PTO has booked a trip to the Supreme Court

The U.S. Supreme Court granted certiorari on a petition filed by the U.S. Patent and Trademark Office to review whether BOOKING.COM is a registrable trademark. The PTO is challenging Booking.com's trademark application on the grounds that the mark is generic as applied to travel booking services. The court's decision will be instructive in the protection of domain names going forward. The question is whether two generic terms -- "booking" and ".com" -- are distinctive when added together as "booking.com." Answering this question will require the court to balance policy considerations that fundamentally shape trademark law -- such as whether an applicant should be rewarded with a registered mark when it chooses a generic term that will drive potential customers to its websifte. See Patent & Trademark v. Booking.com B.V., 19-46 (Nov. 8, 2019).

This dispute began in the PTO when Booking.com B.V. (BBV) applied to register the BOOKING.COM mark. The trademark examiner rejected the application, finding that the mark was generic as applied to travel booking services. The examiner also found, in the alternative, that the mark was merely descriptive and that BBV had not shown secondary meaning for acquired distinctiveness. BBV then appealed to the Trademark Trial and Appeal Board. The board affirmed the examiner's rejection.

An applicant that is unsuccessful before the TTAB can appeal either in the U.S. Court of Appeals for the Federal Circuit or in the U.S. District Court for the Eastern District of Virginia (15 U.S.C. Section 1071), and BBV elected the latter route. In the district court, BBV introduced "Teflon survey" evidence that 74.8% of consumers recognized BOOKING.COM as a brand rather than a generic service. The district court held that BOOKING.COM -- taken as a whole -- was descriptive, not generic, relying heavily on BBV's survey evidence and despite finding that "BOOKING" and ".COM" individually would be generic. The district court further held that BBV had successfully shown its mark had acquired secondary meaning. See Booking.com B.V. v. Matal, 278 F. Supp. 3d 891 (E.D. Va. 2017).

On appeal, the 4th Circuit affirmed and discussed the use of survey evidence at length, explaining that "Teflon surveys are the most widely used survey format to resolve a genericness challenge. These surveys explain the distinction between generic names and trademark or brand names and then ask survey respondents to identify a series of names as common or brand names." Booking.com B.V. v. USPTO, 915 F.3d 171, 178 n.4 (4th Cir. 2019) (internal quotations and citations omitted).

It is well settled that trademark protection requires distinctiveness. Lanham Act Section 45. Determining whether a mark is distinct requires an analysis involving five potential categories of distinctiveness: fanciful, arbitrary, suggestive, descriptive and generic. Fanciful, arbitrary and suggestive marks are considered to be inherently distinctive, while descriptive and generic marks are not. A descriptive mark may acquire distinctiveness upon a showing of secondary meaning (i.e., that the primary significance of the mark in the public's mind becomes the producer rather than the product).

Generic marks are neither inherently distinctive nor capable of acquiring distinctiveness. Trademark law recognizes that protection of a generic mark would likely impede competition by effectively granting a monopoly on an entire genus. Thus, the distinctiveness requirement: allows competitors to freely use generic words as necessary to refer to their goods or services, reduces consumers' transaction costs in selecting a good or service, and protects consumers interests by identifying and representing the competitor responsible for quality and reputation associated with a good or service.

Now before the Supreme Court, the PTO argues that the lower courts conflated the questions of genericism and secondary meaning, improperly considering survey evidence to determine that BBV's mark has secondary meaning and is therefore not generic. BBV responds that BOOKING.COM is not generic at all but is rather descriptive and that courts have long considered Teflon survey results as strong evidence for determining that descriptive terms are not generic. And here, the survey showed that consumers do not consider the mark BOOKING.COM to be generic.

The PTO also argues that a generic mark should not be able to escape genericism by the mere addition of ".com." For support, the PTO cites an 1888 Supreme Court case that held genericism cannot be avoided by the addition of "Company" to an otherwise generic term. See Goodyear's India Rubber Glove Mfg. Co. v. Goodyear Rubber Co., 128 U.S. 598 (1888). Further, the PTO cites to 9th and Federal Circuit cases applying the Goodyear principle to domain name marks to find them generic as well. See, e.g., Advertise.com, Inc. v. AOL Advertising, Inc., 616 F.3d 974 (9th Cir. 2010) (holding ADVERTISING.COM generic); In re Hotels.com, L.P., 573 F.3d 1300 (Fed. Cir. 2009) (holding HOTELS.COM generic). Notably, though, the 9th and Federal Circuit cases made clear that Goodyear was not a bright-line rule with respect to top level domains.

The Supreme Court's grant of certiorari here indicates that it is likely to overturn the lower courts' decisions that BOOKING.COM is not generic. If the court sides with the PTO and holds that BOOKING.COM is generic, BBV's application will not be registered after having spent more than five years in litigation to obtain and protect it. BBV has also invested in widespread advertising to build up its brand and goodwill, and it is one of the largest online travel booking services in the country. It would seem unfair if such a successful company could not protect its brand nor stop potential infringers from trading on the goodwill that it has built in its brand.

On the other hand, a decision in favor of Booking.com would result in the grant of a monopoly in a generic term that trademark law seeks to discourage. There may also be a race to the PTO to register [generic].com domain names, and such registrations would surely produce the anticompetitive effects against which the rules requiring distinctiveness are intended to protect.

Owners of domain name marks should pay close attention to the outcome. If BBV prevails, the court's decision will pave the way for a rush of [arguably generic].com trademark registrations. However, if the Supreme Court overturns the lower-courts' decisions, domain name owners will be reminded to exercise caution in choosing a new mark that is distinctive. 