A Legal Dispute Casts Uncertainty Over a Rainbow Affinity Card

  A card created to tap the sizable and potentially lucrative gay market ran into problems this summer, and its marketing has been suspended.
  The Visa Rainbow Card, an ambitious affinity program that many view as an anomaly to the card industry's lukewarm marketing to the gay and lesbian community, was launched in 1995 by New York-based Citibank. The card shifted to MBNA Corp. in 2002. About 10 cents of every purchase made with the card is funneled to gay-oriented causes, according to the Rainbow Endowment, the not-for-profit group overseeing the card.
  Difficulties arose in 2004 when the endowment's longtime spokesperson, Martina Navratilova, sued Do Tell Inc., the marketing agency that handled the card. The tennis legend alleged that the agency did not follow her request to drop her image from commercials on "The L Word" and "Queer as Folk" television shows she considers risqu?. Navratilova won the suit last summer.
  Navratilova bought the program rights to the card, and Do Tell was dissolved, according to Pam Derderian, one-time CEO of Conshohocken, Pa.-based Do Tell.
  The card is promoted on the endowment's Web site, but attempts to click through the site lead to a page noting that a card application link is not available. Instead, consumers are encouraged to call an 800 number to apply.
  An MBNA spokesperson said the card is not being "marketed at present, but we still support thousands of (Rainbow) cards in circulation and look forward to doing so for years to come." The endowment did not return calls or e-mail messages seeking comment.
  Even before the suit, the card had bounced around a bit. The move to MBNA and its large stable of affinity programs rankled some gay activists. MBNA provides financial support to conservative causes and candidacies, but that issue may have become moot with MBNA's sale this summer to Bank of America.
  Meanwhile, the card has produced modest results, according to some observers. "They may have overestimated their potential market share," says Megan Bramlette, an associate at Auriemma Consulting Group, a Westbury, N.Y.-based firm that specializes in cards. "People take care of donations on their own rather than say, 'Here, let me hand my money over to a credit card company.'"
  The Rainbow Endowment, which receives contributions from the card and from corporate sponsors, has distributed 78 grants totaling $1.5 million in 10 years, according to its Web site. Recipients have ranged from the AIDS Information Network and the American Civil Liberties Foundation to Dyke TV and the Sperm Bank of California.
  Derderian says she and a former partner in Do Tell have formed a new company called 15 minutes Inc., but they have no plans to market a credit card.
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