In what appears to be a classic David vs. Goliath case, Progressive Insurance, one of the nation’s largest auto insurers, is suing Crestview Paint and Body (CP&B) of Crestview, Fla., a business with 40 employees, over a sign in front of the collision repair business. The sign invites Progressive customers to use Crestview’s concierge service for their repairs.

Progressive is suing Ed Lowe, owner of CP&B, for trademark infringement, and he is counter suing Progressive for unfair competition and illegal steering. The two parties have a Nov. 8 date set in federal court in Pensacola, Fla.

“They say I’m confusing their customers, but they sell insurance and I repair cars,” Lowe says. “How can I be confusing them? This is the only lawsuit against a body shop for trademark infringement by advertising to an insurance company’s customers.”

The roadside sign in dispute is at a new claim center facility Lowe opened in January 2007. It’s been flashing its electronic invitation to motorists for about a year. In addition to Progressive, it also invites drivers who are insured by State Farm, Allstate, GEICO, Nationwide, USAA and Farm Bureau to give his business a try. Only one other insurer has complained.

“USAA sued me over the sign about a year ago,” Lowe says. “Four days later they dropped their suit after learning I had representation through my insurance company.” Lowe is insured for advertisement injury through Zurich, but has to pay costs related to his counterclaim suit out of his own pocket.

The costs are worth it, he said.

“Progressive has been using unfair competition against me through my customers for years by telling them they will deny policy limits if they use us instead of a network shop,” Lowe says. “I have sworn affidavits from several consumers who were steered away from my business. Adjusters from Progressive say awful things about my shop to get cars moved from my shop to a Progressive direct repair program (DRP) shop. They are taking away the rights of customers.”

One of the sworn affidavits is from an event that occurred in August 2005, which indicates this has been going on for years, he said.

“Steering a customer in Florida is legal, but it’s not legal to deny policy limits if they won’t use a DRP shop,” Lowe says. “Progressive wants to strong arm me because I’m fighting their illegal procedures of denying policy limits. They are using Mafia-style tactics against the collision repair industry.”

Progressive declined to be interviewed by ABRN. A company spokesperson responded to an e-mail inquiry by writing, “As a general practice, we do not comment on pending litigation, but I can tell you that we deny the allegations against Progressive.”

The legal outlook
Lowe’s attorney, David Henry of the Orlando, Fla., law firm Allen Dyer Doppelt Milbrath and Gilchrist, said illegal steering is a species of unfair competition.

“There is no anti-steering legislation in Florida, but you have a right to bring common law claims for unfair competition and deceptive trade practices,” he says. “The Progressive claims adjusters are slandering my client and his business to get their customers to go to Progressive DRP shops. They can’t say false and misleading statements to drive customers to their DRP shops.”

Lowe said that a Progressive manager admitted during the discovery process of litigation that employees are expected to persuade at least 45 percent of Progressive customers to use DRP shops, and that placing 55 percent of customers in DRP shops is the goal.

Lowe’s sign refers to Progressive and several other insurance companies, just as Progressive uses several other insurance company names in their ads, Henry noted.

“To be a viable claim against my client, he must create confusion in the marketplace,” Henry says. “We don’t hold ourselves out as an agent of Progressive. In fact, we make it clear we are not affiliated with Progressive.”

While this case is being contested in Florida, it has national implications.

“Insurance companies cannot be allowed, through inexperienced claims personnel, to make false and misleading claims to customers to induce them to go to the insurer’s DRP shops,” Henry says. “In addition, Progressive is trying to claim trade right names in ‘concierge service.’ It is a descriptive name that does not have a federal trademark.”

Building the business
Lowe has been in business in Crestview since 1988 and is not a DRP for any insurance company.

“When you sign those contracts you give away all your rights to the insurers,” he says. “DRPs are a lose/lose situation. Since I’m not a DRP, I get paid for vehicle storage, supplements and requested labor rates for the work I do.”

Because insurance companies don’t funnel work into his two shops, Lowe relies on advertising, such as the sign outside his new facility, word of mouth, supporting local athletics and a live talk radio show to build his business. The new shop is part of his company’s growth strategy.

“I built the new concierge center on the main artery of our town to combat illegal steering,” he says. “It’s a more prominent and visible location that will give me more business. The new location, building, sign and advertising work together to help my business grow.”

Lowe’s two CPB facilities employ about 40 people in collision repair, towing, auto glass repair and clerical work. He admits he could change the electronic sign without too much trouble to delete Progressive’s name from being up in lights. But that prospect angers him.

“They’ve already taken away freedom of choice from customers,” he says. “Now they are trying to deny me my freedom of speech with the sign. Where will it end?”

He seems undaunted by taking on one of the nation’s three largest auto insurers.

“I’m too busy protecting my livelihood to worry about being put out of business,” he says. “If I focused on all of Progressive’s resources, I couldn’t sleep at night. All I want to do is show people I am being wronged.”

Lowe said he did not know how much the counter suit will cost because he does not know when the process will end.