Federal Circuit Clarifies the Role of Explanatory Text in Advertising Materials When Considering a Mark’s Descriptiveness

In a precedential opinion published on August 10, 2017, the Federal Circuit upheld a TTAB decision that denied registration of the “FIRST TUESDAY” mark due to its merely descriptive nature when identifying lottery services and games.¹ Appellant, North Carolina Lottery (“NC Lottery”), sought to register the mark in connection with new scratch-off lottery games introduced on the first Tuesday of every month. Classifying “FIRST TUESDAY” as “merely descriptive” of the goods connected to the mark, the TTAB refused to register the “FIRST TUESDAY” mark. NC Lottery appealed the TTAB’s decision, arguing that the mark was instead “suggestive” and therefore apt for registration.

Explaining the legal background of this issue, the Federal Circuit reiterated the four categories of trademark descriptiveness as outlined in the landmark case, Abercrombie & Fitch Co. v. Hunting World, Inc., 537 F.2d 4, 10-11 (2d Cir. 1976). “When arranged ‘in an ascending order which roughly reflects their eligibility for trademark status and the degree of protection accorded,’ these four categories are: generic (or ‘common’ descriptive), merely descriptive, suggestive, and arbitrary (or fanciful) marks.”² Of these categories, the Court noted that merely descriptive marks may not be registered (usually),³ but “marks that are suggestive are ‘inherently distinctive’ and can be registered.”⁴ The Court then defined the “merely descriptive” and “suggestive” categories, finding that “merely descriptive” marks “immediately convey[] information concerning a feature, quality, or characteristic of the goods or services for which registration is sought,” while “suggestive” marks “‘require[] imagination, thought, and perception to reach a conclusion’ about the nature of the goods or services.”⁵

In determining whether the mark was “merely descriptive” or “suggestive,” NC Lottery argued before the Federal Circuit that explanatory text in advertising materials bearing the “FIRST TUESDAY” mark should not be relied upon “to supplement the meaning of the mark itself.”⁶ Indeed, NC Lottery argued that “the inquiry should be limited to what a consumer with ‘only general knowledge’ of [NC] Lottery’s goods and services, and without additional context from the explanatory text, would immediately understand the mark to mean.” Since “FIRST TUESDAY” does not inherently convey the mark’s associated goods/services, but instead requires some imagination to connect the mark to its goods/services, NC Lottery asserted that the mark is “suggestive and eligible for registration.”⁷

The Federal Circuit disagreed with NC Lottery’s proposition, finding that “the TTAB must consider a mark in its commercial context to determine the public’s perception [of the mark.”⁸ In assessing descriptiveness, a court may therefore look at the mark’s association with “Websites, publications, and [the mark’s] use ‘in labels, packages, or in advertising material directed to the goods.'”⁹ Accordingly, the Federal Circuit rejected NC Lottery’s argument that “explanatory text [in advertising materials] cannot supply additional meaning to a mark when the mark itself does not convey that meaning.”¹⁰

The Court then went on to clarify that the use of explanatory text with a mark does not necessarily render the mark descriptive, but that “distinctiveness of a mark in the context of explanatory text remains a case-specific analysis.”¹¹ Faced with this legal standard, NC Lottery argued that “FIRST TUESDAY” was not “merely descriptive” because “NC Lottery found it necessary to explain the connection between the mark and [its] goods and services.”¹² In response, the Federal Circuit acknowledged that courts may partly rely on explanatory text to find that a mark not “merely descriptive.” However, the Court found that “[u]nderstanding that FIRST TUESDAY refers to a new good or service being offered on the first Tuesday of a month requires [a relatively small] mental leap.”¹³ Indeed, the “FIRST TUESDAY” mark was associated with simple explanatory text, as the “text simply use[d] the same two words as the mark-“first Tuesday”-along with words like ‘new’ and ‘every month’ to describe the relevant feature or characteristic of [NC] Lottery’s scratch-off lottery games.”¹⁴ Thus, the Court held that the existence of explanatory text associated with the mark in this case did not sufficiently convert the mark to “suggestive” in nature, and substantial evidence supported the TTAB’s finding that the mark is “merely descriptive.”