A small Canadian insurance brokerage is suing to force First Niagara Financial Group Inc. of Lockport, N.Y., to change its name.
Lockport Savings Bank rechristened itself as First Niagara Financial in early 2000. First Niagara Insurance Brokers Inc. of Niagara Falls, Ontario, said it has been trying to get the $8 billion-asset banking company to stop using the name since then.
The two companies, both of which offer insurance products and services, have headquarters about 20 miles apart, and the brokerage has been using the “First Niagara” name since 1984.
Paul M. Fakler, a partner at the Manhattan law firm Moses & Singer LLP, who is representing First Niagara Insurance, said in an interview that it resorted to court action after realizing that First Niagara Financial would not back down.
“They’ve made it clear they just won’t stop until the court orders them to,” he said.
In a lawsuit filed Oct. 10 in the U.S. District Court for the Southern District of New York, First Niagara Insurance said “an alarming number” of the U.S. company’s customers confused by the similar names have mistakenly sent the Canadian company sensitive personal information, including account data, Social Security numbers, and photocopies of driver’s licenses.
First Niagara Financial is accused of deliberate trademark infringement and unfair competition. First Niagara Insurance is asking for at least $532 million of damages and an injunction barring the U.S. company from any use of the “First Niagara” name.
Leslie Garrity, a First Niagara Financial spokeswoman, said in an e-mail Tuesday that it is “confident” it has the right to use the name in the United States.
Several analysts said they were not concerned about the suit.
Jared Shaw of KBW Inc.’s Keefe, Bruyette & Woods Inc., said the damages being sought are comically excessive. “It seems a little bit like Dr. Evil saying he wants $100 billion.”
Richard D. Weiss of Janney Montgomery Scott LLC, said similar names are common in the banking industry. “How many First Feds are there?”
But Mr. Fakler said the proximity of the two companies in this case and the common products they offer make the similarity in names a problem.
The family-run First Niagara Insurance has been involved in a proceeding against the U.S. company in the Patent and Trademark Office for more than five years. Though several early decisions went in First Niagara Financial’s favor, First Niagara Insurance had some success on appeal, according to Mr. Fakler. He cited a partial victory several months ago, when the Trademark Trial and Appeals Board ruled that the similar names could be confusing for insurance products, but not for banking.
However, “all the parties are arguing about in the Trademark Office is whether a trademark can be registered,” he said, and the office cannot speak to a company’s legal right to use a name — the issue First Niagara Insurance intends to resolve with the suit.
Before the banking company changed its name, it had to be aware of the existence of the brokerage, Mr. Fakler said, because it tried twice to buy First Niagara Insurance’s Web domain name, firstniagara.com. (First Niagara Financial currently uses the Web address fnfg.com.)
First Niagara Insurance sells insurance policies to people and businesses in the United States and Canada through third-party brokers, he said.
First Niagara Financial’s insurance unit, First Niagara Risk Management, is the largest insurance agency in upstate New York.