AMERICAN SURVIVES CHALLENGE TO ITS FEDERAL TRADEMARK INFRINGEMENT LAWSUIT
February 6, 2024
On January 23, 2024, the U.S. District Court for the Northern District of Texas (“the Court”) issued a decision in a case filed by American against GTT Travel (“GTT”) alleging various causes of action for federal trademark infringement. After confirming American’s possession of inherently distinctive, and thus legally protectable, trademarks, the Court outlined well-pleaded allegations that GTT misuses American’s trademarks by holding itself out as an authorized agent of American. Specifically, American alleges that GTT uses its trademarks to fraudulently misrepresent itself to customers as an online travel agency operating on behalf of American. According to the Complaint, GTT’s misuse of the trademarks misleads customers into believing that certain unauthorized commercial conduct by GTT, including excess charges and hidden ticket fees, are approved by American itself.
After GTT moved for partial dismissal against American for failure to state a claim, the Court concluded that American plausibly stated claims for trademark infringement, false designation of origin, and dilution under the Lanham Act. Importantly, the Court observed that the factual content pleaded by American allowed it to reasonably infer GTT’s liability for the misconduct alleged under the Lanham Act. For example, the Court concluded that American adequately alleges that it could face reputational damage due to the deceptive and second-rate nature of the travel services offered by GTT and its sub-agents. The pleadings also allege that GTT’s use of the trademarks induces a likelihood of confusion as to the source, affiliation, and sponsorship of the marks, warranting further factual development. The Court agreed and denied GTT’s motions, reasoning that the detail GTT sought in its Rule 12(e) motion can be sought through the discovery process.
If you have any questions, please contact Evelyn Sahr at 202.659.6622 or esahr@eckertseamans.com; Drew Derco at 202-659-6665 or dderco@eckertseamans.com; Jay Julien at 202.659.6648 or jjulien@eckertseamans.com, or any other attorney at Eckert Seamans with whom you have been working.
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