Who would have thought that the children’s cartoon “Peppa Pig” would become something of a political magnet, including in the field of trademarks? Yet over the past few months Peppa has had just as much screen time in the news as on a children’s TV channel.

In November 2021, UK Prime Minister Boris Johnson made headlines after discussing the “merits” of Peppa Pig World at a conference. In his speech, he was enthused by the fact that “a pig that looks like a hairdryer ... would be exported to 180 countries ... [and evidence] the power of UK creativity”.

In March this year, a Russian court has ruled that the children’s cartoon trademarks relating to Peppa Pig can be used and infringed by a Russian “entrepreneur”, without fair payment to, or consent from, the registered owner of the Russian trademarks.

The judge overseeing the case reportedly dismissed the claim after stating that the restrictive economic and political sanctions imposed on Russia allowed it to refuse the infringement claims.

Reports have since been made that the Russian government has issued a decree that allows patented inventions and industrial designs from “unfriendly countries” to be used without permission or compensation. “Unfriendly countries” include the UK, US and affiliated foreign countries.

While a decree has not been given in relation to the validity of western trademark registrations and copyrighted works, following the “Peppa Pig” judgment and the decree regarding patents and industrial designs, it seems inevitable that it is a question of ‘when’ not ‘if’?

What does this mean for western brands?

Refusing to acknowledge existing IP rights reduces any element for competition; it allows for flagrant infringement and stifles creativity.

While at present many highly regarded western-owned businesses have pulled out of or temporarily ceased sales in Russia, it is useful to consider what would happen in the event that any business would wish to re-open in Russia at a future point.

It is conceivable that in Russia, western brands may significantly reduce in value or smaller brands could even become worthless in the jurisdiction because of brand dilution. It is likely to become nearly impossible to stamp out copycats and infringers in a market where western brands have effectively been deemed unprotected. This is another unexpected cost of this awful war, one that the industry and government will have to face.

Brands will have to get creative with how they protect and enforce their IP rights; traditional enforcement methods such as cease and desist letters would become futile and there would be no option to bring enforcement actions in the courts.

The impact of the decision could also spill over into other territories outside of Russia; brands could see a rise in counterfeit and infringing goods being imported from Russia (although this is unlikely to be an immediate effect). Even where there are valid intellectual property protections in importing jurisdictions, brands with large intellectual property portfolios will already be aware of the difficulties and costs in enforcing these rights against infringers and counterfeiters.

The ruling and decree give free rein for Russian businesses, and individuals, to produce, manufacture and sell goods using western trademarks and patents; which they could sell at a much cheaper cost to ‘authentic’ goods and services, which may appeal to consumers in a world where inflation and the daily cost of living is soaring.

It is plausible that consumers may not be aware of where these cheaper goods are coming from if they are purchased from online marketplaces (which present their own enforcement challenges even in jurisdictions with valid IP protections).

Madrid Protocol

As a contracting party of the Madrid Protocol, it will also be interesting to see what impact this will have on Russia’s membership or whether the Russian Federation will denounce its membership entirely.