Claudia Pappas, head of trademarks and brand protection at Thyssenkrupp, tells us how she set up a trademark department from scratch, how the global engineering conglomerate forms IP strategies, and the benefits of maximizing in-house (as opposed to outsourced) legal capabilities.
Leaders League. Could you tell me about your professional background?
Claudia Pappas. I began my career in 1997 at an IP boutique in Düsseldorf, handling anti-competition, trademark and design cases for a few big clients. I worked as a partner there for 19 years, until 2015. In early 2016, I arrived at Thyssenkrupp. Despite being more than 200 years old, the company didn’t have a trademark department and had created a patent department only three years before I joined. They were searching for a person to open a trademark department. That’s why I thought it interesting to go in-house.
I put the trademark team together from scratch, assembling a group of prosecutors who now make up half the team. As well as handling trademarks we’re responsible for design protection, trade secret protection and for all contracts related to IP, meaning all R&D agreements and license agreements.
Why was the Thyssenkrupp trademark department only launched recently? What was holding them back?
We are a longstanding engineering company with huge technical experience. Trademarks weren’t a priority, which seemed to me to be an oversight. ThyssenKrupp is a strong brand. We are copied around the world and must constantly deal with infringements. It is a problem of awareness.
But that changed when, in November 2015, the company launched new branding, featuring much more striking colors, and lower-case letters. It was a real modernization of the brand. So, when I arrived, it was a perfect time to start a trademark strategy. I was able to work closely with the communication department from day one.
We are one side of the same coin: communications and trademarks/brand protection. This helped strengthen our brand from both a communications and legal point of view.
How does Thyssenkrupp formulate its IP strategy?
We are securing and protecting our company brands but also our product brands, of which we have many. We also have a lot of old company names. In Germany, we own 25 existing companies still known under their old names - Uhde for chemical plants, Envinox for chemical processes, Rothe Erde for bearings, Blohm und Voss for submarines. These are strong brand names in Germany.
We also protect them. When I arrived, I identified those names as having very strong value. It would have been foolhardy to do away with those old company names because they are synonymous with old values. Many people know these names. I advocated that we use these companies’ names as product brands. For example, we have Uhde, which is very well known as a chemical engineering company. We then use Uhde for all related products. Rasselstein is very well known for packaging steel, so we use it for our steel products. We developed this strategy from the beginning to protect our old company names that are separate from Thyssenkrupp.
I decided to protect them because, as trademarks, it is not only worthwhile to file them, you have to actually use them. In terms of strategy it was the right move too, because it made getting our message out easier, so on the one hand you have to strengthen company brand reputation and on the other hand you also have to protect old values.
This also gives clarity to the different product lines. Our customers really identify with the various company names. They know that these old names equate to quality and tradition. It was also a means of showing that we are one family at Thyssenkrupp.
We also have a strong trademark for Bilstein, the Damper brand. Everyone in motorsports knows it, without knowing it’s a part of Thyssenkrupp. We decided to promote the fact that they are part of us, while also doing some reallocation between Bilstein and Thyssenkrupp.
How would you describe your role?
On one hand, I am a normal lawyer in that here I do the exact same work I did in the law firm – filing, protecting and defending trademarks. As an in-house lawyer you are very much part of the company’s strategy. We decide to file for a trademark because we are using a certain name, or we conduct research in case we infringe third-party rights or want to file a lawsuit. I have a governance role across the different business units.
Describe the relationship between the patent department and other related IP departments in the company?
We are part of the IP department. What I did from the beginning was to build all the structures and processes. Dr. Stephan Wolke [interviewed in Leaders League’s Innovation: Technology & Patents guide] established the patent department three years before I arrived, so there was already a structure in place.
From the beginning I had the goal of implementing design, trademark and brand protection within the patent framework. For example, we have five business areas and 27 business units. We set up a council for each business unit that has different members, and we have established a patent and trademark coordinator.
These councils sit every three months and decide on IP-related issues, which allows each business unit to be directly informed. Because of this structure, there is always a relation between patent, trademark and other IP rights. Also strong across all departments are the research and strategy teams. We have a team that defines IP strategy for the whole company. We are all part of a common strategy, but we have specific teams executing it.
How does this apply to the R&D department?
At a very early stage of the development of any product we need to figure out what the name could be and if the product warrants design protection.
We are responsible for all IP-related contracts, including R&D contracts. We need to know what project they have under development and with which corporation, so we can advise them on the IP-related clauses of R&D contracts.
What recent innovations or new processes are you proud of in terms of trademarks?
We are quite a new department, so I’m proud of the whole set-up we’ve achieved so far. We function as a digitalized law firm and have developed a successful contract management environment.
We’ve also established processes around the world for trademark protection. We have 150,000 people based across 80 countries.
At first, I had to write to our 600 legal entities and 320 lawyers worldwide. Now we have all our trademarks gathered in our system. Before, each legal entity and business unit worked with external lawyers and outsourced many proceedings. We then opted for complete insourcing. Today, the filings for the whole group are now centralized at our Essen headquarters. We are proud of this rapid shift.
This insourcing movement has also had a cost impact. We saved a lot of money because we also benchmark the law firms we’re working with. Before, we were working with some 350 law firms. Now in each country we work with no more than two or three firms; the rest is done in-house.
What are the challenges and opportunities for your department in the next few years?
China represents a big challenge in terms of detecting infringement. We have a big issue in China with elevators, where they are copying our whole plants, company names and brands. I have a particular focus on infringement cases in China.
I also want to focus more on brand name protection. It is a growing strategy and I intend to implement a licensing programme for the firm. The implementation of our trade secret protection system is also an ongoing process that has had some success.
It relates to IP risk management, which will be a core focus in coming years.
This is all leading to better online protection for trademarks and patents and the incorporation of AI in filing and researching processes. This is part of the firm’s overall IP strategy.