28 Jul 2020 in Newsletter
U.S. Supreme Court Rules That GENERIC.COM Trademark Format is not Registrable Only if the Term Has That Generic Meaning to Consumers
Under U.S. trademark law, generic terms are not eligible for federal registration because registration gives a mark owner the right to exclude others from use of the term. By way of example, a generic term is the name of a class of goods or services, for example, “bleach” or, in the case at hand, “online hotel reservation services.” Other businesses or individuals may require the unrestricted use of generic term to describe their products or services. In United States Patent and Trademark Office, et al. v. Booking.com B.V., 2020 WL 3518365, the Supreme Court considered whether “Booking.com” is an unregistrable generic term, and more broadly, whether the U.S. Patent and Trademark Office’s (USPTO) nearly per se rule that combining generic terms with generic Internet-domain-name suffixes like “.com” results in an unregistrable composite mark should stand. Here, the Court ultimately ruled that registrability of the combination of a descriptive or generic term with another generic term (for example, “.com”) depends on consumer perception the combined terms. Namely, if consumers perceive the combination as being capable of functioning as the sole source identifier of the trademark owner’s goods or services, the composite mark is registrable. The Court, in agreement with the decisions of the lower courts, held that (1) a term styled “generic.com” is a generic name for a class of goods or services only if the term has that generic meaning to consumers and (2) the USPTO’s proposed rule prohibiting registration of combined generic terms is untenable because it is not supported by the USPTO’s past practices and lacks support in trademark law and policy.
This case came before the Court after the USPTO refused registration of the mark “Booking.com” for being the generic name for online hotel-booking services. Considering both the USPTO’s past practices and general tenets of trademark law, the Court ruled in favor of Booking.com, B.V., holding that “Booking.com” is not generic because it is not considered generic by consumers, and is therefore registrable.
In support of their decision, the USPTO argued that refusal to register generic composite marks guards against anticompetitive effects, for example, monopolizing on a generic dictionary term like “booking.” Secondary concerns of the USPTO included a doubt that owners of “generic.com” brands need trademark protection, as they are able to rely on other unfair competition laws and the competitive advantages of owning a domain name. The USPTO further argued that because of the exclusive nature of domain names (no two are identical and only one entity can occupy a domain name at a time), consumers who are familiar with that aspect of the domain-name system can infer that a domain such as “Booking.com” refers to a specific entity. Accordingly, the Court concluded that an exclusive connection between a domain name and its owner “makes trademark protection more appropriate, not less.”
Under §1052 and §1091 of the Lanham Act, an important requirement for registration of a trademark is that the applicant’s mark is capable of distinguishing its goods and services from the goods or services of others. If the mark meets this requirement, then the mark cannot be generic. The USPTO claimed that the terms “booking” and “.com” are generic when viewed separately, and therefore generic when combined. However, the Court reasoned that a consumer would view the terms together, as a whole, and not as separate terms. However, trademark law requires that a mark be considered from the view of consumers. Therefore, it is the combined terms that must be considered for trademark registration eligibility. Analyzing the mark as a whole, the Court reasoned that a consumer would not consider other travel-booking services such as Travelocity to be a “Booking.com.” Accordingly, “Booking.com” is not generic.
The Court further pointed to examples of the USPTO’s past practices where registration was granted for other “generic.com” trademarks, including “Art.com” and “Dating.com.”
Notwithstanding their decision in Booking.com, the Court noted that not every “generic.com” mark is automatically eligible for registration. In accordance with the Lanham Act and other common law trademark principles, registrability is dependent on consumer perception of the mark.
In conclusion, the Court’s decision in Booking.com reinforces the tenet of trademark law that marks must be evaluated from the view of a consumer. Incorporating the foregoing ruling, the Court rejected the USPTO’s proposed per se rule that combining generic terms with generic Internet-domain-name suffixes (such as “.com”) results in a generic composite that is not eligible for federal registration.