By Jake Abrahamian.
Later this year, the Supreme Court is set to decide USPTO v. Booking.com B.V. in a ruling that will determine whether a generic name can be transformed into a protectable trademark when followed by a top-level domain (“.com”). The issue arose when Booking.com, a hotel accommodations service, sought to register booking.com as its trademark, but the USPTO refused on the ground that booking and .com were generic. However, the Fourth Circuit found that as a whole, booking.com could be something that consumers perceive as a brand. And this is the heart of trademark law.
Trademarks are brand identifiers. They indicate source. When you see a small bitten apple on the back of a laptop, you know who made the computer. The policy theory behind protecting trademarks is that when a consumer sees that mark—the apple—she does not have to further investigate the quality and characteristics of the product—the computer—because it will be just like any other computer product with that mark. Meanwhile, the producer is incentivized to maintain a high-quality product. For this theory to be effective, however, each mark must serve as a distinctive source identifier.
Thus, distinctiveness is fundamental to any trademark and without distinctiveness, a mark cannot gain protection. Distinctiveness for word marks is measured on a spectrum, with the most distinctive marks being those that are “inherently distinctive,” and they immediately may be protectable (e.g., Apple for computers; Kodak for cameras). Marks that are not inherently distinctive fall into one of two categories. First there are descriptive marks (marks that describe characteristics of the product; e.g., American Airlines for an airline in America). Descriptive marks do not inherently identify source, so they cannot be trademarks until the consuming public understands them to be brands. In other words, the marks must gain acquired distinctiveness or a secondary meaning. Finally, there are generic marks (common name of the product; e.g., Apple for apples). Generic marks are not trademarks at all, and the courts have held that no amount of secondary meaning can overcome a generic mark.
The Booking.com case straddles the vital line between generic and descriptive marks—the line separating possibility from preclusion of protection. There is centuries-old precedent holding that firms may not tack “company” to the back of a generic word to gain protection, and the USPTO argues that the same should be held, as a bright-line rule, for adding “.com.” The Fourth Circuit disagreed, holding that when taken as a whole, booking.com could be non-generic where evidence demonstrates the mark’s primary significance is the source, not the product.
The Next Step
The Supreme Court is now left to decide whether to implement a per se rule denying protection to generic marks in combination with generic top-level domains. Plainly, it should not. As Booking.com aptly stated in its respondent brief, under trademark law “the consumer is king.” While it may expedite trademark examiners’ decision making, a per se rule in these cases ignores the fundament tenet of trademark law: consumer perception governs. An industry-standard survey revealed that nearly 75% of respondents perceived booking.com as a brand name, a number so high it should possibly be dispositive. If a per se rule denies Booking.com the protection it seeks, the company can no longer protect its consumers from firms using confusingly similar marks that may offer suboptimal services. Both Booking.com and the consumers are harmed as a result.
Furthermore, while the USPTO argued that adding “company” is “analytically indistinct” from adding “.com,” that is simply not true. Trademarks aside, Booking.com owns its internet domain name, and it can be the only company that does so. Therefore, no one else needs booking.com. Granting trademark rights here would not raise the same concerns as granting rights to shoe company, for example. The Court should allow consumer perception to dictate, and in some cases the total commercial impression of a generic mark with a generic top-level domain may serve to properly identify a brand. The Court should not adopt the USPTO’s bright-line rule, but whether it does is a matter of time. Arguments are set for March 23.