Friday, May 14, 2021

TTAB Affirms Refusal of ELECTRONIC PAYMENTS: Providing Independent Sales Reps is Not a Registrable Service

The Board affirmed a refusal to register the term ELECTRONIC PAYMENTS for "Business to business commerce services, namely, providing a network of independent sales representatives that earn bonus incentives to promote multi-function point of sale credit card and debit card processing equipment and supplies of others to merchants that enable payment authorization processing and inventory management solutions for merchants; and not available to cardholder markets," on the ground that the activities recited in the application are not registrable services. In re Electronic Payments Inc., Serial No. 87239532 (May 10, 2021) [not precedential] (Opinion by Judge Cheryl S. Goodman). 

To qualify as a registrable “service,” the activity in question "must be (1) a real activity; (2) performed to the order of, or for the benefit of, someone other than the applicant; and (3) the activity performed must be qualitatively different from anything necessarily done in connection with the sale of the applicant’s goods or the performance of another service."

Applicant’s principal business is processing payments from merchants via point of sale (POS) terminals that have payment authorization enabled through Applicant. Thus, promoting and placing POS hardware is an inherent part of marketing Applicant’s merchant acquiring services. Applicant earns its revenue from these sales transactions by placing the POS hardware at the merchant business, programmed to request authorization through Applicant.

The Board found that the recited "independent sales agent services that obtain new merchant accounts for Applicant, and promote the POS hardware of others to these merchants, is a routine activity provided in connection with Applicant’s primary service, merchant acquisition services, and is not a sufficiently separate activity to constitute a service rendered for the benefit of others."

Although third-party hardware manufacturers may derive some benefit from these activities, the Board found that this benefit is incidental to that obtained by Applicant from the independent sales organization, "which operates primarily for Applicant’s benefit to convert a potential merchant to a merchant account so that Applicant can earn fees for sales transactions and servicing the account."

And so the Board affirmed the refusal to register.

Read comments and post your comment here.

TTABlogger comment: In November 2019, the Board found the term ELECTRONIC PAYMENTS to be generic for credit card payment processing services, on an application owned by the same applicant as here. Opinion here.

Text Copyright John L. Welch 2021.


At 9:46 AM, Anonymous Anonymous said...

My favorite line from Applicant's brief: "Applicant acknowledges that to some groups of people the Opposer's Mark is known and recognizable, but this recognition is of limited strength, and is declining rapidly." Elsewhere Applicant describe the similarity between the marks as negligible. Erosion of the Second Amendment is mentioned.

At what point does credibility fall victim to advocacy? In some instances early on.


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