CASE SUMMARY

FACTS

ChaCha Search, Inc. (“ChaCha”) instituted a combined opposition and cancellation proceeding against Grape Technology Group, Inc. (“Grape”) for various marks comprised of numbers for telecommunications services. On the parties’ cross-motions for summary judgment, the sole remaining issue was Grape’s counterclaim cancellation against ChaCha’s registration for the mark 242242 used for mobile search-engine services, where the numbers corresponded to the letters c-h-a-c-h-a on a telephone dial. Grape based its original counterclaim against ChaCha’s 242242 mark upon mere descriptiveness. Then, nearly fifteen months later, Grape sought to amend its counterclaim to add that the 242242 mark did not function as a trademark. In support of its amended counterclaim, Grape argued that its subsequent allegation merely served to “amplify” its original counterclaim of mere descriptiveness. The TTAB denied Grape’s motion to amend its counterclaim. On the issue of mere descriptiveness, the TTAB ruled in favor of ChaCha, finding that the 242242 mark was not merely descriptive for mobile search-engine services.

ANALYSIS

In considering Grape’s motion to amend, the TTAB rejected Grape’s contention that it merely sought to amplify its allegations, noting that “Grape is clearly seeking to add a new ground for cancellation of ChaCha’s registration.” The TTAB explained that a claim that a mark is merely descriptive relates to the character of the mark at issue, while a claim that a designation does not function as a mark is generally tied to the manner in which a party uses the designation at issue. The TTAB concluded that Grape unduly delayed in filing its motion to amend, noting that Grape waited fifteen months after it had served its pretrial disclosures and after ChaCha had filed a motion for summary judgment. Because Grape presumably knew about this ground at the time it filed its counterclaim, Grape could not justify its delay. The TTAB also rejected Grape’s argument that the delay was due in part to settlement negotiations between the parties, noting that negotiations had ended seven months before Grape’s motion to amend. Finally, the TTAB determined ChaCha would suffer prejudice if it permitted Grape’s motion to amend, because “allowing piecemeal prosecution of this case would reward Grape for its apparent haphazardness and would unfairly prejudice ChaCha by increasing the time, effort, and money that respondent would be required to expend to defend against an additional basis for Grape’s challenge to its registration.” In denying Grape’s motion to amend, the TTAB also denied Grape’s cross-motion for summary judgment on its unpleaded ground that 242242 did not function as a mark.

The TTAB next considered ChaCha’s cross-motion for summary judgment on the issue of descriptiveness. Grape argued that 242242 was merely descriptive because the numbers correspond with letters that spell “ChaCha” on a telephone keypad and thus simply informed users how to acquire ChaCha’s services. Grape argued that the use of a mark as a telephone or short-messaging service (“SMS”) number gave rise to a descriptiveness inference. Grape asserted that the PTO established “a bright line examination rule that requires alphanumeric telephone number marks to be deemed registrable [only] if there are word elements in the alphanumeric telephone number that are not descriptive or generic of the goods or services offered in association with the alleged mark.” In response, ChaCha argued that neither 242242 nor ChaCha identifies any quality, characteristic, function, feature, purpose, or use of its services, and that Grape was seeking to stretch the meaning of descriptiveness beyond its current legal meaning.

In ruling for ChaCha, the TTAB found that Grape failed to explain how the 242242 mark was descriptive of ChaCha’s mobile search-engine services, concluding that it did not follow that, “because the SMS number 242242 provides the means of accessing ChaCha’s services,” such a number was functional and descriptive.

CONCLUSION

This decision indicates that marks used as SMS or telephone numbers do not automatically qualify as merely descriptive. The TTAB also drew a clear and helpful distinction between a claim that a mark is merely descriptive versus a claim that a designation does not function as a mark.