SAN FRANCISCO—Wells Fargo Insurance Services USA Inc. has filed suit against newly-launched ABD Insurance & Financial Services Inc., citing trademark infringement on a similarly-named unit the brokerage acquired in 2007.

The suit, which was filed on July 24 in the U.S. District Court for Northern District of California, alleges ABD, a newly-launched brokerage based in the Bay Area and led by former Wells Fargo employees, misappropriated the ABD trademark, which Wells Fargo acquired in 2007 as part of its acquisition of ABD Insurance and Financial Inc.

The suit names current ABD CEO and former Wells Fargo executive Brian Hetherington, and former ABD vp and founder of the Insurance Leadership Network Inc. Kurt de Grosz as defendants. According to the suit, ILN filed an “intent to use” application for the ABD trademark in October 2011 and subsequently recruited more than 50 employees to quit Wells Fargo and join the reconstituted ABD.

Wells Fargo contends that the new company is attempting to build its business based on a misappropriated brand name.

“The ABD brand has established extremely valuable goodwill that was one of the primary reasons that Wells Fargo acquired ABD,” the lawsuit states. “Rather than establish a brand and reputation of their own, the defendants are attempting to misappropriate the goodwill of a recognized brand and compete in a manner calculated to deceive consumers and irreparably harm Wells Fargo.”

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A spokesperson for ABD Insurance & Financial Services Inc. was unavailable.

Laura Schupbach, head of insurance for Wells Fargo, said that the company disputed the contention that Wells Fargo ever sought to sell the ABD brand or business to the defendants. “We have never had any intention of selling any of this business,” Ms. Schupbach said.

She added that the employee defections, which came primarily from Wells Fargo's San Carlos office, accounted for only 10% of the company's employees in the Bay Area and that the company was working to rebuild its business there, noting that the company had hired industry veteran Bob Volkel as head of Bay Area operations. “We've been able to react quickly,” she said. “While this is a very unique situation, staff changes are part of the business when you are company of this size.”

Mr. Vokel said that since assuming his post in July he has been able to rely on other Wells Fargo locations for expertise and support. “When people move on, it opens doors and opportunities,” he said. “I'm excited to be leading this group.”