Change at Pernod

Tackling IP change at

brand owners, manage their IP rights and Audrey Yayon-Dauvet, group IP products. In order to ensure the best director at Pernod Ricard, explains possible consistency and harmonisation how she shaped the company’s IP in the protection and defence of our IP rights, we had to put in place an overall function to match the corporate organisation, sharing the same values and culture rules. The IP team I now coordinate is composed of six IP hubs, based near the businesspeople in each major brand-owning Feature by Trevor Little company – for example, in Australia, the United States, the United Kingdom, Sweden Implementing a consistent approach to and France – while also taking into account trademark and brand protection is always the development of the group.” a challenge, but in a company with a This landscape has shifted continuously decentralised portfolio of brands and a as Pernod Ricard has pursued acquisition history of expansion, the job is harder still. strategies (see illustration on page 10). In Yet this was precisely the task facing 2001 the company acquired 38% of Audrey Yayon-Dauvet when she took on the ’s and spirits business, while role of group IP director at Pernod Ricard. in 2005 it took over . “It was Since its creation in 1975, Pernod Ricard after this acquisition, and with the increase has adopted a devolved management in the size of the IP function, that the structure, being organised into a holding general counsel and senior management company, which focuses on strategic decided it was a good idea to look at the IP management and monitoring business structure,” notes Yayon-Dauvet. In 2008 activities, and brand-owning subsidiaries, came the acquisition of the Vin & Sprit which develop products and define the group, leading to the need for a dedicated global marketing strategy for their brands. team in Sweden. Yayon-Dauvet explains: “When I joined Today, the emphasis is on taking a as the global head of IP, a brand-new IP common approach to trademark issues. organisation had to be developed and She explains: “The link between the IP coordinated. Because Pernod Ricard is a hubs, which we do see as one global team, is decentralised group, which is one of its key that each team member works with one strengths, we really had to integrate the specific brand owner to obtain and protect culture of the group into the IP structure.” its IP rights and conduct all the prosecution To achieve this, the decision was taken and enforcement work. They are there to to shy away from creating a central IP manage litigation, advise, negotiate, work function (“by which I mean that we don’t on agreements such as licensing and have all the IP resources based in Paris”), sponsorship agreements, and review and instead create regional IP hubs working advertising materials. They also oversee directly in the sites where the brand owners all internet issues, like domain names (with are themselves located. the support of a single administrative and “The Pernod Ricard holding company technical contact for the whole group) and is not the owner of all the IP rights of the other areas where IP expertise is required, brands – certain of its affiliates, called such as social networking. They are www.iam-magazine.com Brands in the Boardroom 2010 11 Change at Pernod Ricard

essentially involved in everything to do environments, specific markets, with the life of the brand. The hubs provide geographical indications and so on. In the support to the brand owners, which we past, individual actions would have been literally view as internal clients, and work in initiated exclusively locally, and sometimes a coordinated and positive way.” redundantly (eg, two brand-owning companies starting two distinct judicial Selling change actions against the same defendent without Having taken the decision to restructure coordinating their strategies). Today we the IP function, the next step was to sell bring one action and all agree that together this new emphasis on mark protection, and we are stronger.” the implementation of consistent practices, This consistency in approach is also to a cohort of business affiliates who had important in strengthening relations with historically developed their own strategies other business partners. “As well as the – or not. brand owners, Pernod Ricard has its own Yayon-Dauvet recalls: “As there was no integrated network of distributors – over coordinated approach, we found that in 70 affiliates dedicated to the distribution some countries certain brands, such as of our brands. It’s important for them to or , were really well understand how we defend our brands protected, but elsewhere brands were not against lookalikes and counterfeits. The as protected as they should have been in message received from Paris, London, specific emerging, local markets. So we New York, Stockholm or Adelaide has had to explain why IP would benefit from to be the same.” a coordinated approach at the group level. If you have different approaches to the Too much, too young? management of marks or domain names, Restructuring the IP function at Pernod you can suffer from inconsistencies in Ricard was a Herculean task and for many protection and defence. So we put in place early 30-somethings could have been a common rules, guidelines and policies to daunting challenge. Yayon-Dauvet is thus be followed by everyone and had to ensure quick to pay tribute to Ian FitzSimons, that, as well as the IP team, the general counsel of the group, “who gave me businesspeople complied with the global IP the chance to develop the IP structure, to policy in the interest of the group. When we implement global strategies and manage one talked to them about IP, we talked about one of the greatest trademark portfolios in the global IP portfolio for major principles, even world, in addition to the other IP rights though each brand has its own particular owned by the group”.

Managing risk in trademark acquisitions

As a brand-focused business, Pernod Ricard has been involved in In breaking down the issues at stake in a pre-acquisition audit, some high-profile deals, giving Yayon-Dauvet first-hand experience suggests Yayon-Dauvet, the first concern is “the level of protection of some of the issues that can arise when acquiring new brands. and the way the brand has been defended in the past. You need to She is keen to stress the importance of an IP audit, as often the see if there is an issue of co-existence with infringing products, as problems that may be encountered down the line can be identified was the case with , and check levels of infringement. long before they actually occur. “You also have to look at the agreements related to the brand, One is the development of lookalikes on the market – often a including all possible agreements which have an impact on IP. consequence of lack of action by the owner. She elaborates: Really, everything related to the life of the rights. We have also “When we took over Allied Domecq, we acquired the Malibu brand, found it important to go beyond the brand name itself to look at which was not protected against lookalikes by the owner. So when issues such as its treatment on the Internet and the protection of we inherited it, we had to start a strong action plan to go in and product characteristics, such as bottle shapes.” really clean up the market. While the IP audit predominately focuses on levels of protection Now the situation is much more satisfactory and most and past action, it can also contribute to the wider company audit – lookalikes have either drastically changed or disappeared adding additional value to the acquisition process. “We have altogether. If you don’t bring any action against the first or second engaged in peer reviews of litigation and agreements, and lookalike launched into a specific market, suddenly you will be supported other departments, such as the finance department, to fighting dozens as infringers won’t anticipate problems when using give a view on the value of the brand on the legal side. Finally, we the distinctive elements of your brand.” have looked at the strategy to anticipate new territories where the On the other hand, an IP audit can also provide welcome peace brand can be strong in the future – for example, in Asian or South of mind. “With the Vin & Sprit acquisition, for example, we carried American markets. So you don’t look just at the ability to exploit out an internal and external audit to investigate the level of the mark’s position in current markets, but also the possibility protection for Absolut. In this case we were really pleased as the of extending the brand and anticipating a protection strategy for brand had been well protected historically.” the future.”

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Yayon-Dauvet joined from the IP The relationship with outside counsel department of Bird & Bird in Paris, having is also one which is tackled strategically, previously obtained a law degree from the mirroring the decentralised approach to the Sorbonne and Assas in Paris, and a diploma Pernod Ricard business. “We have teams that from Sciences Po, specialising in economy are completely linked to brand owners, but and finance. She recalls: “After my studies, we also develop geographical competence – I spent almost a year as an IP in-house having people in most continents, we try to counsel at Danone, followed by a year at optimise the local expertise of each of these Stibbe Simont (now Latham & Watkins). teams and develop know-how internally. So I then moved to Bird & Bird. I joined three while we use external counsel, it’s important months after they opened the Paris branch, to have our own databases and meetings to in 2000. It was just a small office then and share our knowledge and experience of local I had just one colleague doing IP. However, legislation and case law. When we have I saw the team grow over the following someone in the UK who needs clarification years. It was great to see the development about a US law, for example, they will first of a law firm with great energy and a lot call a colleague in the US to try to find a of ambition, to become a key actor in the solution. After, if the question is too specific, sectors of telecoms, IP and IT – which are we will then turn to external counsel.” now still among its key specialities, In terms of selecting outside counsel, especially in Paris.” it is the individual whom she looks at, After seven years at the firm, she joined rather than firm size and resources. “We Pernod Ricard as group IP director. The definitely consider it more important to beverage giant had not been a previous client, work with individuals than with corporate so she came completely fresh to the company structures. If an excellent lawyer who is and its inner workings – and it was precisely among the most renowned local leaders in these that sold her on the role. “I felt it was a IP is in a big structure, then that’s fine, but great position because when I met people at it really isn’t my priority.” Pernod Ricard, especially the general counsel, I really got the feeling that IP was considered Looking like a problem an important business asset.” Turning to the protection of Pernod Ricard’s trademark portfolio, Yayon-Dauvet suggests The move in-house that while the company faces a range of Yayon-Dauvet now heads up a 30-strong potential issues, the most prevalent are global IP team, including in-house counsel lookalikes and illicit uses of the various and paralegals, and oversees a portfolio of brands. “Some products aren’t concerned at over 26,000 trademarks, in addition to all by this problem; some are locally, some other IP rights, covering more than 150 globally,” she notes. “But most brand owners countries. She has also just been elected in food and beverages face these issues. We vice president of the French Association are in an industry where infringers can of Practioners in Trademark and Design develop a business and mislead consumers Law, which has 760 members. very quickly when successful brands emerge While she spends time coordinating the in a market. Importantly, the development of respective IP hubs, she also works with the lookalikes is often a consequence of the company’s affiliates to promote IP globally. absence of action of the brand owner” (see However, she argues that she does not box on page 9). “want to be just a public figurehead. I also The lookalike problem is particularly want to be working on the ground. I work troublesome if it attacks the heart of a on specific matters considered by senior company’s values – the brand itself. “We Key brand evolution management as strategic affairs, including have strong and even iconic brands, and one key litigations, brand acquisitions, of the mottos of our general management assignments and restructuring. So I still is that the brands are our main asset. We 1975 work on technical IP matters. are also in an industry where we have a “It’s important to do that to understand historical context to take into account. 2000 the concerns of my team and to be the When you talk about or champagne, person they can call, not only with there are real historical environments 2001 organisational and management questions, around the products and we have to take but also technical and legal ones. It’s these into account and be strict about their difficult, though – we work across 150 defence. Also, we are not in an industry 2005 different jurisdictions so we can’t be a where we develop a new spirit brand every specialist on them all, but we can give day, so we have to very carefully protect the 2008 helpful and pragmatic advice to our existing portfolio we do have.” businesspeople in terms of strategy.” Protection can also be extended to www.iam-magazine.com Brands in the Boardroom 2010 13 Change at Pernod Ricard

60-second interview

What aspects of your job do you find the most challenging? lawyer who really helped me at the beginning of my career and has At Pernod Ricard, the multicultural approach can be a challenge also followed me since then. Finally, without the Pernod Ricard IP and not having everyone here in Paris makes it more complex. team, and their enthusiasm and great involvement, all this would Looking more globally, the development of new technologies is a not have been possible. It’s all still a work in progress, but with this challenge for all IP practitioners – particularly social networking and team we can do more. video sharing. These will expand in the future and we all need to be aware of the challenges they pose. If you could make one change to the industry, what would it be? What aspects do you find the most rewarding? I’m not sure I would want a change, but rather an evolution. I think It’s the flipside: the international approach is also a real positive. that in most countries, even emerging markets, there are some Being at the holding company allows me to work on interesting great IP laws. However, what I’d like to see is more efficient global issues. I feel privileged to have access to these. Another enforcement of existing laws. plus is that the general management is really positive about IP protection and adheres to the plan – in fact, they always push What career do you think you would have followed if not law? for more protection. So management support is great. I would have been a chef and opened my own restaurant by now. Parallel to my legal studies, I also studied cooking and I still try to Who has been the greatest influence on your career? cook whenever I have time. That isn’t often, but certainly at the It’s difficult to name one person. Certainly Pascale Gelly, a French weekend I’ll be in the kitchen. markets that have not yet been the focus As in all organisations, a particular of product expansion. The successful action challenge over the past 12 months has been taken in in relation to Blenders Pride maintaining this level of protection while whisky best illustrates this approach. While keeping one eye on the bottom line. She Pernod Ricard had not sold Blenders Pride explains: “As intangible assets are directly in India, it successfully argued that considered key to the strategy of Pernod the brand had a worldwide reputation and Ricard, we haven’t lowered the level of halted the defendants’ sale of whisky under protection in defence of our IP rights or our the Blenders Pride name, which they had enforcement actions due to the economic been using since 1993-94 (prior to Pernod crisis. That said, we are completely in line Ricard’s 1995 application). The decision with the global strategy of the group and affirmed the ‘first past the post’ precedence prioritise certain matters differently. So, of the international trademark held by where there are efforts to rationalise costs Pernod Ricard outside India. and limit expenses, we are part of those On the issue of protecting marks in efforts. For example, we have limited travel countries where Pernod Ricard has not yet expenses and developed video conferences launched its products, Yayon-Dauvet notes: internally. It can actually be a positive – “It is difficult to anticipate all issues, but in everyone understands why we have to cut this case and all others we use the same costs and we don’t see ourselves as different strategy – to protect as much as we can, but from other departments.” in a consistent way. We know, for example, All this makes for a hectic workload – that if we take action in markets we are not and one perhaps not expected when Yayon- involved in and have no solid plans to do so, Dauvet first joined the company. “When I this will put us in a difficult position, as if came to Pernod Ricard, people at my previous we don’t use our rights within a certain firm said I would find it much calmer than period of time (depending on the being in private practice. But the reality is jurisdiction), we could lose those rights.” that I now work a lot harder.”

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