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U.S. Patent and Trademark Office v. Booking.Com (Decision June 30, 2020)

Is the mark BOOKING.COM protectable as a trademark for online hotel reservation services?

In the United States Supreme Court

ArgumentJanuary 14, 2020
DecisionJune 30, 2020
Opinion BelowU.S. Patent and Trademark Office
Petitioner BriefBooking.com
Respondent BriefFourth Circuit Court of Appeals

Case Decision

On June 30, 2020, the Supreme Court ruled in favor of Booking.com. The mark BOOKING.COM is protectable as a trademark.

Scroll down for our decision analysis.

May 4, 2020

The major online hotel reservation platform Booking.com B.V. will argue to the Supreme Court that it should be allowed to trademark its web address.  The case is among those the Supreme Court selected to hear via teleconference in May while the Court building is closed due to Covid-19.

Booking.com is a leading digital travel company.  The company logs more than 30 million unique website visitors each month to its internet properties, which include the booking.com website.  Booking.com filed a trademark application for the mark BOOKING.COM in connection with online hotel reservation services.  The US Patent and Trademark Office (“USPTO”) rejected the trademark application because, in its view, term BOOKING.COM is a “generic” term for online hotel reservation services.

Booking.com and the USPTO agree that “booking” generically refers to making hotel reservations for others.  Booking.com and the USPTO also agree that “.com” generically refers to a commercial website.  However, they disagree on whether the combination BOOKING.COM is protectable as a trademark for online hotel reservation services.

Generic terms cannot be trademarked

A term is “generic” if it is the common name for a class of products or services.  Examples of generic marks include LITE BEER for light beer or CONVENIENT STORE for convenience stores.  Generic terms are not registerable as trademarks because they do not distinguish a product or service from any other categorically similar product or service.  From a public policy perspective, if trademark protection were granted to generic terms, a competitor could not describe their goods or services as what they are.  For this reason, generic terms can never be registered as a trademark, even if consumers recognize the generic term as a brand-specific identifier.

The term “booking” is generic for the reservation services and the “.com” suffix is generic for commercial online services.  The U.S. Patent and Trademark Office held the mark BOOKING.COM is nothing more than the sum of its generic components and refused to register the mark.

Booking.com appealed the USPTO’s refusal to register BOOKING.COM.  The lower courts reversed the USPTO and held BOOKING.COM is not a generic term.  For example, the public uses the terms “booking websites,” or “booking sites,” but necessarily BOOKING.COM as a generic descriptor for online hotel reservation services.

Descriptive marks can qualify for trademark registration

The lower courts also held BOOKING.COM is registerable as a trademark because it is a “descriptive” mark.  Descriptive marks describe a specific characteristic of a product but are not generic descriptors for a class of products.  Examples of descriptive marks include 5 MINUTE GLUE or KING SIZE MEN’S CLOTHING.  Descriptive marks are registerable as trademarks if evidence shows that the mark triggers a mental association with a specific brand or source of a product/service.  In this case, the lower courts credited evidence showing that 74.8% of survey respondents considered the mark BOOKING.COM a brand identifier.

Question in the case

The question before the Supreme Court is how to determine whether a mark is generic or descriptive.  Should a mark be considered generic based on whether the public uses the mark as a generic descriptor (Booking.com position) or should a mark be considered generic when the public would understand the mark to be a generic descriptor (USPTO position).

The USPTO arguments

The USPTO position is that a mark is generic when the public would understand the mark to be a generic descriptor.  More than 130 years ago, in Goodyear’s India Rubber Glove Mfg. Co. v. Goodyear Rubber Co., 128 U.S. 598 (1888) the Supreme Court held the addition of an entity designation like “Company” or “Inc.” to a generic term such as “wine,” “cotton,” or “grain” cannot create a protectable trademark.  The USPTO argues a straightforward application of the Goodyear holding applies when evaluating BOOKING.COM or any other “generic.com” mark.  Just like Goodyear held “Generic, Inc.” cannot be registered as a trademark, nor can “generic.com.”

Although the parties in Goodyear did not present survey evidence, each of the parties did present evidence that the public associated the term “Rubber Company” (or some other variant) as a brand identifier.  Nevertheless, Goodyear held appending the word “Company” to an unquestionably generic term does not create a protectable trademark.  A generic descriptor can never be registered as a trademark, even if combined with a generic suffix and even if consumers recognize the combination mark as a brand identifier.

The problem with the USPTO’s position is that the Trademark Statute in Section 1064(3) provides a test for evaluating whether a mark is generic based on actual consumer usage (the “primary-significance test”).  Under the primary-significance test, evidence of how a term is currently used by the public, such as survey evidence, is relevant to determine whether the term is generic.

The USPTO argues that Section 1064(3) and its primary-significance test only apply when deciding whether to cancel an existing trademark registration.  In a cancellation proceeding, the public’s current usage of a previously registered mark is relevant because pervasive usage of the registered trademark may have turned it into a generic term.  (For example, see Elliott v. Google, Inc., 860 F.3d 1151 (9th Cir. 2017) discussing whether the term “google” has become generic through public usage).

However, Section 1064(3) and its primary-significance test do not displace the Goodyear holding which applies when determining whether to register a mark in the first place.  Marks such as “Generic Company,” “Generic Inc.” or “generic.com” are ex ante understood to be generic descriptors.  Such generic marks are ineligible for trademark protection as a matter of law, regardless of whether evidence shows that consumers consider the mark a brand identifier.

The mark BOOKING.COM is obviously and immediately understood as referring to booking travel related services online.  Therefore, BOOKING.COM is nothing more than the sum of its generic component parts and is a non-registerable generic mark.

Furthermore, rejection of the mark BOOKING.COM furthers the public policy goals of the Trademark Statute.  For example, a trademark registration for BOOKING.COM could be asserted against similar marks such as BOOKING.BIZ, BOOKING.INFO, BOOKING.NET or BOOKING.ORG.  Such broad trademark protection would prevent competitors for using a simple, easy to remember domain names that generically describes the services provided.

Finally, the USPTO notes that courts and commentators continue to cite Goodyear for the principle that adding a corporate or other entity designation to a generic mark does not create a protectable trademark.  This demonstrates Goodyear remains good law and is the proper test for determining whether a potentially generic mark is registerable as a trademark.

Booking.com arguments

Booking.com argues the primary-significance test of Section 1064(3) supersedes Goodyear.  The Goodyear case was decided almost sixty years before enactment of the Trademark Statute.  The primary-significance test in Section 1064(3) is now the controlling test for evaluating whether a mark is generic – whether for initial registration or cancellation purposes.

Although Section 1064(3) only expressly discusses cancellation of a preexisting trademark registration, it is logical to apply the same primary-significance test to initial registration.  Holding otherwise means a different, unstated test controls initial registration of potentially generic marks.

Booking.com also argues the Goodyear holding embodied a common law principle that one may not obtain trademark protection for a mark that equally describes a competitor’s product, regardless of whether consumers associate the mark with a specific brand identity.  The Trademark Statute discarded this common law principle and instead created a distinction between “generic” and “descriptive” marks.  The primary-significance test provides the proper balance for distinguishing between generic and descriptive marks by approving registration of marks consumers consider distinctive of a brand and refusing registration of marks consumers use as generic descriptors.

The USPTO’s arguments rely solely on whether the Goodyear holding applies to the mark BOOKING.COM.  The USPTO does not argue BOOKING.COM is generic under the primary-significance test.  Under the primary-significance test, survey evidence is relevant to deciding whether BOOKING.COM is used by the public in generic way.  In this case, there is ample evidence showing that consumers do not use BOOKING.COM as a generic term for all online hotel-reservation services.  Therefore, BOOKING.COM is not generic and is potentially registerable as a trademark.

Additionally, Booking.com argues that applying the primary-significance test to initial registration questions furthers the goals of Federal Trademark law.  Firstly, the primary-significance test prevents registration of marks that do not distinguish between competitors while allowing registration of those that do.  Secondly, providing trademark protection for domain-name marks is particularly important to prevent rampant Internet-based confusion and fraud.  A registered trademark for BOOKING.COM will provide the necessary injunctive and monetary relief to combat deceptive typosquatting such as “BO0KING.COM” or “BOOKNG.COM.”

Booking.com notes that the USPTO itself has not been consistently applying the Goodyear holding.  Their brief lists of hundreds of registered trademarks that would be subject to cancellation under the Goodyear holding.  However, under the primary-significance test, different factual records will produce different results.  For example, based on presented evidence, BEDANDBREAKFAST.COM satisfied the primary-significance test and HOTELS.COM failed.  See, In re Hotels.com, L.P., 573 F.3d 1300 (Fed. Cir. 2009).  Additionally, even after overcoming the generic barrier, if an applied-for mark is descriptive, to obtain a trademark registration a registrant must also show consumers associate the descriptive mark with a single source.

Finally, Booking.com notes that registration of BOOKING.COM is in-line with global principles of trademark law.  85 foreign jurisdictions, including the European Union and United Kingdom, have approved registration of BOOKING.COM.

The Court will hear oral argument – by teleconference – on May 4, 2020.


DECISION ANALYSIS:

July 2, 2020

Booking.com Can Register its Web Address as a Trademark

On June 30, 2020, the Supreme Court in U.S. Patent & Trademark Office v. Booking.com held that the mark BOOKING.COM is not generic and may be registered as a trademark.

Booking.com filed a trademark application for the mark BOOKING.COM in connection with online hotel reservation services.  The U.S. Patent and Trademark Office (“USPTO”) rejected the trademark application because, in its view, the term BOOKING.COM is a “generic” term for online reservation services.  A term is “generic” if it is the common name for a class of products or services.  Generic terms are not registerable as trademarks because they do not distinguish a product or service from any other categorically similar product or service.

Booking.com and the USPTO agreed that “booking” generically refers to making hotel reservations for others. Booking.com and the USPTO also agreed that “.com” generically refers to a commercial website.  However, they disagreed on whether the combination BOOKING.COM is protectable as a trademark for online hotel reservation services.

The Majority Opinion – Authored by Justice Ginsburg

Justice Ginsburg, writing for a majority of the Court, held that a mark is generic only when consumers use the mark as a generic descriptor.

The Trademark Statute in Section 1064(3) provides a test for evaluating whether a mark is generic based on consumer usage (the “primary-significance test”).  Under the primary-significance test, evidence of how a mark is currently used by the public, such as survey evidence, is relevant to determine whether the mark is generic.  Although Section 1064(3) is discussing procedures for cancelling a preexisting trademark registration, eligibility for trademark registration also depends on consumer usage and perception.  The Court held that the primary-significance test governs cancellation of pre-existing registrations and whether a mark is registrable in the first place.  In this case, the lower courts properly concluded, based on survey evidence, that consumers do not perceive BOOKING.COM as referring to the general class of online reservation services.

Furthermore, the majority said, only one entity can hold rights to a particular Internet domain name at a time.  Therefore, a generic.com mark inherently conveys an association with a particular website and service provider.  This distinguishes BOOKING.COM from marks such as “Wine, Inc.” or “The Wine Company” that were held to be generic.  A mark composed of generic elements is itself generic only if the combination provides no additional meaning to consumers.  However, in this case, the lower courts considered evidence demonstrating that consumers understood BOOKING.COM to refer to a specific, non-generic entity.

The Court rejected a rule that all generic.com marks are per se ineligible for trademark protection regardless of consumer perception.  Principles underlying Trademark Statue require determining whether consumers in fact perceive a mark as a general description of a class of services or as a differentiator among members of the class.  In this case, the mark BOOKING.COM is eligible for federal trademark registration because evidence shows that consumers do not use BOOKING.COM as a generic term for online reservation services.

Moreover, the USPTO’s has registered other arguably generic.com marks such as ART.COM and DATING.COM. Adopting a rule that BOOKING.COM or other generic.com marks are per se ineligible for trademark protection would put all those registrations at risk of cancellation.

The majority was not swayed by the USPTO’s concern that registering BOOKING.COM would hinder competition by allowing the trademark owner to exclude competitors from using similar terms like “ebooking.com” or “hotel-booking.com.”  The majority argued that any such anticompetitive risks are small because, like any descriptive mark, potentially infringing use must be likely to cause confusion to infringe the BOOKING.COM mark.  Marks like BOOKING.COM that incorporate generic or highly descriptive components are less likely confuse consumers into thinking that a competitor’s use of the common generic elements originate from the mark’s owner.

Concurring Opinion by Justice Sotomayor

Justice Sotomayor filed a concurring opinion to clarify that in this case, the only question before the Court was whether BOOKING.COM is generic solely because it is a composite of two generic terms.

Justice Sotomayor noted that survey evidence alone may not be determinative of whether a mark is generic.  Various sources should be considered to determine whether a mark is generic.  For example, the USPTO could have properly concluded BOOKING.COM is generic based on other evidence such as dictionaries or usage by competitors.  However, consideration of other reasons for why the mark BOOKING.COM may or may not be generic was not before the Court.

Dissenting Opinion by Justice Breyer

Justice Breyer filed a dissenting opinion arguing that BOOKING.COM or any generic.com mark, is per se generic, as advocated by the USPTO.  Prior cases recognized that corporate designations such as “Company,” “Corp.,” and “Inc.” do not distinguish one service provider from another.  Like those corporate designations, a top-level domain such as “.com” is merely a necessary component of any web address and has no capacity to distinguish a source of goods or services.  Just as “Wine Company” expresses the generic concept of a company that deals in wine, “wine.com” expresses the generic concept of a website that deals in wine.

Justice Breyer rejected the majority’s distinction of the corporate designation cases.  That only one entity can hold rights to a particular domain name does not distinguish the corporate designation cases.  A generic term is not eligible for trademark protection even if consumers associate the generic term with a specific source provider.  Generic terms that describe the nature of a service provided must remain free for all to use.  Granting trademark protection to such generic marks would allow the trademark owner to prevent competitors from describing goods as what they are.

Although survey evidence shows that consumers do not use the term BOOKING.COM to refer to reservation websites generally, Justice Breyer notes that consumers also do not use the term “Wine, Inc.” to refer to sellers of wine, generally.  Nonetheless, the mark “Wine, Inc.” is generic because it inherently describes a company incorporated for that purpose.  BOOKING.COM likewise describes the basic nature of online reservation services, and not a distinguishing feature, quality, or characteristic of the website provider.

Justice Breyer also points out that survey evidence presented in this case does not address whether BOOKING.COM itself is generic.  For example, survey participants who identified BOOKING.COM as a brand may have done so because the company was first to market, based on company advertising efforts or other reasons.  The mark BOOKING.COM does nothing more than inform a consumer that an online booking service is being provided.  Trademark law does not protect marks that do nothing more than identify the service provided as opposed to identifying the provider of the service.

Additionally, Justice Breyer notes that there are anticompetitive consequences for granting trademark protection to generic.com marks.  Domain name ownership confers automatic, worldwide exclusivity because there can be only one BOOKING.COM.  Granting trademark protection to generic.com marks on top of this exclusivity allows owners to exclude others from using similar domain names.  For example, a trademark registration would allow the owner of BOOKING.COM to threaten trademark lawsuits against competitors using domains such as “Bookings.com,” “eBooking.com,” “Booker.com,” or “Bookit.com.”  Marks that inform the consumer of the basic nature of a business and nothing more must remain free for all to use.

For these reasons, Justice Breyer would have upheld the USPTO’s refusal to register BOOKING.COM and any other similar generic.com marks.

 
 

U.S. Patent and Trademark Office v. Booking.Com (Decision June 30, 2020)

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About the Author

Jacob Baldinger

Jacob Baldinger

Jacob Baldinger is a partner at Weiss & Arons LLP in Spring Valley, NY, and advises on intellectual property procurement and enforcement.

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