Consumers Enterprises Inc., 26 III App . 3d 814, 327 N.E. 2d 242 (1975).
33. A. No. 8043/ 2009 I CS (O)S No. 1154 /2009 (Delhi 2010).
34. Comparing the Indian position with UK 1938 Act of UK ha similar provision restricting trafficking but the 1994 Act had omitted any reference to trafficking.
35. See S lavin v. Francis H Leggett & Co., 177 A 120 (1935); Swift v. Blackwell, 84 F 2d 130 (1936).
36. Licensing one’s persona: analysing the practice of personality merchandising, Raman M ittal, (2010).