Following up on a case we first told you about in March 2007, Canada’s Federal Court of Appeal recently delivered its judgement in the case of Cheap Tickets and Travel Inc. v. Inc.

Disputes between these parties have been underway for some time. In 2002, Cheap Tickets obtained Canadian trademark registrations for CHEAP TICKETS and CHEAP TICKETS AND TRAVEL & DESIGN for use in association with a range of travel agency and other ticketing-related services, claiming use in Canada dating back to July 1997. Emall obtained the domain name in 1999.

In 2003, Cheap Tickets tried to use the CDRP to stop Emall from using the domain. This effort failed, so in late 2004, Cheap Tickets took to the courts, commencing a trademark infringement action against Emall in the Supreme Court of British Columbia.

Likely tired of Cheap Tickets’ attacks, Emall commenced an action in the Federal Court of Canada to expunge Cheap Tickets’ trade-marks. And the Federal Court obliged: concluding that the marks were clearly descriptive of the character or quality of the services in association with which they were registered, the Court expunged Cheap Tickets’ trademarks.

On appeal to the FCA, Cheap Tickets made a variety of arguments: that their marks were not “clearly descriptive” but rather “merely suggestive;” that their marks had acquired distinctiveness at the time applications to register them were filed; that the Design mark contained unique and distinct visual elements, entitling it to remain on the Register.

Again, all of Cheap Tickets arguments failed. The Federal Court concluded that no errors of fact or law could be found in the Trial Division’s judgement; accordingly, Cheap Tickets’ appeal was dismissed.

Beyond serving as another example of the maxim “turnabout is fair play”, there are a couple of important lessons for both trademark owners and advisors arising from this case. For trademark owners, this case is a prime example of the perils of selecting and using trademarks that are strongly suggestive of the products and services offered in association therewith. Such marks, even if secured by a registration, typically enjoy a narrow scope of protection, are highly susceptible to attack, and should be avoided. In addition, if you have already registered trade-marks that “push the limits” of descriptiveness, consider if it is possible to file supporting applications for those marks on the basis of acquired distinctiveness. Had Cheap Tickets done so, or if they had been able to establish acquired distinctiveness at the time of their original filings, they likely would not have lost their registrations.

For advisors: remember that once judgment is rendered and an order made by a court, the Registrar of Trademarks will not tarry in acting upon it, unless a stay is in place. Though it filed an appeal, Cheap Tickets did not seek a stay of the trial judge’s expungement order; accordingly, the Registrar struck Cheap Tickets’ marks from the Registry before the order’s appeal period had even expired. Had a stay been obtained, Cheap Tickets’ registrations would have remained on the Registry through the appeal period, and could have been used to assert claims against third parties while it awaited its hearing before the Federal Court of Appeal.

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Jeffrey Vicq is a Partner and co-chair of the Intellectual Property and Information Technology practice groups at Clark Wilson. A lawyer and registered Canadian Trademark Agent, Jeffrey has written and spoken extensively on IP and commercial law issues relating to the Internet and to e-commerce in Canada.