The Supreme Court just this morning affirmed that an Internet domain name including a generic term – specifically Booking.com – can function as a trademark.
Does this matter to small and medium-size businesses?
The answer is, probably not. While this can be very significant to the owners of these names, and while these companies will have to now become even more aggressive in going after potential imitators, this decision – although momentous from a legal standpoint – probably will not open the floodgates to litigation against smaller, less well-funded businesses.
To many consumers this may not sound surprising, since consumers associate many generic-termed domain names with a particular source. The Supreme Court found that if consumers believe Booking.com refers to a specific company, and not just to a general website where consumers can “book” travel-related services, then the name does exactly what the trademark is supposed to do.
Most small and mid-sized businesses frankly cannot afford such a high-level domain, which will often – if not usually – sell for seven-figures plus. Up until now, companies have been buying those names because they are so memorable and are common words that consumers would use to find products in a specific category. That the Trademark Office now must allow registration and that these names have been ruled protectable makes a huge advance in their value.
Generally, a generic trademark is not protectable. “Car” cannot be registered for cars, or “Computer” for computers. This case does not change that. But when you match “Car” or “Computer,” or in this case “Booking” with “.com,” does the consumer recognize that as a particular brand? The Court also points out that the Trademark Office has already allowed “Art.com” for “online retail store services” offering “art prints, original art, [and] art reproductions” and “Dating.com” for, well, I’ll let you guess.
The Trademark Office had been clinging to a lawsuit dating back to the late 19th Century (called Goodyear’s India Rubber Glove Mfg. Co. v. Goodyear Rubber Co.) to support its claim that a generic corporate designation added to a generic term does not confer trademark eligibility, and which said that adding “Company” to a generic word was not enough. The Trademark Office has maintained that adding a “.com” is really no different.
The Trademark Office also said that allowing registration of this generic word would effectively remove it from the public. But the Court pointed out that the law already allows for this type of situation with another category of word which is not completely generic but highly descriptive (think “bubbly” for soft drinks). If a trademark owner can show that this descriptive word has been theirs, and theirs for a long(ish) period of time, they can own it.
The Supreme Court does not address the interesting issue of what happens if a domain name owner were to allow its domain name registration to inadvertently lapse, and fall into the hands of a potential competitor. Someone else could scoop up the name – but probably not use it without getting sued. This applies to these “genericword.com” marks, as well as any other domain that could lapse. If the thought of the domain name being lost by accident seems far-fetched to you, consider the sad tale of the loss of rights in Park City Mountain Resort due to a late lease renewal (see “Could There Be Two Park City Ski Resorts In Utah? Ask Vail”).
Though some opponents of this trademark have claimed that it would only consolidate rights in big trademark owners and take common, necessary words such as “booking” out of the dictionary and prohibit third-parties from using them, the reality is that the impact on SMEs is not likely to be negative.
Small and medium-size businesses which are able to secure rights in some sort of generic name will be able to do so knowing that they will have a much better chance of protecting that domain name and trademark than the law may have appeared to allow in the past.
Any decision by the Supreme Court, especially in a fundamental issue of trademark law such as what is generic and what is protectable, will have consequences down the road. But generally, any decision from the Court which supports a business owner’s right to use and protect a trademark is good for every business.
The most important thing to remember is this: generic and descriptive words make alluring trademarks because of the powerful way they communicate your message to consumers. But they are very difficult to protect, and will remain so even after this decision. For a more protectable name, aim more for “Kayak” than for “Booking.” Finally, descriptiveness/genericness is only one factor. Be sure there is no mark similar in the market, or you will have another host of problems.
Partner Jess Collen published "'Booking.com' Is A Trademark - Does This Matter To Your Business?" on Forbes.com. Jess is a contributor on the site and regularly writes on trademarks, branding, copyright, advertising, and patent law.
To read the full article on Forbes.com please click here.