In Red Label Vacations Inc v 411 Travel Buys Limited, 2015 FC 19, a recent decision delving into metatags, Justice Manson of the Federal Court recognized that both copyright and trademark rights may exist in metatags, the HTML coding statements that add information—words or small phrases— to a website for Internet search engine purposes, but which are not visible.

Justice Manson specifically found the particular metatags in this case did not contain sufficient skill and judgment to attract copyright protection, and, in any event, that no substantial part of the Red Label Vacations’ metatags, as a whole, were taken. Justice Manson also found that use of a trademark in metatags was not trademark use per se, and therefore, could not, on its own, be used to support a claim for depreciation of goodwill under section 22 of theTrade-marks Act. Further, although recognizing that metatags affect search engine results, Justice Manson did not find that these facts created a “deception” sufficient to ground claims for passing off and, as well, trademark infringement.

Red Label Vacations, which operates an online travel information services and bookings business, brought an action in Federal Court in 2009 against 411 Travel Buys Limited, which offered travel information to customers through its website, and made travel agents available for over-the-phone travel bookings. Red Label Vacations alleged that 411 Travel Buys’ website, which went live in January 2009, infringed Red Label Vacations’ copyright in metatags from its website and also infringed its registered trademarks “redtag.ca”, “redtag.ca vacations”, and “Shop. Compare. Payless!! Guaranteed”. Red Label Vacations specifically claimed that 411 Travel Buys’ use of the trademarks on its own website and in the metatags for that website infringed on Red Label Vacations’ copyright and registered trademarks, constituted passing off, and depreciated the goodwill of Red Label Vacations’ marks. Over $2.1 million of damages were claimed. 411 Travel Buys counter-claimed for passing off.

Justice Manson dismissed all of the parties’ claims.

On the copyright claim, Justice Manson reviewed the test for copyright infringement and found that although it was clear that 411 Travel Buys copied metatags from Red Label Vacations’ website – including by reproducing some spelling errors – there was no infringement. Justice Manson first reviewed decisions that found metatags constituted “formulae derived … to serve a business function” and were merely the “operation of an algorithm” in the context of a search engine, and he also reviewed decisions outlining the copyright principle that where no skill and judgment (i.e., originality) can be said to exist, no copyright exists, and that where the creation and use of a specific element is dictated by law or function, or may only be expressed in a limited number of ways, no copyright exists. Applying these decisions and concepts, Justice Manson held that since the copied metatags were all common generic terms used in the travel industry, Red Label Vacations’ metatags attracted no copyright protection, and were thereby incapable of being infringed. Although recognizing that there may be instances where sufficient originality exists in metatags to attract copyright protection, he found that such a threshold was not met in this case, stating:

“While in some cases there may be sufficient originality in metatags to attract copyright protection when viewed as a whole, the substance of the metatags asserted by the Plaintiff in this case does not meet the threshold required to acquire copyright protection in Canada.”

Moreover, despite stating that the analysis for copyright infringement was qualitative, not quantitative, Justice Manson also held that even if Red Label Vacations’ metatags did attract copyright protection, the taking of the metatags from 48 pages out of 180,000 pages of Red Label Vacations’ website would not constitute the taking of a “substantial part”, a requirement for infringement.

On the trademark claim, Justice Manson accepted that Red Label Vacations’ trademarks appeared in 411 Travel Buys’ metatags. Justice Manson first focused on the passing off claim, finding that there was no misrepresentation to the public, even though the evidence showed the 411 Travel Buys’ use of the trademarks in its metatags influenced Internet search engine results – resulting in 411 Travel Buys’ websites being ranked higher than Red Label Vacations’ – which caused some Internet traffic to be redirected away from Red Label Vacations’ website. While admitting that such activity could constitute “initial interest confusion”, which United States’ courts have recognized as a type of passing off, Justice Manson rejected that such a theory has gained a foothold in Canada. This is of note, since the Supreme Court of Canada in Masterpiece Inc. v Alavida Lifestyles Inc, 2011 SCC 27 at para 73, recognized that goodwill in a mark could be diminished by a consumer’s initial, although eventually remedied, confusion. Importantly, however, Justice Manson held that there could be no deception since all the metatags did was influence search results—consumers still had a chance to review the different websites returned by a search, and retained choice to access the website initially sought:

“The use of metatags in a search engine merely gives the consumer a choice of independent and distinct links that he or she may choose from at will, rather than directing a consumer to a particular competitor. Rankings may affect the choice to be made, but nevertheless, such a choice exists. Even if a searcher is looking for the website connected with a particular trade name or trademark, once that person reaches the website, there must be confusion as to the source of the entity or person providing the services or goods. If there is no likelihood of confusion with respect to the source of the goods or services on the website, there is no support for finding this prong of the test for passing off. Accordingly, use of a competitor’s trademark or trade name in metatags does not, by itself, constitute a basis for a likelihood of confusion, because the consumer is still free to choose and purchase the goods or services from the website he or she initially searched for.”

For the same reasons, Justice Manson held that there was no trademark infringement. Further, on the “depreciation of goodwill” claim, Justice Manson suggested that metatag use would not be “trademark use” under section 4 of the Trade-marks Act, a requirement for a finding of depreciation of goodwill, since metatags are not visible to the public.

In recognizing that both copyright and trademark rights may exist in metatags, Justice Manson’s decision further opens the door in Canada to copyright and trademark litigation concerning metatags.  His decision suggests, however, that it may be difficult to push the door open fully.