Surprising Decision by U.S. Supreme Court

This past Tuesday, something quite unusual happened: a trademark case was decided at the U.S. Supreme Court. This is rare, only one or two trademark-related cases/year are argued — and in some years, none — and most of these deal with procedural questions, damages, or dilution.

The USPTO vs. Booking.com case, on the other hand, dealt with exactly the kind of issue name owners and creators worry about, that is, the uniqueness, registrability, and defensibility of one’s new company or brand name. Dating to 2011 when the USPTO (United States Patent & Trademark Office) refused to register Booking.com as a trademark, the case made its way up through multiple courts and appeals over the past 9 years.

The basic question was, could a generic term — booking — with the addition of a TLD (Top Level Domain) such as .com, acquire distinctiveness and become a trademark? The USPTO's position was no, that a generic + a TLD was unregistrable, as it was still generic. That view was consistent with the tradition that you can’t take a generic and add “Company" to it, and claim you and only you can use that term. In fact, in their refusal, the USPTO asserted a “sweeping rule” that a generic term + .com is intrinsically generic and not eligible to be a trademark.

In an 8-1 decision, the Supreme Court decided just the opposite. In the majority opinion, Justice Ginsburg laid out the argument that Booking.com had in fact developed acquired meaning, in that customers recognize it as a brand, not as a generic source of hotel information. Booking.com functions as the indicator of a specific source of services, the very purpose and definition of a trademark.

While meaningful for the trademark-ability of other generic + TLD brands such as Wine.com or, indeed, hotels.com, what are the implications here, for new company and brand names? While generic + TLD names may now become more common, it can take years to establish acquired meaning for a generic, and for it to function as a brand. Further, it is unclear how effective many of these names are; there are a number of examples in which a generic.com leads to its more branded entity, books.com forwarding to Barnes & Noble, for example, and flowers.com to 1-800-Flowers.

In our view, for name creators and selectors, suggestive names remain preferable to these now-more-possible generic.com trademarks. Suggestive (and indeed, arbitrary) names are more ownable, defensible, and memorable; and often avoid the very high cost of acquiring a generic.com. How many successful recent brands are generic, compared to the plethora of unicorns and high-growth brands with suggestive names: one-word names like Stripe, Lime, Deliveroo, Intercom, and Affirm; and compounds like Robinhood, DoorDash, Transferwise, and Snapchat?

Net net, for those of us in a position to create and choose new names, building on the solid foundation of a suggestive name you can own and grow into a powerful brand, without going all the way to the Supreme Court, is a smarter, less fraught approach.