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U.S. Supreme Court to Hear Booking.com Trademark Case

Author: Anthony H. Cataldo

12/02/2019
U.S. Supreme Court to Hear Booking.com Trademark Case

Reprinted with permission from the December 1, 2019 Law Journal Newsletters IP News. © 2019 ALM Media Properties, LLC. Further duplication without permission is prohibited. All rights reserved.

The Supreme Court of the United States issued an order on Nov. 8, 2019 granting certiorari in the matter of United States Patent & Trademark Office et al. v. Booking.com BV (No. 19-46). The issue is whether an applicant may obtain a trademark registration for a generic term by adding a top-level domain suffix to that term and demonstrating through a survey that the public considers the entire term to indicate the origin of applicant’s services, rather than the genus of such services. Put another way, the Court will decide whether an applicant may appropriate a term that is generic for the services offered by the applicant by appending “.com” to that term and building up goodwill in that entire term.

Prior Cases Considering This Issue

Several cases have considered protection for a mark comprising a top-level domain, such as “.com,” combined with a term that is otherwise generic for the relevant services. No case appears to have previously allowed registration or found such a mark protectable. In In re Hotels.com, L.P., 573 F.3d 1300 (Fed. Cir. 2009), the Federal Circuit considered the Trademark Trial and Appeal Board’s rejection of applicant’s HOTELS.COM mark as generic, because it was a combination of “hotels” and “.com,” both of which it found to be generic based on evidence such as dictionary definitions and third-party websites for hotel reservations that also used “hotel” in their second-level domain. The TTAB found that the composite term HOTELS.COM communicates no more than the common meanings of the individual components (i.e., a website providing information on hotels), though the TTAB did note that if it were reversed on its finding of generic-ness and the mark were deemed descriptive, then the applicant’s evidence demonstrated acquired distinctiveness such that the mark would be registerable. The Federal Circuit upheld the TTAB’s refusal, finding that the generic “hotels” did not lose its generic character by placement in the domain name hotels.com, and deferring to the TTAB’s weighing of the competitive uses of “hotel” in domain names against a survey submitted by the applicant along with a number of customer declarations indicating that the consuming public understood hotels.com to be a brand indicating source. While finding the term to be generic despite evidence that it was recognized as a brand, the Federal Circuit nonetheless held open that some quantum of evidence of consumer recognition could hypothetically render an otherwise “generic.com” mark to be protectable. The Federal Circuit has decided other cases in a similar fashion, including, for example, In re 1800Mattress.com OP, LLC, 586 F.3d 1359 (Fed. Cir. 2009) (MATTRESS.COM) and In re Reed Elsevier Props. Inc., 482 F.3d 1376 (Fed. Cir. 2007) (LAWYERS.COM).

The Ninth Circuit considered this issue in Advertise.com, Inc. v. AOL Advert., Inc., 96 U.S.P.Q.2d 1310 (9th Cir. 2010). There, the Court reversed a preliminary injunction barring Advertise.com from using its trade name deemed to be confusingly similar to AOL’s ADVERTISING.COM mark. Specifically, the Court rejected the lower court’s determination that the mark was descriptive with secondary meaning, holding instead that ADVERTISING.COM was generic for “online advertising” or “internet advertising.” While noting that the component parts were each generic on their own, the Court acknowledged the importance of evaluating the mark as a whole and recognized that in some cases a compound of two generic terms may result in a protectable mark. Ultimately the Court pointed to the who-are-you/what-are-you test and the fact that any online advertising company, such as one of AOL’s competitors, when asked “what are you?”, might fairly respond “an advertising dot-com.” The Court noted the danger in allowing a business to appropriate for itself a generic term, even where the term had become associated with a first user in the minds of the consuming public, potentially allowing for an unfair monopoly. But as the Federal Circuit had done, the Ninth Circuit left open that a hypothetical generic.com mark could “in rare circumstances” result in a distinctive and protectable trademark. The Supreme Court in the Booking.com matter now seems poised to decide whether BOOKING.COM is one of these “rare occasions.”

Procedural History

Applicant, Booking.com BV, filed applications to register trademarks containing the term BOOKING.COM for hotel reservation services, which the Examiner rejected on the grounds that “booking” is generic for the relevant services and that the addition of a top-level domain, such as “.com,” did not render the mark protectable. On appeal, the TTAB upheld the refusal (2016 WL 1045671), finding that dictionary definitions and usage evidence cited by the Examiner established, prima facie, by clear evidence that the relevant consuming public would understand BOOKING.COM to refer to an online portal for booking lodging.

Undoubtedly influenced by the Federal Circuit’s refusal of HOTELS.COM (In re Hotels.com, L.P.), Booking.com appealed the TTAB’s ruling to the U.S. District Court for the Eastern District of Virginia, instead of the Federal Circuit. The District Court reversed the TTAB. 278 F. Supp. 3d 891. Although the Court acknowledged that “booking” used in connection with the relevant services is generic, it held that, taken as a whole, BOOKING.COM was not generic for the services. The Court relied chiefly on a survey submitted by Booking.com showing that nearly three quarters of respondents identified BOOKING.COM as a brand name and not as a generic category of services.

The Patent Office subsequently appealed to the Fourth Circuit, which affirmed the District Court’s reversal. 915 F.3d 171.

Fourth Circuit Opinion

In affirming, the Fourth Circuit emphasized strongly the black letter proposition that, in evaluating a compound mark, the Examiner must consider it in the proper context “as a whole.” With that preface, the Fourth Circuit deferred to the lower court’s factual findings that the public understood “BOOKING.COM” to be a brand name and not a generic term, even if on their own “booking” and “.com” were each generic for the particular aspect of Booking.com’s services that they described. The Court found that the lower court did not err in crediting Booking.com’s survey as more probative of common usage and the understating of consumers than the PTO’s evidence of dictionary definitions and use of “booking” in the second-level domain for a number of third parties offering similar services.

The Court acknowledged that trademark protection of generic terms combined with a top-level domain has previously been refused by the Federal Circuit (HOTELS.COM) and the Ninth Circuit (ADVERTISING.COM), but correctly pointed out that neither of those cases adopted a per se rule that such marks could never be protectable. As the Fourth Circuit noted, these opinions suggested that in rare cases such marks could be registered where the composite mark took on some new connotation. Thus, the Fourth Circuit roundly rejected the theory that adding a top-level domain name to a generic term must necessarily be generic. In doing so the Court further rejected the PTO’s reliance on Goodyear’s India Rubber Glove Mfg. Co. v. Goodyear Rubber Co., 128 U.S. 598 (1888), which held that adding a corporate identifier such as “Company” to a generic term could not render the name a protectable mark under the common law (discussing examples such as “GRAIN COMPANY” and “WINE COMPANY”). The Fourth Circuit rejected the PTO’s equation of “Company” as analytically indistinct from “.com.” This appears to stand in stark contrast to the Ninth Circuit’s reliance, in part, on Goodyear to deny protection to ADVERTISING.COM as equivalent to ADVERTISING (internet) COMPANY. The Fourth Circuit instead deemed Goodyear of limited value since it predated the Lanham Act and distinguished it based on the opening left by the Ninth and Federal Circuits for the hypothetical rare “generic.com” mark that was proven protectable through consumer surveys and other evidence of the public’s understanding.

The Court also rejected the PTO’s theory that any generic.com is per se generic as nothing more than the sum of its generic parts (e.g., a .com company offering booking services), resulting in a compound generic, relying again on its emphasis that the inquiry must focus on how the public views the entire mark as a whole. By the same token, the Court clarified that simply appending “.com” to a generic term does not automatically render the resulting domain name non-generic because the inquiry must be whether the public primarily understands the term as a whole to refer to source of the services.

Analysis

This case offers the Supreme Court an opportunity to clarify the law on the narrow question of whether a generic term plus a top-level domain can ever rise beyond a generic composite and thereby qualify as a protectable mark through evidence of customer recognition of the mark as a brand. Booking.com does not dispute that, on its own, “booking” is generic for the relevant services, and the PTO does not dispute that if a generic.com can ever legally qualify as descriptive, then Booking.com has established through its survey and other evidence that BOOKING.COM has acquired distinctiveness and is therefore registerable.

The Supreme Court’s ruling here could have far-reaching implications. If the Court upholds the Fourth Circuit, it would open the doors for a host of other parties with “generic.com” websites to obtain trademark protection over generic terms by relying on consumer surveys. In the typical case, such a survey could establish that a term starting life as a brand’s name has (or has not) subsequently become generic. Typically such a survey could not be used to establish that a term beginning life as generic had later become associated with a brand and become protectable. But as deployed by Booking.com, and surely others if Booking.com is successful, that seems to be exactly how the consumer survey is being used. In reality, such a survey might establish that the applicant has created a connection in the minds of the public between itself and a generic term through successful marketing, without saying anything about whether the term was generic prior to adoption by the mark holder and therefore beyond trademark protection. This could lead to the unfair situation where competitors are unable to use the generic name of their own services. The Fourth Circuit brushed off such concerns by noting that trademarks protect only relevant services and that “later proceedings” could address any potential overbreadth, thus hypothetically preventing Booking.com from wielding a BOOKING.COM registration against a third-party offering outside of the lodging context. But this ignores the fact that parties in distinct fields that have some conceivable connection to a mark holder would likely avoid the protected term altogether, creating a de facto monopoly. That is, the fear or threat of an infringement suit can be enough to stifle use of an otherwise generic term. Such a fear is likely less than remote as it is not inconceivable that Booking.com would bring an infringement claim against, say, a company using THEATREBOOKING.COM or even simply operating a website at the domain theatrebooking.com. Nor would it be out of the question that a factfinder could determine that there is enough customer overlap between consumers seeking to book travel and those looking to book entertainment in the city to which they are traveling to support a finding of a likelihood of confusion. The Fourth Circuit’s kicking the can down the road to “a later proceeding” creates little comfort for a third party considering using some BOOKING-formative mark in a potentially related field.

The case further highlights an interesting tension between the black letter law of evaluating a composite mark in its entirety, with the Supreme Court’s well-reasoned ruling in Goodyear, over 130 years ago, that a corporate designation such as “Company” can never elevate a generic term to a trademark. “.Com” would appear to be closely analogous to “Company” as merely designating that the services are offered by a company operating on the internet. But such a per se rule does appear to contradict the edict to consider the impression of composite marks as a whole.

As Judge Wynn noted in his dissent of the appealed Fourth Circuit decision, BOOKING.COM does not appear to fall within the “rare” exceptions that were envisioned by the Federal Circuit and Ninth Circuit’s decisions rejecting protection of generic.coms. The narrow window for such exceptions is where the composite term takes on a new meaning, rising above the sum of its parts. The identified hypothetical examples illustrate such word play that could render a generic.com mark registerable: “TENNIS.NET” for a brick and mortar store selling tennis equipment (In re Oppendahl & Larson LLP, 373 F.3d 1171 (Fed. Cir. 2004)) and “ROM.COM” for a website cataloguing and discussing romantic comedies (In Re Booking.com Dissent, (J. Wynn)). In In re Steelbuilding.com, 415 F.3d 1293 (Fed. Cir. 2005), the Federal Circuit reversed a refusal of the mark STEELBUILDING.COM as generic, based on its finding that the STEELBUILDING portion was not itself generic. The Court went on to note that the addition of .COM was an “unusual case” in which a top-level domain indicator expanded the meaning of the mark to include additional goods and services, citing Oppendahl. But it is unclear whether the Court would have reached the conclusion that the addition of .COM rendered the full mark protectable had the STEELBUILDING portion been deemed generic. Both examples play on the top-level domain to create a new connotation for the mark as a whole. By contrast to the word play in the hypothetical examples, the only new meaning for BOOKING.COM is that Booking.com has been highly successful, through memorable advertising, in creating an impression upon the consuming public. But perhaps a commercial entity should not be permitted to take for itself the generic name of its services and monopolize use of that generic name as its own trademark.

The material in this publication was created as of the date set forth above and is based on laws, court decisions, administrative rulings and congressional materials that existed at that time, and should not be construed as legal advice or legal opinions on specific facts. The information in this publication is not intended to create, and the transmission and receipt of it does not constitute, a lawyer-client relationship.

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