In late September of last year, Beijing’s No 1 Intermediate People’s Court heard a case involving Chinese Press using pictures of Beatrix Potter’s fictional character, Peter Rabbit, on books. The British company Frederick Warne Co. Ltd. alleged infringement upon their trademark of Peter Rabbit illustrations, which was registered in 1994 (a decision has not yet been reached in case).
The rights attached to a fictional character can generally be referred to as “property rights”. As is case with most property, those rights include right to use a fictional character’s name, image, appearance, etc., to receive benefits resulting thereof and right to dispose of it. These rights are in principle owned by creator of that character unless lawfully transferred, created in course of his professional activity for his employer, commissioned to be created, or conferred on creator’s descendants for exploitation of his/her work.
The secondary exploitation of a fictional character’s essential features by its creator in relation to various goods and/or services to exploit consumers’ affinity with that character can be defined as character merchandising. This merchandising activity is very seldom conducted by creator of fictional character, and thus various property rights vesting in character are subjected to contracts which authorize one or several interested third parties (the merchandisers) to use character. The main economic rights relevant to merchandising of characters are rights of reproduction, adaptation and communication to public in any manner or form--books, for example.
Beatrix Potter was a pioneer in secondary exploitation of literary works. The animal characters from books Peter Rabbit and Squirrel Nutkin were recreated and are still being recreated as still as soft toys or other articles for children. This merchandising successfully continues today, with a wider range of merchandise. On May 25th, 1919, Frederick Warne & Company Limited was registered. Although imprint is still used by Penguin Books, Frederick Warne & Company Ltd really ceased to exist on December 31st, 1984.
The rights attached to a character may enjoy legal protection in a number of forms, either automatically (copyright), or following an act before a competent authority (for example, trademark or industrial design registration).
Copyright protection starts on date of creation of work as expressed in a material form such as writings, drawings, etc. Contrary to industrial property rights such as trademarks or industrial designs, a work enjoying copyright protection is protected against all unauthorized uses, irrespective of goods or services covered by each use. Generally, no one may exercise economic or exploitation rights without authorization of copyright owner. Needless to say, enforceability of such IP rights is not dependent upon effective registration or patent granting, although there are public registrars to this effect that provide evidence of date of creation of such works.
It is generally accepted that copyright must be recognized and protected at least throughout life of author. After his/her death, his/her work continues to be protected for a certain time. Under Article 21 of China’s Copyright Law, copyright protection extends through lifetime of author and 50 years after author’s death. Article 21 later states in paragraph two that “where copyright belongs to a legal entity… period shall be fifty years provided that any such work has not been published within fifty years after completion of its creation”. Upon expiry of term of protection, work falls into public domain. It is no longer protected by copyright and can be used by anyone without authorization.
It should, however, be noted that, through other forms of legal protection (for example, trademark protection), some works may continue to be protected against unauthorized use. Because Beatrix Potter created fictional character of Peter Rabbit herself, she enjoyed copyrights until her death in 1943. Afterwards, copyright was probably managed by her descendants unless previously transferred by an act of law thereafter for following 50 years.
Copyright vs. Trademark (Effectiveness in its Use for Fictional Characters)
When does a fictional character become a trademark in a strict sense? A mark is a symbol which distinguishes goods or services of one entity from goods or services of another entity, that is, it is intended to indicate who is responsible for goods placed before public. There may be many makers or sellers of same goods, and they may all use different marks which all consist of pictorial devices, without any words at all. The consumers distinguish between goods of competing traders solely by means of their marks on basis of expected properties or a certain quality. When any consumer tries to purchase one of these books online, a notification comes up on screen: “The Penguin Online bookshop is recommended online shop from which to purchase Beatrix Potter titles”. This is a good instance of natural way trademarks work: Penguin Publishers is industrial origin of books, and little logo of a penguin appears in these goods to tell consumers which is publishing company.
For that to be possible, marks must be clearly recognizable. In other words, marks must be distinctive in order to apply for registration, as referred to in Articles 9 and 11 of PRC’s Trademark Law. But then, how distinctive is a trademark consisting of a globally known fictional character first published and thus introduced to general public in 1902? Article 9 of Trademark Law sets forth condition that applied trademark “shall not conflict with any other legal rights acquired earlier by others”. It could be argued that when a fictional character’s copyright expires and falls into public domain, it forms part of that ‘conflicting’ legal art and rights, as it is a legal text (Copyright Law) which concedes this right upon citizens.
A second point on effectiveness of PRC trademark law for fictional characters is that a trademark must be used in same way it is registered and for goods or services so elected, as set forth in Article 51 of PRC’s Trademark Law. It should be noted that, mainly in case of cartoon strips and animated cartoons, copyright protects each different original pose adopted by character. The same cannot be expected from a trademark, which, one can argue, makes it rather impossible for any trademark consisting of a fictional character of public domain to be distinctive at all.
In a further argument on this issue, PRC Trademark Law states in Article 1 purposes of trademark registration such as “…pressing producers and sellers to guarantee quality of goods and services, maintaining repute of trademarks, safeguarding interests of consumers…” However, neither a merchandising agency nor creator of a character will themselves be engaged in manufacture or marketing of secondary products, and it will therefore be difficult for them to acquire trademark rights over a fictional character, as they will not themselves be dealing with goods or services and be thus held liable for their quality as stated in Article 7 of Trademark Law which sets forth trademark user’s liability for quality of goods to which trademarks were applied. And even if a merchandising agency or creator of character were involved in producing and selling at some levels, Article 40 sets upon licensor duty of supervising quality of such goods, and obligation to indicate “the name of licensee and origin of goods”. So here again, trademarks are meant to work as a link between product and its industrial origin, which ultimately provides useful information to consumers.