Under Armour and Nike Settle Trademark Infringement Lawsuit

Since we are in the midst of March Madness, we here at Abnormal Use take this opportunity to relay a recent apropos settlement involving two sports brand powerhouses. According to the Baltimore Sun, last month, Under Armour and Nike settled a trademark infringement lawsuit arising from Nike’s use of the certain phrasing in its advertising.  In its complaint filed early last year in federal district court in Maryland, Under Armour alleged that Nike launched an advertising campaign that appropriated “I Will” prominently and repeatedly, which suggests Under Armour’s longstanding use of its iconic “I Will” tagline for its similar performance products.  Under Armour claimed that Nike used slogans such as “I will finish what I started” and “I will sweat while they sleep” in various social media ads.  The company also complained that Nike used a variation of Under Armour’s phrase “protect this house” by using the Nike tag line “I will protect my home court.” As one might expect, the terms of the settlement were not revealed.  (The Sun quotes Under Armour as saying only: “The litigation has been resolved on a confidential and mutually agreeable basis.”). But one can only imagine the settlement amount was a drop in Nike’s proverbial bucket of revenue.  Quite frankly, when we here at Abnormal Use first got wind of the “I Will” dispute, we thought it was Under Armour’s, not Nike’s, use of the phrase that was causing such flack.  Why?  “I Will” is an appropriate and clever response to Nike’s universally known command “Just Do It.”

UIM Coverage Issue Goes Viral; Great Misunderstandings Ensue

For whatever reason, insurance companies may not have the best reputations. So, it comes as no one surprise that a recent Tumblr post entitled, “My Sister Paid Progressive Insurance to Defend Her Killer in Court,” has gone viral and garnered much attention across the Internet. The piece, penned by comedian Matt Fisher, documents his family’s struggle to recover underinsured motorist (UIM) benefits under a Progressive auto policy. Fisher’s sister, Katie, was  killed  in a motor vehicle accident after another driver reportedly ran a red light.    The liability carrier for the other motorist tendered its policy limits shortly after the accident.  Thereafter, the family turned to Progressive for additional UIM benefits.  For reasons not specifically documented in his post, Progressive denied coverage.  In order to pursue those benefits, the family filed suit against the other driver.  Progressive, as the UIM carrier, appeared in the matter and defended the case.  Although the jury ultimately returned a verdict for the Fishers in the matter following a trial last week, Matt Fisher was none too pleased with Progressive’s conduct, leading him to write a series of posts on the issue.

First off, it should be noted that there is not much information in the public record about the specifics of this case, other than Fisher’s original post and a brief reply from Progressive.  Accordingly, it’s challenging to opine about the specifics of this case without access to trial transcripts, court orders, policy documents, or other information that might usually be available in a reported case. But, as we see it, much of the confusion here lies in the very nature of UIM coverage.

Indeed, following Fisher’s post, a firestorm was unleashed against Progressive.  Celebs such as Wil Wheaton and Patton Oswalt took to Twitter, campaigning against the company.  The story has also been well-documented on other sites, including Thought Catalog and Gawker.  Despite this fanfare, however, Progressive appears to be getting a bad rap, primarily because of a great misunderstanding of the sometimes counterintuitive nature of UIM coverage and benefits.

For starters, we do not know exactly why Progressive denied coverage in the first place.  As noted above, we do not have access to many of the relevant documents in this case, including any letters explaining the denial of coverage. But, we imagine it may have had something to do with perceived liability.  In his own post, Fisher, who attended the trial, admits that there may have been some issue with his sister’s comparative fault:

Now, I don’t discount the possibility that Katie was at fault in the accident, but it never really looked that way. The only witness who gave a statement on the day said that Katie had the light, etc. The totality of the evidence left some room for argument, but that will be the case any time there’s a catastrophic car accident that doesn’t happen underneath an array of video cameras.

Further, as Ted Frank of the Point of Law blog notes:

Maryland is one of the few remaining contributory negligence states: if Katie was 1% at fault in the accident, there is no liability to the other driver or Progressive.

In other words, under Maryland law, if Katie played any role – no matter how slight – in contributing to the accident, Maryland state law would not permit her to recover.  Thus, we must consider “the totality of the evidence” and Maryland’s adherence to the contributory negligence doctrine when analyzing Progressive’s initial coverage decision and subsequent actions in defending the case (as was its right to do so).

Second, a simple explanation of the UIM concept may help to clarify the misguided notion that “Progressive defended Katie’s killer.”  In reply to a Progressive statement that  it did not serve as an attorney for the defendant, Fisher outlined the conduct of “Progressive’s legal team” at trial in support of his argument.  In this instance, both Fisher and Progressive are correct – to a degree.  Progressive did employ lawyers – not in-house – to represent its interests in the matter.  While Progressive essentially stepped into the shoes of the defendant at trial, however, it did not serve as his attorney.  The lawyers represented Progressive.  Even though the defendant may have sat in the chair right next to Progressive’s lawyer, there was not an attorney-client relationship.

To the lay person, it may be a strange dynamic when one’s own insurance company technically “defends” the underinsured motorist.  However, here, Progressive had an ostensibly legitimate coverage position, and this was the forum available to the insured in which to litigate it. While we do not know all of the facts in this matter, nor are we aware of  Progressive’s internal decision-making process, UIM cases are very common and sometimes do culminate in a trial where this very dynamic comes into play.

We recognize Fisher’s frustration.  Sitting through a civil trial and fighting with an insurer is the last thing anyone wants to do after the loss of a loved one.  Just as every accident does not necessitate the insurer paying under its policy, every accident with an uninsured/underinsured policy does not necessarily entitle the insured to UM/UIM benefits.  Insurers, including Progressive, should investigate every accident and accordingly make coverage determinations based on liability and damages.

Choice of Law – Application of the Laws of Multiple States in One Action

One consideration that practitioners need to always keep in front of them is how choice of law principles can affect what state’s law applies in an action. A recent opinion by the District of Maryland is a good example of how the application of choice of law rules can result in the application of multiple states’ laws in one action. Desrosiers v. MAG Indus. Automation Sys., LLC, No. WDQ-07-2253, 2010 WL 4116991 (D. Md. Oct. 19, 2010). This opinion does not discuss any novel choice of law rules but is relevant to show the importance of the question — “What law is going to apply?”

David Desrosiers was killed while operating a horizontal boring machine at work in Maryland. The machine was manufactured and sold by a Wisconsin company in 1953. Bridget Desrosiers sued the manufacturer as well as its holding companies as a result of David Desrosiers’ death asserting various products liability claims. She brought both a wrongful death action and a survival action.

The Maryland district court granted summary judgment for the two holding company defendants and granted in part and denied in part summary judgment for the manufacturer.

In making its determination on defendants’ motions for summary judgment, the court first applied the basic rule that “[i]n a diversity case, the choice of law rules are those of the state in which the Court sits.” Therefore, the Court looked to the choice of law rules of Maryland. “Maryland generally follows the principle of lex loci delicti, which applies the law of the place ‘where the last event required to give rise to the tort occurred.’” Further, in Maryland, wrongful death actions are governed by statute.

Therefore, on Desrosiers’ survival claims, the Court applied lex loci delicti and determined that Maryland law applied because the decedent was at his work site in Maryland at the time of the injury that resulted in his death. However, on Desrosiers’ wrongful death claims, the Court looked to Maryland statutory law that stated that “if a wrongful act occurred in another state, [the Court] shall apply the substantive law of that jurisdiction.” The Court interpreted “wrongful act” as the act that entitles another party to recovery, and since Desrosiers claimed that the machine was defectively designed, the “wrongful act” occurred in Wisconsin where it was manufactured. The Court, therefore, applied Wisconsin law on Desrosiers’ wrongful death claims.

The Court applied both Maryland law and Wisconsin law throughout its opinion. The differences between Maryland law and Wisconsin law were not outcome determinative in this matter; however, it could be in other matters. That said, we need to always determine at the outset of a matter what law applies and be ready for any differences in the application of those states’ laws.