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U.S. Supreme Court Cites Restatement Third of Unfair Competition

The U.S. Supreme Court recently cited the Restatement of the Law Third, Unfair Competition, in United States Patent and Trademark Office v. Booking.com, No. 19–46 (June 30, 2020), in which it concluded that a “generic.com” trademark—formed by combining any generic word and “.com”—was not generic per se and was potentially eligible for federal trademark registration.

The respondent, Booking.com, which maintained a website that provided hotel reservations and other travel-related services to consumers, filed applications with the petitioner, the U.S. Patent and Trademark Office (PTO), to register four federal trademarks containing the term “Booking.com.” The PTO refused registration on the ground that the term “Booking.com” was generic for the services at issue. The PTO’s Trademark Trial and Appeal Board agreed with the PTO, reasoning that “Booking” meant making travel reservations and that “.com” signified a commercial website. 

The U.S. District Court for the Eastern District of Virginia, relying in part on new evidence of consumer perception presented by Booking.com, concluded that, although the word “booking” was generic, “Booking.com” was not, because the “consuming public” understood that term to be “descriptive of services involving ‘booking’ available at that domain name”; in addition, the term had acquired secondary meaning as to hotel-reservation services, thus satisfying the distinctiveness requirement for registration. The U.S. Court of Appeals for the Fourth Circuit affirmed the district court’s conclusion that “Booking.com” was not generic, “reject[ing] the PTO’s contention that the combination of ‘.com’ with a generic term like ‘booking’ was ‘necessarily generic.’”

The U.S. Supreme Court affirmed, holding that whether any given “generic.com” term was generic depended “on whether consumers in fact perceive[d] that term as the name of a class or, instead, as a term capable of distinguishing among members of the class.” Associate Justice Ruth Bader Ginsburg, delivering the opinion of the Court, explained that, while, according to Restatement of the Law Third, Unfair Competition § 15, “generic terms [were] ordinarily ineligible for protection as trademarks at all,” the determination as to whether “Booking.com” was generic turned on whether that term, taken as a whole, signified to consumers the entire class of online hotel-reservation services. Justice Ginsburg pointed out that it was undisputed that consumers did not in fact perceive the term “Booking.com” in that fashion, and concluded that because “Booking.com” was not a generic name to consumers, it was not generic. The Court declined to adopt the nearly per se rule proposed by the PTO, which would render “Booking.com” and all other “generic.com” terms ineligible for registration absent exceptional circumstances, regardless of specific evidence of consumer perception, reasoning that the PTO’s own past practices did not appear to reflect such a rule, and that there was no discernible support for such a rule in trademark law or policy. 

Read the full opinion here