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Booking.Com B.V. v. Matal

United States District Court, E.D. Virginia, Alexandria Division

August 9, 2017

BOOKING.COM B.V., Plaintiff
v.
JOSEPH MATAL, Performing the Functions and Duties of the Undersecretary of Commerce for Intellectual Property and Director of the United States Patent and Trademark Office, AND THE UNITED STATES PATENT AND TRADEMARK OFFICE Defendants.

          MEMORANDUM OPINION

          Leonie M. Brinkema, Judge

         Plaintiff Booking.com B.V. (“Booking.com” or “plaintiff”) filed this civil action challenging the denial by the Trademark Trial and Appeal Board (“TTAB”) of the United States Patent and Trademark Office (“USPTO”) of four trademark applications involving the mark “BOOKING.COM” for services in Classes 39 and 43. One of the applications was for the word mark and three were for stylized versions of the mark. For each of the applications, the TTAB found plaintiff's marks ineligible for registration as trademarks because it concluded that BOOKING.COM is generic for the services identified in the applications or, alternatively, that it is merely descriptive and lacks acquired distinctiveness.

         Before the Court are plaintiff and defendants' cross-motions for summary judgment. For the reasons that follow, plaintiff's Motion for Summary Judgment [Dkt. No. 63] will be granted in part and denied in part; defendants' Motion for Summary Judgment [Dkt. No. 60] will be granted in part and denied in part; and the USPTO will be ordered to register the mark BOOKING.COM as to the Class 43 services identified in plaintiff's applications but not as to the Class 39 services.

         I. BACKGROUND

         On December 1, 2011, plaintiff filed a federal trademark application, Serial No. 85485097 (“'097 Application”), based on use, for the mark:

         (Image Omitted)

         A3166. The services identified in the application (as amended) were:

Class 39: Travel agency services, namely, making reservations for transportation; travel and tour ticket reservation services; travel agency services, namely making reservations for transportation for tourists; provision of travel information; providing consultation related to making reservations for transportation, and travel and tour ticket reservation; all of the foregoing services rendered in-person and via the internet.
Class 43: Making hotel reservations for others in person and via the internet; providing personalized information about hotels and temporary accommodations for travel in-person and via the Internet; providing on-line reviews of hotels; consultation services related to making hotel reservations for others, provision of personalized information about hotels and temporary accommodations for travel, and on-line reviews of hotels.

Moskin Decl. [Dkt. No. 65-5] ¶ 2.

         On June 5, 2012, plaintiff filed Application Serial No. 7911498 (“'998 Application”), for recognition in the United States of its International Registration (hereinafter referred to by the name of the authorizing treaty, “the Madrid Protocol”) for the mark:

         (Image Omitted)

         A4. The services identified in the application (as amended) were:

Class 39: Arranging of tours and arranging of tours online; reservation and sale of travel tickets and online reservation and sale of travel tickets; information, advice and consultancy regarding the arranging of tours and the reservation and sale of travel tickets; provision of information relating to travel and travel destinations; travel and tour agency services, namely, travel and tour ticket reservation services; travel agency services; tourist agency services; providing online travel and tourism services, namely, providing online travel and tour ticket reservation services, online travel agency services, online tourist agency services and providing online information relating to travel and travel destinations.
Class 43: Making hotel reservations for others; holiday accommodation reservation services and resort reservation services, namely providing online hotel and resort hotel room reservation services; providing information about hotels, holiday accommodations and resort accommodations, whether or not based on the valuation of customers; providing information, advice and consultancy relating to making hotel reservations and temporary accommodation reservations; providing online information, advice and consultancy relating to making hotel reservations and temporary accommodation reservations.

Moskin Decl. [Dkt. No. 65-5] ¶ 3.

         On November 7, 2012, plaintiff filed two federal trademark applications, Serial No. 79122365 (“'365 Application”) and Serial No. 79122366 (“'366 Application”), under the Madrid Protocol for the following marks:

         (Image Omitted)

         A2153, A1138. The services identified in the two applications (as amended) were limited to a subset of services in Class 43:

Hotel reservation services for others; holiday accommodation reservation services and resort reservation services, namely, providing hotel room reservation services and resort hotel reservation services and providing online hotel and resort hotel room reservation services; providing information about hotels, hotel accommodations and resort accommodations, whether or not based on the valuation of customers; information, advice and consultancy relating to the aforesaid services; aforesaid services also provided electronically.

Moskin Decl. [Dkt. No. 65-5] ¶ 4.

         During review by the USPTO, all four applications followed the same procedural history. The examiner initially rejected each application on the ground that BOOKING.COM is merely descriptive of plaintiff's services and therefore unregisterable. A1074, A2089, A3765. After plaintiff objected that the mark BOOKING.COM had acquired distinctiveness, the examiner issued a new refusal, this time on the basis that the word mark is generic as applied to the relevant services and, in the alternative, that the mark is merely descriptive and that plaintiff had failed to establish acquired distinctiveness. A1074, A2089-90, A3766. For each application, plaintiff sought reconsideration of the new refusal and in each instance reconsideration was denied. A1075, A2090, A3766.

         Plaintiff filed a Notice of Appeal for each application and requested consolidated briefing before the TTAB, which was granted. A3766. The evidence submitted to the TTAB included dictionary definitions of the words “booking” and “.com;” print-outs of plaintiff's webpages; examples from news articles and travel websites of terms such as “online booking services” and “booking sites, ” used to refer to hotel reservation and travel agency services; examples of eight third-party domain names that include “booking.com;” a 2012 JD Power & Associates press release and survey results, indicating that Booking.com ranked highest in overall customer satisfaction; and a declaration from plaintiff's director listing awards won by plaintiff and figures regarding plaintiff's sales success, advertising campaigns, followers on social media, and unsolicited news articles. See Def. Mem. at 6; A1089-92.

         Following the hearing, the TTAB affirmed the four refusals of registration in three separate opinions. See A1073-111 (denying the appeal for the '998 Application), A2088-126 (denying the appeals for the '365 and '366 Applications), A3764-801 (denying the appeal for the '097 Application). Although there are minor differences among the three opinions, all share the same central conclusions that “booking” refers to “a reservation or arrangement to buy a travel ticket or stay in a hotel room” or “the act of reserving such travel or accommodation;” that “.com” indicates a commercial website, which does not negate the generic character of the term “booking;” and that the combined term BOOKING.COM would be understood by consumers “primarily to refer to an online reservation service for travel, tours, and lodging, ” which is consistent with the services proposed in the applications, making the mark generic for the services offered. See, e.g., A1092, A1096, A1107. In the alternative, the TTAB concluded that BOOKING.COM is descriptive of plaintiff's services and that plaintiff “failed to demonstrate that the term has acquired distinctiveness.” See, e.g., A1111.

         On April 15, 2016, plaintiff filed this civil action under 15 U.S.C. § 1071(b) against Michelle Lee, who was then the USPTO Director (“the USPTO Director”), [1] and the USPTO (collectively “defendants”), challenging the USPTO's denial of registration of the four applications. The parties have filed the administrative record from the USPTO proceedings and both sides have produced new evidence on the questions of genericness and descriptiveness. Although the body of evidence before this Court is similar to what was before the TTAB, of significance, plaintiff has now submitted a “Teflon survey, ” which, as will be discussed below, is the most widely used survey format for measuring consumer opinion in a genericness challenge, and defendants have provided a report by a rebuttal expert. By way of relief, plaintiff asks the Court to reverse the decisions of the TTAB and order the USPTO Director to publish each application in the Principal Register. Compl., [Dkt. No. 1] at 17.

         II. DISCUSSION

         A. Standards of Review

         A trademark applicant “dissatisfied with the decision” of the USPTO has two remedies under the Lanham Act: either “appeal to the United States Court of Appeals for the Federal Circuit, ” see 15 U.S.C. § 1071(a), or file a civil action against the USPTO Director in federal district court, see 15 U.S.C. §1071(b). Under § 1071(a), an appeal to the Federal Circuit is taken “on the record” before the USPTO, id. § 1071(a)(4), and the USPTO's factual findings will be upheld if they are supported by “substantial evidence, ” see, e.g., Recot, Inc. v. Becton, 214 F.3d 1322, 1327 (Fed. Cir. 2000). In contrast, in a civil action under §1071(b), “the district court reviews the record de novo and acts as the finder of fact.” Swatch AG v. Beehive Wholesale, LLC, 739 F.3d 150, 155 (4th Cir. 2014) (citing Durox Co. v. Duron Paint Mfg. Co., 320 F.2d 882, 883-84 (4th Cir. 1963)).[2] Placement of a mark on the generic-descriptive-suggestive- fanciful continuum is a question of fact. In re Dial-A-Mattress Operating Corp., 240 F.3d 1341, 1344 (Fed. Cir. 2001).

         Upon the motion of a party, the district court must admit the USPTO record and give it the “same effect as if originally taken and produced in the suit.” § 1071(b)(3). “[T]he district court may, in its discretion, ‘consider the proceedings before and findings of the [USPTO] in deciding what weight to afford an applicant's newly-admitted evidence.'” Kappos v. Hyatt, 132 S.Ct. 1690, 1700 (2012) (quoting Hyatt v. Kappos, 625 F.3d 1320, 1335 (Fed. Cir. 2010)). The district court also “has authority independent of the [USPTO] to grant or cancel registrations.” Swatch AG, 739 F.3d at 155 (citing § 1071(b)(1)).

         Summary judgment is appropriate where the record demonstrates that “there is no genuine dispute as to any material fact and that the moving party is entitled to judgment as a matter of law.” Fed.R.Civ.P. 56(a). Although the Court must view the record “in the light most favorable to the non-moving party, ” Dulaney v. Packaging Corp. of Am., 673 F.3d 323, 324 (4th Cir. 2012), “[t]he mere existence of a scintilla of evidence in support of the [nonmovant's] position will be insufficient” to overcome a motion for summary judgment. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 252 (1986); see also Am. Arms Int'l v. Herbert, 563 F.3d 78, 82 (4th Cir. 2009). Rather, a genuine issue of material fact exists only “if the evidence is such that a reasonable jury could return a verdict for the nonmoving party.” Anderson, 477 U.S. at 248. Summary judgment does not become disfavored simply because there is an “important, difficult or complicated question of law.” Lewis v. Coleman, 257 F.Supp. 38, 40 (S.D. W.Va. 1966); Bradacs v. Haley, 58 F.Supp.3d 514, 521 (D.S.C. 2014).

         The parties have “expressly agree[d] that if the Court determines after reviewing the briefs and evidence on summary judgment that any material issue of fact exists, the Court is authorized to resolve any such factual dispute.” [Dkt. No. 26] ¶ 4(B). Accordingly, the Court will make factual determinations as well as weighting decisions that are not normally appropriate on a motion for summary judgment.

         B. Analysis

         Although plaintiff filed four trademark applications, neither plaintiff nor defendants contend that the stylized elements described in those applications affect the protectability of the mark. Instead, the parties focus on the word mark BOOKING.COM and on where along the generic-descriptive-suggestive-fanciful continuum the mark is situated. Def. Mem. at 1-2; Pl. Mem. at 10-12. Therefore, rather than addressing each application individually, the Court will disregard the stylized elements and focus on the appropriate categorization of the word mark BOOKING.COM; however, because a multi-class application is regarded as a series of separate applications, the Court must independently assess the protectability of the mark for the two classes of services plaintiff claims in its applications, Classes 39 and 43. See 3 J. Thomas McCarthy, McCarthy on Trademarks and Unfair Competition § 19:56.50 (4th ed.) (hereinafter McCarthy on Trademarks).

         1. The Framework of the Lanham Act

         The Lanham Act provides nationwide protection of trademarks. A trademark is “any word, name, symbol, or device, or any combination thereof” used “to identify and distinguish . . . goods [or services], including a unique product [or service], from those manufactured or sold by others and to indicate the source of the goods [or services], even if that source is unknown.” 15 U.S.C. § 1127. The Act has two purposes. The first is to prevent consumer confusion regarding the source of goods and services and to reduce consumers' information costs by “quickly and easily assur[ing] a potential customer that this item-the item with this mark-is made by the same producer as other similarly marked items [or services] that he or she liked (or disliked) in the past.” Qualitex Co. v. Jacobson Prod. Co., 514 U.S. 159, 163-64 (1995) (emphasis in original). Second, the Act incentivizes brand investment by assuring the “producer that it (and not an imitating competitor) will reap the financial, reputation-related rewards associated with a desirable product [or service], ” id. at 164, thereby “secur[ing] to the owner of the mark the goodwill of his business, ” Park 'N Fly, Inc. v. Dollar Park & Fly, Inc., 469 U.S. 189, 198 (1985). By allowing the producer to reap the benefits of consumer goodwill, trademark law “encourages the production of quality products [and services] and simultaneously discourages those who hope to sell inferior products [or services] by capitalizing on a consumer's inability quickly to evaluate the quality of an item [or service] offered for sale.” Qualitex, 514 U.S. at 164 (internal quotation marks omitted). Thus, the Lanham Act reflects Congress's conclusion that “[n]ational protection of trademarks is desirable . . . because [it] foster[s] competition and the maintenance of quality by securing to the producer the benefits of good reputation.” Park 'N Fly, 469 U.S. at 198.

         In keeping with these twin purposes, the Lanham Act identifies four categories of marks. “Arrayed in an ascending order which roughly reflects their eligibility [for] trademark status and the degree of protection accorded, these classes are (1) generic, (2) descriptive, (3) suggestive, and (4) arbitrary or fanciful.” Abercrombie & Fitch Co. v. Hunting World, Inc., 537 F.2d 4, 9 (2d Cir. 1976). “A generic mark refers to the genus or class of which a particular product [or service] is a member and can never be protected.” Ashley Furniture Indus., Inc. v. SanGiacomo N.A., 187 F.3d 363, 369 (4th Cir. 1999). Examples include Light Beer for ale-type beverages and Thermos for vacuum-insulated bottles. Sara Lee Corp. v. Kayser-Roth Corp., 81 F.3d 455, 464 (4th Cir. 1996). A descriptive mark “describes a function, use, characteristic, size, or intended purpose” of the product or service, such as 5 Minute glue and the Yellow Pages telephone directory. Id. “Marks that are merely descriptive are accorded protection only if they have acquired a secondary meaning [also called ‘acquired distinctiveness'], that is, if in the minds of the public, the primary significance of a product [or service] feature or term is to identify the source of the product [or service] rather than the product [or service] itself.” Id. (internal citations omitted). Although eligible for protection in some instances, descriptive marks are considered weak marks. Shakespeare Co. v. Silstar Corp. of Am., 110 F.3d 234, 239-40 (4th Cir. 1997). Suggestive marks, such as Coppertone for sunscreen and Orange Crush for orange flavored soda, “connote, without describing, some quality, ingredient, or characteristic of the product [or service].” Sara Lee Corp., 81 F.3d at 464. Marks that are “comprised of words in common usage” but “do not suggest or describe any quality, ingredient, or characteristic of the goods [or services] they serve, are said to have been arbitrarily assigned.” Id. Examples of arbitrary marks include Tea Rose brand flour and Apple for computers. Id. Lastly, fanciful marks are “in essence, made-up words expressly coined for serving as a trademark, ” such as Clorox for a bleach product and Kodak for photography-related products. Id. Because the “intrinsic nature” of suggestive, arbitrary, and fanciful marks “serves to identify a particular source of a product [or service], ” these categories “are deemed inherently distinctive and are entitled to protection.” Two Pesos, Inc. v. Taco Cabana, Inc., 505 U.S. 763, 768 (1992).

         2. Genericness

         Because a generic mark, which is statutorily defined as “the common descriptive name of an article or substance, ” Federal Trade Commission Improvements Act of 1980, Pub. L. No. 96-252, § 18, 94 Stat. 374, 391, by definition neither signifies the source of goods or services nor distinguishes the particular product or service from other products or services on the market, it cannot be protected as a trademark nor registered as one. Retail Servs., Inc. v. Freebies Publ'g, 364 F.3d 535, 538 (4th Cir. 2004) (citing Park 'N Fly, 469 U.S. at 194). To permit otherwise “would grant the owner of the [generic] mark a monopoly since 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); see also Renaissance Greeting Cards, Inc. v. Dollar Tree Stores, Inc., 405 F.Supp.2d 680, 688 (E.D. Va. 2005), aff'd, 227 F. App'x 239 (4th Cir. 2007) (“[T]he goals of trademark protection . . . must be balanced by the concern that trademark protection not become a means of monopolizing language or stifling productive competition.”). To the contrary, such marks must remain in the public domain where they are free for all to use. See Am. Online, Inc. v. AT & T Corp., 243 F.3d 812, 821 (4th Cir. 2001) (explaining that trademark law “protects for public use those commonly used words and phrases that the public has adopted, denying to any one competitor a right to corner those words and phrases by expropriating them from the public ‘linguistic commons'”); 2 McCarthy on Trademarks § 12:2.

         “The rub . . . is in trying to distinguish generic marks from [protectable marks].” Ashley Furniture Indus., 187 F.3d at 369. According to the test adopted by the Supreme Court in Kellogg Co. v. Nat'l Biscuit Co., a plaintiff seeking to establish a valid trademark as compared to a generic mark “must show that the primary significance of the term in the minds of the consuming public is not the product but the producer.” 305 U.S. 111, 118 (1938). A mark is not generic simply because it plays some role in denoting to the public what the product or service is; rather, a mark may serve a “dual function-that of identifying a product [or service] while at the same time indicating its source.” S. Rep. No. 98-627, at 5 (1984). Hence, Kellogg focuses on whether “the primary significance of the mark [is] indication of the nature or class of the product or service, rather than an indication of source.” Glover v. Ampak, Inc., 74 F.3d 57, 59 (4th Cir. 1996) (emphasis in original); see also Retail Servs., 364 F.3d at 544 (explaining that a generic mark “neither signifies the source of goods nor distinguishes the particular product from other products on the market”).

         Determining whether a mark is generic involves three steps: “(1) identify[ing] the class of product or service to which use of the mark is relevant; (2) identify[ing] the relevant purchasing public of the class of product or service; and (3) [determining whether] the primary significance of the mark to the relevant public is to identify the class of product or service to which the mark relates.” Glover, 74 F.3d at 59. Evidence of public understanding of the primary significance of a mark can come from “purchaser testimony, consumer surveys, listings and dictionaries, trade journals, newspapers, and other publications.” Id. The burden of proof rests with the party seeking to establish genericness, in this case the defendants, who must prove that the mark is generic by clear and convincing evidence. In re Cordua Restaurants, Inc., 823 F.3d 594, 600 (Fed. Cir. 2016).

         a. Classes of Services

         The first step in analyzing the proposed BOOKING.COM mark is to determine the classes of services (sometimes referred to as “genera of services”) at issue in each application. Glover, 74 F.3d at 59. The defendants recognize that the services identified in each registration vary, but summarize the classes of services as “online travel agency services, namely the arrangement of transportation and tours, ” for Class 39 and “online hotel and lodging services” for Class 43. Def. Mem. at 17-18. Plaintiff does not appear to understand that this is a class specific analysis and argues that the USPTO's “inability to adopt a single genus . . . requires reversal.” See Pl. Reply at 16-17 & n.5. This argument is inconsistent with the longstanding principle that a single application to register multiple classes, i.e., a combined application, is treated “as though it were a group of individual applications” requiring “separate analyses for each class of goods [or services].” Federated Foods, Inc. v. Fort Howard Paper Co., 544 F.2d 1098, 1102 (C.C.P.A. 1976).

         Plaintiff further criticizes the defendants' “new proposed genera” for “ignor[ing] most of plaintiff's actual services, ” including “the information and search (or research) services . . . and business oriented services . . . used by hotels and other travel services seeking to advertise and list their accommodations for rental.” Pl. Opp. at 28. This critique is baseless for several reasons. As an initial matter, plaintiff overlooks that it too has taken a reductivist view of the class of service by defining the relevant class of services or genus as “travel agency services.” Pl. Mem. at 13. Further, plaintiff's suggestion that the class of services should include specific services, such as business consulting, stems from plaintiff's argument that a granular approach that emphasizes services that would not be described with the word “booking” can save its mark from genericness. See Pl. Opp. at 28 n.18 (“[T]here is no reason a broad specification of services or goods cannot be held distinctive for some of the services and not so for others.”). Defendants, on the other hand, maintain that “registration is properly refused if genericness is found as to any service specified in the application.” Def. Reply at 9. On this issue, defendants have the better of the argument. Registration must be refused if a mark “is the generic name of any of the goods or services for which registration is sought.” See Cordua Restaurants, 823 F.3d at 605 (quoting 2 McCarthy on Trademarks § 12:57). Therefore, even though plaintiff provides business consulting services, its mark will fail if it is generic as to plaintiff's hotel reservation services. Similarly, even if, as plaintiff argues, the appropriate genus is “travel agency services, ” to the extent that this encompasses hotel reservation services, plaintiff's mark is not entitled to protection if it is generic for hotel reservation services. See Otokoyama Co. v. Wine of Japan Imp., Inc., 175 F.3d 266, 271 (2d Cir. 1999) (“Generic words for sub-classifications or varieties of a good are . . . ineligible for trademark protection.”).

         In addition, as defendants acknowledge, “[p]laintiff is the master of its application, including the identification of services covered by it” and “[i]t was from the identification of services provided by plaintiff that the TTAB derived its recitation of the services.” Def. Opp. at 10; see also A1076 (describing the genus of services as an “accurate[] summar[y]” of the recitation provided by the plaintiff); A3768 (same). Because “the question of registrability of an applicant's mark must be decided on the basis of the identification of goods [and services] set forth in the application regardless of what the record may reveal as to the particular nature of an applicant's goods, ” Octocom Sys., Inc. v. Houston Computer Servs., Inc., 918 F.2d 937, 942 (Fed. Cir. 1990), the identification of services in plaintiff's applications “controls this analysis, ” In re Dayan, 61 F. App'x 695, 696 (Fed. Cir. 2003). Although plaintiff's applications reference a multitude of services, because “registration is properly refused if the word is the generic name of any of the goods or services for which registration is sought, ” 2 McCarthy on Trademarks § 12:57, the Court need not analyze each service. Instead, it will focus on the broadest services described in plaintiff's applications: “travel and tour ticket reservation services” for Class 39 and “[m]aking hotel reservations for others” for Class 43. Moskin Decl. [Dkt. No. 65-5] ¶¶ 2-4.

         b. Relevant Purchasing Public

         To define the relevant purchasing public, a court must look to the class of goods and services for which the trademark application was submitted. Cf. Glover, 74 F.3d at 59; Retail Servs., Inc. v. Freebies Publ'g, 247 F.Supp.2d 822, 826 (E.D. Va. 2003), aff'd Retail Servs., 364 F.3d at 535. Here, the applications sought registration for travel, tour, and hotel reservation services, including those offered online, making consumers who use travel, tour, and hotel reservation services offered via the internet or in person the relevant purchasing public.

         c. Primary ...


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