Protecting the Brand
One of a travel company’s most valuable assets is its brand. Name recognition, referrals from past customers, and reputation drive revenue. Recognition and consumer goodwill arise because the company has spent significant resources toward creating, advertising, selling, and providing services under the brand. The brand may acquire trademark status through either the trademark registration process or continuous use.
When third parties claim association with the travel company’s brand without permission (a license), there is significant risk to the goodwill and reputation of the company and likely dilution of the brand value. It is therefore critical to defend the brand and marks from these associations to prevent and minimize damage to the brand, reputation, and goodwill assets.
Protection requires proactive handling of these threats and diligence. Steps to take include monitoring advertising and promotions on the internet and listening to customers who may come across confusing marks or brands. Once it has been determined that a protected mark is being used by another party, notice is usually given through a letter demanding that the misuse or unauthorized use cease and desist. If that is ineffective, then a trademark claim can be brought in court. The legal standard for maintaining that claim is proof that another person or entity has used or is using a protected mark or “colorable imitation” in commerce and that there is a likelihood of consumer confusion because of the other’s use of the mark or imitation. A likelihood of confusion exists when the source or association of a mark or brand is likely to confuse or deceive the consumer.
Harm to Trademarks Through Fraud Is Common
Both the companies damaged by fraud and the sources committing fraud run the gamut of the travel industry. To demonstrate this point, the following examples illustrate how travel companies have proactively protected the reputation of their brands and marks against harm and dilution.
Delta Airlines: Recently Delta Airlines filed suit against a series of travel booking sites: Triposaver.com, Webflyts.com, Triptkt.com, Flyairs.com, 1800Cheapairtickets.com, and Easyflightdeals.com. Delta accuses these sites of misleading consumers by appearing as though they were affiliated with Delta through the use and misappropriation of Delta’s trademarks, causing consumers to be charged inflated fees to cancel flights. The booking companies then fabricated reasons such as medical emergencies when informing Delta of cancellations. As a result, Delta claimed that the sites were engaged in an intentional scheme to harm Delta’s reputation and diminish the value of its marks. In addition, innocent consumers were harmed by being led to believe that there was an affiliation between Delta and these sites through search engine optimization results using Delta’s name or marks and by referring to themselves as “Delta Air Lines” in telephone calls with customers. On September 21, 2017, a proposed settlement was presented to the court in which the defendants would be barred from using Delta’s marks, from profiting from search engine keywords related to Delta and its marks, and from selling Delta flights or modifying Delta reservations.
Travelzoo: According to a suit brought by Travelzoo, in 2015 Travelzoo promoted Mexico resort trips as a result of an advertising agreement with San Diego Travel for pre-paid bookings through Fresh Trips. Hotel rooms were not reserved and hundreds of consumers were left without reservations or stranded. At the same time, Fresh Trips used Travelzoo’s trademark without license in its publications and website. In this type of circumstance, even though the terms and conditions of the bookings may have mitigated Travelzoo’s risk of legal liability to consumers, damage to the brand and reputation can arise from the use of the brand and trademarks in the third party’s advertising, and harm arises from social media complaints by the disgruntled travelers. Of course, the reality of these types of situations is that the company, whose brand is what the consumers see in the sales transaction (in this case Travelzoo), wishes to avoid consumer lawsuits and, as we often see, wants to help travelers who have been placed in untenable situations. As a result, travel companies pay out significant costs to help defrauded consumers and therefore suffer further harm from this type of fraud.
I attend several travel industry conferences each year and have heard from organizers that their delegates are targets of unaffiliated third-party companies claiming to offer discounted flight and accommodation bookings on behalf of the conference-organizing company. If these new bookings are fraudulent, delegates may end up having pre-paid for reservations that were not made, that have additional fees not previously disclosed, or that have unanticipated cancellation fees. Personally, I conduct my own due diligence by, in part, (1) conducting a general internet search about a company, (2) reading the terms and conditions to identify where the company is likely to be based because it is often not obvious on its website, (3) confirming the company’s state registration and licensing in the state that it claims to be based in through the state’s “corporation search” webpage, and (4) searching for current and past litigation through both public and paid docket information. When such unauthorized use of a brand becomes known, the conference organizers typically send out a notice to their delegates warning that they might be contacted by unaffiliated third parties and suggesting additional steps they might take to minimize the risk of fraud.
As these examples show, protecting one’s brand and mark requires proactive monitoring and enforcement of the associated legal rights. Given that brand is one of the most valuable assets that a travel company holds, it is worthwhile to take steps to protect it.