Days Inn sues former franchisee for TM infringement
US-based hotel chain Days Inn Worldwide has sued a former franchisee, alleging trademark infringement.
Days Inn sued (pdf) Singh Hospitality at the US District Court for the District of New Jersey on Thursday, March 16, arguing that it had competed unfairly, and contributorily infringed and diluted its mark.
According to the suit, Days Inn has used its mark since 1990 and has registered service marks for the term ‘Days Inn’ at the US Patent and Trademark Office.
The marks cover classes 35, 42 and 43.
Through its franchise system, Days Inn provides services to its guest lodging licensees throughout the US. In order to identify the hotel’s services, Days Inn allows its licensees to use the ‘Days Inn’ marks and promote the brand name.
In 2012, Days Inn and a company called North American Partners (NAP) entered into a franchise agreement for the operation of a 168-room hotel.
Later that year, Days Inn, NAP and Singh Hospitality entered into an agreement, under which Singh Hospitality assumed NAP’s franchise rights and obligations for the hotel.
According to the suit, under the agreement Singh Hospitality was “obligated” to operate a Days Inn hotel for a 15-year term, during which the company could use Days Inn’s trademarks.
Singh Hospitality was also required to make “periodic payments” to Days Inn for royalties, taxes, interest and other fees.
It was also agreed that if the franchise agreement was terminated, Singh Hospitality would pay Days Inn “compensation for all damages, losses, costs and expenses” as well as reasonable attorneys’ fees.
Singh Hospitality was also obliged to stop using Days Inn’s mark if the agreement was terminated.
In December last year, Singh Hospitality terminated the agreement.
Despite this, in its claim Days Inn has argued that Singh Hospitality “continued to use the ‘Days Inn’ marks” without authorisation.
Days Inn has asked for actual damages of $168,000 for the premature termination of the agreement, damages, profits, and a jury trial.
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