American Petroleum Institute Sues Motor Oil Marketers for Trademark Infringement

Orange County – The American Petroleum Institute (API) is suing two Michigan-based motor oil manufacturers and distributors of trademark infringement.

According to the lawsuit, filed in federal court in Washington D.C., API is accusing the two companies of selling engine oils that bear its trademark without its permission. API charges that Detroit-based U.S. Energy Resources LLC and Warren-based Babylon Trading & Development are not licensed to use its trademark and that their engine oils do not meet its quality standards. They are “unfairly trading on API’s goodwill” with the intention “of deceiving the public,” the lawsuit alleges.

According to its website, The American Petroleum Institute is the only national trade association that represents all aspects of America’s oil and gas industry. It has over 400 corporate members, from major oil companies to small independent distributors. API represents all segments of the oil and gas industry including producers, refiners, suppliers, pipeline operators and marine transporters, as well as service and supply companies that support all of the industry segments.

Regarding the trademark infringement allegations against U.S. Energy Resources, company CMO Tiku Vyas responded, “We have never sold a single bottle of motor oil with an API logo on it.” Babylon Trading & Development, the second firm named in the lawsuit, could not be reached for comment an no phone number could be found for the company.

API is seeking a permanent injunction that would prevent the two oil companies from using its trademark on any of their products. API is also seeking $1 million in damages for each grade oil that the firms allegedly sold using its logos. In addition, API is demanding a court order that would require the destruction of the infringing products and is requesting that the companies be required to issue corrective statements and notify each purchaser that the oil they bought was not API certified.

API claims that only oils that pass inspection and meet its strict standards may use its Sunburst and Donut trademarks. API’s certification program has been in operation since 1985 and has certified and licensed about 530 companies to use the trademarks. A spokesperson for API alleged that testing by an independent laboratory revealed that both of the defendant’s products “fell significantly short” of API’s quality requirements and “could cause damage to late-model automobile engines.”