Booking.com: Domain Names Get Their Due
Champions of Internet domain names should hail this week's decision in USPTO v. Booking.com B.V. That case left no doubt that the combination of the top level domain ".com" and a generic term, "booking", to create "booking.com," is eligible for federal trademark registration and all the advantages it brings.
Unlike many of the recent cases decided by the Supreme Court, Booking.com was not particularly controversial. Let's face it: Domain names are important because they point to websites where businesses and individuals can conduct commerce or communicate, but whether a subset of "generic.com" domain names may be registered as trademarks hardly stirs the soul. Compared to the many highly-charged issues before the Court this term, this was a relatively low-key case, and that was reflected in the Court's nearly-unanimous 8-1 opinion affirming the decision below.
We describe the decisions below in our earlier article. In brief, the central question in the case was whether adding the ".com" top-level domain (TLD) to an otherwise generic term may transform that term into a trademark. In particular, at issue was the registrability of booking.com, the domain name that points to Booking.com's popular Internet reservation website. The United States Patent and Trademark Office (USPTO) refused registration on the basis that "booking.com" was generic as applied to online hotel reservation services and thus not registrable. The USPTO reasoned that "booking" referred to "a reservation or arrangement to buy a travel ticket or stay in a hotel room," and, in combination with ".com" it was likely to be understood by consumers to generically refer to online reservation services.
A "generic" term names a category or genus of goods or services, such as shampoos or baseball caps. If the USPTO determines that a mark is generic, it will deny registration. If, however, the Trademark Office concludes that the term merely describes the qualities or characteristics of the goods or services for which registration is sought it will permit registration upon a showing of "secondary meaning." To demonstrate secondary meaning, an applicant is required to show that the applied-for mark is understood by consumers to refer to goods from a single source, rather than merely describing those goods. The line between "descriptive" and "generic" can be a thin one.
In Booking.com, The US District Court in the Eastern District of Virginia reversed the USPTO's determination. It district court held that the "primary significance" of "booking.com" to the relevant consumers was not as a generic term for on-line hotel reservation websites, and therefore the term was not generic. In reaching this conclusion, the district court noted in particular a consumer survey showing that a majority of respondents understood that "Booking.com" referred to a specific brand. The US Court of Appeals for the Fourth Circuit affirmed.
The Supreme Court's Decision
Justice Ginsburg's majority decision comes right to the point, sweeping aside obstacles to recognizing a "generic.com" term as a trademark eligible for registration. To Justice Ginsburg and the seven Justices who agreed with her decision, the touchstone of the "generic" inquiry is consumer perception. Simply put, because consumers "do not perceive the term 'Booking.com' to signify online hotel reservation services as a class," it is "not generic and can be eligible for federal trademark registration."
The majority rejected the USPTO's argument that the case is governed by a nearly per se rule that, when a generic term is combined with a generic TLD, the resulting combination is also generic. As we discussed in our previous article, the USPTO contended that this rule follows from the Court's 19th century decision in Goodyear's India Rubber Glove Mfg. Co. v. Goodyear Rubber Co., 128 U. S. 598 (1888), which involved the combination of generic terms with generic corporate designations like "Company." Justice Ginsburg rejected such an inflexible rule, explaining that a "[b]edrock principle" of the Lanham Act—which was enacted more than half a century after Goodyear—is that "whether a term is generic depends on its meaning to consumers." That rule is incompatible with "an unyielding legal rule that entirely disregards consumer perception." Moreover, taking into account consumer perception is not inconsistent with Goodyear, which, she explained, only held that "a compound of generic elements is generic if the combination yields no additional meaning to consumers capable of distinguishing the goods or services."
The majority also rejected the USPTO's concerns that allowing registration for eligible domain names would have anti-competitive effects, because it would prevent competitors from adopting domain names that incorporate terms that are similar to "booking.com" Justice Ginsburg reasoned that such concerns attend all descriptive marks, and the trademark law addresses this issue by narrowing the scope of protection accorded to such marks. Notably, the majority referred to Booking.com's counsel's admission at oral argument that a BOOKING.COM trademark would be relatively weak, with the implication that it could not be widely enforced against others.
Alone in his dissent, Justice Breyer expressed doubt that the majority's consumer perception test could be applied reliably to the genericness inquiry. Most significantly, he expressed support for the line of authority holding that consumer survey evidence "is generally of little value in separating generic from descriptive terms" because it is possible for generic terms to achieve an association with a single source, "either because the producer has enjoyed a period of exclusivity in the marketplace . . . or because it has invested money and effort in securing the public's identification." In these cases, consumer survey responses are easily misinterpreted—they do not show that a term is not generic, but merely that a single source has, through luck or effort, come to be associated with the term.
Justice Sotomayor penned a two-page concurrence, in which she addressed concerns raised by Justice Breyer's dissent. First, the Justice argued that survey evidence is not the "be-all and end-all" of the genericness inquiry because other materials may also serve as evidence about how consumers perceive a term's meaning and, ultimately, whether a mark is generic or descriptive. Second, she argued that the USPTO may have been correct in its initial conclusion, based on dictionary and usage evidence, that booking.com was generic for the class of services at issue, and the district court may have erred in reversing. But, she observed, that issue was not before the Court.
What's Changed and What Remains the Same?
In the end, not much has changed. Even prior to Booking.com, the USPTO was handing out federal registrations for formulations of "generic.com" domain names. See, e.g., BEDANDBREAKFAST.COM, promoting real estate properties Reg. No. 4,430,129 (Nov. 5, 2013); LAW.COM, online newspapers, magazines, and newsletters in the field of law, Reg. No. 3,413,772 (Apr. 15, 2008). With that said, federal registrations for generic.com domain names will likely become easier to secure and, particularly when backed by a solid consumer survey, more difficult to challenge. Will we see increased business interest in "generic.com" domain names—which already tend to be relatively expensive—because ownership of such a domain name may yield trademark rights in a term that might otherwise be considered generic?
© Arnold & Porter Kaye Scholer LLP 2020 All Rights Reserved. This Advisory is intended to be a general summary of the law and does not constitute legal advice. You should consult with counsel to determine applicable legal requirements in a specific fact situation.