This article first appeared in a Special Report published by World Trademark Review on 15 July 2024.
Betting brands can quickly become household names through sports sponsorships, while major sporting events draw millions of players to the gambling industry. But betting brands face their own risks of infringement. Stuart Lester, managing associate at Mishcon de Reya LLP, outlines the strategies that betting brands can employ to manage their IP rights across different jurisdictions.
It is safe to say, the online betting and gaming industry is booming, with global revenue projected to reach $107.3 billion in 2024, alongside a forecast of annual growth rate (CAGR 2024-2028) of 6.51%, resulting in a projected market volume of $138.1 billion by 2028. Analysts believe that this significant rise is fuelled by a shift in customer preferences towards the convenience and accessibility of online platforms, more countries around the world legalising and regulating gambling, and the widespread availability of smartphones and high-speed internet. But where there is money to be made online, scammers and opportunists are never far away. Amid this backdrop of rapid growth and changing consumer behaviour, betting brands face the dual challenge of capitalising on favourable market trends while simultaneously defending their intellectual property against a rising tide of digital threats. Phishing and spoofing attacks, where impersonators create copycat websites or social media profiles, are a common issue. These platforms aim to steal sensitive customer information, disseminate malware or divert traffic from legitimate channels. Cybersecurity and fraud concerns persist alongside cybersquatting issues, with bad actors registering or selling domain names to profit from a brand or create confusion with a trademark. The ease in which scammers can set up fraudulent operations makes them a lucrative venture. Impersonation of legitimate betting brands is a common tactic, often involving bad-faith trademark filings, company name registrations and fake websites. Tackling impersonations is vital to ensure consumer safety and to prevent financial risks and revenue loss due to customer diversion. Negative interactions with fake accounts or websites can also erode trust in a brand.
Techniques used to impersonate a business
Scammers have honed a suite of sophisticated techniques to impersonate and leverage the credibility of established betting brands for illicit purposes.
- Copycat websites – deceptive sites are designed to mirror the appearance of legitimate betting platforms, using similar domain names, logos and web content to create an aura of authenticity. They often claim to hold gaming licences from reputable jurisdictions, display fraudulent links or cite a web of companies in less-regulated territories to feign regulatory compliance and mislead consumers.
- Social media deception – scammers create fake social media profiles and pages that are near-identical replicas of genuine brands’ accounts.
- Bogus promotions – exploiting the allure of special offers, scammers disseminate false coupons and bonuses to entice players. Fraudulent promotions often lead to the misuse of credit card information and hacking of personal accounts, as players are duped into sharing sensitive data under the guise of receiving a reward.
- Trademark and company name misuse – by incorporating company names and filing for trademarks that include well-known brand names, imposters create a veneer of legitimacy. This tactic is designed to trick consumers into believing they are dealing with an authorised entity.
These deceptive practices not only pose a direct threat to consumers but also inflict significant damage on the brand equity and reputation of legitimate betting companies. Understanding and combatting these techniques are therefore critical.
The intricate balance: IP protection amid gambling regulations
Registering your brand is often the first key step to successfully challenging potential IP infringers. For betting brands, in particular, protection of IP rights must be carefully balanced against the backdrop of diverse gambling regulations. Early protection of intellectual property, particularly trademarks, is a prudent approach. Trademark law acknowledges the importance of securing rights early, allowing a grace period for non-use, which recognises the legitimacy of an intention to use the mark within a reasonable timeframe. However, the regulatory environment in the gambling sector often necessitates a cautious approach to the commencement of brand-related activities, particularly in ‘grey’ jurisdictions where the legality of gambling is unclear. This tension can lead to a restrained approach to IP protection, with brands wary of drawing regulatory scrutiny or inadvertently suggesting active business where none exists. In first-to-file jurisdictions, meanwhile, the imperative to secure IP rights swiftly can lead to a race against time and opportunists. IP squatters, recognising the value of well-known betting brands, may file for trademarks and other IP rights with no legitimate interest, intending to hold these rights ransom or to lend credibility to fraudulent operations.
A recent example is the situation in Brazil. Following legalisation of sports betting in 2018, many betting brands hesitated to protect their intellectual property, uncertain of the legal landscape and without an established framework for sports betting operations and licensing. This hesitation allowed opportunists to register domains, trademarks and company names in bad faith. When the law began to take shape, including a framework for sports betting, some brands found that their trademarks had already been registered by others.
Practical tips
In the face of escalating digital impersonation and IP infringement, betting brands should adopt a multi-faceted and proactive approach to safeguard their assets.
Implement advanced monitoring systems
Deploy sophisticated surveillance technology that goes beyond basic watch services. Use AI-powered tools to scan for and analyse potential infringements across various platforms, including e-commerce sites, social networks, and even the dark web. This should cover not just trademarks, company names and domain names, but also visual assets and brandassociated keywords and hashtags.
Secure IP rights proactively
Establish a robust IP portfolio early on, ensuring that all brand assets are comprehensively protected under trademark, design rights, patent and copyright laws. As well as logos and names, consider protecting distinctive brand features such as slogans, colour schemes and unique product features. Seek expert legal counsel to navigate the complexities of international IP frameworks and to leverage grace periods effectively.
Develop a domain name defence strategy
Develop a domain name strategy that includes defensive registrations, particularly in key markets and for common misspellings of the brand name (typosquatting).
Customise filing approaches
Tailor trademark filing strategies to align with the specific legal and cultural environments of each jurisdiction. This may involve segmenting trademark filings to address particular classes of goods or services, or prioritising filings in jurisdictions with a first-to-file system.
Establish robust enforcement and a rapid response
Establish a legal team capable of swift action when infringement is detected. This can include traditional methods of enforcement such as preparing cease-and-desist letters and, if necessary, litigation. However, also utilise online takedown services or other abuse complaint procedures provided by many website hosts, or domain dispute resolution policies such as the UDRP to address cybersquatting issues promptly. Additionally, consider partnering with online marketplaces and social media platforms to facilitate faster removal of infringing content. Many platforms now provide the ability for brands to register their intellectual property with them and enrol in systems that allows brands to identify and report infringing content more easily.
Educate and engage your audience
Create awareness among customers about the risks of copycat and fraudulent sites. Engage with your audience through regular communication and education campaigns that help to identify authentic platforms and promotions.
Leverage data analytics
Use data analytics to understand patterns and tactics of infringers. By analysing the data collected from monitoring efforts, brands can anticipate potential threats and adapt their protection strategies accordingly.
Collaborate with industry partners
Work with other betting brands, industry associations and law enforcement to share intelligence and best practices. Collective action can often be more effective in combatting IP infringement and can lead to industry-wide standards and solutions.
Embrace cutting-edge technology
Betting brands must stay ahead of the curve by adopting the latest technological innovations to protect their intellectual property. Blockchain technology and AI can be used to detect patterns of infringement and automate the protection process. However, as technology advances, so do the methods of infringement. The emergence of deepfakes and sophisticated AI-generated content necessitates advanced digital verification tools to authenticate official communications and marketing materials. Betting brands should invest in technology that can detect and flag synthetic media, and actively educate their customers about these threats.
Enhancing customer experience and market position
By integrating these strategies into their IP management framework, betting brands can not only counteract the current threats but also build a resilient and adaptable defence system that can withstand future challenges in the ever-evolving digital landscape. In the high-stakes game of online betting and gaming, the strategic management of intellectual property is not just a legal necessity but a cornerstone of consumer trust and brand longevity. As they continue to race against the ever-evolving tactics of fraudsters and other opportunists, the most successful brands will be those that view IP protection not as a defensive chore but as a strategic asset that enhances the customer experience and fortifies the brand’s market position.