Consumer Perception at the Heart of Trademark Law; the U.S Supreme Court sides with Booking.com

On June 30, 2020, the Supreme Court of the United States replied to the question “Is the combination of a generic term with a generic Top-Level Domain necessarily generic?”. And the response was “Because “Booking.com” is not a generic name to consumers, it is not generic and may be registered as a trademark.”

Background

The company Booking.com maintains a travel-reservation website under the brand and domain name booking.com. Booking.com filed four trademark applications for the trademark BOOKING.COM for hotel booking services, but the applications were refused by the U.S. Patent and Trademark Office on the ground that the trademark consisting of a generic term combined with a generic Internet-domain name suffix like “.com,” the resulting combination is necessarily generic. After a series of appeal, the Supreme Court rendered an opinion disagreeing with the USPTO.

How did they succeed?

Booking.com did not dispute that the word “booking” is generic for hotel-reservation services. The question was whether a domain name styled “generic.com” is necessarily a generic name that cannot be registered as a trademark, as claimed by the USPTO. In its opinion, the Supreme Court started by recalling that a generic name is by principle ineligible for federal trademark registration, unless it has acquired distinctiveness, and that the legal test for assessing the distinctiveness of a trademark is how consumers perceive it as a whole. And as Booking.com presented a consumer survey that 74.8% of the participants perceive the term “Booking.com” as a brand, the Supreme Court concluded that in circumstances like those of the case, a “generic.com” term is not generic and may be eligible for federal trademark registration.

For those not familiar with domain names, the domain name system has a particularity: while an identical trademark may be used by several companies, as the scope of protection of a trademark is limited geographically and by designation of goods and services, a domain name is unique and confers worldwide exclusivity. A domain name is only associated with a particular website at a time.

Which is why, to the argument of the USPTO that adding a generic corporate designation like “Company” to a generic term does not make the trademark nongeneric, the Supreme Court replied that as only one entity can occupy a particular Internet domain name at a time, a “generic.com” term can convey to consumers an association with a particular website and identify the website’s proprietor.

What does this mean for companies in general?

This opinion of the Supreme does not however support that “generic.com” terms are automatically classified as nongeneric terms; it only rejects the USPTO’s ruling that “generic.com” terms are generic names by nature. Not every domain name containing a generic term will be allowed to be registrable as a trademark following the Supreme Court’s opinion: a “generic.com” brand will still need to be perceived as distinctive by consumers for its registration to be possible. Similarly, a “generic.com” trademark will still benefit from a weaker scope of protection as a trademark, even if registrable, as it is only the combination of the generic term with the generic Top-Level Domain that will be deemed nongeneric, as opposed to an arbitrary or fanciful trademark. Booking.com’s competitors will remain free to use the term “booking” or registering domain names containing the term “booking” under the doctrine of fair use.

What is important moving forward?

Even if this ruling might be an indicator on how the perspective on domain names as trademarks are changing, it is still of great importance to be strategic when choosing a name for your brand.  A nongeneric name will give still you greater possibilities to protect it – both legally and digitally.

If you are curious on how this decision affects your brand, or if you want to know more about how we help our clients protecting their business, you are more than welcome to contact our legal- and digital specialists!