United States Patent and Trademark Office v. Booking.com B.V.

Issues 

Does the addition of a generic top-level domain name such as “.com” to a generic term such as “booking” create a protectable trademark, notwithstanding the Lanham Act’s prohibition on registering generic terms as trademarks?

Oral argument: 
March 23, 2020

This case asks the Supreme Court to determine whether the addition of a domain suffix such as “.com” to a generic term like “booking” can create a protectable trademark. The Petitioners, United States Patent and Trademark Office and the Department of Justice, contend that the Court’s decision in Goodyear that the addition of a corporate designation such as “Company” or “Inc.” to a generic word does not render the combination protectable, extends to adding a “.com” suffix. The Respondent, Booking.com, counters that the Lanham Act repudiated Goodyear, and advocates for the application of the “primary significance” test which focuses the genericness inquiry on whether the consuming public views the term as signifying the producer rather than the product. The Court’s decision will have implications for online companies that have invested resources in developing their brand recognition using generic terms.

Questions as Framed for the Court by the Parties 

Whether the addition by an online business of a generic top-level domain (“.com”) to an otherwise generic term can create a protectable trademark.

Facts 

Booking.com manages a website where customers can make travel and lodging reservations. Booking.com B.V. v. USPTO at 5. In 2011 and 2012, Booking.com filed four trademark applications with the U.S. Patent and Trademark Office (“USPTO”) for the use of BOOKING.COM. Id. For trademarks to be protected they have to be distinctive. Id. at 3. The Lanham Act recognizes four types of trademarks: (i) generic; (ii) descriptive; (iii) suggestive; and (iv) arbitrary. Id. Arbitrary and suggestive marks are treated as inherently distinctive, while generic marks are never distinctive and thus incapable of protection. Id. at 4. Descriptive trademarks can be protected if the mark owner is able to establish that the mark has acquired secondary meaning in the market. Id.

The USPTO examiner denied the applications, holding that the marks were not protectable because BOOKING.COM was a generic term as applied to the services for which it sought registration. Id. at 5. The USPTO also denied registration under the category of ‘descriptive’ marks because Booking.com had failed to prove that they had gained secondary meaning among consumers. Id. Booking.com appealed to the Trademark Trial and Appeal Board (“TTAB”), which affirmed the denial of Booking.com’s applications. Id. at 6. TTAB found that BOOKING.COM was a generic term for the types of services it offered and thus ineligible for trademark protection. Id. According to the TTAB, the meaning of the term “booking” combined with “.com” simply referred to “an online reservation service for travel, tours, and lodging,” the very services offered by Booking.com. Id.

Booking.com appealed by filing a civil action in the United States District Court for the Eastern District of Virginia (the “District Court”). Id. at 6. It asserted that BOOKING.COM was a “descriptive or suggestive mark” which qualified for protection. Id. In the District Court, Booking.com produced evidence to show that 78.4% of consumers perceived BOOKING.COM as a brand, not a generic service. Id. at 7. The District Court granted summary judgment, finding that BOOKING.COM was a descriptive mark and that it had demonstrated secondary meaning, thereby making it protectable. Id. The USPTO filed two motions: seeking to revise the court’s decision to require the USPTO to register the two marks and requiring Booking.com to compensate the USPTO’s attorneys regarding its expenses used for the defense action. Id. The District Court rejected the USPTO’s motion to revise but granted the USPTO’s motion for expenses. Id. at 7–8.

Both the USPTO and Booking.com appealed to the United States Court of Appeals for the Fourth Circuit, (the “Fourth Circuit”) which affirmed the District Court’s conclusion that BOOKING.COM was a protectable trademark. Id. at 25. The Fourth Circuit concluded that adding “.com” to a generic term such as “booking” can create a non-generic, descriptive mark that may be registered as a trademark upon a showing of secondary meaning. Id.

Following the Fourth Circuit’s decision, the USPTO petitioned the Supreme Court of the United States for a writ of certiorari on the Fourth Circuit’s holding that BOOKING.COM is a protectable trademark. Petition for Writ of Certiorari at i. On November 8, 2019, the Supreme Court granted certiorari. Orders and Proceedings, 19-46.

Analysis 

PROTECTION FOR “GENERIC.COM” TRADEMARKS

The USPTO argues that after the decision in Goodyear’s India Rubber Glove Manufacturing Co. v. Goodyear Rubber Co., the addition of words such as “Company” or “Inc.” to a generic word does not render the compiled word non-generic as the addition only implies that parties had formed a business entity dealing in the specific goods or services that the generic term connoted. Brief for the Petitioners, United States Patent and Trademark Office at 18–19. The USPTO explains that Goodyear’s reasoning is derived from a basic principle of trademark law that trademarking generic terms will harm competitors engaged in similar businesses and will prevent them from using similar designations. Id. at 19. The USPTO contends that domain names like “.com” are covered under the Goodyear rationale because the term only implies that the organization has an online presence to deal in the relevant goods or services. Id. at 20. The USPTO also argues that Goodyear continues to apply even though it predates the Lanham Act (“Act”) because the Act codified common law principles of trademark protection including Goodyear. Id. at 21. The USPTO relies on several decisions of the TTAB and courts of appeals which have considered the analogy between “Generic Inc.” and “generic.com,” and have concluded that a “generic.com” domain is not a protectable trademark. Id. at 22. The USPTO takes the position that if the respondent cannot trademark “Booking Company” or “Booking Inc.,” it should not be permitted to register “BOOKING.COM” as a trademark either. Id. at 25.

Booking.com counters that the Lanham Act superseded Goodyear. Brief for the Respondent, Booking.com B.V. at 37–38. Booking.com explains that in Goodyear, the Court uses the terms generic and descriptive marks interchangeably and that in fact pre-Lanham Act cases treat Goodyear as barring trademark protection for descriptive terms and not as dealing specifically with generic marks. Id. at 37. Booking.com highlights provisions in the Lanham Act that now permit descriptive marks to be registered as trademarks. Id. at 39. Booking.com adds that the standard under the Act has shifted to a mark’s ability to differentiate a party’s products from others’ products. Id. Booking.com highlights the USPTO’s registration of trademarks such as “Cotton Emporium,” “Cotton Collection,” and “Margarita Company” to argue that even the government’s understanding of the Act is that consumer recognition determines whether a mark is protectable. Id. Booking.com argues that even if Goodyear continues to be good law, its rationale does not extend to domain names like “.com” because these suffixes differ from corporate designations in important ways. Id. at 43.

USING CONSUMER SURVEYS TO ESTABLISH SECONDARY MEANING OF A GENERIC TRADEMARK

The USPTO argues that Booking.com’s survey that was offered to prove that consumers perceived the name as a brand name rather than as a general reference to booking services, does not offer a basis for trademark registration. Brief for Petitioners at 36. The USPTO asserts that the survey is not relevant under Goodyear as trademark policy is not based on how long a producer has used the name and how much goodwill it has accrued. Id. The USPTO then acknowledges the primary significance test which focuses the inquiry on whether the consuming public views the term as signifying the producer rather than the product but argues that this test only governs cancellation of an existing trademark. Id. at 37. The USPTO contends that the “primary significance” test does not replace Goodyear’s ruling that “Generic Company” or “Generic Inc.” terms are not protectable trademarks as a matter of law because such protection to generic marks would frustrate competitors’ capacity to promote their own goods or services. Id. at 38. The USPTO emphasizes that survey evidence could not transform an unprotectable, generic mark into a protectable trademark and doing so would conflate generic marks with descriptive marks. Id. at 40. The USPTO explains that generic terms do not qualify for trademark protection regardless of secondary meaning while descriptive terms may qualify for trademark protection upon a showing of secondary meaning. Id. at 41.

Booking.com counters that the Lanham Act does not prevent registration of “generic.com” trademarks if the “primary significance” of the mark to consumers is the producer rather than the category of goods and services the term connotes. Brief for Respondents at 18–19. Booking.com argues that the “primary significance” test applies to both initial registration and cancellation of trademarks, and is the appropriate test to determine the genericness of a mark. Id. at 20. Booking.com contends that courts and the USPTO have consistently applied this test to both original registration and cancellation. Id. at 21. Further, according to USPTO, as the “primary significance” test considers how consumers perceive a mark, it is more consistent with the Lanham Act’s goals of rewarding trademark owners who build goodwill in the market. Id. at 24. Booking.com also argues that survey evidence may properly be used under the “primary significance” test because evaluating genericness of any mark is a factual issue that depends on evidence of what consumers actually think. Id. at 30. Booking.com argues that USPTO miscategorized all “generic.com” marks as fundamentally generic regardless of how consumers recognize these marks. Id. at 31. Lastly, Booking.com argues that BOOKING.COM is a descriptive mark, not a generic one, because of the results of the consumer survey and as such should be registered because “BOOKING.COM” has acquired a distinctive meaning. Id. at 34.

Discussion 

UNFAIR COMPETITION CONCERNS

Electronic Frontier Foundation (“EFF”), in support of USPTO, argues that adding “.com” for online companies is indistinguishable from adding “Co” to offline corporate entities and that adding “.com” to a generic term should therefore not transform that generic term into a protectable trademark. Brief of Amicus Curiae EFF, in Support of Petitioner at 7–8. EFF emphasizes the chilling effect of allowing trademark protection to “generic.com” words; it is EFF’s concern that this would give one market player monopoly over a common word that all its competitors might also need to promote their goods and services. Id. at 9. EFF warns that the terms used in a domain name play an important role in attracting internet traffic, and that if terms such as BOOKING.COM are trademarked, they might potentially prevent competitors from using domain names such as “booking.biz,” “booking.org,” or even terms that are similar to BOOKING.COM such as “booker.com.” Id. at 10–12. EFF cautions that extending trademark protection to BOOKING.COM will go beyond the control it already exercises over the domain name and grant it a significant competitive advantage over other players. Id. at 13. EFF explains that such “generic.com” trademark owners could leverage the threat of protracted and expensive trademark litigation and drive small business owners out of business because these small businesses will not have the sophistication or resources to register such “generic.com” domain names first. Id. at 20–21.

Trademark and Internet Law Professors (“Professors”), in support of Booking.com, explain that any concerns of an unfair competitive advantage are addressed by the “primary significance” test which extends trademark protection to only those “generic.com” marks that a majority of consumers view as a product designator or as a unique brand. Brief of Amici Curiae Trademark and Internet Law Professors, in Support of Respondent at 26–27. The Intellectual Property Law Association of Chicago, in support of Booking.com, maintains that concerns over monopoly power to “generic.com” mark owners are misplaced. Brief of Amicus Curiae Intellectual Property Law Association of Chicago, in Support of Respondent at 9–10. It argues that competitors do not have any incentive to use terms such as “bookings.com” to describe themselves because they would be risking diverting consumer traffic to the well-established player, BOOKING.COM. Id. The Boston Patent Law Association (“BPLA”), in support of Booking.com, rejects the notion that trademarking “generic.com” marks may lead to increased litigation, arguing instead that the USPTO itself has recognized that issuing legal notices actually helps settle potential litigation and that in any event such letters are used in a wide variety of circumstances. Brief of Amicus Curiae Boston Patent Law Association, in Support of Respondent at 22–23.

PROTECTING INVESTMENT IN DEVELOPING UNIQUE BRANDS

The USPTO argues that Booking.com does not need trademark protection for its investment in the brand “BOOKING.COM” and the related domain name. Brief for Petitioners at 34. The USPTO explains that domain name holders such as Booking.com have other avenues such as unfair competition law to protect against third parties’ misuse of its reputation or deception of consumers. Id. at 34–35. The EFF reiterates this, stating that adding “.com” does nothing to distinguish businesses because it is the term preceding the “.com” that identifies and defines the business; so, the EEF argues that trademark law should only protect those non-generic terms preceding “.com.” Brief of EEF at 17. The USPTO also contends that Booking.com can register the “stylized elements” on its website such as its image of an “earth behind a briefcase” and in that manner protect itself from unfair competition without the trademark registration of “generic.com” word. Brief for Petitioners at 35.

The Internet Commerce Association (“ICA”), on behalf of Booking.com, argues that disallowing trademark protection to “generic.com” terms would dissuade companies from investing in newly established top-level domain names. Brief of Internet Commerce Association, in Support of Respondent at 13. ICA states that new generic top-level domain names such as “.homes,” “.banks”, and “.inc” are poised to be introduced soon. Id. at 15. If online businesses cannot trademark their “generic.com” marks, the ICA contends, they would hesitate to invest in creating their own brand identity, which in turn would reduce innovation and experimentation. Id. ICA asserts that ultimately generic top-level domains improve branding and promote commerce by helping consumers to locate certain things more easily. Id. at 14. The amici Professors, in support of Booking.com, explain that unfair competition law does not adequately protect Booking.com because courts are reluctant to find unfair competition even when presented with evidence of actual consumer confusion, and are instead shaping alternative remedies like requiring a junior user to use a disclaimer making it clear that they are not associated with the senior user of a brand name. Brief of Professors at 29.

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