American Airlines has settled a trademark and unfair competition lawsuit with US-based travel agency Expedia.
The airline filed the suit in the US District Court for the Northern District of Texas, Fort Worth Division, in October 2018.
American Airlines accused Expedia of infringing its trademarks for the airline’s AAdvantage loyalty rewards programme. In 2014, the companies signed two agreements in which Expedia was licensed to sell fares for American Airlines flights and promote the AAdvantage programme.
In June 2018, Expedia filed applications to register two trademarks for its ‘Add-On Advantage’ programme in “transport and travel arrangement” and “food services”, covered by classes 39 and 43.
Expedia marketed ‘Add-On Advantage’ as a discount programme which allows customers to bundle airline fares, car rental and accommodation bookings. Some American Airlines fares are offered as part of the programme.
According to the complaint, customers booking American Airlines flights through Expedia’s programme could be asked to provide their user number for the airline’s own loyalty programme and earn rewards on it during the same session.
The airline claimed this was likely to cause confusion over “the source, sponsorship, or affiliation” of Expedia’s ‘Add-On Advantage’ programme.
American Airlines owns ten trademarks relating to its ‘AAdvantage’ programme, registered with the US Patent and Trademark Office (USPTO) from 1983 to 2016. “These marks are assets of incalculable value as symbols of American, its quality goods and services, and its goodwill,” the complaint said.
Under the terms of the companies’ agreements, Expedia undertook not to “use any intellectual property that is confusingly similar to the American marks, including the AAdvantage marks”, the airline claimed.
American Airlines sued Expedia on five counts, including breach of the companies’ written agreements, trademark infringement, unfair competition and trademark dilution. The airline initially sought a ruling enjoining Expedia from infringing its trademarks, and awarding it damages including all profits gained by Expedia from infringing activity.
On December 17, the district court dismissed the case following a joint request by the parties. Terms of the settlement were not made public. According to the USPTO, both of Expedia’s trademark applications for ‘Add-On Advantage’ were withdrawn on December 21.