First Security Capital, L.L.C.

Trademark Trial and Appeal Board

Feb 27, 2001

No. 75515579 (T.T.A.B. Feb. 27, 2001)

2/27/01
Paper No. 13
HWR
UNITED STATES PATENT AND TRADEMARK OFFICE
________
Trademark Trial and Appeal Board
________
In re First Security Capital, L.L.C.
________
Serial No. 75/515,579
_______
William J. Mason of Rhodes & Mason, PLLC for First Security
Capital, L.L.C.
Robert C. Clark, Jr., Trademark Examining Attorney, Law
Office 108 (David Shallant, Managing Attorney).
_______
Before Hairston, Chapman and Wendel, Administrative
Trademark Judges.
Opinion by Wendel, Administrative Trademark Judge:
First Security Capital, L.L.C. has filed an
application to register the mark ESOP QUALIFIED ASSET LOAN
for “financial services, namely, making loans of up to 90%
of the value of the reinvested proceeds from the sale of a
company to an employee stock ownership plan.”1
1 Serial No. 75/515,579, filed July 8, 1998, claiming first use
dates of April 1998.
THIS DISPOSITION
IS NOT CITABLE AS PRECEDENT
OF THE T.T.A.B.
Ser No. 75/515,579
2
Registration has been finally refused under Section
2(e)(1) of the Trademark Act on the ground that the mark is
merely descriptive, when used in connection with
applicant’s services. The refusal has been appealed and
both applicant and the Examining Attorney have filed
briefs. An oral hearing was originally requested but
subsequently waived.
A term or phrase is merely descriptive within the
meaning of Section 2(e)(1) if it immediately conveys
information about a characteristic or feature of the goods
or services with which it is being used. See In re Abcor
Development Corp., 588 F.2d 811, 200 USPQ 215 (CCPA 1978).
Whether or not a particular term or phrase is merely
descriptive is determined not in the abstract, but rather
in relation to the goods or services for which registration
is sought, the context in which the designation is being
used, and the significance the designation is likely to
have to the average purchaser as he or she encounters the
goods or services bearing the designation, because of the
manner in which it is used. See In re Bright-Crest, Ltd.,
204 USPQ 591 (TTAB 1979). It is not necessary that the
term or phrase describe all the characteristics or features
of the goods or services in order to be merely descriptive;
it is sufficient if the term or phrase describes one
Ser No. 75/515,579
3
significant attribute thereof. See In re Pennzoil Products
Co., 20 USPQ2d 1753 (TTAB 1991).
The Examining Attorney has made of record evidence
showing that ESOP is a commonly used abbreviation for the
term “employee stock ownership plan.” Applicant
acknowledges the same. The Examining Attorney has also
made of record Nexis excerpts showing use in the financial
field of terms such as “asset loan,” “fixed-asset loan” or
“single asset loan.” In addition, he has pointed to the
specimens of record in which applicant describes its
services as providing loans on “qualified assets for
reinvestments of ESOP proceeds.” On the basis of this
evidence, the Examining Attorney finds ESOP QUALIFIED ASSET
LOAN merely descriptive when used in connection with
applicant’s financial services, which have been identified
as “making loans of up to 90% of the value of the
reinvested proceeds from the sale of a company to an
employee stock ownership plan.”
Applicant argues that although the acronym “ESOP” and
words such as “qualified” and “asset” are frequently used
in the financial field, the combination of these terms
found in applicant’s mark would not immediately communicate
to purchasers the particular type of services being
provided by applicant. According to applicant, in a
Ser No. 75/515,579
4
conventional employee stock ownership plan (ESOP), the ESOP
borrows from the bank in order to purchase stock from the
employer, using the stock as collateral. Applicant’s
services, on the other hand, relate to secured loans made
to the employer who has received proceeds from the sale of
stock to an ESOP and reinvested these proceeds.
Applicant contends that the nature of these services would
not be readily apparent from applicant’s mark ESOP
QUALIFIED ASSET LOAN.
The problem with applicant’s argument is that
applicant’s mark is not to be considered in the abstract,
but rather in relation to the specific services identified
in the application. Applicant’s services are identified as
involving the making of loans to the individual having
realized proceeds from the sale of a company to an ESOP and
having reinvested the same. The issue of descriptiveness
is determined by considering the mark when used in
connection with these services. See In re American
Greetings Corp., 226 USPQ 365 (TTAB 1985). There is no
potential, in view of this identification, for purchasers
to believe that the loan services being offered by
applicant under the mark ESOP QUALIFIED ASSET LOAN are
directed to participants in the ESOP, rather than the
Ser No. 75/515,579
5
individual who has obtained proceeds from the sale of stock
to an ESOP.
The only real question is the significance of the mark
ESOP QUALIFIED ASSET LOAN as viewed by these potential
customers for applicant’s loan services. In connection
with this question, evidence of the context in which
applicant is using the mark in advertising materials is
clearly probative of the reaction of prospective customers
to the mark. See In re Pharmaceutical Innovations, Inc.,
217 USPQ 365 (TTAB 1983). The specimens of record, which
appear to be advertising materials, specifically describe
applicant’s loans as being made on “qualified assets for
reinvestment of ESOP proceeds” and urge potential customers
to “unlock 90% of the equity in your assets reinvested from
an ESOP.” From this description by applicant of its
services, we find it clear that prospective customers would
immediately grasp the informational significance of the
mark ESOP QUALIFIED ASSET LOAN as it is being used in
connection with applicant’s services. These are loans made
on qualified assets for the reinvestment of ESOP proceeds
or, in other words, ESOP QUALIFIED ASSETS.
Ser No. 75/515,579
6
Accordingly, we find the mark ESOP QUALIFIED ASSET
LOAN to be merely descriptive when used in connection with
applicant’s financial services of making loans of up to 90%
of the value of the reinvested proceeds from the sale of a
company to an employee stock ownership plan.
Decision: The refusal to register under Section
2(e)(1) is affirmed.