The decision by Truist Financial Corp. to delay a name change for the bulk of its branches until at least August 2021 could become a legal liability in fending off a trademark-infringement lawsuit by Truliant Federal Credit Union.
Truliant filed its complaint June 17 against BB&T Corp. and SunTrust Banks Inc., which combined to form Truist on Dec. 7. Truist’s headquarters is in Charlotte and its community/banking hub in Winston-Salem.
Truliant has narrowed the focus of its complaint to the usage of the “Tru” prefix in the Carolinas and Virginia marketplaces it shares with the nation’s sixth-largest bank.
Truliant’s latest request, submitted Friday, represents the credit union’s latest push for a federal judge to halt the process.
The credit union claims a preliminary injunction is timely and necessary to stop further confusion before the Truist signs, logo and color appear at branches in the three states.
The credit union claimed growing consumer confusion between the brands even before Truist debuted Jan. 13 its logo and purple color scheme.
“No harm to defendants would outweigh that irreparable harm to Truliant,” the credit union said.
Todd Hall, Truliant's president and chief executive, said in a statement that "unfortunately, the merged entities have ignored our complaint and we will not tolerate their infringement."
“Our detailed motion and affidavits show not only that their use of Truist is likely to cause consumer confusion, but that it has actually caused confusion among both Truliant’s members and their customers."
"Our motion for an injunction asks the court to put a stop to it.”
Truist said in a statement Tuesday that “the two brands are very different, and we look forward to our opportunity to prove that this action is without merit.”
In its counterclaim, Truist said “the marks — as actually used in the marketplace — could not be more dissimilar, not only in terms of appearance, sound and meaning, but also logo, color scheme, design and stylization.”
“There is no risk that anyone would confuse these marks in context in actual marketplace use.”
Truliant acknowledged in a response that it previewed the Truist logo and colors, “which differ from Truliant’s logo and colors.”
Truist told analysts and investors Jan. 30 it was delaying the bulk of the branch conversions in states where BB&T and SunTrust have significant overlap.
Given the likelihood Truist will convert the Carolinas and Georgia markets last, it could mean late 2021 or early 2022 before Truist signs debut here.
“This is about really the digital investments that we’re going to be making,” Truist chairman and chief executive Kelly King said. “We want to get some of those made before we actually roll out the conversion, and so the branch conversions are delayed some.”
Truliant requests that Truist be prevented from moving forward with marketing Truist at retail or online sites, including applying for Truist trademarks.
Truist submitted the logo and signage trademarks to the U.S. Patent and Trademark Office on Jan. 13. The agency had not assigned a trademark examiner as of Tuesday.
Truliant wants any Truist-branded products to be destroyed. Truliant also wants to be awarded any profits made via the Truist brand as compensatory monetary damages and is requesting punitive damages.
Meanwhile, Truist wants the federal court to dismiss the Truliant complaint with prejudice, meaning it can’t be re-filed.
Truliant cited in its latest response the testimony of UNC Chapel Hill business school professor Nicholas Didow among seven affidavits that it claims are examples of potential consumer confusion. Didow’s affidavit said he was hired by Truliant in August.
Didow conducted both an online consumer survey and an in-person survey in Charlotte.
Altogether, Didow said he found an average of 61% of consumers surveyed “mistakenly believed that Truliant and Truist were (either) the same financial services company, were affiliated, connected or associated with one another; or they did not know.”
“There is a strong and substantial likelihood of confusion among consumers between the existing Truliant and proposed Truist marks,” Didow said. He cited as a particular example confusion that Truliant’s TRU2GO mobile app belongs to Truist.
Truist has not debuted a Truist mobile app but continues to use BB&T and SunTrust apps.
Industry analysts have questioned such a confusion claim considering Truist has $463.7 billion in total assets in its 17-state network.
By comparison, Truliant, based in Winston-Salem, has $2.6 billion in total assets as one of the largest credit unions in the Carolinas.
Truist has claimed that “many banks, credit unions, financial service companies and others use ‘Tru’ in their names without confusion.” It lists the brand logos for 24 financial institutions, 12 of which use the “Tru” prefix and 12 that use a variation of True, Trust or Truity in their brand.
“In this crowded field, consumers can easily differentiate among these various uses of ‘Tru,’” according to the response.
Truliant countered by saying that while it acknowledges other financial institutions use “Tru,” only Truist “provides goods or services within the counties ... in Truliant’s field of membership.”
Truist claims that “by filing this lawsuit, plaintiff Truliant ... is improperly (attempting) to monopolize the common term ‘Tru-.’
“But the truth of the matter is that no one can exclusively own the term ‘Tru.’”