SCOTUS Ruling In USPTO v. Booking.com Opens The Door For Generic Domain Owners To Register Their Trademark
The U.S. Patent and Trademark Office (USPTO) has believed that “generic.com” domain names were almost always generic and therefore not registrable under trademark law. However, the Supreme Court’s nearly unanimous decision in USPTO v. Booking.com (2020) 591 U.S. ___, earlier this year has rejected that per se rule, which means such generic combinations have the potential to become protectable trademarks.
Under the Lanham Act, a mark must be distinctive in order to obtain protection. As such, generic terms alone cannot be protected as trademarks. 15 U.S.C. § 1051 et seq. Booking.com is a company that offers hotel reservations and similar services over the web under the mark “Booking.com.” When the company filed four service mark applications containing the “Booking.com” term, the USPTO rejected the mark as generic for the services offered. The Supreme Court ultimately offered a simple test for generic marks which looked at the following: (1) that “generic” terms designate a class of goods or services, rather than an element of such a class; (2) compound marks are to be judged for distinctiveness as whole marks, rather than a collection of elements; and (3) the relevant meaning of a term is its meaning to consumers. The Court stressed this third factor, explaining that the relevant question was whether consumers perceived “Booking.com” to signify online hotel reservation services as a class. Because consumers did not perceive Booking.com to hold that meaning, the Court held that the term was not generic.
In disputing Booking.com’s action for trademark registration, the USPTO primarily relied on the Supreme Court’s longstanding precedent, Goodyear’s India Rubber Glove Mfg. Co. v. Goodyear Rubber Co (1888) 128 U.S. 598. In that case, the Supreme Court held that the addition of “Company” to a generic term added no protectable meaning to the term as a mark and that the term merely indicated that the parties had formed an association to deal in such goods, rather than serving as a source-identifier. Thus, “generic term” plus “company” marks were “ineligible for trademark protection as a matter of law regardless of how consumers would understand the term.” The Supreme Court in Booking.com’s case, however, distinguished the Goodyear case, explaining that the USPTO’s reliance on Goodyear was flawed because it ignored a key principle of the Lanham Act that the question of whether a term is generic must be answered by asking how consumers perceive the term. Booking.com presented as evidence a survey exhibiting that a majority of consumers recognize the name “Booking.com” as a brand rather than a generic term for reservation service.
This survey evidence, in response to an office action, is almost certainly out of the price range for small or even mid-size companies to provide, which concern was hinted in the lone dissent by Justice Breyer. The dissent highlighted several points regarding the potential anti-competitive effect of the majority’s decision, fearing that owners of these registrations would be able to exclude others from using similar domain names resulting in monopolies and the inhibition of free competition in online commerce. Justice Breyer also explained that a top-level domain such as “.com” has no capacity to identify and distinguish the source of goods or services and that “it is merely a necessary component of any web address.” Justice Breyer further rejected the majority’s reliance on survey evidence, which he believed to have “limited probative value in this context” because some courts have held that surveys cannot adequately distinguish between generic and descriptive terms.
Although the majority relied on survey evidence and the decision is a victory for companies that style critical brands in the form of generic.com as top-level domains, trademark filings are not necessarily appropriate for all such marks. Consistent with long established trademark law principles, brands may only achieve such protection when there is strong evidence that they have acquired distinctiveness and do not serve merely as tools for consumers to locate websites.
While such marks are not automatically generic, adding “.com” is not a free pass. The question of whether a mark is generic essentially remains a fact question, and a brand intending to use a “.com” to their advantage should be prepared to offer evidence that their consumers recognize the mark as a source indicator, rather than a category of goods or services. Ultimately, however, the Supreme Court’s recent ruling has opened the door for generic.com domain owners to build brand equity with the potential for trademark registration and the benefits that accompany such registration.
At Cartee, LC, we are monitoring related developments in trademark law and implications for mid-size and growing businesses. If you have questions or any issues related to any of the above-mentioned, please do not hesitate to contact our office.
