Vernon Chatman III

Trademark Trial and Appeal Board

Jan 29, 2009

No. 77261143 (T.T.A.B. Jan. 29, 2009)

Mailed:
January 29, 2009

UNITED STATES PATENT AND TRADEMARK OFFICE
________

Trademark Trial and Appeal Board
________

In re Vernon Chatman III
________

Serial Nos. 77261141 and 77261143
_______

Vernon Chatman III, pro se.

Kathleen M. Vanston, Trademark Examining Attorney, Law
Office 107 (J. Leslie Bishop, Managing Attorney).
_______

Before Seeherman, Drost and Wellington, Administrative
Trademark Judges.

Opinion by Seeherman, Administrative Trademark Judge:

Vernon Chatman III, an individual, has applied to
register the marks BETA1-INDEXING1 and β1-INDEXING,2 both in
standard character format, for “financial services, namely
investment portfolio management and consultation.”
Registration has been finally refused pursuant to Section

1 Application Serial No. 77261143, filed August 21, 2007, based
on Section 1(b) of the Trademark Act, 15 U.S.C. §1051(b)(intent-
to-use).
2 Application Serial No. 77261141, filed August 21, 2007, based
on Section 1(b) of the Trademark Act.

THIS OPINION IS NOT A
PRECEDENT OF THE TTAB
Ser Nos. 77261141 and 77261143
2
2(e)(1) of the Trademark Act, 15 U.S.C. §1052(e)(1), on the
ground that applicant’s marks are merely descriptive or in
the alternative are deceptively misdescriptive. Applicant
has appealed both refusals. Because they involve similar
issues and records, we are deciding both in a single
opinion.
As a preliminary matter, we note that applicant filed
reply briefs in each appeal on January 5, 2009. Trademark
Rule 2.142(b)(1) provides that if an applicant wishes to
file a reply brief it should do so within twenty days of
the mailing of the Examining Attorney’s brief. The
Examining Attorney’s brief for the appeal in Application
Serial No. 7726141 was mailed October 23, 2008, and
therefore the reply brief in that appeal was due by
November 13, 2008, while the reply brief for the appeal in
Application Serial No. 7726143 was due by December 11,
2008. Applicant’s reason for the late filing of his reply
briefs is that he is not an attorney and did not understand
the communication allowing applicant to file a reply brief,
which stated that “you may file a reply brief within twenty
(20) days of” the mailing of the Examining Attorney’s
brief, because it did not specifically exclude a later
response. The Board previously allowed applicant some
leniency when, on August 8, 2008, he filed in connection
Ser Nos. 77261141 and 77261143
3
with Application Serial No. 77261143 some web pages with
the handwritten note “Brief Attached.” At that time, the
Board did not dismiss the appeal because of applicant’s
failure to submit a proper brief, and allowed him 30 days
in which to submit a brief conforming to the requirements
of Trademark Rule 2.142. Despite applicant’s own
experience with the problems that can arise when not
represented by an attorney to prosecute his appeal, he
continued to act pro se. Doing so does not relieve him of
the responsibility to follow the rules; further, we do not
find his reading of either the rule or the Office’s
communication to be a reasonable interpretation.
Accordingly, applicant’s late-filed reply briefs have not
been considered.
It is the Examining Attorney’s position that
applicant’s marks BETA1-INDEXING and β1-INDEXING are merely
descriptive of applicant’s identified investment portfolio
management and consultation services because these terms
have an understood meaning for such services. In support
of this position, the Examining Attorney has made of record
excerpts from numerous dictionaries and financial websites
that define and explain the individual terms in the marks.
As a preliminary matter, we point out that the “β”
symbol in applicant’s mark is the Greek letter “beta,” and
Ser Nos. 77261141 and 77261143
4
would be recognized as such. First, we note that applicant
filed its application for β1-INDEXING in standard character
format, thus acknowledging that β is a standard character.
Second, the Examining Attorney has submitted evidence
showing that β is used in financial contexts as the
equivalent of “beta.” Thus, we will treat both marks as
equivalents, and although we will use “beta” in referring
to them, our comments are equally applicable to the Greek
symbol for the letter.
The following is some of the evidence as to the
meaning of the terms in the marks in connection with the
identified services:
What is beta?
Beta (β) is used to measure the risk
(volatility) of a stock relative to the
stock market. By definition, the
overall stock market has a beta of 1.0.
Invest 18, www.invest18.com

Beta: Stock Exchange an arbitrary
measure of the volatility of a given
stock using an index of the volatility
of the market as a whole. A beta of
1.1 indicates a stock that is 10
percent more volatile than the market.
Random House Unabridged Dictionary, ©
1997

Indexing: the adjustment of the weights
of assets in an investment portfolio so
that its performance matches that of an
index. (from Investopedia)
A strategy for choosing securities so
that a portfolio mimics the market as
represented by some chosen market
Ser Nos. 77261141 and 77261143
5
index. Most stock index funds attempt
to mimic Standard & Poor’s 500 Stock
index. (from Wallstreet Words)
http://dictionary.reference.com

Beta Factors How they can be used in
the current situation (title)
**
The aim of this article is to explain
one method of measuring the volatility
[of stocks] namely beta factors and how
investors can interpret this
information. ….
BETA FACTORS (subhead)
The beta of an investment is a relative
measure of the systematic risk of an
investment. In other words it measures
the specific risk of the company’s
shares relative to the market as a
whole. In general, the sign of the
beta (+/-) indicates whether, on
average, the investment’s returns move
with the market or in the opposite
direction to the market.
MONEY-zine.com, www.money-zine.com

Understanding a Stock’s Beta (title)
A stock’s beta is a comparative measure
of how the stock performs relative to
the market as a whole. The basic
premise is that a rising market
generally tends to boost most stock
values with it, while a falling market
is apt to lower them. The beta is a
calculated method of determining just
how close the correlation between the
two is.

To begin with, the market itself has
been assigned a beta value of 1; in
other words, its movement is exactly
equal to itself (a 1:1 ratio). Stocks
may have a beta value of less than,
equal to, or greater than one.
Financial Web, www.finweb.com

Ser Nos. 77261141 and 77261143
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Applicant has provided little argument in response to
the Office actions. In the responses to the first Office
actions, filed November 30, 2007, applicant merely stated
that “BETA 1 INDEXING does NOT describe the adjustment of
assets in a portfolio so that its performance matches that
of the stock market as a whole,” and submitted an article
he had written called “β1-Indexing: Reducing Investing
Complexity” which appears to have been published in “FPA
Journal,” found at www.fpanet.org. The Examining Attorney
specifically invited applicant to explain why his mark was
not descriptive:
Rather than state conclusively that the
term does not mean what the office
action states it to mean, applicant
should explain in writing what
precisely its [sic] services entail and
how the mark has no descriptive
significance in relation to them.
Providing a one sentence argument and
reference to an abstract does little to
assist the examiner in understanding
applicant’s services or its [sic]
position with respect to the
descriptiveness of the term in relation
to those services. Please explain in
writing your services and your position
in more detail.

Office actions mailed December 20, 2007. Despite this
request, applicant did not provide any further information.
On the contrary, in the responses filed on December 21,
2007, he merely stated “response reflects a limited
Ser Nos. 77261141 and 77261143
7
understanding of usage of [BETA or β] as used in an
investment context and an over-interpretation of symbol
[BETA1-INDEXING and β1-Indexing] that no consumer would
engage in; at best they would be curious.” He also
basically referred the Examining Attorney to his paper,
stating that “it is clear from the fact of publication of
my paper … that the symbol is NOT misleading.” Even his
appeal briefs consist only of 8 numbered points, each of
which is just a single sentence, e.g., “2. Examining
Attorney examined wrong mark: mark is ‘Beta1-indexing’, not
‘Beta=1 indexing’. 3. ‘Beta1’ mark is NOT the same as
‘Beta’.”
The paper submitted by applicant is clearly a
technical document that is designed for the sophisticated
investor or financial planner. Thus, it is not surprising
that the Examining Attorney requested that applicant
provide a clearer explanation than simply referencing his
paper. From our layman’s reading of the paper, it appears
that applicant has chosen BETA1-INDEXING and β1-INDEXING as
the name of an investing tool he has created.3 “Using index

3 We do not consider whether BETA1-INDEXING and β1-INDEXING
actually function as marks. The applications were filed based on
intent-to-use, and no specimens of use have been submitted.
Therefore, the Examining Attorney has not considered the issue of
whether applicant is actually using the applied-for terms as
trademarks for the identified services, and that issue is not
before us.
Ser Nos. 77261141 and 77261143
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mutual funds or exchange-traded funds that exactly model
desired indexes (β1-indexing) reduces investing complexity
by (1) decreasing the number of sets of assets involved in
portfolio construction and thereby (2) decreasing the
number of performance attributes that need to be
projected.” The tool “uses reasonably available
information: β and R-squared.” According to the article,
by using applicant’s tool or procedure, a financial advisor
or planner can choose mutual funds or exchange-traded funds
with greater certainly as to returns even though the fund
does not include all of the securities in the asset class.
Despite the limited information provided by applicant,
it is still the Office’s burden to prove that a mark is
merely descriptive or deceptively misdescriptive of the
identified services. The Examining Attorney has basically
used the definition of “beta,” and of “indexing,” set forth
previously, and the fact that the stock market itself has a
beta value of 1. From this, she concludes that BETA 1
indexing “describes a portfolio management strategy in
which the investor strives for an investment return similar
to that of the market as a whole as represented by a
particular index.” Brief, p. 4. She also asserts that
BETA1-INDEXING is a significant aspect of applicant’s
services, as set forth in applicant’s paper:
Ser Nos. 77261141 and 77261143
9
There are many approaches to portfolio
construction. Proposed here is a
specific one: only use index mutual
funds or exchange traded funds (ETFs)
that exactly model the bogey.[4] …
Further, as used here “exactly model”
and “model” imply that the ETF’s or
index mutual fund’s β=1.00 (and R-
squared=100%) with respect to the
index, by design, and the index does
not serve as a benchmark.

From this, the Examining Attorney concludes that “applicant
proposes using index mutual funds or exchange traded funds
that exactly model a benchmark index” and that “these funds
must have a β of 1 with respect to the benchmark index.”
Brief, p. 5.
We do not read applicant’s paper as supporting the
Examining Attorney’s position. On the contrary,
applicant’s proposed tool appears to help investors achieve
a more certain return when the funds do not have a beta
factor of 1.
Section 2(e)(1) of the Trademark Act prohibits
registration of a mark that is merely descriptive.
However, a suggestive mark may be registered. “Whether a
given mark is suggestive or merely descriptive depends on
whether the mark ‘immediately conveys … knowledge of the

4 “Bogey” is defined as “the benchmark return that a portfolio
or fund manager is compared against, such as the S&P 500.”
Investor Words.com, submitted by the Examining Attorney with the
June 9, 2008 Office action.

Ser Nos. 77261141 and 77261143
10
ingredients, qualities, or characteristics of the goods …
with which it is used’, or whether ‘imagination, thought or
perception is required to reach a conclusion on the nature
of the goods’.” In re Gyulay, 820 F.2d 1216, 3 USPQ2d 1009
(Fed. Cir. 1987). It has been recognized that there is but
a thin line of distinction between a suggestive and a
merely descriptive term, and it is often difficult to
determine when a term moves from the realm of
suggestiveness into the sphere of impermissible
descriptiveness. In re Recovery, Inc., 196 USPQ 830 (TTAB
1977). Although one can determine how applicant’s mark has
been derived by looking to the definitions and uses of the
various words, we do not think that the mark directly and
immediately conveys information about applicant’s
investment portfolio management and consultation services.
On the contrary, it does not appear that “beta 1 indexing”
is a term that is used or recognized in the financial
field. It would take a mental pause to view “beta 1” as
meaning a beta factor of 1, and another pause to see how
this would fit with the concept of “indexing,” and these
pauses or mental “hiccups” are enough to put applicant’s
marks on the suggestive side of the descriptiveness/
suggestiveness line. See In re Crocker National Bank, 223
USPQ 152 (TTAB 1984)(WORKING CAPITAL not merely descriptive
Ser Nos. 77261141 and 77261143
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of banking services because it has no precise meaning when
applied to banking services); In re Southern National Bank
of North Carolina, 219 USPQ 1231 (TTAB 1983) (MONEY 24 not
descriptive of automatic teller machine services). In
reaching this conclusion we have followed the well-
established practice that any doubt on this issue must be
resolved in applicant’s favor. See In re The Gracious Lady
Service, Inc., 175 USPQ 380 (TTAB 1972). We might well
reach a different result in an inter partes proceeding in
which more and clearer information is provided about the
nature of applicant’s services.
In view of our finding that BETA1-INDEXING and β1-
INDEXING would not be recognized as describing a feature of
applicant’s services, we also find that the mark is not
misdescriptive.
Decision: The refusals of registration on the grounds
that applicant’s marks BETA1-INDEXING and β1-INDEXING are
merely descriptive or deceptively misdescriptive are
reversed.