Triple A Wants to Put the Brakes on Auto Warranty Company's Use of Trademark.

DETROIT, June 17, 2009 -- The American Automobile Association, Inc., commonly known as AAA or Triple A, enlisted the federal court system in the hopes of stopping the Advanced American Auto Warranty Service, Inc. from using AAA.

The lawsuit filed in the U.S. District Court for the Eastern district of Michigan asks for compensatory and punitive damages for trademark infringement and unfair competition in addition to a court order prohibiting use of any variation of the AAA trademark.

The American Automobile Association, Inc., is a not-for-profit, non-stock corporation organized and existing under the laws of Connecticut, with its principal place of business in Heathrow, Florida. Originally formed in 1902 with the dual purposes of combating unfair automobile laws and campaigning for better roads and more reliable vehicles, the organization quickly became much more. They currently provide over 50 million members with products and services throughout the United States, such as insurance and warranty coverage; travel, vacation, and automobile products and services; financial advice; and discounts related to travel and transportation.

Adanced American Auto Warranty Service, Inc. is based in Michigan. In or around February 2008, the American Automobile Association began receiving reports from consumers confused by a company named “AAA Warranty” selling automobile warranties.

The Michigan enterprise is accused of advertising and selling automobile-related roadside assistance and warranty products and services under, among others, the marks “AAA Warranty Services, Inc.,” “A.A.A. Warranty Service, Inc.,” “AAA Warranty Service,” “AAA Warranty,” and “AAA Advanced American Auto Rental & Leasing.” They are also the alleged beneficiary of web sites including but not limited to: www.aaa-warranty.com, www.aaawarranty.net, www.thetripleawarranty.com, and www.warrantyaaa.com.

On or about March 5, 2008, a cease and desist letter was sent to the defendant demanding a cessation of continued use of the AAA Marks in connection with its business. Defendant’s counsel responded in a letter dated April 1, 2008, denying any infringement or a bad faith use of the domain names.

The primary purpose of trademark infringement laws is to prevent consumer confusion regarding the source of goods and services. The first party to use a trademark has the superior claim of ownership. As such, they may prohibit other parties from using a mark subsequently on connection with similar goods or services. The marks do no have to be identical, but merely similar enough that they are likely to cause confusion.

A number of variations of the AAA trademark are registered with the United States Patent & Trademark Office, not the least of which are for AAA in connection with emergency road services and insurance services owned by the the American Automobile Association.

If the American Automobile Association is successful in proving trademark infringement, they could recover defendants' profits and any damages sustained by the plaintiff. In assessing damages the court may enter judgment for any sum above the amount found as actual damages, up to three times. When a court finds a defendant intentionally exploited a registered trademark, the court must, unless the court finds extenuating circumstances, enter judgment for three times such profits or damages, whichever is greater, together with a reasonable attorney’s fee unless the injured party elects for statutory damages of $1,000,000.

Absent from the pleading filed by the American Automobile Association is a claim of cybersquatting. Cybersquatting has been defined as registering, trafficking in, or using a domain name with bad faith intent to profit from the goodwill of a trademark belonging to someone else. Cybersquatting is prohibited by the Anticybersquatting Consumer Protection Act which allows a maximum recover of $100,000 per domain.

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