India: Chacha Chaudhary And Character Merchandising

Very recently, Mr. Pran Kumar Sharma, father of the Indian comic book industry and creator of iconic character Chacha Chaudhary, passed away. Chacha Chaudhary, a middle class turban-clad witty old man, who resolves everyone's problems with great ease using his wisdom, is India's most popular and loved cartoon character. Pran created this Indian superhero along with various other captivating cartoons and with them was created history in the Indian comic and children's book industry.

In order to cater to readers from different regions, all the comic strips of Pran are published at least in 10 different languages including English and Hindi. Also, a serial based on Chacha Chaudhari comics, presently airs on an Indian television channel, where Raghubir Yadav portrays the role of Chacha Chaudhary. As expected, the television series has been well received so much so that more than five hundred episodes of the serial have been telecasted.

With Pran's death, an era has come to an end. Nonetheless, what is still alive are the comic icons created by him and cherished by all Indians! Soon after Pran's death, at the twentieth Delhi Book Fair, the publisher of Pran's comic books, Diamond Comics, organized a sale of all his old comics and received overwhelming response from the people of all age groups. Readers from 25 - 30 age group were also interested in old Chacha Chaudhary comic strips. All copies of the strips were sold in the initial three days.2 The death of the creator generated a stir in the country, due to which record sale of his old comics has been happening ever since.

Pran's death also has some legal implications. Since he was the creator of the comic strips and its characters, the copyright over his works and fictional characters will subsists for sixty years calculated from next year, as per Indian copyright laws3. Post the expiry of the copyright term, the copyright will cease to exist in all the works and such works will fall in public domain for everyone to utilize the same. Therefore, it is certain that Pran's comic strips will continue to be re-published, adapted on a broader scale and translated in several more languages by their publishers until the expiry of the copyrights in order to reap maximum benefits from such comic strips and characters within the copyright term.

In addition to the primary mode of exploitation of Pran's works (republications, translations and adaptations), another mode of commercialization, character merchandising based on the fictional characters, which has already started on a minor scale, is extensively anticipated where the said fictional comic characters will be exploited to the maximum.

The present article discusses some aspects of character merchandising, its types, the ownership and legal rights associated with personalities, while mostly focusing on fictional character merchandising. Examples of famous fictional character merchandising from the west and a few notable Indian examples too have been included.

Character Merchandising

In order to understand character merchandising, it is first important to note what is merchandising. Merchandising in its broadest sense, is any practice or plan that contributes to the sale of a product or service to a retail consumer. It encompasses the planning involved in marketing the right product or service at the right place, the right time, at the right price and in the right quantities.4

Character merchandising is the secondary exploitation of the essential features of a popular fictional character or a real person in respect of commercial articles, so that prospective customers are ultimately lead into buying such products due to their penchant for the character or person.5 Simply put, it is commercially using the wide appeal of a popular character for merchandising of products and services.

The exploitation is rarely done by creators of characters. In most cases, it is another person or entity, which is given limited licenses and rights by the owners for merchandising, i.e., for using the characters' specific features in respect of articles of commerce.

In the west, character merchandising is a very common tool with the help of which the reputation and goodwill surrounding a popular fictional character or a real person is exploited.6

Types

Broadly speaking, there are three types of character merchandising.7 The first one is use of characteristic features of a famous fictional human or non-human character, either appearing in a literary work or in a cinematograph film or as an artistic work, for merchandising. The examples of fictional character merchandising include, Pinocchio, GI Joe and James Bond toys, and t-shirts bearing images of Popeye, Powerpuff Girls and Disney characters.

In India, the notable case of fictional character merchandising is the one based on comic character Chhota Bheem that was initially introduced in a television series in 2008. Due to popularity of the series and wide recognition most of the characters acquired within a short span of time, several movies have been made based on the character Chhota Bheem and others. Additionally, the characters have extensively been used on toys, children's apparels and numerous other articles of merchandise. Most revenues associated with the Chhota Bheem series are earned from licensing and merchandising activities. Chhota Bheem is also reaching international markets like Indonesia and Singapore, where it is telecasted in local languages.8 It has emerged as an Indian success story in the merchandising segment.

The second type is personality merchandising where a famous real person, who could be a celebrity from the entertainment or sports industry or a national or international hero, or some of their essential personality features, are used for merchandising; like use of Madonna's name in respect of perfumes; branding of Sachin Tendulkar inspired personal care products under the name 'Sach'; endorsements of energy drinks and cosmetics by various celebrities. This is also called celebrity merchandising.

There is another third type, which is a hybrid of the first two types. It is where the personality features of a fictional character from a movie or tele-series, portrayed by a real person, like character Shaktimaan portrayed by Mukesh Khanna in the television series with the same title, character Captain Jack Sparrow portrayed by Johnny Depp in Pirates of the Caribbean movie series and the characters of Harry Potter movie series, is used for merchandising. The association of the character with the actor is such that the public at large is not able to distinguish the actor from his character and therefore, the merchandising is based on the fictional image of the actor who has portrayed the character. The same is called image merchandising. For instance, toys based on Mukesh Khanna's Shaktimaan's image, video games and costumes based on Johnny Depp's appearance of Captain Jack Sparrow and clothing, eyewear and footwear inspired by Daniel Radcliffe's appearance of Harry Potter.

It could be noted from the above that the subject matter of character merchandising could be as varied as essential characteristics of a personality. The basis of merchandising could range from a simple cartoon character to a non-human character derived from a literary source to a character played by a real person in a movie, drama or television series to a real celebrity. Character merchandising based on fictional non-humans is relatively simpler than the character merchandising based on fictional and real persons, as in case of the latter, identification of essential characteristics of one's image or personality for merchandise is critical and of key consideration.

Legal Framework - Cluster of Rights

The rights of ownership in respect of the subject matter of character merchandising do not belong to one single person or party when real or fictional characters are used for merchandising. For this reason, a single law does not provide protection or deal with legal issues faced in character merchandising. It is a group of laws that affords protection to different aspects of character merchandising and is used for enforcement of a multitude of rights in case of misuse or violations.9

Copyrights

When a fictional character is introduced in a literary work or as an artistic work, it is governed by the principles of copyright law. Typically, authors of the works hold copyright over the fictional characters. However, if the character is a work for hire, the party commissioning the creation of the character holds copyrights. Further, when a fictional character is a part of a movie or a tele series, the producer of the series has copyrights over the character.

It is essential to note that the copyright may not come to exist in any fictional character appearing in a copyrighted work by itself. For a fictional character to be separately covered under the scope of copyright protection, it is important that the character has been treated as an individual work of art.10 It should have been developed extensively and has come to be reputed as a fictional character originating from a movie, tele or cartoon series on its own. Clearly, only when a character has become so extremely reputed already that it is easy to base the whole merchandising scheme around it, it is used for fictional character merchandising. In the landmark case of Star India v. Leo Burnett, the same preposition, mentioned above, was noted:

"The fictional characters are generally drawings in which copyright subsists, e.g., cartoon, and celebrities are living beings who are otherwise very famous in any particular field, e.g., film stars, sportsmen. It is necessary for character merchandising that the characters to be merchandised must have gained some public recognition, that is, achieved a form of independent life and public recognition for itself independently of the original product or independently of the milieu/area in which it appears. Only then can such character be moved into the area of character merchandising. This presumes that the character has independently acquired such reputation as to be a commodity in its own right independently of the goods or services to which it is attached or the field/area in which it originally appears. It is only when this is established on evidence as a fact, that the claimant may be able to claim a right to prevent anyone else from using such a character for other purposes."

Personality rights

The producer of a movie or tele series may not have full rights to exploit the characters that cannot be separated from the actors portraying the same and the image based on the character is built around the actor. In such case, personality rights of the actor also apply in addition to copyrights of the producer. This, at times, gives rise to conflict between the two kinds of rights.

For instance, recently, there was a clash between an actor playing the role of a popular character Gutthi in an Indian television series and a television channel, which is also the producer of the series. Due to this clash, the actor moved out of the tele-series and went on to start his own new show on a different television channel. The first television channel issued a public statement that the character Gutthi has been created for the original tele-series and so, it has copyright over the same. The actor issued another statement asserting his personality rights and saying that it is he who has attained recognition as and is always associated as Gutthi. Owing to this clash of rights, none of the parties could use the character Gutthi in their respective shows during the time of the clash.

Personality rights prominently apply in cases of celebrity merchandising. Copyright is applicable only to the extent there are photographs of celebrities and they are to be commercialized; the photographers have rights over the photographic works.

Trademarks

Since the essential personality features of fictional and real persons are used in relation to articles of commerce, trademark law principles also come in picture in cases of character merchandising. In India, a trademark is described as any device, heading, design, label, word, name, signature, etc., which is capable of a graphical representation and which should be capable of distinguishing goods and / or services of one party from those of the other.11 Owing to this wide explanation, it becomes possible to have the essential personality features of any fictional or real person protected as trademarks. Not only name of a character, but his image, signature, character designs, voice, catch-phrases used by him, and the like, could be protected under the scope of trademark law.

While in case of a celebrity or an artist, one has to consider the most distinctive personality attributes that are famous and worthy of trademark protection, for any fictional character originating from a literary source or a cinematograph film or as artistic work, like a cartoon, it is simply treating such fictional character as a trade indication and using the same in respect of articles of commerce. Character merchandising is the first step for treating famous fictional characters or real personalities as trade indications.

Celebrities also enforce their personality and name rights under the laws of passing off. In a significant case12 concerning the personality and trademark rights of the famous pop icon Daler Mehndi, the pop icon and his associate plaintiff company were able to successfully enforce trademark rights over the name Daler Mehndi against the defendants who earned huge monetary gains by sale of toys based on his personality. Although the name of Daler Mehndi or his essential personality features were not registered as trademarks, common law proprietary rights of the pop star in his name and personality, which were transferred to the plaintiff company, were recognized in the passing off action.

Successful claims of passing off or misrepresentations could also be brought for enforcement of common law proprietary rights by the owners of fictional characters in case essential features of their characters' personality are used without their authorization. Obtaining statutory trademark protection is additionally beneficial in bringing rightful claims of trademark infringement against misuse.

The owners of internationally acclaimed characters like Superman, Harry Potter and the like have also acquired statutory rights by registering the names of the fictional characters as trademarks in India. On the Indian side, the owners of fictional character Munnabhai (that appeared in the movie titled Munnabhai MBBS and its sequel Lage Raho Munnabhai) have also registered such character name as a trademark.

Character Merchandising and Value Transference

Value transference is one of the key branding strategies that big businesses adopt in order to extend their ownership and rights over their products of creativity. It could be explained as "the premeditated use of several IP regimes at specific points across a particular product lifecycle, in order to realize sustainable differentiation"13.

Generally, copyrights, design or patent rights are aimed to be secured on the creations of intellect, depending on the subject matter. These are essentially primary intellectual property rights, which creatives wish to have. However, the primary intellectual property rights are acquired for limited terms and upon expiration, the subject matters fall in public domain for everyone's use and exploitation. Nevertheless, by applying the strategy of value transference appropriately, the owners retain the value acquired in their works by way of primary intellectual property rights through the secondary intellectual property rights, i.e., names, logos and other brand identities, legally protectable as trademarks.14

In character merchandising, the valuable reputation associated with fictional and real persons is exploited and their essential personality features are treated like trade indications. The value of a fictional character, acquired by way of copyright law, is exploited for merchandising. Similarly, in case of celebrity merchandising, the value of a celebrity's name and persona, is commercialized. In turn, such merchandising leads to channelization and retention of owners' rights in fictional and real persons. Character and celebrity merchandising are clearly modes of value transference.

The international giant Disney has set up a perfect example of value transference, where it started trademarking its cherished fictional cartoon characters, like Mickey, Mini, Goofy, etc., when copyrights therein came close to expiry15. Merchandising and theme parks activities based on Disney's reputed cartoon characters were extensively undertaken, which not only escalated Disney's revenue in leaps and bounds, but also helped them in legally claiming and obtaining trademark protection over such cartoons. In addition to common law trademark rights that the cartoons had started to enjoy in respect of merchandise, etc., the artistic works were statutorily protected as Disney's trademarks too. This was one of the key strategies for them to extend IP protection over their valuable characters.

It is noteworthy to mention that the US Congress made several amendments in the US copyright law over the course of decades for retrospectively changing term of copyright for individual works as well as works held by corporates, from which amendments Disney benefitted the most having regard to the extensions of copyright terms in respect of its most famous work Mickey Mouse. From the time Mickey was created in 1928 till date, its term of copyright protection has been extended thrice. Initially, its term of copyright was for 56 years (including renewal terms), i.e., until 1984. Pursuant to the amendments in the law in 1976 (that made the term of copyright for corporate works 75 years), its term of copyright was extended until 2003. The copyright term of Mickey was further extended until 2023, owing to Copyright Term Extension Act of 1998 (also called Mickey Mouse Protection Act) that made the term of copyright for corporate works 95 years from the year of first publication or 120 years from the year of first creation, whichever expires first. Disney is said to have contributed towards such amendments to the US copyright law to a great extent.16

In addition to leveraging from the changes in copyright law, Disney started activities of opening theme parks and giving licenses to third parties for character merchandising. Presently, Disney generates enormous amounts from merchandise royalties. In India alone17, the buyers spend more than a thousand crore rupees on Disney's merchandise ranging from toys and stationery to fashion accessories and clothing to food products, kids' bicycles and LED lighting products. Based on such use of its cartoons, Disney started obtaining and securing statutory protection of trademarks inter alia containing its cartoon designs and names thereof. So, even if Disney's copyrights over its cartoons will expire, Disney's trademarks will continue to protect the same.

It is to be noted that during copyright term also, cartoons could be protected as common law trademarks owing to their reputation, if they serve as 'trade source identifiers', i.e., are used in respect of goods and services. Pleas of passing off could be included along with pleas of copyright infringement in cases of unauthorized use of cartoons used in commerce.18 However, claiming trademark protection of cartoons used in merchandising is the only way out when copyright protection lapses.

Conclusion

India is an emerging business market for merchandising; and character merchandising in the kids segment could fetch unprecedented results. Most fictional character merchandising in this segment in India is based on Disney cartoons, its princes and princesses, Marvel's famous superheroes, Harry Potter characters, Angry Birds, to illustrate a few. Few popular Indian cartoons, like Hanuman in the past and Chhota Bheem presently, sometimes join the league.

This is an ideal time when the most famous Indian iconic comic characters, including Chacha Chaudhary, Sabu, Billu, Pinki, and the like, should be commercialized and exploited for extensive merchandising. Considering that these comic characters and their stories have always been well received by people of all age group, be it in form of comic strips or in a television show, it is imperative to understand the potential in such characters and to diligently take up extensive licensing and merchandising activities.

Footnotes

1 Authored by Suneeth Katarki, Partner and Aditi Verma Thakur, Senior Associate. The views expressed in this article are the personal views of the authors and do not reflect the views of the Firm

2 Pankaj Sharma (2014); "Pran dies but Chacha still alive in the heart of his readers"; Available from http://www.iamin.in/en/new-delhi/news/pran-dies-chacha-still-alive-heart-his-readers-41446 (accessed 3/09/2014)

3 Copyright subsists in a literary and artistic work published within the lifetime of the author until 60 years from the beginning of the calendar year next following the year in which the author dies (S. 22 of the Copyright Act, 1957; Term of Copyright)

4 Based on the definitions of 'merchandising' by the American Marketing Association and BusinessDictionary.com; Available from http://www.businessdictionary.com/definition/merchandising.html (accessed 4/11/2014)

5 WIPO (1994); "Character Merchandising"; Report prepared by the International Bureau of WIPO, WO/INF/108, p. 6

6 Raman Mittal (2011); "Character Merchandising: International Experience And Indian Perspective"; Available from http://www.lesi.org/les-nouvelles/les-nouvelles-online/march-2011/2011/05/01/character-merchandising-international-experience-and-indian-perspective (5/09/2014)

7 WIPO (1994); "Character Merchandising"; Report prepared by the International Bureau of WIPO, WO/INF/108, p. 6 to 8

8 Amit Bapna (2014); "Child's Play: Brands cash in on Mickey Mouse, Angry Birds, Chhota Bheem merchandise"; Available from http://articles.economictimes.indiatimes.com/2014-09-03/news/53522923_1_disney-india-chhota-bheem-hero-cycles (accessed 9/09/2014)

9 Kewalramani and Hegde (2012); "Character Merchandising"; Journal of Intellectual Property Rights; September 2012 Issue; p. 455

10 Star India Private Limited v. Leo Burnett (India) Private Limited 2003 (2) BomCR 655, 2003 (27) PTC 81 Bom

11 Based on the definition of mark and trademark under the Trade Marks Act, 1999 (India)

12 DM entertainment v. Baby Gift House and Others MANU/DE/2043/2010

13 James Conley (2005); "Trademarks, not patents: The real competitive advantage of the Apple iPod" Available from http://www.core77.com/reactor/12.05_ipod_trademark.asp (9 09 2014)

14 Aditi Verma Thakur (2012); "Branding and Business Management: Leveraging Brand Names for Business Advantage"; Journal of Intellectual Property Rights; September 2012 issue; p. 379.

15 Nermien Al-Ali (2003); "Comprehensive Intellectual Capital Management: Step-by-step"; New Jersey, John Wiley & Sons Inc, p. 143

16 Steve Schlackman (2014); "How Mickey Mouse Keeps Changing Copyright Law"; Available from http://artlawjournal.com/mickey-mouse-keeps-changing-copyright-law/ (accessed 4/11/2014); Timothy B. Lee (2013); "15 years ago, Congress kept Mickey Mouse out of the public domain. Will they do it again?"; Available from http://www.washingtonpost.com/blogs/the-switch/wp/2013/10/25/15-years-ago-congress-kept-mickey-mouse-out-of-the-public-domain-will-they-do-it-again/ (accessed 4/11/2014)

17 Amit Bapna (2014); "Child's Play: Brands cash in on Mickey Mouse, Angry Birds, Chhota Bheem merchandise"; Available from http://articles.economictimes.indiatimes.com/2014-09-03/news/53522923_1_disney-india-chhota-bheem-hero-cycles (accessed 3/09/2014)

18 Ivan Hoffman (2003); "The Protection Of Fictional Characters"; Available at http://www.ivanhoffman.com/characters.html (accessed 4/11/2014)

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