Intellectual Property Update – June 2007

Federal Court's Expungement Of CHEAP TICKETS Shows Descriptive Marks Are At Risk

On March 2, 2007, the Federal Court issued its decision in Emall.ca Inc. (c.o.b. Cheaptickets.ca) v. Cheap Tickets and Travel Inc. [2007 FC 243], and ordered the expungement of the trade-marks CHEAP TICKETS (TMA564,905) and CHEAP TICKETS AND TRAVEL & DESIGN (TMA564,432) (collectively, the CHEAP TICKETS Marks), on the grounds of descriptiveness. The case serves as a reminder to owners of registered trade-marks that a registration will almost certainly face scrutiny for validity whenever an owner tries to enforce its rights in the trademark. It is also a reminder that it may be difficult to enforce descriptive or very suggestive trade-marks, even if a trade-mark registration has been obtained.

The owner of the CHEAP TICKETS Marks was Cheap Tickets and Travel Inc. (Cheap Tickets or Respondent), a federal corporation using its registered trade-marks in association with the provision of the following services: "travel agency; travel information; travel tours and charters; ticket agency services in the field of transportation, travel, theatre and sports events." Both of its CHEAP TICKETS Marks were registered in July, 2002 on the basis of use in Canada by itself, and by predecessor companies, back to 1997.

In December, 2004 Cheap Tickets and Travel Inc. commenced an action in the Supreme Court of British Columbia against EMALL.ca Inc. c/o/b Cheaptickets.ca (EMALL.ca or Applicant) alleging infringement of the CHEAP TICKETS Marks. By way of affidavit evidence, EMALL.ca describes itself as "the registrant of numerous similarly generic or descriptive Canadian domain names," including its principal website EMALL.CA, an "on-line shopping mall or portal that enables Internet users to visit a wide variety of online businesses." In response, EMALL.ca commenced a proceeding in the Federal Court for expungement of the CHEAP TICKETS Marks on the bases of non-registrability and non-distinctiveness.

In deciding to expunge the CHEAP TICKETS Marks, Justice Strayer explained that a proceeding under Section 57 of the Trade-Marks Act (the Act) is the exercise by the Federal Court of its exclusive original jurisdiction, as opposed to an appeal under Section 56 for which a standard of review should be identified. The Respondent's argument that the CHEAP TICKETS Marks could not be clearly descriptive of the wares, given that many of its sales do not involve "tickets" per se, was refuted...