The ‘Booking.com’ Trademark case: “Shaping the Online Space” courtesy SCOTUS

“Fight for the things that you care about, but do it in a way that will lead others to join you.”

United States Supreme Court Justice Ruth Bader Ginsburg

Introduction

Trademark law has seen many substantive developments in 2020, with many cases in Europe, India and the United States coming into the limelight. However, the most recent ruling issued by the US Supreme Court (SCOTUS) which touches on the issue of genericism — is perhaps one of the most talked about.

Starting with a brief overview of Trademark Law, trademarks provide your company with identity and distinguish your goods and services from those of your competitors. US trademark law (the Lanham Act of 1946) has established a system wherein a name, which has entered everyday language, a so-called generic name, no longer qualifies for trademark protection.

Normally, the distinctiveness of a mark is a pre-requisite when it comes to registering a trademark without any opposition or legal action.

Distinctive marks include those deemed inherently distinctive in that they, include fanciful or made-up words, such as Kodak (for cameras). Arbitrary marks, which have no direct connection in terms of meaning to the underlying goods or service, may also be deemed distinctive. Take, Apple (for computers) as an example. Then there are suggestive marks, which require some reflection on the part of the consumer to connect the mark with the goods or services in question. Netflix (streaming services) is a suggestive mark.

On the other hand, descriptive terms are not inherently distinctive and may encounter some difficulties with respect to their registration. However, if they have acquired distinctiveness or secondary meaning through extensive commercial use and promotion by the trademark owner, they may be registered and protected. The mark “Best Buy” is such an example.

However, at the lowest end of the distinctiveness spectrum lies the generic name for the goods or services [§§1127, 1064(3), 1065(4)]. These are commonly used names or phrases for goods and services that are widely used in the public domain. In general, such names do not qualify for trademark protection. The benchmark for determining whether a name is generic or not depends on whether consumers perceive the term to be capable of creating a source identity or is easily distinguishable from other similar goods or services in the market.

After setting forth the conceptual underpinnings, a recent decision by the Supreme Court of the United States highlights how important it is for businesses to have a clear view of how trademark law works when formulating a branding strategy for their company.

The “Booking.com” Saga

We now discuss the case United States Patent & Trademark Office ET AL. v. Booking.com B.V. in detail, wherein the Supreme Court affirmed the ruling by the United States Court of Appeals for the Fourth Circuit’s that the combination of the generic word “Booking” with the generic top-level domain “.com” could receive federal trademark protection even if “Booking” alone could not.

After a pause in arguments due to COVID-19, the Supreme court, for the first time in its history, held oral arguments by telephone.

Booking.com is a travel company that operates a website on which customers can initiate online booking services for flights, rental cars, hotel-reservations, and more. It has used the name since 2006. On a number of occasions, the company attempted to register Booking.com as a word mark for goods related to online hotel reservation services (Class 43 of the Nice Classification of Good and Services) as well as for “travel and tour ticket reservation services” and “online travel and tourism services (Class 39). [Booking.com B.V. v. Matal, 278 F. Supp. 3d 891, 896-97 (E.D. Va. 2017) B.V. v. Matal, 278 F. Supp. 3d 891, 896-97 (E.D. Va. 2017)].

The United States Patent and Trademark Office (USPTO) refused registration in three separate opinions. Failing to obtain registration from the USPTO and then from the Trademark Trial and Appeal Board (TTAB), the applicant, “Booking.com” initiated a civil action under 15 U.S.C. § 1071(b) against the Director of the USPTO and the USPTO, challenging the USPTO’s refusal to register its four applications at the U.S. District Court for the Eastern District of Virginia, Alexandria Division. In doing so, Booking.com requested the Court to review the case and to decide in favor of the registration of its marks, holding that the term “Booking.com” was non-generic and potentially protectable as a trademark.

The company relied heavily on survey evidence, which showed that 74.8% of relevant consumers considered “booking.com” to be a brand rather than a generic service. The District Court found that the mark was distinctive and thus eligible for federal registration. Nonetheless, the district court concluded that top-level domains like “.com” are generally source identifying and that a mark composed of a generic [second-level domain, for example, brand name, product name, or even your own name that is located to the left of the extension you use, such as www.booking.com as in this case] and a [top-level domain] is a descriptive mark eligible for protection only when acquired distinctiveness is demonstrated. It also held that, when applied to hotel reservation services, the marks had acquired secondary meaning.

The U.S. Court of Appeals for the Fourth Circuit [Booking.com B.V. v. United States Patent & Trademark Office, 915 F.3d 171, 181-82 (4th Cir. 2019)] affirmed the District Court’s ruling. It concluded that, when taken as a whole, the term “Booking.com”, is not generic as the relevant public would readily understand the origin of the term and associate it with the Applicant alone.

In light of this decision, the USPTO petitioned the US Supreme Court to review the case. On June 30, 2020, the Supreme Court ruled, in an 8-1 vote, that Booking.com, N.V., could register its eponymous domain name. The Court rejected the per se rule established by the USPTO that a generic word followed by “.com” is necessarily generic and therefore, ineligible for trademark protection. In upholding the decision of the lower courts, the Supreme Court found that the appropriate test in determining the registrability of the mark, is whether the public perceives “Booking.com” as identifying a single source for travel booking services.

The decision is a noteworthy win for brand owners, including those whose marks would have been at risk of cancellation if the USPTO’s per se rule was adopted. It affirms that the consumers interests are at the very forefront when it comes to brand names, and underscores the importance of consumer perception evidence for those seeking to register arguably generic or descriptive terms as trademarks.

Key Observations by the Supreme Court

  • The Supreme Court ruled that a generic term combined with “.com” or other top-level domain can be registered as a trademark if there is sufficient evidence to show that the relevant public recognizes the “generic.com” term as an indicator of source;
  • The late Justice Ruth Bader Ginsburg in her majority opinion wrote that “We have no cause to deny Booking.com the same benefits Congress accorded other marks qualifying as non-generic”;
  • Under the domain-name addressing system, only one company may hold the rights to a particular domain name at a given time;
  • It held that “Booking.com” could be registered as a trademark, even though the term consists of a generic term followed by ‘TLD’, i.e., “.com.”;
  • A consumer who is familiar with that aspect of the domain-name system can infer that “Booking.com” refers to some specific entity or a single product;
  • Booking.com B.V. conducted a survey that identified itself as a (brand name – 74.8 percent) versus a (common name – 23.8 percent), strongly demonstrating that consumers do not perceive it to be a generic or common name;
  • The Court cautioned against a blanket rule, however, and specified that the proper determination for a “generic.com” styled term was whether consumers perceived the term as identifying a class of goods or services in general or a specific member of that class. If consumers perceived the generic.com term to identity a class of goods or services, then the term would be generic;
  • In discarding the USPTO’s view that the combination of a generic term and a top-level domain (such as .com) is generic, the Court distinguished the 1888 ruling in Goodyear’s India Rubber Glove Mfg. Co. v. Goodyear Rubber Co., on which the USPTO relied. In that case, the Supreme Court ruled that adding the word “company” to a generic term did not give rise to a protectable trademark. In the current case, the Supreme Court noted that domain names, unlike company names, were necessarily one-of-a-kind, as only one entity may be assigned a particular domain name. The Court also noted that the USPTO’s understanding of the Goodyear case was “flawed” because it excluded consumer perception as a factor in determining whether a term is generic.

Critical takeaways

  • If you wish to use a “generic.com” term, ensure you use a unique font, logo, stylization or combination of colors on your website that is sufficiently distinct from other marks that already exist in the records of the Trade Marks Register;
  • Use hybrid terms, such as the combination of an adjective followed by a noun, a mixture of two words (with the same meaning) in different languages to create a new word, only juxtapose two commonly used words after their combined use has acquired secondary meaning;
  • Use a TM symbol as soon as you apply for the mark – it denotes that the mark is pending and under examination and that a formal application to register the mark (with the intention to use it) is in process;
  • Online businesses operating in the United States with a generic domain name should consider registering for trade mark protection;
  • Consider undertaking a consumer survey and and submitting it with your application to register your proposed generic term as a trade mark in relation to the goods or services for which registration is sought;
  • Now is the time to assess your branding and marketing strategy;
  • Booking.com is likely to usher in a new age of trademark registrations for domain names with respect to generic terms; and
  • Make sure you gather strong evidence to support of your trademark application or domain name registration. Such evidence might include purchaser testimony, nation-wide consumer surveys, listings and dictionaries, trade journals, newspaper articles, awards and recognition, invoices, advertisement and promotional material, ledger accounts, social media presence and other publications.

 

(This post has been authored by Yashvardhan Rana. Yashvardhan is an Intellectual Property Lawyer with a particular focus on IP prosecution practice. He is an esteemed member of the FICCI IP Forum and serves as the Editor of the Trade Mark Reporter)

Cite As: Yashvardhan Rana, The ‘Booking.com’ Trademark case: “Shaping the Online Space” courtesy SCOTUS’ (The Contemporary Law Forum, 22 March 2021) <https://tclf.in/2021/03/22/the-booking-com-trademark-case-shaping-the-online-space-courtesy-scotus> date of access. 

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