Kars4Kids Awaits Ruling on Decade-Long Trademark Dispute

The case has been winding its way up and down the New Jersey federal court system for nearly a decade. An unfortunate naming coincidence placed Lakewood-based charity organization Kars4Kids at loggerheads with earlier-founded Texas-based charity Cars for Kids (incorporated as America Can), leading both to sue each other in their respective states for trademark infringement. Now, following a December 12th hearing before the New Jersey Third District Court of Appeals, the protracted conflict may be drawing to a close.

Kars4Kids is faced with a trial court verdict of $7.8M in damages to its rival from profits it earned in Texas. The ruling on damages is now on appeal before the district court. “We hope they will vindicate, and the truth will prevail,” said Kars4Kids spokeswoman Wendy Kerwin.

The organizations have been operating in the car donation market since the 1990s, but it was in 2003 that the latent issue between the two broke into open conflict. After Kars4Kids began running ads in the phonetically identical organization’s home state of Texas, they were served a cease and desist letter. Another cease and desist was sent in 2013, whereupon Kars4Kids took the case to court, filing a suit in New Jersey Federal Court in 2014. Cars for Kids then filed their own suit in federal court in Texas.

Cars for Kids contends that the much larger organization with its pervasive jingle makes it hard for their brand to penetrate as a distinct entity. “We spell it right, we do it right,” said Cars for Kids CEO Colin Weatherwax. “I want to make sure that the public knows that there are two different companies. They may sound the same, but they are different.”

Kerwin disagrees. “We have been pouring our marketing brains and blood, sweat and tears into this brand and building it up,” she said. “We are the brand. This other organization is trying to capitalize on our success.”

The two cases were consolidated in federal court in New Jersey, where the court found that Kars4Kids had infringed Cars for Kids’ trademark in the state of Texas and ordered them to disgorge $10.6M in profits to the victor. On appeal, the case was remanded back to the trial court for a review of damages. These were reduced by the trial court to the current $7.8M, and the fate of the award is now back in the court of appeals.