Ferrari Loses Testarossa Brand to Toy Maker
Ferrari has recently lost their trademark claim on ‘Testarossa’ according to the German court. Ferrari is famous as an Italian sports car manufacturer, the Testarossa, literally ‘red head,’ being one of its most famous models produced between 1984 and 1996. Kurt Hesse, head of the Autec AG toy company, wanted to use the Testarossa on a variety of different products without paying Ferarri licensing fees.
The dispute was taken to the Dusseldorf District Court. Hesse argued that, as the Testarossa has been out of production for over twenty years, Ferrari has lost exclusive rights to the term. Ferrari countered that it still handles repairs and maintenance of old models. The court ruled in Hesse’s favor, arguing that the repair services were a marked service of Ferrari itself and not a distinctive usage of the Testarossa brand, meaning the term had fallen into disuse.
Regardless of whether one agrees with this ruling, the case demonstrates an important principle of intellectual property law. A central purpose of any form of intellectual property is to encourage creation and innovation, and trademarks in particular to allow customers to know who they are buying something from, preventing fraudulent counterfeits. If an IP is simply being sat on, it runs counter to this purpose, actively preventing new creations or innovations. Customers will not mistake someone else’s products as one of a trademark holder’s if that holder does not use the mark in the first place.