Could its image take a hit?
Ferrari is currently hard at work developing its first-ever SUV, the Purosangue. Although previous CEO Sergio Marchionne once swore the Italian supercar company would never build an SUV on his watch, times change. Marchionne suddenly passed away and the rise of the high-performance SUV segment, currently led by the Lamborghini Urus, is something Ferrari cannot ignore. But according to the Financial Times, an expected legal setback has come up.
It turns out Ferrari Roma-based Purosangue, which means "thoroughbred" or "pure blood" in Italian, has already been trademarked by - go figure - the Purosangue Foundation, a charity that advocates against doping in sports. The foundation sets up training camps for runners in Kenya and also performs health check-ups for the elderly, claims it registered the Purosangue trademark back in 2013 for clothing and other products.
Ferrari was apparently aware of this fact but an agreement between the two sides could not be reached. The foundation is now seeking to block the Maranello giant's registration to the trademark in Europe. Ferrari, however, is making legal moves of its own. It is now building a legal case on the idea the foundation never put the nameplate to proper use and, therefore, does not have exclusivity over it. More specifically, the charity has not used the name in the past five years.
An attorney representing the charitable foundation claims this is a case of "David versus Goliath." He claims there's more than enough proof of the foundation's activities, such as a partnership with Adidas to manufacture branded clothing. "I am not going to be scared off, even knowing that we are up against one of the most important brands in the world," says Max Monteforte, founder of Purosangue Foundation.
Ferrari has long been known for going to great lengths to protect its brand image and reputation by pursuing legal action. Because of its wealth and global brand stature, it typically wins. But is going after a charitable foundation really the best course of action? Could this situation backfire and hurt its reputation? After all, Ferrari builds cars for the super-wealthy while the Purosangue Foundation aims to provide free health check-ups for poor old people. Ferrari's decision to sue this charity could possibly backfire.
The case is set to be heard by a court in Bologna, Italy on March 5.