Supreme Court Rules That Generic Terms + .com May Be Capable of Federal Trademark Registration

On June 30, 2020, the Supreme Court decided United States Patent and Trademark Office v. Booking.com B.V., Case No. 19-46, 589 U.S. ____ (June 30, 2020) held, with only one dissent, that it is possible for a domain name comprised of a generic term appended by “.com” to qualify for federal trademark registration.

Booking.com B.V. (“Booking.com”) operates a travel reservation website under the mark BOOKING.COM found at the domain name booking.com. Booking.com attempted to register this mark with the United States Patent and Trademark Office (the “PTO”), but the PTO refused registration on the ground the mark was generic.

The PTO evaluates proposed marks on a continuum ranging from generic to arbitrary or fanciful. Generic terms, which are terms that name the associated class of goods or services, are not eligible for trademark registration because they are incapable of distinguishing one person’s goods from another’s. Descriptive terms which are terms that describe an ingredient, quality, or feature of the associated goods or services, are not inherently distinctive. Therefore, they do not qualify for registration on the Principal Register unless and until they have acquired distinctiveness through use. Suggestive marks require some imagination or a series of mental leaps to establish a connection with the goods or services offered under them and are inherently distinctive and registrable on the Principal Register. But the strongest marks are arbitrary and fanciful marks, which are comprised of terms that have no connection to the goods or services offered under them or are marks that have been invented.

The parties agreed that the term “booking” is generic for hotel reservation services. The PTO maintained that the mere addition of “.com” to the end of a generic term was also generic, but Booking.com disagreed, so it appealed the refusal to register BOOKING.COM. The Trademark Trial and Appeal Board (the “TTAB”) agreed with the PTO and affirmed the refusal to register the proposed mark. Alternatively, even if the proposed mark was not generic, the TTAB would consider it descriptive and unregistrable on the Principal Register.

Rather than appealing the TTAB decision to the U.S. Court of Appeals for the Federal Circuit, Booking.com sought de novo review in the U.S. District Court for the Eastern District of Virginia. Booking.com was permitted to introduce additional evidence to the District Court, including evidence about consumer perception of the mark. The District Court concluded that BOOKING.COM was descriptive of the services offered at the domain name, but had acquired distinctiveness with respect to hotel reservation services. Thus, the District Court concluded that the mark could be registered for those services on the Principal Register.

The PTO appealed the finding that BOOKING.COM is not generic to the United States Court of Appeals for the Fourth Circuit, which affirmed the District Court’s decision. The PTO filed a petition with the United States Supreme Court, which granted certiorari.

Whether a compound term is generic turns on its meaning as a whole – not its individual parts in isolation – and its meaning to consumers. Because the Court found that consumers do not perceive BOOKING.COM to be synonymous with hotel reservation services, the Supreme Court ruled the mark is not generic.

In reaching this conclusion, the Supreme Court rejected the PTO’s argument for a nearly per se rule that would render the combination of a generic term with a generic top level domain a generic mark absent exceptional circumstances. The PTO argued that adding “.com” to a generic term added no more meaning than the addition of “Company” to a generic term. The Court disagreed, observing that the additional meaning would associate the mark with a website. Because only a single entity can occupy a domain name at a time, a mark comprised of a generic term combined with a generic top level domain will perceive the mark to refer to a specific business. The Court further rejected the PTO’s argument that a mark would be generic as a matter of law without regard to consumer perception. Rather, whether consumers perceived a difference in meaning capable of distinguishing the goods and services would determine whether the compound term is generic. At the same time, the Court was careful to note that it was not proposing a per se rule of its own automatically finding compound terms comprised of generic terms and top level domains to be non-generic. Rather, whether such a compound term is generic depends on whether consumers perceive the term as the name of a class or as capable of distinguishing among members of the class.

The Court rejected the argument that protecting BOOKING.COM as a mark would hinder competition, specifically hindering others from using variations of the term booking or booking.com. But this risk is associated with any descriptive mark and the manner in which likelihood of confusion is assessed takes into account whether the mark at issue is strong (like an arbitrary or fanciful mark) or weak (like a descriptive mark). The law also allows for fair use of descriptive terms other than as a mark. Further, the Court pointed to a series of concessions Booking.com made in the course of oral argument. Specifically, that BOOKING.COM is a weak mark, that it is descriptive, that close variations are unlikely to infringe, and that competitors can use the word “booking” to describe their services.

Thus, the Supreme Court held that compound marks comprised of generic terms in combination with generic top level domains are not always themselves generic. Instead, if such terms are perceived by consumers to indicate the source of associated goods and services, they may be protectable as marks.