Allstate first began using its registered trademark “DriveWise” in December 2010 and has used it continuously since then. Kia Motors Corporation filed its first trademark application in 2016 for the phrase “Drive Wise” as a stylized design mark.
Allstate sued Kia for trademark infringement, but the judge refused to enjoin Kia from using its version of the phrase. Is it enough to show the two marks are virtually the same?
Here’s some background. As part of its use of its “DriveWise” trademark, Allstate created the Drivewise Program in 2010. The program, which has over 1.1 million participants, has been available in all 50 states and the District of Columbia since 2016.
The Drivewise Program is a driver behavior monitoring system. The insured driver receives a small device which plugs into the vehicle’s on-board diagnostics port and taps into the car’s computer systems. It provides insight into car and driver performance and allows drivers to monitor and improve their driving habits. It also allows Allstate to get an accurate sense of the driver’s habits.
Allstate says it has invested more than $400 million into the development and operation of the Drivewise Program in the U.S., along with an additional $47 million in advertising.
Kia uses the phrase “Drive Wise” to market a set of advanced driver-assistance systems which directly interact with and even control the operation of the vehicle. These safety tech systems include items such as blind spot detection, a lane keeping assist system, autonomous emergency braking and similar features. The inclusion of these features increase the price of a vehicle by between $1,000 and $3,000.
Allstate’s lawsuit against Kia sought a permanent injunction against its use of the phrase “Drive Wise.”
What did Allstate have to prove to win?
According to the federal judge, Allstate had to prove that “DriveWise” was a valid, protectable trademark which it owned. Allstate proved this. It was also required to demonstrate that Kia’s version of the phrase created a likelihood of confusion among ordinary consumers. This, the judge held, Allstate did not do.
The trademark is conceptually weak, the judge said. While Allstate had made a substantial investment in the trademark, it did not show that the phrase had achieved any marketplace recognition.
Also, although the two trademarks referred to in-vehicle technology, they are not closely related and do not directly compete. Allstate failed to demonstrate that there was significant overlap in its and Kia’s marketing channels. There was also no evidence that Kia had intentionally tried to confuse consumers or appropriate any goodwill Allstate had earned.
In trademark infringement cases, it’s not enough to consider the similarity of two trademarks. It’s typically necessary to show that the goods and services of the two parties are the same or related and that the plaintiff’s mark is sufficiently recognized by potential purchasers.