Refusal of application for a European Union trade mark

(Article 7 and Article 42(2) EUTMR)

Alicante, 09/11/2018

CARPMAELS & RANSFORD LLP

One Southampton Row

London London, City of WC1B 5HA

REINO UNIDO

Application No:	17 895 716
Your reference:	T041233EM
Trade mark:	EARNED ALPHA
Mark type:	Word mark
Applicant:	American Beacon Advisors, Inc. 220 E. Las Colinas Blvd., Suite 1200 Irving Texas 75039 ESTADOS UNIDOS (DE AMÉRICA)

The Office raised an objection on 17/05/2018 pursuant to Article 7(1)(b) and (c) and Article 7(2) EUTMR because it found that the trade mark applied for is descriptive and devoid of any distinctive character, for the reasons set out in the attached letter.

Upon request of 17/07/2018 from the applicant, the Office extended on 17/07/2018 the time limit for submitting observations with two months till 22/09/2018.

The applicant submitted its observations on 24/09/2018¹, which may be summarised as follows:

1. Descriptiveness/several meanings [of the verbal element ‘ALPHA’]

2. Relevant public and its’ level of attention

3. Distinctive character/the mark seen as a whole

Pursuant to Article 94 EUTMR, it is up to the Office to take a decision based on reasons or evidence on which the applicant has had an opportunity to present its comments.

After giving due consideration to the applicant’s arguments, the Office has decided to maintain the objection.

1. Descriptiveness/several meanings [of the verbal element ‘ALPHA’]

General remarks

Under Article 7(1)(c) EUTMR, ‘trade marks which consist exclusively of signs or indications which may serve, in trade, to designate the kind, quality, quantity, intended purpose, value, geographical origin or the time of production of the goods or of rendering of the service, or other characteristics of the goods or service’ are not to be registered.

It is settled case-law that each of the grounds for refusal to register listed in Article 7(1) EUTMR is independent and requires separate examination. Moreover, it is appropriate to interpret those grounds for refusal in the light of the general interest underlying each of them. The general interest to be taken into consideration must reflect different considerations according to the ground for refusal in question (16/09/2004, C‑329/02 P, SAT/2, EU:C:2004:532, § 25).

By prohibiting the registration as European Union trade marks of the signs and indications to which it refers, Article 7(1)(c) EUTMR pursues an aim which is in the public interest, namely that descriptive signs or indications relating to the characteristics of goods or services in respect of which registration is sought may be freely used by all. That provision accordingly prevents such signs and indications from being reserved to one undertaking alone because they have been registered as trade marks (23/10/2003, C‑191/01 P, Doublemint, EU:C:2003:579, § 31).

‘The signs and indications referred to in Article 7(1)(c) [EUTMR] are those which may serve in normal usage from the point of view of the target public to designate, either directly or by reference to one of their essential characteristics, the goods or service in respect of which registration is sought’ (26/11/2003, T‑222/02, Robotunits, EU:T:2003:315, § 34).

Applicant´s remarks

ALPHA has a number of different meanings such as:

• the first letter of the Greek alphabet,

• the substitution of that letter to mean “A” or “first”, or

• the use of that letter to describe a top or dominant personality or animal.

However, in the context of finance, the meaning of alpha is extremely niche. It is also extremely precise, and the highly sophisticated consumer of the relevant services will recognise that “EARNED ALPHA” is an unusual juxtaposition of words.

Office´s comments

The Office has taken note of and acknowledges the existence of different meanings as cited by the applicant of the verbal element ‘alpha’, contained in the sign at issue, ‘EARNED ALPHA’. However, the Office is of the position that the sign, seen as a whole, and in relation to the financial investment management services applied for which for the sake of good order are:

Class 36 Financial services, namely investment management services, funds of funds management and advisory services; financial services, namely total portfolio offerings of separate account management, alternative asset investments, enhanced cash portfolios, off shore funds, mutual funds for equity and fixed income investments, enhanced cash portfolios and pension plan consultation in International Class 036.

will be perceived direct and straightforwardly by the relevant public as a measure of fund management performance or in other words how well the funds at issue have earned alpha. Therefore, the sign describes the intended purpose – or the benefits – of the services in question.

Moreover, for a trade mark to be refused registration under Article 7(1)(c) EUTMR, it is not necessary that the signs and indications composing the mark that are referred to in that Article actually be in use at the time of the application for registration in a way that is descriptive of goods or services such as those in relation to which the application is filed, or of characteristics of those goods or services. It is sufficient, as the wording of that provision itself indicates, that such signs and indications could be used for such purposes. A sign must therefore be refused registration under that provision if at least one of its possible meanings designates a characteristic of the goods or services concerned (23/10/2003, C 191/01 P, Doublemint, EU:C:2003:579, § 32, emphasis added).

2. Relevant public and its’ level of attention

Applicant´s remarks

The relative public for the services at issue is “a rather highly specialised market sector.” Given the high stakes of involvement with services of this nature, the relevant consumer is likely to be extremely attentive and circumspect, and thus likely to notice any turns of phrase that do not fit in to the established vocabulary in the sector. Sectors of this sort use established terms of art rather than woolly or creative descriptions. EARNED ALPHA is such a phrase.

Office´s comments

The Office does agree with the applicant that the relevant public is a professional in a rather specialised market sector [within finance and investment]. However, at the same time it must be held that the fact that the relevant public is a specialist one cannot have a decisive influence on the legal criteria used to assess the distinctive character of a sign. Although it is true that the degree of attention of the relevant specialist public is, by definition, higher than that of the average consumer, it does not necessarily follow that a weaker distinctive character of a sign is sufficient where the relevant public is specialist (12/07/2012, C‑311/11 P, Wir machen das Besondere einfach, EU:C:2012:460, § 48).

As to the applicant´s allegation that the sign at issue, ‘EARNED ALPHA’ is a woolly, creative description – as opposed to an established term of art – the Office respectfully disagrees with the applicant. On the contrary, the Office is of the position that in the relevant finance and investment sector the sign at issue will be perceived straightforwardly as the term for a measure of performance for the active return or excess return gained on an investment [fund] in relation to the financial investment services at issue in Class 36.

3. Distinctive character/the mark seen as a whole

General remarks

Under Article 7(1)(b) EUTMR, ‘trade marks which are devoid of any distinctive character’ are not to be registered.

The marks referred to in Article 7(1)(b) EUTMR are, in particular, those that do not enable the relevant public ‘to repeat the experience of a purchase, if it proves to be positive, or to avoid it, if it proves to be negative, on the occasion of a subsequent acquisition of the goods or services concerned’ (27/02/2002, T‑79/00, Lite, EU:T:2002:42, § 26). This is the case for, inter alia, signs commonly used in connection with the marketing of the goods or services concerned (15/09/2005, T‑320/03, Live richly, EU:T:2005:325, § 65).

Moreover, it is also settled case-law that the way in which the relevant public perceives a trade mark is influenced by its level of attention, which is likely to vary according to the category of goods or services in question (05/03/2003, T‑194/01, Soap device, EU:T:2003:53, §  42; and 03/12/2003, T‑305/02, Bottle, EU:T:2003:328, § 34).

A sign, such as a slogan, that fulfils functions other than that of a trade mark in the traditional sense of the term ‘is only distinctive for the purposes of Article 7(1)(b) EUTMR if it may be perceived immediately as an indication of the commercial origin of the goods or services in question, so as to enable the relevant public to distinguish, without any possibility of confusion, the goods or services of the owner of the mark from those of a different commercial origin’ (05/12/2002, T‑130/01, Real People, Real Solutions, EU:T:2002:301, § 20 ; and 03/07/2003, T‑122/01, Best Buy, EU:T:2003:183, § 21).

Applicant´s remarks

The fact that each verbal element on its own of the sign may be descriptive or non-distinctive does not mean that their combination automatically lacks distinctive character. If the mark is syntactically unusual or a lexical invention,

- as it is the case here - this renders the mark with distinctive character.

Office´s comments

The Office does agree with the applicant that the sign at issue has to be assessed as a whole. Since the trade mark at issue is made up of several components (a compound mark), for the purposes of assessing its distinctive character it must be considered as a whole. However, this is not incompatible with an examination of each of the mark’s individual components in turn (19/09/2001, T-118/00, Tabs (3D), EU:T:2001:226, § 59).

Accordingly, the Office finds that the mark is far from being syntactically unusual or a lexical invention. The sign at issue, ‘EARNED ALPHA’, is a mere combination of the adjective ‘earned’ and the noun ‘alpha’ (being a measure of the active return of an investment) each of which is descriptive of characteristics of the services themselves. Merely bringing those elements together without introducing unusual variations – e.g. as to syntax or meaning – cannot result in anything else than a descriptive sign.

The following results of a Google internet search on the term ‘earned alpha’ reflects that it is used commonly in the relevant financial investment market:

https://books.google.es/books?id=-adGz0ED0asC&pg=PA250&lpg=PA250&dq=%22earned+alpha%22&source=bl&ots=s2uvTGoFEX&sig=X4UNR0uy_CuamFk5t31Gs72Lwms&hl=en&sa=X&ved=2ahUKEwjiqpyZxqHeAhUDVsAKHQQAA3wQ6AEwCnoECAEQAQ#v=onepage&q=%22earned%20alpha%22&f=false

http://www.na-businesspress.com/JAF/BuQ_Web16_1_.pdf

https://www.civilservicepensionscheme.org.uk/media/95092/alpha_schemeguides6_colour.pdf

https://www.emeraldinsight.com/doi/abs/10.1108/AJB-01-2016-0001?fullSc=1&journalCode=ajb

For the abovementioned reasons, and pursuant to Article 7(1)(b) and (c) and Article 7(2) EUTMR, the application for European Union trade mark No  17 895 716 is hereby rejected for all the services claimed, namely:

Class 36 Financial services, namely investment management services, funds of funds management and advisory services; financial services, namely total portfolio offerings of separate account management, alternative asset investments, enhanced cash portfolios, off shore funds, mutual funds for equity and fixed income investments, enhanced cash portfolios and pension plan consultation in International Class 036.

According to Article 67 EUTMR, you have a right to appeal against this decision. According to Article 68 EUTMR, notice of appeal must be filed in writing at the Office within two months of the date of notification of this decision. It must be filed in the language of the proceedings in which the decision subject to appeal was taken. Furthermore, a written statement of the grounds of appeal must be filed within four months of the same date. The notice of appeal will be deemed to be filed only when the appeal fee of EUR 720 has been paid.

Finn PEDERSEN