A. Griffiths

A Law-and Economics Perspective on Trade Marks

The aims and scope of this chapter The school of analysis that has come to be known as ‘Law-and-Economics’ involves the use of economic concepts and reasoning in the analysis of legal rules and institutions. It includes both normative analysis, in which the law is evaluated in terms of its contribution to economic efficiency, and positive analysis of the development of the law and of proposals for reform. Some scholars of Law-and-Economics have argued that common law rules have an underlying economic logic and achieve greater economic efficiency than rules imposed through legislation. This chapter will suggest that trade mark law provides some vindication of this view when the traditional limits on the property rights of trade mark owners, which reflected the common law of passing-off, are compared to the trend towards giving them much broader protection against misappropriation and free-riding. Trade marks play an important role in the organization of economic activity. They are the means through which undertakings compete with each other. Thus, after registering a sign as a trade mark for designated goods or services (or ‘products’), an undertaking can use it to confer a distinctive identity on its products when they are ready for marketing and presentation to consumers. Such a distinctive identity enables consumers to recognize the undertakings products and distinguish them from others and to make choices on this basis. For many products, such an identity provides the main reference point for consumers and defines the subject matter of their transactions.

An economic perspective on trade mark law

Contents: 1. Trade Marks in Modern Commercial Life 2. The Legal Nature of a Trade Mark as a Marketing Resource and a Structuring Device 3. The Marketing Power of Trade Marks 4. Trade Marks and the Organization of Economic Activity 5. An Economic Perspective on Trade Mark Law 6. Concluding Thoughts Index

Brands and corporate power

ABSTRACT This article argues that brands, with trade marks as their legal anchors, are important sources of corporate power and have facilitated a significant expansion of this power. Trade mark law has contributed to the development of firms and to the rise of powerful business actors that rely on strong marketing presences based on brands to attract demand, but use flexible supply chains to meet this demand. This article considers the relationship between trade marks and brands and the kinds of corporate power to which brands can contribute. It shows how brands have enabled some firms to transform their activities in response to changing economic and social conditions and even to transform themselves as business actors. Whilst trade mark law provides some mitigation of the power that brands can confer, it can still be substantial and to some extent of questionable social value.

Trade Marks and Business Organisation

Firms use trade marks to distinguish their goods or services from rival products on the market. When a firm registers a particular sign as its trade mark,1 it acquires the exclusive right to use it in order to identify products of the designated kind within the territory of registration.2 A trade mark gives products a distinctive identity, under its owner’s exclusive control, and can provide a convenient identifier and reference point for acquiring and conveying information about these products and for entering transactions. Such an identity roughly equates to the marketing concept of a “brand” and provides a focus for “goodwill”.3 Moreover, this identity, and thus the goodwill focused upon it, need not be tied to a particular firm or to any fixed set of production arrangements.

The Economic Implications of Validating Unauthorised Contracts made by Corporate Agents

This article examines the English law governing the legal effect of a contract made by the agent of a company who lacks the necessary authority to act on the company’s behalf under its internal rules that confer power to make contracts on its behalf. The article focuses on what could be called an ‘overriding rule of attribution’, which ensures that such contracts can still be binding on the company in certain circumstances. It also considers the economic context of this rule, which can be viewed as allocating risk between companies and third parties contracting with those companies. In effect, the law strikes a balance between two conflicting sets of costs and benefits, and this can be analysed in terms of economic efficiency.This article shows that the English courts have taken two differing approaches in establishing the ambit of the overriding rule of attribution and evaluates each of these approaches in terms of their capacity for promoting an economically efficient allocation of risk. It argues that the special circumstances of corporate agency (as opposed to agency for a natural principal) demand a special approach and that the more flexible approach embodied in the so-called ‘indoor management rule’ is more satisfactory in this context and more likely to promote efficiency in the organisation of a company’s management body. However, there need to be some modifications to this approach and a greater acknowledgement of its overall economic context.