Edward W. Vaughan

Trademark Trial and Appeal Board

Oct 11, 2016

No. 86363396 (T.T.A.B. Oct. 11, 2016)

THIS OPINION IS NOT A
PRECEDENT OF THE TTAB

Mailed:
October 11, 2016

UNITED STATES PATENT AND TRADEMARK OFFICE
_____

Trademark Trial and Appeal Board
_____

In re Edward W. Vaughan
_____

Serial No. 86363396
_____

Michael P. Fortkort of Michael P. Fortkort P.C. for Edward W. Vaughan.

Gina Hayes, Trademark Examining Attorney, Law Office 103 (Michael Hamilton,
Managing Attorney).
_____

Before Wellington, Ritchie and Masiello, Administrative Trademark Judges.
Opinion by Masiello, Administrative Trademark Judge:
Edward W. Vaughan (“Applicant”), a corporation organized under the laws of
Virginia and doing business as Electronic Transactions Systems Corporation, filed
an application for registration on the Supplemental Register of the proposed mark
ELECTRONIC TRANSACTION SYSTEMS CORPORATION in standard characters
for the services set forth below:
Merchant accounts, namely, merchant banking services;
credit and debit card processing or handling,
authorization and clearing; merchant accounts in the field
of finance, namely, provision of monthly financial
statements online; financial services, namely, provision of
merchant account interchange qualification reporting,
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chargeback and retrieval information, provision of daily
deposit summaries for review, retrieval of requests for
sales and credit slips and credit match verification;
financial services, namely, processing all types of credit
cards and debit cards, in International Class 36.1
Applicant has disclaimed the exclusive right to use CORPORATION apart from the
mark as shown.
The Examining Attorney refused registration under Section 23 of the Trademark
Act, 15 U.S.C. § 1091, on the ground that Applicant’s proposed mark is generic and
thus incapable of distinguishing the identified services. When the Examining
Attorney made the refusal final, Applicant requested reconsideration and
simultaneously appealed to this Board. The Examining Attorney denied the request
for reconsideration and this appeal proceeded. Applicant and the Examining
Attorney have filed their briefs.
In order to qualify for registration on the Supplemental Register, a proposed mark
“must be capable of distinguishing the applicant’s goods or services.” 15 U.S.C.
§ 1091(c). “[G]eneric terms by definition are incapable of indicating a unique
source.” In re La. Fish Fry Prods., Ltd., 797 F.3d 1332, 116 USPQ2d 1262, 1267
(Fed. Cir. 2015), citing In re Merrill Lynch, Pierce, Fenner, & Smith, Inc., 828 F.2d
1567, 4 USPQ2d 1141, 1142 (Fed. Cir. 1987) (“Generic terms, by definition
incapable of indicating source, are the antithesis of trademarks, and can never
attain trademark status.”). A mark is generic if it refers to the class or category of

1 Application Serial No. 86363396 was filed on August 11, 2014 under Trademark Act
Section 1(a), 15 U.S.C. § 1051(a), based on Applicant’s asserted use of the mark in
commerce, stating June 1994 as the date of first use and first use in commerce.
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goods or services on or in connection with which it is used. In re Dial-A-Mattress
Operating Corp., 240 F.3d 1341, 57 USPQ2d 1807 (Fed. Cir. 2001), citing H. Marvin
Ginn Corp. v. Int’l Ass’n of Fire Chiefs, Inc., 782 F.2d 987, 228 USPQ 528 (Fed. Cir.
1986) (“Marvin Ginn”). The test for determining whether a mark is generic is its
primary significance to the relevant public. In re American Fertility Soc’y, 188 F.3d
1341, 51 USPQ2d 1832 (Fed. Cir. 1999); Magic Wand Inc. v. RDB Inc., 940 F.2d
638, 19 USPQ2d 1551 (Fed. Cir. 1991); and Marvin Ginn, supra. Making this
determination “involves a two-step inquiry: First, what is the genus of goods or
services at issue? Second, is the term sought to be registered … understood by the
relevant public primarily to refer to that genus of goods or services?” Marvin Ginn,
228 USPQ at 530. The Examining Attorney has the burden of establishing by clear
evidence that a mark is generic. In re Merrill Lynch, 4 USPQ2d at 1141; In re
American Fertility Soc’y, supra; and Magic Wand Inc., supra. “Doubt on the issue of
genericness is resolved in favor of the applicant.” In re DNI Holdings Ltd., 77
USPQ2d 1435, 1437 (TTAB 2005).
1. The genus of Applicant’s services.
Our first task under Marvin Ginn is to determine, based on the evidence of record,
the genus of Applicant’s services. Because the identification of goods or services in
an application defines the scope of rights that will be accorded the owner of any
resulting registration under Section 7(b) of the Trademark Act, generally “a proper
genericness inquiry focuses on the description of services set forth in the
[application or] certificate of registration.” Magic Wand, 19 USPQ2d at 1552, citing
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Octocom Sys., Inc. v. Houston Computer Servs., Inc., 918 F.2d 937, 942, 16 USPQ2d
1783, 1787 (Fed. Cir. 1990).
Applicant contends that the genus of services at issue is “merchant banking
services.”2 While this expression appears to be a term of art, neither Applicant nor
the Examining Attorney has provided a persuasive explanation as to the meaning of
“merchant banking.”3 We will instead focus our discussion on the following
identified services, which are clearer in meaning: “credit and debit card processing
or handling, … financial services, namely, processing all types of credit cards and
debit cards.” Although these services represent only a portion of the application’s
entire recitation of services, a refusal on the ground of genericness is proper with
respect to all of the identified services in an International Class if the mark is
generic for any of the identified services in that class. In re Cordua Rests., Inc., 823
F.3d 594, 118 USPQ2d 1632, 1638 (Fed. Cir. 2016) (“A registration is properly
refused if the word is the generic name of any of the goods or services for which
registration is sought.” (quoting 2 MCCARTHY ON TRADEMARKS AND UNFAIR
COMPETITION § 12:57)); see also In re Analog Devices, Inc., 6 USPQ2d 1808, 1810
(TTAB 1988), aff’d, 871 F.2d 1097, 10 USPQ2d 1879 (Fed. Cir. 1989) (unpublished).
Applicant confirms in its brief that its services “assist merchants in converting
credit and debit card payments to funds the merchants may deposit in their bank

2 Applicant’s brief at 6, 7 TTABVUE 7.
3 According to RANDOM HOUSE DICTIONARY OF THE ENGLISH LANGUAGE 1202 (2nd ed. 1987),
“merchant bank” is a chiefly British expression meaning “a private banking firm engaged
chiefly in investing in new issues of securities and in accepting bills of exchange in foreign
trade.” As the dictionary identifies the term as a British one, we cannot be sure that in the
United States market the term would be understood to have this meaning.
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accounts …”4
Applicant argues that the Examining Attorney erred when she “incorrectly
identified the genus of Applicant’s Services,”5 making “the profoundly inaccurate
finding that ‘the identification, and thus the genus [of Applicant’s Mark], is
financial services provided through electronic transaction systems.’”6 This
characterization of the Examining Attorney’s position is given without a citation to
the record, and is not an accurate one. We note that in her first Office Action, the
Examining Attorney clearly contended that the genus at issue was “credit and debit
card processing or handling, authorization and clearing” and “financial services,
namely, processing all types of credit cards and debit cards.”7 As this language is
drawn directly from Applicant’s recitation of services, it was a sound contention.
Magic Wand, 19 USPQ2d at 1552.
2. Public understanding of the term ELECTRONIC TRANSACTION SYSTEMS
CORPORATION.

We next consider whether ELECTRONIC TRANSACTION SYSTEMS
CORPORATION would be understood by the relevant public primarily to refer to
the processing or handling of credit and debit cards. Applicant contends that its
services “are not consumer services” but would be marketed only to “merchants who
use Applicant’s services in serving their own customers”; and that the relevant

4 Applicant’s brief at 7, 7 TTABVUE 8.
5 Id. at 10, 7 TTABVUE 11.
6 Id. at 8, 7 TTABVUE 9.
7 Office Action of December 2, 2014 at 2.
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public therefore consists of merchants.8 The Examining Attorney does not contest
this characterization of the relevant public.9 Therefore, we consider the relevant
public to consist of merchants and the personnel of businesses where credit cards
and debit cards are presented as a form of payment.
The Examining Attorney has analyzed Applicant’s mark in two parts, contending
that ELECTRONIC TRANSACTION SYSTEMS is generic for Applicant’s services
and that CORPORATION is generic for Applicant’s form of entity. We will address
both of these contentions before analyzing the mark in its entirety. In our
deliberations, we have considered all of the evidence of record. We summarize below
and discuss the evidence that we find most highly relevant and probative regarding
the public’s understanding of Applicant’s mark.
To begin, the Examining Attorney has submitted the following definitions:
electronic transaction:
An act of buying or selling something or sending money
electronically, especially over the internet.
CAMBRIDGE BUSINESS ENGLISH DICTIONARY, at .10
system:
a set of connected items or devices that operate together
…
A way of doing things: a method

CAMBRIDGE ACADEMIC CONTENT DICTIONARY, at .11

8 Applicant’s brief at 6-7, 7 TTABVUE 7-8.
9 Examining Attorney’s brief, 9 TTABVUE 7.
10 Office Action of December 2, 2014 at 40.
11 Id. at 42.
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The Examining Attorney has made of record excerpts of news items in which the
phrase “electronic transaction system” (or its plural) is used in the context of
payments. Among these, we note the following:
House Bill 190 Authorizes the Supreme Court to develop
and implement an electronic transaction system for
submittal of payment to the circuit courts of all fees,
penalties and fines and bonds …
12
MyECheck Inc., … provider of alternative payment
solutions, reported …
… the company said it processed about 2.1 million
transactions in 2008, its first full year of operation with
its electronic transaction system.
Sacramento Bee, January 15, 2009.13
… a 23 percent sales tax on net retail purchases would be
far less of an economic burden if we replaced our paper
currency with an electronic transaction system.
Pittsburgh Post-Gazette, December 19, 2007.14
He also knew the ins and outs of electronic transaction
systems through previous positions with gift-card supplier
Stored Value Systems and National City Processing,
where he developed a smart-card system to handle food
stamps and cash benefits in several states.
The Courier-Journal (Louisville, KY), August 20, 2007.15

12 Id. at 7.
13 Office Action of July 7, 2015 at 6.
14 Id. at 7.
15 Id. at 8.
Serial No. 86363396

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The company also creates electronic transaction systems
to enable online selling.
Grocery Headquarters, January 1, 1999.16
Both Chase Manhattan and Citibank, in association with
Visa and Mastercard, are launching a smart card program
in New York this fall.
… Michael Smith, general manager of operations and
electronic transaction systems at Schlumberger DANYL,
said that the Atlanta and New York tests should create a
ripple effect.
The Boston Herald, August 5, 1996.17
…the financial habits of both consumers and corporations
would have to change. But, because the electronic
transaction system was really superior to the paper-based
one, it would win out in the end.
One of the recommendations was to establish a series of
local automated clearing houses (ACHs) to process a large
number of both paperless credit and debit transactions.
ABA Banking Journal, March 1980.18
Tittle, 54, spent 20 years developing an electronic
transaction system for the Minnesota Department of
Revenue. He led the design and development of the state’s
first electronic tax-filing system and its first electronic
tax-payment systems.
Star Tribune (Minneapolis, MN), November 6, 2006.19
Founded in 1981, VeriFone introduced one of the first
check verification and credit authorization devices. … In
1997, HP bought the company …

16 Id. at 14.
17 Id. at 17.
18 Id. at 19.
19 Id. at 28.
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HP was attracted by the possibilities of taking the
company’s electronic-transaction systems onto the
Internet …
San Jose Mercury News, July 10, 2006.20
The Examining Attorney has also submitted an excerpt from the commercial
website , which “provides debit card, credit card and gift
card processing services for our merchants” and offers “an electronic transaction
system which utilizes the NACHA (National Automated Clearing House
Association) network to provide … processing …”21 She has also submitted excerpts
of the descriptions of certain patents:
Electronic transaction system capable of improving
transaction security …
When the user wants to proceed a shopping transaction, a
sale end operation device of a sale end reads the electronic
certificate and personal radio frequency identification,
respectively, …
22
A CRYPTOGRAPHIC SYSTEM AND METHOD FOR
ELECTRONIC TRANSACTIONS …
1. An electronic transaction system comprising at least
one first subscriber interface …
The current electronic commerce and payments through
the Internet are partially unprotected …

20 Id. at 29.
21 Id. at 41
22 Id. at 54.
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In this manner, the present electronic transaction system
increases the real security ICC-type guarantees of
commerce over IP (Internet Protocol).
23
SECURE ELECTRONIC TRANSACTION SYSTEM …
… a system and method for the secure processing of
electronic transactions comprises: receiving …
information for a financial transaction card; …
24
Finally, the Examining Attorney submitted additional evidence showing use of
“electronic transaction system” in connection with a wider range of transfers (other
than payments), such as transfers of information, documents, title in stocks and
bonds, real estate transactions, and bank-to-bank transfers of money. While this
evidence shows that “electronic transaction system” is a term of wide applicability,
its relevance is less than that of evidence showing use of the term specifically in
connection with payments.
The documentary evidence submitted by Applicant consists of an “Order and
Entry of Default Judgment” issued by the U.S. District Court for the District of
Columbia, permanently enjoining a defendant named Prodigy Partners Ltd., Inc.
from using various trade names, including “Electronic Transaction Services.”25 We
do not interpret this order as constituting an adjudication of whether Applicant’s
proposed mark is or is not generic.

23 Id. at 44-48.
24 Id. at 49.
25 Applicant’s response of June 2, 2015 at 11-12.
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The Examining Attorney has presented clear evidence of the generic use of the
term “electronic transaction systems” or “electronic transaction system” to identify a
process for dealing with various kinds of payments in a manner that does not
require the physical transfer of cash or commercial documents such as checks. The
evidence demonstrates use of the term in a number of contexts, including online
buying and selling; payment of taxes; payment of court fees; processing of gift cards
and smart cards; credit authorization; and “paperless credit and debit transactions”
in general. “Credit and debit card processing,” as identified in Applicant’s recitation
of services, is indeed such a process of effectuating payments.
With respect to the term CORPORATION in Applicant’s mark, the Examining
Attorney points out that “‘corporation’ is applicant’s business type.”26 This is
confirmed by the application, as filed on August 11, 2014, in which Applicant stated
that it is “a corporation of Virginia.”27 Moreover, the specimen of use filed with the
application is an advertisement in which Applicant describes itself as “an
international corporation headquartered in Virginia, with satellite offices in
Germany, Canada, and Ireland.”28 A “corporation” is:
An artificial person or legal entity created by or under the
authority of the laws of a state or nation … [It] is
regarded in law as having a personality and existence
distinct from that of its several members, and … is, by the
same authority, vested with the capacity of continuous
succession, …either in perpetuity or for a limited term of
years, and of acting as a unit or single individual …within

26 Examining Attorney’s brief, 9 TTABVUE 9.
27 Application at 4.
28 Id. at 7.
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the scope of the powers and authorities conferred upon
such bodies by law.
BLACK’S LAW DICTIONARY 307 (Fifth ed. 1979).29 We take judicial notice of the fact
that a very substantial portion of the entities that do business in U.S. commerce are
organized as “corporations.”
On this record, it is clear that ELECTRONIC TRANSACTION SYSTEMS is the
generic name of a key aspect of Applicant’s credit and debit card processing
services. It is also clear that CORPORATION is generic with respect to Applicant’s
form of business entity. We must now consider Applicant’s mark as a whole to
determine whether ELECTRONIC TRANSACTION SYSTEMS CORPORATION
would be understood by the relevant public primarily to refer to the genus of credit
and debit card processing services.
In an early case, the U.S. Supreme Court addressed the effect of adding a generic
business entity designation to another generic term:
The addition of the word ‘Company’ only indicates that
parties have formed an association or partnership to deal
in such goods, either to produce or to sell them. Thus
parties united to produce or sell wine, or to raise cotton or
grain, might style themselves ‘Wine Company,’ ‘Cotton
Company,’ or ‘Grain Company,’ but by such description
they would in no respect impair the equal right of others
engaged in similar business to use similar designations,
for the obvious reason that all persons have a right to deal
in such articles, and to publish the fact to the world.
Names of such articles cannot be adopted as trade-marks,
and be thereby appropriated to the exclusive right of any
one; nor will the incorporation of a company in the name

29 The Board may take judicial notice of dictionary definitions. Univ. of Notre Dame du Lac
v. J.C. Gourmet Food Imp. Co., 213 USPQ 594 (TTAB 1982), aff’d, 703 F.2d 1372, 217
USPQ 505 (Fed. Cir. 1983).
Serial No. 86363396

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of an article of commerce, without other specification,
create any exclusive right to the use of the name.
Goodyear’s Rubber Manuf’g Co. v. Goodyear Rubber Co., 128 U.S. 598, 602-603
(1888) (emphasis added). The Federal Circuit characterized this pronouncement as
“the per se rule in Goodyear that ‘Corp.’, etc. never possess source-indicating
significance …” In re Oppedahl & Larson LLP, 373 F.3d 1171, 71 USPQ2d 1370,
1373 (Fed. Cir. 2004) (declining to extend the per se rule to top-level domain
indicators). Professor McCarthy explained the effect of combining a generic entity
designation with another generic term as follows:
Company Designation Combined with a Generic
Name. Tacking a company organizational designation
such as “Company,” or “Inc.” or “Partners” cannot
transform a generic name into a protectable trademark.
Such company designations or their abbreviations are
themselves generic and have no trademark significance.
[Citations omitted.] Thus, one cannot append a generic
company designation and magically transform a generic
name for a product or service into a trademark, thereby
giving a right to exclude others. Such composites cannot
be trademarks. For example: “Color Television, Inc.”;
“Laptop Computers, Ltd.”; or “Restaurant Food Services
Company.”
MCCARTHY ON TRADEMARKS § 12:39. See also Welding Services, Inc. v. Forman, 509
F.3d 1351, n.4, 85 U.S.P.Q.2d 1233 (11th Cir. 2007) (The addition of “Inc.” to
“Welding Services” for servicing welding equipment does not turn a generic name
into a protectable trademark.).
We find the Supreme Court’s guidance, as amplified by the other authorities,
relevant to the present case, where the term CORPORATION has been added to
ELECTRONIC TRANSACTION SYSTEMS. The Federal Circuit has several times
Serial No. 86363396

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warned of the dangers inherent in analyzing multi-word marks by reference to the
meanings of their component words. See In re American Fertility Soc’y, 51 USPQ2d
at 1835-6; and Princeton Vanguard, LLC v. Frito-Lay N. Am., Inc., 786 F.3d 960,
114 USPQ2d 1827, 1831-3 (Fed. Cir. 2015). The Court has explained:
[E]ven in circumstances where the Board finds it useful to
consider the public’s understanding of the individual
words in a compound term as a first step in its analysis,
the Board must then consider available record evidence of
the public’s understanding of whether joining those
individual words into one lends additional meaning to the
mark as a whole.
Princeton Vanguard, 114 USPQ2d 1832-33. The Examining Attorney has not
submitted evidence of generic use by third parties of the entire phrase
ELECTRONIC TRANSACTION SYSTEMS CORPORATION. However, she has
shown generic usage of closely similar phrases (emphasis added):
The Phoenix-based electronic transaction systems
company reported a $2.74 million … net loss for the
quarter …30
Roswell-based IVI Checkmate is an electronic
transaction systems provider.31
To the relevant public, Applicant’s mark would be understood as designating an
electronic transaction systems business, just as “electronic transactions systems
company” and “electronic transaction systems provider” would be so understood. In
a commercial context, the term CORPORATION can be adopted by any business
that chooses to incorporate itself. Thus, this term may be applied to virtually any

30 Office Action of February 18, 2016 at 27.
31 Id. at 32.
Serial No. 86363396

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kind of business name with equal effect. In a commercial context, we find that the
addition of the word CORPORATION to the phrase ELECTRONIC TRANSACTION
SYSTEMS does not “lend[ ] additional meaning to the mark as a whole.” Princeton
Vanguard, 114 USPQ2d 1832-33. It does not “magically transform a generic name
for a product or service into a trademark…” MCCARTHY ON TRADEMARKS § 12:39.
Applicant argues that its mark refers to a product and therefore cannot be generic
for services:
“Financial services” are services, while “electronic
transaction systems” are goods. To identify the “genus” of
Applicant’s Services as services provided by means of
goods not only fails to support a finding of genericness, it
actually supports a finding in favor of the descriptiveness
(or suggestiveness) of Applicant’s Mark insofar as it
describes the means by which Applicant’s [sic] does or
could provide its services to consumers.32
Applicant’s suggestion that the generic name of goods cannot be generic for services
is not tenable:
[A] term can be generic for a genus of goods or services if
the relevant public … understands the term to refer to a
key aspect of that genus—e.g., a key good that
characterizes a particular genus of retail services. “A
generic name of goods may also be a generic name of the
service of selling or designing those goods.”
In re Cordua Rests., Inc., 118 USPQ2d at 1637 (quoting MCCARTHY ON TRADEMARKS
§ 12:23). See also In re Hotels.com LP, 573 F.3d 1300, 91 USPQ2d 1532 (Fed. Cir.
2009) (HOTELS.COM is generic for “providing information for others about
temporary lodging” and “travel agency services” because the term “hotels” “names a

32 Applicant’s brief at 8-9, 7 TTABVUE 9-10.
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key aspect” of such services.) In this case, the very essence of Applicant’s card
processing business is to operate and make available to customers a system for
making electronic payments. As the Examining Attorney’s evidence shows, people
in the relevant market use the expression ELECTRONIC TRANSACTION
SYSTEMS to refer to such a system.
Applicant criticizes the Examining Attorney’s evidence as “an array of random
and irrelevant blurbs and other references from the Internet…”33 Evidence of the
ways in which members of the public use language to discuss relevant fields of
business is exactly the type of evidence that will reveal whether the relevant public
would use the proposed mark to refer to the services at issue. While some items of
the Examining Attorney’s evidence are more relevant than others, much of the
evidence is directly on point, as is shown above, clearly associating the term
ELECTRONIC TRANSACTION SYSTEMS with credit and debit payment
transactions and clearly associating the term CORPORATION with Applicant’s
admitted form of business entity.
Finally, Applicant argues that the Examining Attorney has “impermissibly
dissected Applicant’s Mark in an effort to make the Internet evidence a better fit.”34
We disagree. The Examining Attorney presented evidence of use of the term
“electronic transaction systems” as a whole by members of the relevant public; and
the record contains ample evidence (including Applicant’s admissions) to
demonstrate that Applicant is the type of business entity known as a “corporation.”

33 Id. at 10, 7 TTABVUE 11.
34 Id.
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This is sufficient evidence to allow the Board to squarely address Applicant’s
proposed mark as a whole. It shows that Applicant’s proposed mark as a whole
would be readily understood by the relevant public to refer to a business that offers
automated payment services. The fact that the Examining Attorney submitted
dictionary definitions of the individual terms “electronic transaction” and “system”
does not detract from the correctness of her approach. “Evidence of the public's
understanding of the mark may be obtained from ‘any competent source, such as …
dictionaries ….’” In re Cordua Rests., Inc., 118 USPQ2d at 1634, citing Princeton
Vanguard, 114 USPQ2d at 1830. Thus ELECTRONIC TRANSACTION SYSTEMS
CORPORATION is generic as applied to Applicant’s credit and debit card
processing services.
Having reviewed all the evidence and arguments of record, we find that clear
evidence shows that the relevant public would understand the term ELECTRONIC
TRANSACTION SYSTEMS CORPORATION primarily to refer to the business of
credit card and debit card processing as identified in the application. Accordingly,
we affirm the Examining Attorney’s refusal to register Applicant’s proposed mark
on the Supplemental Register on the ground that it is incapable of distinguishing
the recited services.
Decision: The refusal to register Applicant’s mark is AFFIRMED on the
ground that ELECTRONIC TRANSACTION SYSTEMS CORPORATION is generic
and thus incapable of distinguishing Applicant’s services.