NGAM Advisors L.P.

Trademark Trial and Appeal Board

Mar 4, 2014

No. 76710461 (T.T.A.B. Mar. 4, 2014)

This Opinion is Not a
Precedent of the TTAB

Mailed: March 4, 2014

UNITED STATES PATENT AND TRADEMARK OFFICE
_____

Trademark Trial and Appeal Board
________

In re NGAM Advisors L.P.
________

Serial No. 76710461
_______

Stephen J. Jeffries and Birte Hoehne Mahyera of Holland & Knight for NGAM
Advisors L.P.

Kristina Morris, Trademark Examining Attorney, Law Office 116 (Michael W.
Baird, Managing Attorney).
_______

Before Quinn, Bucher and Hightower,
Administrative Trademark Judges.

Opinion by Quinn, Administrative Trademark Judge:
NGAM Advisors L.P. (“applicant”) filed, on January 30, 2012, an application to
register the proposed mark ACTIVE INVESTMENT ADVISORS (in standard
characters; “INVESTMENT ADVISORS” disclaimed) for “investment management
services; investment advisory services” in International Class 36. The application
was filed pursuant to Section 1(a) of the Trademark Act, 15 U.S.C. § 1051(a),
alleging first use anywhere and first use in commerce on January 5, 2005. Applicant
claims that the applied-for mark has acquired distinctiveness for applicant’s
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services under Section 2(f), 15 U.S.C. § 1052(f). Applicant also claims ownership of
Registration No. 3147021 (issued September 19, 2006 on the Supplemental
Register; Section 8 affidavit accepted) of the mark ACTIVE INVESTMENT
ADVISORS (in standard characters; “INVESTMENT ADVISORS” disclaimed) for
“investment management services; investment advisory services” in International
Class 36.
The trademark examining attorney refused registration on the ground that
applicant’s proposed mark, when used in connection with applicant’s services, is so
highly descriptive that applicant’s Section 2(f) showing is insufficient.
When the refusal was made final, applicant filed a request for reconsideration.
The request was denied, and applicant appealed. Applicant and the examining
attorney filed briefs.
The Arguments and Evidence
Applicant notes its disclaimer of the words “Investment Advisors,” and
“concedes that the portion of Applicant’s Mark comprising the wording ‘investment
advisors’ is generic.”1 (Brief, p. 6). Applicant also “concede[s] that the phrases ‘active
management,’ ‘active investing’ and ‘active investment approach’ are sometimes
used to describe a strategy where specific investments are managed or made to
outperform a benchmark index.” (emphasis in original) (Brief, p. 8). Applicant also

1 See In re Creative Goldsmiths of Wash., Inc., 229 USPQ 766, 768 (TTAB 1986) (“it is
within the discretion of an Examining Attorney to require the disclaimer of an
unregistrable component (such as a common descriptive, or generic, name) of a composite
mark sought to be registered on the Principal Register under the provisions of Section
2(f)”). The disclaimer, along with the Section 2(f) claim, was included in the application as
originally filed.
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states that “while Applicant’s Mark does describe one feature of Applicant’s
significantly broader and much more complex service offering, Applicant’s Mark is
not ‘highly descriptive.’” (Brief, p. 11). Moreover, applicant argues that its
customers are institutional investors and high net worth individuals who are
familiar with the landscape of the financial industry and its players and, thus, are
more likely than members of the general consuming public to recognize ACTIVE
INVESTMENT ADVISORS as an indicator of source of applicant’s services, rather
than as a mere descriptor thereof. In connection with its claim of acquired
distinctiveness, applicant submitted a declaration of one of applicant’s officers who
sets forth allegations regarding the specifics of applicant’s business under the
proposed mark; the declaration is accompanied by several related exhibits.
Applicant submitted additional internet excerpts with its request for
reconsideration. Applicant summarizes its position as follows:
[C]onsidering the conditions under which Applicant’s
complex and multifaceted investment services are
evaluated and chosen, the very select pool of customers
that Applicant serves, the well-known and famous
publications that have used Applicant’s Mark to identify
Applicant and Applicant’s services, the over ten years
Applicant has been offering its services [in] connection
with Applicant’s Mark, and the assets exceeding half a
billion US dollars that were entrusted to Applicant during
only a five year period, it is Applicant’s belief that
Applicant’s evidence quite readily suffices to establish
that Applicant’s Mark has come to function as an
indicator of the source of Applicant’s investment
management and advisory services.
(Brief, p. 16)

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Applicant further asserts that the examining attorney’s evidence does not include
the following: any evidence of third-party use of the exact wording “active
investment advisors”; any evidence that the term “active” is used in a widespread
manner in connection with investment management and advisory services; any
evidence that the term “active” has a single, fixed meaning in connection with
investment management and advisory services; and any evidence of use of “active
investment advisors” to describe a bundle of distinct services like applicant’s
services.
The examining attorney maintains that the designation sought to be registered
is highly descriptive, and applicant’s evidence falls short of establishing that the
designation has acquired distinctiveness when used in connection with “active”
investment management and advisory services. In support of the refusal the
examining introduced dictionary definitions, and excerpts of third-party websites.
The Law
Section 2(e)(1) provides that a mark (or portion thereof) is unregistrable on the
Principal Register if, “when used on or in connection with the goods of the applicant
[it] is merely descriptive or deceptively misdescriptive of them … .”
Pursuant to Section 2(f), matter which is merely descriptive under Section
2(e)(1) may nonetheless be registered on the Principal Register if it “has become
distinctive of the applicant’s goods [or services] in commerce.” Thus, the mark may
be registered on the Principal Register if the applicant proves that the merely
descriptive matter has acquired distinctiveness (also known as “secondary
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meaning”) as used on the applicant’s goods and/or services in commerce. See In re
Chopper Indus., 222 USPQ 258 (TTAB 1984).
The applicant seeking registration of a mark under Section 2(f) bears the
ultimate burden of establishing acquired distinctiveness. See In re Hollywood
Brands, Inc., 214 F.2d 139, 102 USPQ 294, 295 (CCPA 1954) (“There is no doubt
that Congress intended that the burden of proof under [Section 2(f)] should rest
upon the applicant for registration….”). See also Yamaha Int’l Corp. v. Hoshino
Gakki Co., 840 F.2d 1572, 6 USPQ2d 1001, 1005 (Fed. Cir. 1988). Applicant’s
burden is to prove acquired distinctiveness by a preponderance of the evidence. See
In re Noon Hour Food Products Inc., 88 USPQ2d 1172, 1181 (TTAB 2008). “Finally,
the applicant’s burden of showing acquired distinctiveness increases with the level
of descriptiveness; a more descriptive term requires more evidence of secondary
meaning.” In re Steelbuilding.com, 415 F.3d 1293, 75 USPQ2d 1420, 1424 (Fed. Cir.
2005). As the Board has explained:
That is to say, the greater the degree of descriptiveness,
the greater the evidentiary burden on the user to
establish acquired distinctiveness. The sufficiency of the
evidence offered to prove acquired distinctiveness should
be evaluated in light of the nature of the designation.
Highly descriptive terms, for example, are less likely to be
perceived as trademarks and more likely to be useful to
competing sellers than are less descriptive terms. More
substantial evidence of acquired distinctiveness thus will
ordinarily be required to establish that such terms truly
function as source-indicators.

In re Greenliant Systems Ltd., 97 USPQ2d 1078, 1085 (TTAB 2010) (internal
citations omitted).
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Degree of Descriptiveness
The initial question before us in our analysis of whether ACTIVE
INVESTMENT ADVISORS has acquired distinctiveness is the degree of
descriptiveness of that wording as applied to applicant’s services. As noted above,
the higher the degree of descriptiveness of the designation in question, the higher
the burden applicant faces in proving acquired distinctiveness.
A term is considered to be merely descriptive under Section 2(e)(1) if it
immediately conveys knowledge of a quality, feature, function, or characteristic of
the goods or services with which it is used. See In re Chamber of Commerce of the
United States of America, 675 F.3d 1297, 102 USPQ2d 1217 (Fed. Cir. 2012).
By seeking registration of its proposed mark ACTIVE INVESTMENT
ADVISORS pursuant to Section 2(f), applicant has conceded that this wording is at
the least merely descriptive of its services, under Section 2(e)(1). See In re
RiseSmart Inc., 104 USPQ2d 1931, 1932 (TTAB 2012) (“…when an applicant
responds to a refusal based on mere descriptiveness of a mark, or portion of a mark,
by claiming acquired distinctiveness, such amendment to seek registration under
Section 2(f) of the Trademark Act is considered an admission that the proposed
mark is not inherently distinctive.”). See also The Cold War Museum, Inc. v. Cold
War Air Museum, Inc., 586 F.3d 132, 92 USPQ2d 1626, 1629 (Fed. Cir. 2009).
The examining attorney introduced dictionary definitions to support the refusal.
The term “investment” means “the act of investing money.” (collinsdictionary.com).
The term “advisor” is defined as “a person who advises.” Id. The term “investment
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advisor” is defined as follows: “As defined by the Investment Advisors Act of 1940,
any person or group that makes investment recommendations or conducts securities
analysis in return for a fee, whether through direct management of client assets or
via written publications.” (investopedia.com).
The term “active investing” is defined as follows:
An investment strategy involving ongoing buying and
selling actions by the investor. Active investors purchase
investments and continuously monitor their activity in
order to exploit investment conditions. Active investing is
highly involved. Unlike passive investors, who invest in a
stock when they believe in its potential for long-term
appreciation, active investors will typically look at the
price movements of their stocks many times a day.
Typically, active investors are seeking short-term profits.
(investopedia.com)

“Active Management” is defined as “the use of a human element, such as a single
manager, co-managers or a team of managers, to actively manage a fund’s
portfolio.” (investopedia.com).
The following information under the listing “Active Management” appears in
Wikipedia:
Active management (also called active investing) refers to
a portfolio management strategy where the manager
makes specific investments with the goal of outperforming
an investment benchmark index. Investors or mutual
funds that do not aspire to create a return in excess of a
benchmark index will often invest in an index fund that
replicates as closely as possible the investment weighting
and return of that index; this is called passive
management. Active management is the opposite of
passive management, because in passive management the
manager does not seek to outperform the benchmark
index.

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Ideally, the active manager exploits market inefficiencies
… active management may also serve to create less
volatility or “risk” than the benchmark index.

Active portfolio managers may use a variety of factors and
strategies to construct their portfolio(s).

The effectiveness of an actively-managed investment
portfolio obviously depends on the skill of the manager
and research staff but also on how the term active is
defined. Many mutual funds purported to be actively
managed stay fully invested regardless of market
conditions, with only minor allocation adjustment over
time. Other managers will retreat fully to cash, or use
hedging strategies during prolonged market declines.
These two groups of active managers will offer very
different performance characteristics.

Approximately 20% of all mutual funds are pure index
funds. The balance are actively managed in some respect
… 45% of all mutual funds are “closet indexers” funds
whose portfolios look like indexes and whose performance
is very closely correlated to an index but call themselves
active to justify higher management fees.

Only about 30% of mutual funds are active enough that
the manager has the latitude to move completely out of an
asset class in decline, which is what many investors
expect from active management.

Due to mutual fund and/or expenses, it is possible that an
active or passively managed mutual fund could
underperform compared to the benchmark index … many
investors find active management an attractive
investment strategy in volatile or declining markets…
The primary attraction of active management is that it
allows selection of a variety of investments instead of
investing in the market as a whole.

In a similar fashion, the term “active investing” is explained as follows:
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Active Investing – Defined
Active investors believe that they are able to consistently
identify enough high performing investments to
ultimately achieve better than average results. Active
investors seek out what they consider to be better than
average opportunities.

Advocates of active investing suggest that the market
provides sufficient inefficiencies to be successfully
exploited by the astute investor.

As academically interesting as the debate between active
and passive management may be, it does not answer the
most important questions an investor is faced with.

The active vs. passive management debate should only be
addressed after a solid investment foundation has been
built.

How important is the active vs. passive investing decision
to advisors?

Active vs. passive investing –
Advantages and disadvantages
An active manager has to add enough value to overcome
the cost disadvantage … the very success of indexing is
based on the research work performed by active
managers.
Passive management could not exist without active
managers keeping the markets efficient.

How to select an active investment manager?
(fragassogroup.com)

The record also includes the following excerpts of third-party websites and one
publication showing use of the term “active” in connection with a particular strategy
or style of investing:
Our flagship strategy, the Parlan Active Management
Strategy (PAMS), is an active investment approach.

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Parlan takes an active approach.
(parlan.com)

Improve Your Understanding of Passive and Active
Investing
[Active investing] is generally defined as an investment
strategy that employs a manager who attempts to
generate returns in excess of the index the portfolio is
benchmarked against.
There are two big advantages of active management: the
prospect of beating the index and protection in a down
market … active managers add value to the investor…
(money.com)

Active Investors are Everywhere
About 85% of investors are active investors.
(ifa.com)

Active investing is a strategy that investors use when
trying to beat a market or appropriate benchmark.
(ifa.com)

He declares, “the dopamine rush we get from long shots is
why we play lotto, invest in IPOs, keep too much money
in too few stocks and invest with active portfolio
managers instead of index funds.”
(ifa.com)

Actively managed ETFs get big-name backing
[A] major hurdle is competitive concerns from active
managers outside of the ETF space.
(marketwatch.com)

Blending Index and Active Investment Strategies
Blending index-investing based ETFs with active
management strategies can offer a number of benefits…
(us.ishares.com)

The exchange traded fund universe has thoroughly
covered basic indexing methodologies, and now, the new
actively managed ETF space looks like the industry’s new
frontier.
(efttrends.com)

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As core/satellite strategies grow in popularity among
intermediaries, fund firms are marketing their actively
managed funds as suitable core holdings. The issue is
important because the core represents as much as three-
quarters of core/satellite investors’ assets and has
traditionally been reserved for passive investments.
(Fund Action, Nov. 6, 2006)

The record includes promotional and informational materials furnished by
applicant to investors and prospective investors. This evidence shows many uses of
the term “active” in connection with applicant’s services. In the example shown
below (Smith dec., Ex. K), applicant appears to identify two investment strategies,
namely, “active” and “indexing” investments. Applicant’s services are a blend of the
two, confirming that its services include, as a significant feature thereof, “active”
investment management and advice. This particular use of the term “active”
appears to be generic use, just as “indexing” appears to be generic use.

All of the other uses by applicant show the term “active” either in italics (e.g.,
“ACTIVE INDEX STRATEGIES” or “Our Active strategies combine…”) or with an
initial capital letter (e.g., Active S&P 500® Strategy). Applicant’s literature
indicates that its “index strategies seek to track a targeted index on a pre-tax basis
and outperform it on an after-tax basis, while delivering customization and tax
management at the individual account level,” and that “[a] dedicated team
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continually monitors the changing world of ETFs, analyzing their relative
attractiveness for potential inclusion in the models.”
Based on the dictionary and Internet evidence, as well as applicant’s literature,
we find that the wording ACTIVE INVESTMENT ADVISORS is highly descriptive
of applicant’s “investment management services; investment advisory services.”
“Active” clearly is a term of art in the financial field to indicate a specific
investment strategy, namely a strategy utilized by applicant’s investment portfolio
advisors and managers who engage in ongoing buying and selling in an attempt to,
as in applicant’s case, outperform an investment benchmark index. Evidence
showing that the wording “active” and “investment advisors” comprising applicant’s
proposed mark is commonly understood and recognized, and that third parties in
applicant’s field use wording similar to that of applicant’s proposed mark, tends to
indicate that the proposed mark as a whole is highly descriptive. This wording
consists simply of the admittedly generic (and disclaimed) terminology
INVESTMENT ADVISORS, modified by the highly descriptive designation
ACTIVE. The mark sought to be registered is highly descriptive of the specific type
of services rendered by applicant. These investment management and advisory
services are offered by active investment advisors, that is, investment advisors who
subscribe to a strategy of active investing in managing their portfolios for investors.
See In re King Koil Licensing Co., 79 USPQ2d 1048 (TTAB 2006) (finding that, as
applied to mattresses, the combination of the highly descriptive word
BREATHABLE with the generic word MATTRESS into the composite
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BREATHABLE MATTRESS results in a composite that itself is highly descriptive);
In re Half Price Books, Records, Magazines, Inc., 225 USPQ 219 (TTAB 1984)
(finding the designation HALF PRICE BOOKS, RECORDS, MAGAZINES to be
highly descriptive of and indeed the “apt descriptive name” of “retail book and
record store services,” because it merely combines the generic words BOOKS,
RECORDS, MAGAZINES with the highly descriptive modifier HALF PRICE).
Applicant observes that the examining attorney’s internet evidence fails to show
any uses of the exact terminology “active investment advisors.” Further, only one
excerpt shows use of the term “active investment,” and the remaining references
include wording such as “active investing,” “actively managed,” or “active
management.” Thus, applicant concludes:
Because the record fails to support the notion that the
phrases “active investment” or “active investing” have
some fixed, commonly understood meaning in connection
with investment management and advisory services, it
can hardly be said to support the examiner’s assertion
that Applicant’s Mark is “highly descriptive.” Instead, the
record shows that the phrases “active investment” and
“active investing” suggest different meanings in different
contexts even as used in connection with investment
management and advisory services.
(Reply Brief, p. 3)

Although applicant contends that terms such as “active investment” and “active
investing” suggest different meanings in different contexts, applicant fails to state
what those different meanings are. To the contrary, we view the third-party use,
and the one use by applicant itself as highlighted by the earlier illustration, to be
consistent with the dictionary definitions of record. The evidence as a whole
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identifies a single and specific meaning that is commonly recognized and
understood as it relates to financial investments: the term “active” identifies a
portfolio management strategy where the manager makes specific investments with
the goal of outperforming an investment benchmark index, such as the S&P 500 (as
in applicant’s “Active S&P 500® Strategy” portfolio). That is to say, the investment
advisors for applicant’s portfolios manage them in an active fashion, buying and
selling equities in an attempt to outperform the benchmark index to which a
particular portfolio is attached.
Applicant asserts that many aspects of its services do not involve “active
investing” or an attempt to outperform an investment benchmark index. What
applicant overlooks, however, is that the designation need not describe all of the
purposes, functions, characteristics, or features of applicant’s services to be
considered highly descriptive or even merely descriptive; it is enough if the term
describes one significant function or attribute. See In re Chamber of Commerce, 102
USPQ2d at 1219; In re Oppedahl & Larson LLP, 373 F.3d 1171, 71 USPQ2d 1370,
1371 (Fed. Cir. 2004), citing In re Dial-A-Mattress Operating Corp., 240 F.3d 1341,
57 USPQ2d 1807, 1812 (Fed. Cir. 2001) (“A mark may be merely descriptive even if
it does not describe the ‘full scope and extent’ of the applicant’s goods or services.”);
In re Positec Group Ltd., 108 USPQ2d 1161, 1171 (TTAB 2013) (“[I]f the mark is
descriptive of some identified items – or even just one – the whole class of goods still
may be refused by the examiner.”). See also In re Omaha Nat’l Corp., 819 F.2d 1117,
2 USPQ2d 1859, 1861 (Fed. Cir. 1987) (rejecting argument that descriptiveness
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should be limited to a quality or characteristic of the service itself and holding that
it includes a designation descriptive of the service provider).
Accordingly, we find that applicant’s proposed mark is highly descriptive when
used in connection with applicant’s services.
Acquired Distinctiveness
We turn now to the question of whether applicant has established that the
highly descriptive designation ACTIVE INVESTMENT ADVISORS has acquired
distinctiveness for purposes of Section 2(f), such that the designation is registrable
on the Principal Register. As noted above, applicant bears the ultimate burden of
proving acquired distinctiveness, by a preponderance of the evidence.
Because we have found that the wording ACTIVE INVESTMENT ADVISORS is
highly descriptive of applicant’s services, applicant’s burden of establishing
acquired distinctiveness under Section 2(f) likewise is very high. See In re
Steelbuilding.com, 75 USPQ2d at 1424; In re Bongrain Int’l Corp., 894 F.2d 1316,
13 USPQ2d 1727, 1729 (Fed. Cir. 1990); In re Greenliant Systems Ltd., 97 USPQ2d
at 1085.
“To show that a mark has acquired distinctiveness, an applicant must
demonstrate that the relevant public understands the primary significance of the
mark as identifying the source of a product or service rather than the product or
service itself.” In re Steelbuilding.com, 75 USPQ2d at 1422. See also Coach Services
Inc. v. Triumph Learning LLC, 668 F.3d 1356, 101 USPQ2d 1721, 1729 (Fed. Cir.
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2012). Our ultimate Section 2(f) analysis and determination in this case will be
based on all of the evidence considered as a whole.
In support of its Section 2(f) claim of acquired distinctiveness, applicant
submitted the declaration of Beatriz Pina Smith, applicant’s executive vice
president and chief financial officer. The declaration is accompanied by several
exhibits, all relating to applicant’s services rendered under the proposed mark. In
pertinent part, Ms. Smith states that applicant has used the designation ACTIVE
INVESTMENT ADVISORS in commerce in connection with investment
management and advisory services for ten years; and that applicant’s business unit
using the designation specializes in index-based separate account solutions that
combine the diversification and return potential of indexing with the enhanced tax
efficiency and personalized construction of a separately managed account. According
to Ms. Smith, applicant renders the following services under the proposed mark:
investment advisory services that consist of discretionary recommendations to
managed account clients based on proprietary models and proprietary sampling
techniques that build securities portfolios with the objective of tracing a particular
index reasonably closely without holding each security in the index. Applicant’s
managed account clients consist of high net worth investors ($50 million minimum)
faced with complex financial planning challenges; the number of customers has
ranged from a low of 643 in 2009 to a high of 1,240 in 2011. Assets under applicant’s
management range from a low of $80 million in 2010 to a high of $197 million in
2007 (with a five-year total of $606 million, or an average of $122 million annually).
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Applicant advertises and promotes its services under the designation through
distribution of brochures, fund profiles, performance overviews, and other print and
electronic marketing pieces; one-on-one presentations and investment proposals
directed to clients and potential clients; and the internet at applicant’s website
located at . Applicant and its services have been the subjects
of unsolicited publicity in online publications such as The Wall Street Journal,
Investment News, Fund Action, Private Asset Management, Fund Marketing Alert
and Foundation and Endowment Management, with the majority of these online
publications enjoying high web traffic rankings.
Although we have considered applicant’s advertising and promotional efforts,
applicant has not submitted any numbers relating to its actual expenditures. Thus,
we are at some disadvantage to gauge how extensive applicant’s promotional efforts
have been. In saying this, we recognize, however, that proof of an expensive and
successful advertising campaign is not in itself enough to demonstrate acquired
distinctiveness. See In re Boston Beer Co. L.P., 198 F.3d 1370, 53 USPQ2d 1056
(Fed. Cir. 1999). The ultimate test in determining whether a designation has
acquired distinctiveness is applicant’s success, rather than its efforts, in educating
the public to associate the proposed mark with a single source.
We also have taken into account the unsolicited publicity in a variety of
publications, keeping in mind the popularity of these on-line websites as shown by
applicant’s evidence. None of the articles, however, highlight applicant or its
services as the feature of the article; rather, there are merely short blurbs about
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applicant or its business, many of which deal with personnel moves. More
importantly, although the evidence may show exposure of the proposed mark to the
relevant public, we have no information as to whether the exposure has paid off,
that is, that ultimate investors have been conditioned to recognize and use the
designation ACTIVE INVESTMENT ADVISORS as an indicator of the source of
applicant’s services. In this connection, the record is devoid of any direct evidence
on point, such as declarations from ultimate investors attesting to their recognition
of ACTIVE INVESTMENT ADVISORS as a source indicator for applicant’s services.
We have considered applicant’s statement that it has used the designation
ACTIVE INVESTMENT ADVISORS for over ten years. This length of use, however,
is outweighed by the other evidence showing that the wording is highly descriptive,
and the absence of any direct evidence showing recognition of the wording as a
source indicator for applicant’s services. Cf. In re Packaging Specialists, Inc., 221
USPQ 917, 920 (TTAB 1984) (use of mark for sixteen years deemed “a substantial
period but not necessarily conclusive or persuasive on the Section 2(f) showing”).
The amount of assets managed by applicant is noteworthy, and provides limited
support for applicant’s claim of acquired distinctiveness. However, the probative
value of the amount of money under applicant’s management is diminished by the
fact that the amounts are raw numbers, providing no context showing applicant’s
market share and whether the stated amount of such assets is significant in the
industry. See Target Brands Inc. v. Hughes, 85 USPQ2d 1676, 1681 (TTAB 2007)
(“The sales figures for 14 years, standing alone and without any context in the
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trade, are not so impressive as to elevate applicant’s highly descriptive designation
to the status of a distinctive mark.”). Further, the raw numbers, although showing
the success of applicant’s endeavors, do not necessarily evidence consumers’
recognition of the proposed mark as a source indicator. See In re Boston Beer Co.
L.P., 53 USPQ2d at 1057.
We have considered applicant’s claim that its customers are sophisticated and
that they necessarily would recognize the proposed mark as indicating the source or
origin of applicant’s services. The main problem with this argument is that the
recitation of services does not reflect this sophistication. We recognize that the
evidence shows that applicant’s customers comprise high net worth individuals who
undoubtedly are very well informed and discerning customers when it comes to
making their investment decisions. However, applicant’s recitation of services reads
simply “investment management services; investment advisory services,” and in
determining the scope of registration sought by applicant, it is the application (not
actual use) that we must look to in determining applicant’s right to register.
Octocom Sys., Inc. v. Houston Computer Servs., Inc., 918 F.2d 937, 16 USPQ2d
1783, 1787 (Fed. Cir. 1990). Because the services are broadly worded with no
limitations, we must presume that the services include all types of “investment
management services; investment advisory services” and that they are offered to all
normal customers. In re Elbaum, 211 USPQ 639, 640 (TTAB 1981). Thus,
applicant’s services could be offered to, and consumed by, anyone with money to
invest, including ordinary consumers seeking investment management and advisory
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services for what might be modest portfolios. Further, as broadly worded in the
application, applicant’s services do not necessarily involve a careful purchase. While
some consumers, if not most choose their investment managers with care, others
may not, especially when lesser amounts of investments are concerned. See
Amalgamated Bank of New York v. Amalgamated Trust & Savings Bank, 842 F.2d
1270, 6 USPQ2d 1305, 1308 (Fed. Cir. 1988).
Applicant points out that no one else in the industry uses the specific descriptor
“active investment advisors” in connection with the same or similar services.
However, even assuming that applicant may be the first and/or only user of the
exact wording ACTIVE INVESTMENT ADVISORS in the financial industry, we
find that this fact does not negate the highly descriptive nature of the wording or
suffice to establish acquired distinctiveness in this case. See J. Kohnstam, Ltd. v.
Louis Marx & Co., 280 F.2d 437, 126 USPQ 362, 364 (CCPA 1960); In re Greenliant
Systems Ltd., 97 USPQ2d at 1083; In re Mortg. Bankers Ass’n of Am., 226 USPQ
954, 956 (TTAB 1985); In re Nat’l Shooting Sports Found., Inc., 219 USPQ 1018
(TTAB 1983).
Lastly, we note Ms. Smith’s statement that applicant’s proposed mark has
become distinctive of applicant’s investment management and advisory services.
This statement is merely a conclusory opinion about source recognition among
relevant consumers, without any probative and corroborating evidence from
consumers themselves. That is to say, Ms. Smith’s statement is merely opinion and
she has not been established as competent to testify as to what others think about
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the source-indicating function of applicant’s proposed mark ACTIVE
INVESTMENT ADVISORS. We find in the overall context of the evidence in this
case that Ms. Smith’s statement is entitled to very little probative weight on the
question of acquired distinctiveness.
In short, we find that applicant has failed to establish that the designation
ACTIVE INVESTMENT ADVISORS has acquired distinctiveness as a source-
indicator for applicant’s services, rather than merely as highly descriptive wording
which identifies a significant feature of the services, that is, applicant’s investment
portfolios are managed with an active strategy by “active investment advisors.”
Given that the proposed mark is highly descriptive, much more evidence, especially
in the form of direct evidence from the relevant purchasing public, than what
applicant has submitted would be necessary to show that the designation ACTIVE
INVESTMENT ADVISORS has become distinctive for applicant’s investment
management and investment advisory services. See, e.g., In re Country Music Assoc.
Inc., 100 USPQ2d 1824, 1834 (TTAB 2011) (“Teflon” consumer survey showed 85%
of respondents believed term COUNTRY MUSIC ASSOCIATION is a brand name
and, thus, is probative evidence of acquired distinctiveness).
As discussed above, the designation ACTIVE INVESTMENT ADVISORS is not
only merely descriptive as applied to applicant’s services (a point applicant has
conceded by seeking registration under Section 2(f)). We find that it in fact is highly
descriptive as applied to investment management and advisory services.
Accordingly, applicant’s burden of proving acquired distinctiveness is likewise very
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high. See In re Steelbuilding.com, 75 USPQ2d at 1424 (“The proposed mark is
highly descriptive. Therefore, applicant had the burden to show a concomitantly
high level of secondary meaning.”). We find that applicant has failed to carry that
burden.
Decision: The refusal to register is affirmed.