Monday, February 4, 2019

U.S. Court of Appeals for the Forth Circuit, BOOKING.COM B.V. v. USPTO, Docket No. 17-2458 and 17-2459, Published Opinion


Trademark
Distinctiveness
Generic Terms
Descriptive Terms
Secondary Meaning
Domain Name
Generic + .com = Nongeneric?
“Advertising” = generic; “.com” = generic; but “advertising.com”, valid and protectable mark?
Fourth Circuit


Protectability of the proposed trademark BOOKING.COM
The USPTO examiner rejected Booking.com’s applications, finding that the marks were not protectable because BOOKING.COM was generic as applied to the relevant services.
Booking.com appealed to the Trademark Trial and Appeal Board (the “TTAB”).
Booking.com appealed the TTAB’s decisions by filing this civil action under 15 U.S.C. § 1071(b) against the USPTO and the USPTO’s director in the Eastern District of Virginia.
Booking.com could have appealed to the Federal Circuit but declined to do so.

In order to be protectable, marks must be “distinctive.” To determine whether a proposed mark is protectable, courts ascertain the strength of the mark by placing it into one of four categories of distinctiveness, in ascending order: (1) generic, (2) descriptive, (3) suggestive, or (4) arbitrary or fanciful. George & Co. v. Imagination Entm’t Ltd., 575 F.3d 383, 393–94 (4th Cir. 2009). Marks falling into the latter two categories are deemed inherently distinctive and are entitled to protection because their intrinsic nature serves to identify the particular source of a product. In contrast, descriptive terms may be distinctive only upon certain showings, and generic terms are never distinctive.
This dispute concerns only the first two of these four categories, with Booking.com arguing the mark is descriptive and the USPTO arguing it is generic. 
A term is generic if it is the “common name of a product” or “the genus of which the particular product is a species,” such as LITE BEER for light beer, or CONVENIENT STORE for convenience stores. OBX-Stock, Inc., 558 F.3d at 340. Generic terms do not contain source-identifying significance--they do not distinguish the particular product or service from other products or services on the market. George & Co., 575 F.3d at 394. Accordingly, generic terms can never obtain trademark protection, as trademarking a generic term effectively grants the owner a monopoly over a term in common coinage. If protection were allowed, a competitor could not describe his goods or services as what they are. CES Publ’g Corp. v. St. Regis Publ’ns, Inc., 531 F.2d 11, 13 (2d Cir. 1975). 

In contrast, descriptive terms, which may be protectable, describe a “function, use, characteristic, size, or intended purpose of the product,” such as 5 MINUTE GLUE or KING SIZE MEN’S CLOTHING. Sara Lee Corp. v. Kayser-Roth Corp., 81 F.3d 455, 464 (4th Cir. 1996). In order to be protected, a descriptive term must have acquired secondary meaning. Hunt Masters, Inc. v. Landry’s Seafood Rest., Inc., 240 F.3d 251, 254 (4th Cir. 2001). Secondary meaning indicates that a term has become sufficiently distinctive to establish a mental association in the relevant public’s minds between the proposed mark and the source of the product or service. George & Co., 575 F.3d at 394.

(…) The question of whether a proposed mark is generic is a question of fact that is subject to deferential review. See Swatch AG v. Beehive Wholesale, LLC, 739 F.3d 150, 155 (4th Cir. 2014).

(…) The Federal Circuit has long held, and we agree, that in registration proceedings, the USPTO “always bears the burden” of establishing that a proposed mark is generic. In re Cordua Rests., Inc., 823 F.3d 594, 600 (Fed. Cir. 2016); see In re Merrill Lynch, Pierce, Fenner, and Smith, Inc., 828 F.2d 1567, 1571 (Fed. Cir. 1987) (explaining that the burden of proving genericness “remains with” the PTO). This is so because finding a mark to be generic carries significant consequence, as it forecloses an applicant from any rights over the mark--once a mark is determined to be generic, it can never receive trademark protection. See 2 J. Thomas McCarthy, McCarthy on Trademarks and Unfair Competition, § 12:12 (5th ed. 2018) (explaining that finding a mark to be generic is a “fateful step” as it may result in the “loss of rights which could be valuable intellectual property”). 

(…) Where a mark is not registered, however, and the alleged infringer asserts genericness as a defense, the plaintiff bears the burden of proving that the mark is not generic. See Ale House Mgmt. Inc. v. Raleigh Ale House, Inc., 205 F.3d 137, 140 (4th Cir. 2000).

(…) Generic terms are the “common name of a product or service itself.” Sara Lee, 81 F.3d at 464. To determine whether a term is generic, we follow a three-step test: (1) identify the class of product or service to which use of the mark is relevant; (2) identify the relevant consuming public; and (3) determine whether the primary significance of the mark to the relevant public is as an indication of the nature of the class of the product or services to which the mark relates, which suggests that it is generic, or an indication of the source or brand, which suggests that it is not generic. Glover v. Ampak, Inc., 74 F.3d 57, 59 (4th Cir. 1996).

(…) If a term is deemed generic, subsequent consumer recognition of the term as brand-specific cannot change that determination. See Retail Servs., Inc., 364 F.3d at 547. Indeed, courts have explained that “no matter how much money and effort the user of a generic term has poured into promoting the sale of its merchandise and what success it has achieved in securing public identification,” that user cannot claim the exclusive right through trademark protection to call the product or service by its common name. Abercrombie & Fitch Co. v. Hunting World, Inc., 537 F.2d 4, 9 (2d Cir. 1976). 

(…) We reject the USPTO’s contention that adding the top-level domain (a “TLD”) .com to a generic second-level domain (an “SLD”) like booking can never yield a non-generic mark.

(…) The USPTO relies on an 1888 Supreme Court case to argue that, as a matter of law, adding .com to a generic SLD like booking can never be nongeneric. In Goodyear’s Rubber Mfg. Co. v. Goodyear Rubber Co., 128 U.S. 598, 602–03 (1888), the Court held that the addition of commercial indicators such as “Company” to terms that merely describe classes of goods could not be trademarked, like “Grain Company” or, as the Dissent provides, “The Grocery Store.” According to the USPTO, “.com” is analytically indistinct from “company,” as it is a generic identifier for an entity operating a commercial website, and therefore its addition to a generic term can never be protected. However, Goodyear was decided almost sixty years before the Lanham Act and, crucially, did not apply the primary significance test. No circuit has adopted the bright line rule for which the USPTO advocates--indeed, sister circuits have found that when “.com” is added to a generic TLD, the mark may be protectable upon a sufficient showing of the public’s understanding through consumer surveys or other evidence. See, e.g., Advertise.com, Inc., 616 F.3d at 982; In re Hotels.com, 573 F.3d at 1304–05. We similarly decline to do so here. 

(…) This approach comports with that taken by our sister circuits, who have similarly declined to adopt a per se rule against protecting domain names, even where they are formed by combining generic terms with TLDs. See, e.g., Advertise.com Inc., 616 F.3d at 978–79; In re Steelbuilding.com, 415 F.3d 1293, 1299 (Fed. Cir. 2005). These courts have left open the possibility that in “rare circumstances” a TLD may render a term sufficiently distinctive to be protected as a trademark. See In re Steelbuilding.com, 415 F.3d at 1299. 

(…) Tellingly, even where courts have found that the individual components of a domain name mark are independently generic, and that when added together the resulting composite merely describes the genus of the service provided, courts still considered other evidence such as consumer surveys in determining whether the mark was generic. For instance, in determining whether ADVERTISING.COM was generic, the Ninth Circuit explained that even though both “advertising” and “.com” were generic, and that ADVERTISING.COM conveyed only the genus of the services offered, it was possible “that consumer surveys or other evidence might ultimately demonstrate that the mark is valid and protectable.” Advertise.com, Inc., 616 F.3d at 982; see In re Hotels.com, 573 F.3d at 1304–05 (considering a consumer survey regarding the public’s understanding of HOTELS.COM even though it determined that “hotels” and “.com” were independently generic and that the combination did not produce new meaning).

(…) As the district court noted, WORKOUT.COM, ENTERTAINMENT.COM, and WEATHER.COM are registered marks that have not precluded domain names such as MIRACLEWORKOUT.COM, WWW.GOLIVE-ENTERTAINMENT.COM, and CAMPERSWEATHER.COM. Booking.com B.V., 278 F. Supp. 3d at 911 & n.6 (taking judicial notice of such marks in the public record). 


Secondary sources: J. Thomas McCarthy, McCarthy on Trademarks and Unfair Competition, § 12:12 (5th ed. 2018).


(U.S. Court of Appeals for the Forth Circuit, BOOKING.COM B.V. v. USPTO, February 4, 2019, Docket No. 17-2458 and 17-2459, Circuit Judge Duncan, Published Opinion)

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