Today, the Supreme Court issued its opinion in the trademark registration case United States Patent and Trademark Office v. Booking.com B.V., holding “A term styled ‘generic.com’ is a generic name for a class of goods or services only if the term has that meaning to consumers.” Justice Ginsburg delivered the majority opinion, in which justices Roberts, Thomas, Alito, Sotomayor, Kagan, Gorsuch and Kavanaugh joined. Sotomayor filed a concurring opinion. Breyer dissented, primarily over the role evidence of consumer perception should play in according a term generic status.
The definition of a trademark is a word or device that identifies goods or services as emanating from a single source. A descriptive term can acquire distinctiveness in the minds of consumers as designating a single source of certain goods and services. With that acquired distinctiveness, the term becomes eligible for registration on the Principal Register of the United States Patent and Trademark Office (USPTO).
In this case, the Court noted that “[t]he word ‘booking,’ the parties do not dispute, is generic for hotel-reservation services.” As Booking.com itself touts, it is “the World’s #1 Choice for Booking Accommodations.” The government argued that the term “booking.com” would remain a generic term even if consumers currently view the primary significance of Booking.com as a brand.
The Court determined, though, that whether a compound term such as Booking.com is generic turns on whether that term, taken as a whole, signifies to consumers a class of goods or services. There was no dispute in the appellate record that consumers do not in fact perceive the term Booking.com that way. Through advertising expenditures, consumer surveys and other evidence gathered over time, customers have come to recognize the combination of booking and .com as a brand name: Booking.com.
The majority rejected a per se rule flowing from the Goodyear Co. v. Goodyear Rubber Co., 128 U.S. 598 (1888), Supreme Court ruling that the combination of a generic term (i.e., one that identifies the goods or services offered) with a generic term like “company” cannot be transformed into a protectable trademark. The .com extension is not analogous to a term like company because every domain name is unique – there can be only one internet protocol address assigned to any given letter string. The Court thus rejected the government’s position that such generic-formed domain names never can be exclusive trademarks, stating that “whether any given ‘generic.com’ term is generic, we hold, depends on whether consumers in fact perceive that term as the name of a class or, instead, as a term capable of distinguishing among members of the class.” Thus, the majority elevated the role of consumer perception over any per se rule, explicitly rejecting the USPTO’s interpretation of Goodyear that generic terms are not protectable regardless of how consumers would understand the term in favor of an analysis that centers on consumer perception. “That bedrock principle of the Lanham Act is incompatible with an unyielding legal rule that entirely disregards consumer perception.”
The alternative rule proffered by the USPTO was a per se rule with an asterisk, excepting those “generic + generic top-level domain” designations that constituted a play on words, like “tennis.net.” Ultimately, the majority held, the USPTO’s rule was “not borne out by the [US]PTO’s own past practice and lacks support in trademark law or policy.” Regarding the policy concerns, several doctrines ensure that registration of Booking.com would not yield its holder a monopoly on the term booking. The existing likelihood of confusion analysis would corral presumptively weak generic-formed .com marks to a narrow band of protection that allows competitive brands, like e-booking.com, to flourish without causing consumer confusion. The fair use doctrine would provide a defense for use of a generic term by competitors. There is no basis to deny Booking.com the same benefits Congress accorded other marks qualifying as nongeneric. Registration accords registrants leverage in enforcing their rights, such as in rem proceedings against counterfeiters (who by definition are infringers of registered trademarks). Registrations also assist in fighting cybersquatters, spoofers and phishers.
Breyer’s dissent declined to place any significance on the functional exclusivity of domain names. The dissent further argued that the addition of definite articles and entity designations may communicate association with a specific entity, e.g., “The Wine Company,” but that does not make the compound term any less generic. The fact-specific approach advanced by the majority, Breyer maintained, could lead to a presumption of trademark eligibility because generic.com marks are unlikely to be found in industry parlance or dictionaries and by their nature are exclusive to a single entity. Survey evidence of the type submitted by Booking.com in the lower court is of limited value because, in Breyer’s view, a segment of people always will hold that any generic.com domain name is associated with a single source. Sotomayor, in her concurrence, echoed Breyer’s concerns over the use of survey evidence to determine genericism.
It will be interesting to see if the Booking.com decision leads to a softening of the USPTO’s examiner-centered determination of what constitutes a generic term and the role survey evidence might play in overcoming such rejections.