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Thankless situation for dueling loyalty programs

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Good manners could be costly: Citigroup Inc. last week filed a lawsuit against AT&T Inc. in the U.S. District Court for the Southern District of New York – all for saying “thanks.”

The bank alleges that the telecommunications company's new customer loyalty program is “confusingly similar” to its own loyalty, reward and redemption programs, according to the lawsuit.

Seeking injunctive relief and damages for trademark infringement, false designation of origin and unfair competition, Citigroup said in the lawsuit that it “has been financially damaged and will continue to be damaged financially” as a result of “AT&T thanks.”

According to AT&T's website, the program is its way of thanking customers “for being the most important part of AT&T.” It will include “tickets to movies and live events, great offers for DIRECTV customers, and personalized offers meant just for you.”

Meanwhile, Citigroup spends tens of millions of dollars annually on advertising and marketing related to its THANKYOU Marks programs, including CITI THANKYOU, CITIBUSINESS THANKYOU, THANKYOU FROM CITI and more, the lawsuit states.

Such programs, which have about 15 million members nationwide, “have been extensively advertised and promoted” since at least 2004, according to the lawsuit. But since at least 1998, Citigroup and AT&T have issued co-branded credit cards, and customers of the AT&T Universal Card can earn THANKYOU points through Citigroup, for example, the lawsuit states.

Citigroup said in the lawsuit that it contacted AT&T after becoming aware of its new loyalty program in March. And in June, AT&T issued a news release announcing the launch of AT&T thanks.

According to the lawsuit, the term “thanks” in AT&T's logo “appears on a different line and in a different color than the AT&T housemark. The use of all lowercase letters and the font in which the term 'thanks' is written are similar to the manner in which Citigroup often presents its THANKYOU Marks.”

Citigroup said in the lawsuit that “consumer confusion or mistake or deception” is likely, and exacerbated by the fact that the companies have a history of co-branding credit cards and services.

It requests that, among other things, AT&T destroy all labels, packaging, banners and brochures that bear the “thanks” or “AT&T thanks” trademark, according to the lawsuit.

“This may come as a surprise to Citigroup, but the law does not allow one company to own the word 'thanks,' ” AT&T said in a statement. “We're going to continue to say thanks to our customers.”