DABPO LLC

Trademark Trial and Appeal BoardJul 29, 2020

88387007 (T.T.A.B. Jul. 29, 2020)

THIS OPINION IS NOT A PRECEDENT OF THE TTAB Mailed: July 29, 2020 UNITED STATES PATENT AND TRADEMARK OFFICE _____ Trademark Trial and Appeal Board _____ In re DABPO LLC _____ Serial No. 88387007 _____ DABPO LLC, pro se. Kim L. Parks, Trademark Examining Attorney, Law Office 112, Renee Servance, Managing Attorney. _____ Before Wellington, Greenbaum and Heasley, Administrative Trademark Judges. Opinion by Wellington, Administrative Trademark Judge: DABPO LLC (“Applicant”) seeks registration on the Principal Register of the mark EXEMPTAX (in standard characters) for the following services: “Electronic storage of resale certificates for sales tax; Providing on-line non-downloadable software for tax compliance services, namely, validation and record-keeping of resale certificates for sales tax; Software as a service (SAAS) services featuring software for tax compliance services, namely, validation and record-keeping of resale certificates for sales tax” in International Class 42.1 1 Application Serial No. 88387007 filed on April 15, 2019, under Section 1(a) of the Trademark Act, 15 U.S.C. § 1051(a), based upon Applicant’s claim of first use of the mark anywhere and in commerce on April 15, 2019. Serial No. 88387007 - 2 - The Trademark Examining Attorney refused registration under Section 2(e)(1) of the Trademark Act, 15 U.S.C. § 1052(e)(1), on the ground that Applicant’s mark is merely descriptive of the services identified in the application. When the refusal was made final, Applicant appealed to this Board. The appeal has been fully briefed, including a reply brief filed by Applicant. We affirm the refusal to register. I. Merely Descriptive -- Applicable Law Section 2(e)(1) of the Trademark Act prohibits registration on the Principal Register of “a mark which, … when used on or in connection with the goods [or services] of the applicant is merely descriptive … of them,” unless the mark has acquired distinctiveness under Section 2(f) of the Trademark Act, 15 U.S.C. § 1052(f).2 A term is “merely descriptive” within the meaning of § 2(e)(1) “if it immediately conveys information concerning a feature, quality, or characteristic of the goods or services for which registration is sought.” In re N.C. Lottery, 866 F.3d 1363, 123 USPQ2d 1707, 1709 (Fed. Cir. 2017) (citing In re Bayer AG, 488 F.3d 960, 82 USPQ2d 1828, 1831 (Fed. Cir. 2007)). A term “need not immediately convey an idea of each and every specific feature of the goods [or services] in order to be considered merely descriptive; it is enough if it describes one significant attribute, function or property of the goods [or services].” In re Fat Boys Water Sports LLC, 118 USPQ2d 1511, 1513 2 Applicant does not claim the proposed mark is registrable because it has acquired distinctiveness. Thus, Section 2(f) is not pertinent to our decision. Serial No. 88387007 - 3 - (TTAB 2016) (citing In re Gyulay, 820 F.2d 1216, 3 USPQ2d 1009, 1010 (Fed. Cir. 1987)). “Descriptiveness must be evaluated ‘in relation to the particular goods or services for which registration is sought, the context in which the mark is used, and the possible significance the term would have to the average consumer because of the manner of its use or intended use,’” In re Chamber of Commerce of the U.S., 675 F.3d 1297, 102 USPQ2d 1217, 1219 (Fed. Cir. 2012) (quoting In re Bayer AG, 82 USPQ2d at 1831), and “not in the abstract or on the basis of guesswork.” Fat Boys Water Sports, 118 USPQ2d at 1513 (citing In re Abcor Dev. Corp., 588 F.2d 811, 200 USPQ 215, 218 (CCPA 1978)). “In other words, we evaluate whether someone who knows what the goods [or services] are will understand the mark to convey information about them.” Id. at 1515 (citing DuoProSS Meditech Corp. v. Inviro Med. Devices Ltd., 695 F.3d 1247, 103 USPQ2d 1753, 1757 (Fed. Cir. 2012)). When two or more merely descriptive terms are combined, the determination of whether the combined mark is also merely descriptive turns on whether the combination of terms evokes a non-descriptive commercial impression. If each component retains its merely descriptive significance in relation to the goods or services, the combination is itself merely descriptive. In re Oppedahl & Larson LLP, 373 F.3d 1171, 71 USPQ2d 1370, 1372 (Fed. Cir. 2004) (citing Estate of P.D. Beckwith, Inc. v. Commr., 252 U.S. 538, 543 (1920)); see also In re Tower Tech, Inc., 64 USPQ2d 1314, 1318 (TTAB 2002) (SMARTTOWER merely descriptive of commercial and industrial cooling towers); In re Sun Microsystems, Inc., 59 USPQ2d 1084, 1087 Serial No. 88387007 - 4 - (TTAB 2001) (AGENTBEANS merely descriptive of computer programs for use in developing and deploying application programs). II. Argument and Analysis At the outset, we agree with the Examining Attorney’s contention that consumers will perceive proposed mark, EXEMPTAX, as simply the telescoped combination of the words “exempt” and “tax.” Upon encountering the mark in connection with the Applicant’s services in the field of tax compliance, there is no doubt that consumers will immediately understand the term as comprising the two words. We further point out that, when spoken, there is little or no aural distinction between the proposed mark and the two words. Applicant posits that its proposed mark is a ‘double entendre’ because it will also be interpreted as a combination of “exempt” and “ax.”3 Applicant contends its proposed mark is “suggestive of using a powerful tool, namely an ax, to help ‘clear’ through the complexity and meticulousness of the compliance process regarding resale and exemption certificates.”4 Applicant asserts that this interpretation “is clearly shown throughout Applicant’s marketing material.”5 We disagree and find no likely alternative interpretation of Applicant’s mark other than the combined words “exempt” and “tax.” Indeed, Applicant’s own marketing materials reinforce our finding that its proposed mark will be viewed and understood as merely the 3 4 TTABVUE 16. 4 Id. at 17. 55 Id., referring to materials attached by Applicant to its response filed November 27, 2019. Serial No. 88387007 - 5 - combination of the terms “exempt” and “tax.” To wit, the words “exempt[ion]” and “tax” are used often and descriptively in connection with Applicant’s services, and we find no mention or suggestion of an ax(e) tool: .6 Given our finding that the proposed mark will have the same meaning and commercial impression as the term “exempt tax,” the question is whether the proposed mark, when viewed and understood as the combination of the words, is merely descriptive of Applicant’s services. In articulating why the proposed mark is merely descriptive, the Examining Attorney relies on the following dictionary definitions of EXEMPT and TAX:7 EXEMPT (adj.): 1. Freed from an obligation, duty, or liability to which others are subject; . . . income exempt from taxation. 6 Printout attached to Applicant’s response filed November 27, 2019, at TSDR p. 17. Highlighting in attachment provided by Applicant in the printout. 7 Printouts of definitions from “The American Heritage Dictionary of the English Language” website (www.ahdictionary.com), attached to Office Action issued on July 1, 2019, at TSDR pp. 2, 4-5. The website identifies the source of the definitions as THE AMERICAN HERITAGE DICTIONARY OF THE ENGLISH LANGUAGE, 5th Ed. 2019, Houghton Mifflin Harcourt Publishing Co.), with copyright notice given. In its brief, Applicant argues that “to the best of its knowledge the dictionary evidence cited by the Examining Attorney does not exist in print format, and therefore is of limited probative value.” 4 TTABVUE 13-14. Applicant did not previously object or question the source of these definitions. In any event and as indicated above, their publication information was contained in the printouts. Moreover, the provided meanings for these terms in the printouts merely corroborate what is already common knowledge. Serial No. 88387007 - 6 - TAX (noun): 1. a contribution for the support of a government required of persons, groups, or businesses, within the domain of that government. The Examining Attorney asserts that these words maintain their merely descriptive meanings in the context of Applicant’s services because their combination, albeit telescoped, “immediately describe[s] that applicant’s tax compliance software features subject matter related to being free from a sales tax obligation (i.e. exempt from tax).”8 Specifically, quoting Applicant’s website, the Examining Attorney points out that Applicant’s services feature “a subscription-based tax exemption certificate management platform.”9 In addition, the Examining Attorney relies on other Internet evidence showing use of the term “exempt tax,” including: “What is exempt from tax? – The company and/or the employee is not subject to the tax, so wages are not reported and no tax is calculated for the exempt tax . . . Note: It is good payroll practice to obtain a copy of the company’s certificate of exemption and keep it on file should questions arise as to why a tax was not calculated for a company.”10 “Exempt Tax Meaning – The IRS only allows you to claim that you're exempt from income tax withholding if you meet two conditions. First, you can’t have owed any income taxes for the prior year. Second, you must expect not to owe any taxes for the current year. When the IRS says you don’t owe any taxes, it doesn’t just mean that you received a refund – it means that your tax liability, before counting any withholding, was $0.”11 8 6 TTABVUE 5. 9 Id. at 6, citing to language in screenshot printout of Applicant’s website attached to Office Action issued on July 1, 2019, at TSDR p. 20. 10 From website www.sage.com; printouts attached to Office Action issued December 26, 2019, TSDR pp. 10-14. 11 From website www.pocketsense.com; id. at pp. 6-9. Serial No. 88387007 - 7 - Applicant, on the other hand, argues that the combined wording, “exempt tax,” has “no definition [and] no well understood or recognized meaning” and relies on evidence it submitted showing a lack of results for a search of the combined terms.12 The fact that the term “exempt tax,” itself, is not found in the dictionary or another authoritative resource is not controlling on the question of whether it is merely descriptive. See In re Gould Paper Corp., 834 F.2d 1017, 5 USPQ2d 1110 (Fed. Cir. 1987) [SCREENWIPE held generic for wipes that clean computer and television screens although not found in dictionary]; In re Gen’l Permanent Wave Corp., 118 F.2d 1020, 49 USPQ 184, 186 (CCPA 1941) (“Because appellant has combined two common English words [VAPER MARCEL], which in combination are not found in the dictionaries, is wholly immaterial.”); In re Planalytics, Inc., 70 USPQ2d 1453, 1456 (TTAB 2004) (GASBUYER held merely descriptive, even though no dictionary definition of term); In re Tower Tech Inc., 64 USPQ2d 1314 (SMARTOWER merely descriptive, even though no dictionary definition of term); see also TRADEMARK MANUAL OF EXAMINING PROCEDURE (TMEP) § 1209.03(b) (October 2018). Rather, we must decide whether the evidence shows that the proposed mark immediately conveys information concerning a feature or characteristic of the Applicant’s services, namely, tax compliance services and storage of resale certificates for tax purposes. The fact that an applicant may be the first to use a term does not mean the term is not merely descriptive. KP Permanent Make-Up, Inc. v. Lasting Impression I, Inc., 543 U.S. 111, 122 (2004) (trademark law does not 12 4 TTABVUE 9. Serial No. 88387007 - 8 - countenance someone obtaining “a complete monopoly on use of a descriptive term simply by grabbing it first”) (citation omitted); Clairol, Inc. v. Roux Distrib. Co., 280 F.2d 863, 126 USPQ 397, 398 (CCPA 1960) (Even novel ways of referring to a product may nonetheless be merely descriptive.); In re Bailey Meter Co., 102 F. 2d 843, 41 USPQ 275, 276 (CCPA 1939) (“The fact that appellant may have been the first and only one to adopt and use the mark sought to be registered does not prove that the mark is not descriptive . . . .”). Applicant also disputes the probative value of the Examining Attorney’s evidence. For example, with regard to the excerpted language, supra, Applicant asserts the given “Exempt Tax Meaning” is irrelevant because it is “in primary reference to IRS form W-2, which would normally be filled out with an employee’s withheld tax, and not with an ‘exempt tax.’ Undoubtedly, the author means not to define ‘exempt tax’ but rather to define ‘exempt from withholding tax.’”13 Although Applicant may be correct that the use of “exempt tax” in that excerpt involves employee withholding tax, this does not mean that the term’s meaning is irrelevant to Applicant’s services. As Applicant posits, the term “exempt tax” will be understood by others as “exempt from tax(ation).” Thus, in the context of Applicant’s services, “exempt tax” conveys the same information, albeit in relation to resale certifications – specifically, there are exemptions from sales taxes when the goods are for resale. Applicant, in its reply brief, provides a helpful diagram that illustrates the nature of its business: 13 Id. at 10. Serial No. 88387007 - 9 - .14 This helps show how Applicant’s purchasers, who are wholesalers or vendors of goods that are intended for resale, are provided with resale certificates that help substantiate the exemption from any sales tax for its transactions with the retail stores. The wholesalers or vendors will immediately understand the proposed mark as merely conveying information regarding the intended purpose or feature of Applicant’s services, namely, to assist them in corroborating the sales tax exempt status of their wholesale to retail transactions. Applicant’s own materials further demonstrate the merely descriptive nature of its proposed mark in connection with its services: 14 7 TTABVUE 5. Serial No. 88387007 - 10 - .15 Finally, we also disagree with Applicant’s contention that that the combination of the terms EXEMPT and TAX is “incongruous and bizarre.”16 Specifically, Applicant argues:17 [T]he only syntactically proper assignment in the English language of EXEMPT TAX in its exact form (i.e., without use of conjugation, pluralization, or insertion between EXEMPT and TAX of another word, such as a conjunction, determiner, preposition, pronoun, or verb) would be EXEMPT in the adjective form followed by TAX in the noun form, as in an “exempt tax,” which is clearly bizarre, nonsensical, and incongruous, due to the incompatibility of the meanings of the individual words. What exactly is an “exempt tax” and how can a tax itself be exempt? Normally a person may be exempt from a tax, in which case the phrase would be modified to “exempt from tax” – the word “exempt” is not an adjective describing the tax, but rather an adjective describing the person. Clearly, the import of this word combination would require some measure of imagination and mental pause to grasp. (Emphasis in italics in original.) Here, despite any ‘syntactically improper’ quality of the proposed mark, there is no incongruity, nor do we find the combination ‘bizarre’ so as to detract from its 15 Printout attached to Applicant’s response filed November 27, 2019, at TSDR p. 15. 16 4 TTABVUE 14. 17 Id. Serial No. 88387007 - 11 - merely descriptive nature. The evidence demonstrates that Applicant’s tax compliance services are directed to wholesalers or vendors for purposes of assisting them with sales transactions that are exempt from sales tax. These customers will immediately understand that Applicant’s proposed mark, when viewed in proper context and despite its syntax, conveys important information about Applicant’s services. Put simply, Applicant’s proposed mark does not “evoke[] a non-descriptive commercial impression,” and each component retains its merely descriptive significance in relation to the services. In re Oppedahl & Larson LLP, 71 USPQ2d 1372. III. Conclusion We have carefully considered all arguments and evidence of record. We find that the telescoped combination of the descriptive term “exempt” with the descriptive term “tax” does not create a non-descriptive or incongruous meaning. Each component retains its merely descriptive significance in relation to Applicant’s identified services, so the combination is itself merely descriptive. We therefore conclude that EXEMPTAX is merely descriptive of Applicant’s identified services, since the proposed mark merely describes a primary purpose or nature of the tax compliance services, namely, assisting its consumers with their exemptions from paying a sales tax on certain transactions. Decision: The refusal to register Applicant’s proposed mark EXEMPTAX under Section 2(e)(1) of the Trademark Act is affirmed.