A trademark is a word, symbol, or device that is used to classify a specific manufacturer or seller’s products and differentiate them from the products of another manufacturer or seller. For example, a company may want to trademark their logo to distinguish their goods or services from another company that provides similar services. Trademarks provide the owner with a right to protect their marks and prevent consumer confusion with regards to certain goods and services.
Trademarks must be distinctive and used in trade in order to be registered with the United States Patent and Trademark Office (the “USPTO”). Marks are categorized in the following levels of distinctiveness, from strongest to weakest: fanciful, arbitrary, suggestive, descriptive, or generic.
Generic or merely descriptive marks cannot be trademarked. Generic trademarks are those that at the time of filing are the name of a good or service offered by the product.
Whether a mark is generic, and thus not able to be trademarked, is decided by the USPTO during the trademark application review process. Typically, the USPTO does not consider the addition of “.com” or any other top-level domains, like “.gov” or “.edu,” to have any significance on the distinct meaning or understanding of a mark. For example, if a company with a generic mark, like “Dog” added “.com” to the name in hopes of making the name more distinct, the USPTO would likely disregard the addition of the top-level domain element, and would reject the trademark application on the grounds that the mark is generic. However, in Booking.com v. USPTO, the 4th Circuit Court of Appeals weighed in on this relatively controversial issue and held that BOOKING.COM should be trademarked, regardless of the presence of “.com” in the name.
Booking.com, which has done business under that name since 2006, manages a website that allows customers to search and book hotel and travel accommodations. Between 2011 and 2012, Booking.com filed four trademark applications with the USPTO for the use of BOOKING.COM, as both a word and stylized mark. However, Booking.com faced several legal obstacles and several years of appeals in order to obtain its company’s trademarks.
In 2012, the USPTO rejected Booking.com's trademark applications on the grounds that the mark was generic as applied to the services provided. Booking.com had filed their trademarks under Class 43, which includes online hotel reservation services. USPTO also stated that, even if the marks were not found to be generic, the marks were merely descriptive and failed to provide a secondary meaning that is required for trademark registration. As descriptive marks are not as strong as arbitrary or fanciful marks, a descriptive mark must have a secondary meaning from the plain understanding of the work. For example, Greyhound has a plain meaning of a dog breed, but a secondary meaning, that can be trademarked, of a bus company. In this case, the USPTO claimed that Booking.com’s mark did not have a secondary meaning because the mark merely described the service it provided – a website for booking travel or accommodations.
As a result of the trademark application rejection, Booking.com appealed to the TTAB. The TTAB affirmed Booking.com's mark rejections and cited that, similar to the USPTO determination, Booking.com was a generic term referring to a service and therefore, did not qualify for trademark registration. The TTAB stated that consumers would comprehend the composite - Booking & .com - to mean an online booking service, rather than relating to a specific company or distinct service provided by Booking.com.
In April 2016, Booking.com appealed the TTAB's decision as a civil decision to be argued in front of the Eastern District of Virginia. Booking.com argued that its mark was descriptive, and not generic, and supported their assertion with a "Teflon survey." A "Teflon survey" helps to test genericness of a challenged mark by surveying consumers to determine whether they consider that mark to be common or brand name. Booking.com's "Teflon survey" revealed that 74.8% of respondents considered Booking.com to be a brand rather than a generic service.
The district court held that "although 'booking' was a generic term for the services identified, BOOKING.COM as a whole was nevertheless a descriptive mark." The district court also held that Booking.com has to pay the USPTO attorneys' fees pursuant to 15 U.S.C. § 1071(b)(3). As a result of the district court's decision, both parties appealed to the 4th Circuit Court of Appeals.
On February 4, 2019, the Second Circuit Court of Appeals held that when “.com” is combined with a second-level domain (SLD), even if SLD is generic, like BOOKING, the resulting combination may not be generic for trademark purposes. The Court did stipulate that the combination of terms, in order to not be generic, must demonstrate “that the mark’s primary significance to the public as a whole is a source, not the product.” Therefore, USPTO was incorrect in finding that Booking.com was ineligible to be a registered mark based upon its genericness.
The Court’s decision was supported by the results of Booking.com’s “Teflon survey,” which provided strong evidence that the public did not connotate “Booking.com” with a service but rather with the company itself. The consumer’s understanding of Booking.com as a company, rather than a common service, led the Court to understand that Booking.com has a secondary meaning that goes beyond the plain descriptive name or service provided. Additionally, the survey clarified that the public understood the parts of the name, “Booking” and “.com” as a whole, rather than separate terms. This distinction was very important to the Court in holding that “Booking.com” was not a generic term. Further, the Court clarified that its decision in this matter was a rare situation and may not necessarily be applicable to terms that were found to be generic, regardless of the addition of “.com.”
Additionally, with regards to Booking.com’s appeal regarding payment of the USPTO’s attorneys’ fees, the Court held that per 15 U.S.C. § 1071(b)(3), Booking.com had to pay the required attorneys’ fees regardless of the substantive outcome of the appeal. The statute reads that a trademark applicant challenging the USPTO’s decision in district court must pay “all of the expenses of the proceeding.”
Lessons to Learn
Going forward, the Court’s decision in Booking.com v. USPTO lends insight into how courts may rule regarding companies adding “.com” to their tradenames in the hopes to create a distinctive mark from a generic name. In this case, the Court provided a warning to companies that unless the name as a whole has a distinct meaning and understanding among consumers, the addition of “.com” will likely not be enough to create a sufficient mark from a common name. However, if a company does decide to attempt to trademark a name that is not conclusively arbitrary or fanciful, it would likely be in the company’s best interest to first ensure that the mark has sufficient brand awareness or name recognition with consumers. By first confirming the consumer’s understanding of the mark, a company may have a better shot at proving that the mark has a descriptive second meaning, similar to the public’s understanding of Booking.com as more than a common travel booking service.
Furthermore, companies should be wary when applying for marks that may result in further litigation at the district court level because, regardless of the outcome of the matter, the company will be responsible for the USPTO’s attorneys’ fees. Therefore, companies should keep in mind the additional costs that could be associated with submitting a trademark application for a mark that could be rejected or questioned by the USPTO and pursued with additional litigation.
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