Recently, the Supreme Court concluded another historic term, handing down landmark decisions in employment discrimination and executive immunity, among others. However, this also means cases like United States Patent and Trademark Office v. Booking.com, B.V. (“Booking.com”), a case decided at the end of June with broad application in the area of trademark law, do not receive similar attention.
First, some background on trademarks and trademark registration. Trademarks are a way of advertising a product or service to distinguish it from competitors. Trademarks can be brand names like “Apple”, logos like the Nike “swoosh” or slogans (McDonald’s “I’m lovin’ it”). When you see those trademarks, chances are you immediately associate them with the product or service advertised due to the mark’s distinctiveness and recognizability in the given market.
Furthermore, trademarks receive the greatest protection from illegal or unfair use if they are registered with the United States Patent and Trademark Office (“PTO”). While this is not necessary to acquire specific rights to a trademark, protections granted to registered trademarks include being able to sue for trademark infringement in federal court, among other things.
The PTO considers several criteria when registering new trademarks, but the most important factor is how “distinctive” a trademark is. A trademark’s distinctiveness indicates how effectively the mark distinguishes the goods or services from competitors and is classified into five levels, 1 being the most distinctive and 5 being the least distinctive:
- “Fanciful”
- “Arbitrary”
- “Suggestive”
- “Descriptive”
- “Generic”
The PTO considers “Fanciful”, “Arbitrary” and “Suggestive” marks “inherently distinctive”, but not “Descriptive” or “Generic” marks.
A “Descriptive” mark is one that merely describes the kind of goods or services provided, e.g. “Quick & Easy Cleaning Services”, while a “Generic” mark is just a common name for a product/service, e.g. “Cleaning Services.” “Generic” marks are prohibited from being registered with the PTO, while “Descriptive” marks may only be registered with if the mark has become so recognizable by consumers that it can distinguish the product or service in a given market. This characteristic is known as “secondary meaning”.
In Booking.com, the central issue was whether the popular online travel agency could register its name: “Booking.com” with the PTO. The PTO has had a longstanding policy that a name for a generic service (e.g. a travel agency booking service) followed by “.com” or some other top-level domain, does not create a protectable trademark no more than a typical “Generic” trademark, and therefore denied Booking.com’s registration. From a policy standpoint, this seems like a valid position. If every generic mark could be found to be sufficiently distinctive, just by adding a “.com”, “.net”, etc., it almost negates the purpose for why generic marks are barred from protection in the first place.
Booking.com, the company, appealed the PTO’s decision, arguing that “Booking.com”, the trademark, possessed a commanding level of distinctiveness because when consumers view the mark in its entirety, they understand that the service connected to the trademark is distinct from other online travel agencies. Ultimately, the Supreme Court agreed with Booking.com and rejected the PTO’s rule prohibiting all generic marks followed by “.com” from registration.
The Court held that “a ‘generic.com’ term might also convey to consumers a source-identifying characteristic: an association with a particular website… only one entity can occupy a particular Internet domain name at a time”. Therefore, consumers may be able to infer that “Booking.com” refers to a specific entity. The Court also noted that the PTO had not even kept this rule consistent, by allowing marks such as “Art.com” and “Dating.com” to be registered previously.
Because a “generic.com” trademark may still possess some inherent degree of distinctiveness, the Court rejected the PTO’s position barring all “generic.com” marks from registration.
It should be noted that, while the Court did reject the PTO’s stance, the Court did not rule on how distinctive “Booking.com” was. The Court remanded that decision to the lower courts to see if the mark is in fact “Descriptive”, not “Generic”, and if so, whether it has acquired “secondary meaning”.
This holding may have lasting consequences for other online service providers that use similar branding in their marketing strategies. Indeed, while not every “generic.com” trademark may be registered with the PTO, it would seem that any holder with a popular enough “generic.com” trademark is free to try.