Expedia filed suit against Xpedior on Dec. 7 in U.S. District Court for the Central District of California, alleging that Xpedior's name infringes on Expedia's own trademarked moniker. According to a regulatory filing Xpedior submitted with the Securities and Exchange Commission, Expedia is seeking an injunction and unspecified damages.
Expedia product manager Suzi LeVine said her company was concerned that consumers would confuse the two companies. Xpedior has a product called "eBusiness Xpediators" and markets itself as an e-business solutions provider, both of which could lead consumers to perceive that the two companies were connected, LeVine said.
"We want to make sure that confusion doesn't exist," she said.
Xpedior officials declined to comment on the dispute, but the company did discuss the suit in its regulatory filing.
"We do not believe that Expedia's claims have any merit; however, we are in discussions with Expedia to explore the possibility of a mutually amicable solution to this lawsuit," Xpedior said in its regulatory filing.
The lawsuit comes roughly two weeks after online toy store eToys persuaded a state court in California to issue a preliminary injunction against eToy--an avant-garde artists' Web site--to shut down its URL. Expedia, Xpedior, eToys and dozens of other Internet companies are spending millions of dollars on branding their sites and fear that consumers will confuse their names with other sites.
"Your name, brand and address are so intricately linked that it's important in the online space to protect your trademark and your brand," LeVine said. "For us, Expedia has a very special meaning that we will vigorously defend."
LeVine confirmed that the two companies are discussing a settlement of the suit, adding that they had reached a verbal agreement by which Xpedior would change its name and phase out the use of "Xpedior." In exchange, Expedia would hold off on proceeding with its suit to give time for Xpedior to follow through on its promise. LeVine said the two sides had not yet signed the agreement, but she said that a signed agreement was "imminent."
Xpedior chief executive David Campbell declined to comment on the substance of the negotiations. However, he questioned whether a deal was imminent.
"I don't know if you can predict the outcome," Campbell said.
Xpedior closed up 7.25 points, or 38.16 percent, at 26.25.