IN RE MERRILL LYNCH, PIERCE, FENNER, AND SMITH No. 86-1080.
828 F.2d 1567 (1987)
In re MERRILL LYNCH, PIERCE, FENNER, AND SMITH, INC.
United States Court of Appeals, Federal Circuit.
September 17, 1987.
Steven H. Hartman, Milgrim, Thomajan, Jacobs & Lee, New York City, for appellant.
Joseph F. Nakamura, Solicitor, Fred E. McKelvey, Deputy Solicitor and Nancy C. Slutter, Asst. Solicitor, Office of the Solicitor, Arlington, Va., for appellees.
Before SMITH, Circuit Judge, COWEN, Senior Circuit Judge, and NEWMAN, Circuit Judge.
PAULINE NEWMAN, Circuit Judge.
The Commissioner of Patents and Trademarks, acting through the Trademark Trial and Appeal Board (Board), refused registration of the term CASH MANAGEMENT ACCOUNT on the Principal Register as a service mark for "stock brokerage services, administration of money market fund services, and providing loans against securities services", Application Serial No. 254,808. In re Merrill Lynch, Pierce, Fenner & Smith, Inc., 230 USPQ 128 (TTAB 1986).
The Board held that CASH MANAGEMENT ACCOUNT is a common descriptive or generic name for these financial services, such that acquired distinctiveness or secondary meaning can not provide a right to registration, as a matter of law. The Board thus refused registration under 15 U.S.C. § 1052(f). We reverse and remand.
Appellant already has a registration No. 1,118,929 on the Principal Register, granted May 22, 1979 for the term CASH MANAGEMENT ACCOUNT as a service mark for "financial services involving the use of plastic credit cards by the cardholders for loans to cardholders from their brokerage equity account." This registration is incontestable, in accordance with 15 U.S.C. §§ 1065 and 1115(b). Taking the position that these services are substantially the same as the services for which registration is now sought, appellant argues that "the Board erred as a matter of law in refusing to order registration on the Principal Register of a service mark as to which Appellant owns incontestable rights". Appellant argues that its incontestable right to use the term CASH MANAGEMENT ACCOUNT for the services for which it is registered "perforce includes the right to register that term for these same services in a subsequent application". Appellant asserts that to hold otherwise would deny it title to the mark for the services for which the mark is already registered, citing Park `N Fly, Inc. v. Dollar Park and Fly, Inc.,
The benefits of incontestability are no more than that "the registration shall be conclusive evidence of the registrant's exclusive right to use the registered mark in commerce". 15 U.S.C. § 1115(b). The only thing that becomes incontestable is the right of the registrant to use the mark for the goods or services for which it is registered. Even that right is subject to the defenses enumerated in 15 U.S.C. § 1115(b) and to the grounds for cancellation set forth at 15 U.S.C. § 1064(c) and (e). Holiday Inn v. Holiday Inns, Inc.,
In Park `N Fly, Inc. the Supreme Court held that an action for infringement of a registered mark that has become incontestable can not be defended on the ground that the mark is "merely descriptive". 469 U.S. at 205, 105 S.Ct. at 667. This holding is not pertinent to appellant's argument concerning registration of the same mark for a broadened class of goods. The appellant does not explain how its existing registration for services that require the use of plastic credit cards is substantially the same as the services for which registration is now sought, as those are set forth in the subject application for registration and as quoted by the Board in its opinion at page 130 of 230 USPQ.
While "ownership of one or more prior registrations on the Principal Register ... of the same mark may be accepted as prima facie evidence of distinctiveness," 37 C.F.R. 2.41(b), ownership of a registration does not of itself authorize the grant of
The Board correctly held that appellant's incontestable registration for specific services involving credit cards does not automatically entitle appellant to a registration for broader financial services.
The Board affirmed the examiner's determination that the term CASH MANAGEMENT ACCOUNT is generic for the services described in the application. The Board considered first whether the term is a common descriptive or generic name for the described services.
Appellant argues that its incontestable registration of the mark for similar services is persuasive evidence of distinctiveness, and also argues that there is no direct evidence that CASH MANAGEMENT ACCOUNT is generic for the services for which registration is sought. From the examiner's evidence of usage in newspapers and financial publications, the Board concluded that "[w]hile there are references to applicant as a pioneer in this type of account", as well as first user of the term to identify such an account, "it appears that said term has been adopted by a major segment of financial business as a name to designate services such as applicant offers." In re Merrill Lynch, 230 USPQ at 130.
The four classic categories — generic ("common" descriptive), descriptive ("merely" descriptive), suggestive, or arbitrary — have been described as "central tones in a spectrum", that "tend to merge at their edges and are frequently difficult to apply." Soweco, Inc. v. Shell Oil Co.,
Generic terms, by definition incapable of indicating source, are the antithesis of trademarks, and can never attain trademark status. Dan Robbins & Associates, Inc. v. Questor Corp.,
CES Publishing Corp. v. St. Regis Publications, Inc.,
Whether a term is classified as "generic" or as "merely descriptive" is not easy to discern when the term sits at the fuzzy boundary between these classifications. See Zatarains, Inc. v. Oak Grove Smokehouse, Inc.,
The Board found that the term CASH MANAGEMENT ACCOUNT is generic or commonly descriptive, not "merely descriptive". This finding of fact is reviewed for clear error. See In re Bed & Breakfast Registry,
Evidence of the public's understanding of the term may be obtained from any competent source, such as purchaser testimony, consumer surveys, listings in dictionaries, trade journals, newspapers, and other publications. In re Northland Aluminum Products, 777 F.2d at 1559, 227 USPQ at 963; Dan Robbins & Associates, Inc. v. Questor Corp., 599 F.2d at 1014, 202 USPQ at 105; In re Thunderbird Products Corp.,
Before the Board was voluminous evidence of usage in financial publications of the term, following Merrill Lynch's introduction of the financial system, from which the Board concluded "that said term has been adopted by a major segment of financial business as a name to designate services such as applicant offers." In re Merrill Lynch, 230 USPQ at 130. The following is representative:
Appellant points out that no publication or usage of the term cited by the Board or the Examiner appeared before Merrill Lynch's introduction of the term for use with specific brokerage services, and argues that those publications that appear to use the term in a descriptive sense do not describe the precise services for which registration is sought. The Board held that the absence of descriptive details was not controlling "since there is no question that they refer to financial services of the same general nature as [appellant's]." In re Merrill Lynch, 230 USPQ at 130-31. The issue, however, is how the consuming public views the mark.
The evidence before the Board showed recognition in a substantial number of publications that the source of the CASH MANAGEMENT ACCOUNT was the appellant. This evidence does not clearly place appellant's mark in the category of a generic or common descriptive term. As Judge Rich explained in In re Abcor Development Corp.,
The term thus must be considered in the category of "merely descriptive". A "merely descriptive" term requires the Board to take cognizance of appellant's evidence of secondary meaning. "[E]very mark sought to be registered by taking advantage of § 2(f) involves descriptiveness to some degree." In re Ideal Industries, Inc.,
On this basis, we reverse the Board's decision that the term CASH MANAGEMENT ACCOUNT is generic. Although the Board stated that "there is no question that applicant has gathered a substantial and comprehensive showing of evidence of distinctiveness", In re Merrill Lynch, 230 USPQ at 131, the Board offered no conclusion on the adequacy of the showing under section 2(f). We remand for this purpose.
REVERSED AND REMANDED.
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