Not resting on its laurels since releasing Squid Game, its most watched series to date, Netflix has been hard at work – filing trade mark applications worldwide to protect the Squid Game name and logos for a wide variety of products and services. Let’s examine why this manner of intellectual property protection is critically important, if not quite a matter of life or death.

Since its release in September 2021, the South Korean Netflix series Squid Game has become a worldwide phenomenon. The show broke all records, with 111 million viewers in its first month of release – unprecedented for a TV series, let alone one in a foreign language.

Squid Game features a group of 456 debt-ridden individuals who are lured to fight for survival, by competing in traditional children’s games with a gruesome twist. They have the chance to win billions of South Korean won if they win a series of six games – but if they lose, they die.

Trade mark filings & classification

Following its massive success, Netflix filed trade mark applications to protect the Squid Game name and logos in over 20 regions, including the EU, Argentina, Canada, Malaysia, Peru, Philippines, South Korea, and the USA.

Interestingly, Netflix is seeking trade mark registration in a number of classes of the Nice Classification system, far beyond the traditional classes that would normally cover a television series.

The Nice Classification is an international system used to classify products and services for the purposes of the registration of trade marks. It simplifies the trade mark process by ensuring that the products and services covered by an application are classified in the same manner in all trade mark offices worldwide that adhere to the classification.

The Squid Game trade mark applications have been filed for an extensive range of merchandise, such as stationery cases, mouse pads, luggage, handbags, mugs, bottle openers, swimwear and even balloons, which are but a few examples of goods falling into classes 16, 18, 21, 25 and 28 of the Nice Classification. These classes mostly cover key categories of merchandising products for the show – including cookie cutters which, as fans will know, feature in one of the show’s deadly challenges.

Why the move to register these trade marks?

Securing trade mark protection will give Netflix exclusive rights over its intellectual property and offer a broad spectrum of merchandise for fans of the show. It will also deter copycats from using the reputation of the show to sell fake merchandise.

Many successful businesses leverage their intellectual property to develop ancillary products and services, using them to attract new customers and to strengthen existing relationships. The efforts taken to protect the trade marks underline the importance of trade marks and merchandising to all expanding businesses.

Merchandising can be defined in the context of the entertainment industry as the licensing of the right to use the film’s name, characters and artwork on spin-off products such as toys, clothing, novelisations and soundtrack albums.

The licensor, who is in most cases the producer of the film, is the owner of the different forms of intellectual property, including trade marks, while the licensee is the authorised manufacturer of products bearing the trade marks or any other form of intellectual property owned by the licensor. Normally the parties conclude a licensing agreement that allows the licensee to leverage popular intellectual property or trade marks to create branded products, usually for a specific period of time.

Merchandising is big business, for big businesses

Merchandising is a major money spinner in the film industry. Star Wars, the epic space opera multimedia franchise created by George Lucas, is said to have generated more revenue from the sale of its toys and licensing income from third parties, than it made at the box office. Other films, including several Disney franchises like Toy Story, Transformers, Despicable Me and Frozen, have had similar merchandising success.

The 2021 License Global Annual Report, which showcases the world's most powerful brands based on prior-year sales of licensed merchandise, is once again topped by The Walt Disney Company, which reported $54 billion in retail sales worldwide of licensed and direct-to-consumer products.

Also featured is the Pokémon Company, which achieved $5.1 billion in retail sales in 2020, a $900 million increase year-on-year. Pokémon attributes retail sales to the franchise growth efforts of its insanely popular video game app, the trading card game, gaming devices, toys, apparel and accessories, tech gear, home decor and more.

These are good examples of successful businesses diversifying their products and ramping up their trade mark protection efforts to match the outpouring of public interest, ensuring that they reap major benefits on the merchandising side too. But what does it mean for small and medium-sized businesses?

Why you should prioritise trade mark protection

Every business, irrespective of the size of its operations, must prioritise trade mark protection. This is why:

By registering a trade mark, you are afforded statutory remedies to prevent someone else from making unauthorised use of your trade mark.

• Registered trade marks may be used as security for debt finance.
• Registration is attractive to licensees as it provides the opportunity to generate royalties.

Registered marks are afforded further protection under the Counterfeit Products Act, as you can apply to seize and destroy counterfeit products.

Trade mark registration strengthens consumer recognition of the brand as well as offers new opportunities for market penetration.

By registering a trade mark, you can enhance your reputation management and also steer clear of customer confusion.

• Trade mark registration can circumvent cybersquatting.
• Registered trade marks are prima facie evidence of ownership and validity.
• “Registered Trade Mark” or other suitable symbols can be used to indicate ownership of marks. This acts as a deterrent to potential infringers.

If you decide to embark on a trade mark filing programme, keep in mind that trade mark protection is territorial. A trade mark registered in one country does not prevent others from registering the exact or similar trade mark in other countries, which is why Netflix protected its trade mark in several countries.

When deciding on which countries to register trade marks in, you might consider factors such as:

• where the products are sold or services offered, 
• where your business has operations, a sizeable revenue stream or consumer bases for the products and services, and 
• if the business anticipates expansion plans abroad.

So whether you are a giant in your field, like Netflix, or an emerging or small to medium-sized business, trade marks are critical business tools that have clear benefits. 

Written by Mpho Dzhivhuwo, Associate, Spoor & Fisher South Africa