Precedential No. 26: TTAB Rejects 2(f) Acquired Distinctiveness Claim for GUARANTEED RATE for Mortgage Lending Services

Conceding that the phrase GUARANTEED RATE is merely descriptive of its services, Applicant Guaranteed Rate, Inc. sought to register the phrase, and the word-plus-design mark shown below, for various mortgage lending services, under Section 2(f), claiming acquired distinctiveness. The Board, however, found the phrase to be highly descriptive - indeed, a "key aspect" - of the services and ruled that applicant had failed to carry the proportionately higher burden to establish acquired distinctiveness. And so the Board affirmed the Section 2(e)(1) refusal of the word mark and likewise affirmed the requirement that applicant disclaim the phrase in the word-plus-design mark. In re Guaranteed Rate, Inc., 2020 USPQ2d 10869 (TTAB 2020) [precedential] (Opinion by Judge Marc A. Bergsman).

Examining Attorney Andrea P. Butler submitted dictionary definitions of the component words and copious evidence of third-party use of "guaranteed rate" and closely similar terms. The Board found from this evidence that "'locking in' a mortgage rate is referred to and explained as 'guaranteed rate' ... for a particular period," and it concluded that the phrase is highly descriptive.

To determine whether the phrase has acquired distinctiveness, the Board looked to In re Snowizard, Inc., 129 USPQ2d 1001, 1005 (TTAB 2018) (quoting Converse, Inc. v. Int'l Trade Comm'n, 128 USPQ2d 1538, 1546 (Fed. Cir. 2018).

[T]he considerations to be assessed in determining whether a mark has acquired secondary meaning can be described by the following six factors: (1) association of the [mark] with a particular source by actual purchasers (typically measured by customer surveys); (2) length, degree, and exclusivity of use; (3) amount and manner of advertising; (4) amount of sales and number of customers; (5) intentional copying; and (6) unsolicited media coverage of the product embodying the mark.

Applicant relied on evidence under the second, third, fourth and sixth Snowizard considerations, but it did not submit a consumer survey or other direct evidence. It has used the phrase in connection with mortgage services since 2000. It owns registrations for GUARANTEED RATE AFFINITY, in standard character and design form, for the same same services, both of which registrations issued with a claim of acquired distinctiveness for "GUARANTEED RATE."

Since 2007, applicant has spent more than $140 Million in promoting its services under the proposed mark, usually in the design format. Applicant garnered more than $3 Billion in revenues in the past 11 years and in 2016 was ranked as the fifth largest mortgage company. It has received favorable media coverage, advertised at the Super Bowl, and owns naming rights to the Chicago White Sox baseball stadium. [I still call it Comiskey Park - ed.].

The Board found applicant's advertising and sales figures to be "impressive," but was "not convinced that this evidence demonstrates consumer recognition of this highly descriptive wording as indicating a single source because of the extensive evidence of third party use." Even if use had been substantially exclusive use of the phrase GUARANTEED RATE since 2000 would not be dispositive.

It was not clear to what extent applicant uses the phrase GUARANTEED RATE standing alone. And the nature and number of third-party descriptive uses undercut applicant's claim "because it interferes with the relevant public's perception of the designation as a source indicator."

Given the number of third-party uses in the same field in which Applicant uses it, consumers are likely to perceive the term “Guaranteed Rate” when used in connection with mortgage lending services not as a trademark for one company, but rather as a term commonly used by many entities in the industry, and in common speech, to describe a feature of mortgage services.

The Board then turned to applicant's two registrations for the mark GUARANTEED RATE AFFINITY, one in standard characters and the other in the form shown below, both of which include a claim of acquired distinctiveness for GUARANTEED RATE. Trademark Rule 2.41(a) provides that "in appropriate cases" ownership of registrations of the "same mark" may be accepted as prima facie evidence of distinctiveness "if the goods or services are sufficiently similar to the goods or services in the application." However, "further evidence may be required."

The Board found the prior registrations to be insufficient to prove acquired distinctiveness, and that additional evidence is required. First, the phrase GUARANTEED RATE is so highly descriptive that reliance on prior registrations is not, in and of itself, enough to establish acquired distinctiveness. The Board observed once again that each application must be examined on its own merits, and the existence of the two prior registrations without disclaimers "are insignificant in the mix of evidence in this particular set of circumstances."

Second, the two prior registration are less than five years old and therefore could be challenged by a competitor on the ground of mere descriptiveness. The Board pointed out that its treatment of the prior registrations is not an "attack on the validity of those registrations."

The Board concluded that, despite applicant's substantial efforts, the public understands and uses the phrase "guaranteed rate" to describe a feature of applicant's mortgage lending services.

Requiring proof that an applicant has been effective in its efforts to sway public perception from primarily viewing a term in its ordinary descriptive sense to instead primarily signifying a brand works hand-in-hand with the corollary that “our society is better served if … highly descriptive or generic terms remain available for use among competitors.”

Therefore the Board affirmed the refusal to register the standard character mark GUARANTEED RATE, and affirmed the refusal of the word-plus-design mark without a disclaimer of the phrase. Applicant was allowed thirty days to submit the required disclaimer, in which case the application will proceed to publication.

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TTABlogger comment: There is a direct correlation between the degree of descriptiveness of a proposed mark and the need for survey evidence to secure registration.

Text Copyright John L. Welch 2020.