Trademarks in the Supreme Court in 2020
Posted on Dec 17, 2020 in Articles
Over the course of this year, the Supreme Court has been actively accepting Trademark cases for review. Four major cases between 2019 and 2020 have emerged which have significant implications for trademark law. Below, we discuss two cases reviewed this year.
United States Patent and Trademark Office v. Booking.com B.V.
The first case arose as the result of a refusal by the USPTO to register the trademark BOOKING.COM, stating that the generic term “booking” coupled with “.com” was considered too generic to register. While the U.S. Court of Appeals for the Fourth Circuit held that BOOKING.COM should be considered a registrable trademark, the USPTO disagreed. The Supreme Court in US Patent and Trademark Office v. Booking. com BV, 140 S. Ct. 2298, 207 L. Ed. 2d 738 (U.S. 2020) sided with Booking.com, ruling that such a term is “a generic name for a class of goods or services only if the term has that meaning to consumers”, bolstering Booking.com’s argument that “under the Lanham Act, the consumer is king.” The opinion was delivered by the late Justice Ginsberg and joined by eight members of the court, with Justice Breyer dissenting and Justice Sotomayor filing a concurring opinion.
A generic term describes a class of goods or services rather than identifying a particular source for that product or service. As a rule, a generic term is never entitled to trademark protection because providing a generic term with trademark protection would be like granting a monopoly in the product. Taking this per se rule, the USPTO based its refusal on the basis that the combination of “booking” and “.com” is merely pairing a generic term with a top-level domain, which results in a generic mark. However, here, the court stated that the mark BOOKING.COM should be considered as a whole, and not its parts in isolation. Thus, the analysis should be whether the whole term signifies to the consuming public a class of goods and services rather than a particular source of those goods or services. To that effect, Booking.com provided survey evidence showing that 74.8% of relevant consumers consider booking.com a brand, rather than a generic case.
The USPTO took the position that “trademark protection for ‘Booking.com’ could exclude or inhibit competitors from using the term ‘booking’ or adopting domain names like ‘ebooking.com’ or ‘hotel-booking.com”, to which the Supreme Court offered two rebuttals:
First, the owner of such a trademark would still need to show likelihood of confusion to prove infringement. This would be particularly difficult to prove for a weaker mark.
Second, the doctrine of descriptive or classic fair use permits the use of a descriptive term other than as a mark to describe the party’s own goods or services: thus, the registration of “Booking.com” would not prevent competitors from using the word “booking” to describe their own services.
While the Supreme Court hasn’t necessarily opened the doors to a floodgate of generic terms coupled with a top-level domain, the present ruling shows that registration of such marks can still be possible with a showing that the average consumer would regard the said mark as a brand, rather than a generic case.
Romag Fasteners v. Fossil
In this second 2020 case, the Supreme Court in Romag Fasteners, Inc. v. Fossil, Inc., 140 S. Ct. 1492, 206 L. Ed. 2d 672, 590 U.S. (2020) resolved the issue of whether a trademark owner was entitled to relief absent a showing of willful infringement: the Court ruled that yes, a trademark infringer could lose its profits despite being an innocent infringer.
Romag, which manufactures fasteners that can be used in leather goods, and Fossil, which manufactures leather products such as bags and watches, came to an agreement in which Fossil would use Romag’s fasteners in its products. However, upon discovering that factories employed by Fossil were using counterfeit Romag fasteners, Romag sued. Romag was awarded damages in the amount of $6.7 million, even though Fossil was not aware of the infringement. The Court of Appeals stated that Romag should not be awarded Fossil’s profits, but the Supreme Court disagreed.
According to the Supreme Court, mens rea, or the state of mind of the infringer, should not be the only consideration for an award of the infringer’s profits. Indeed, Section 1117(a) of the Lanham Act, which is the federal statute that governs trademarks, service marks, and unfair competition, does not mention mens rea with regard to an infringer despite surrounding sections that do. The court did note, however, that the mens rea of the infringer is still an important condition; just not the absolute condition. In future cases of an innocent infringer, awards may still be awarded to the harmed party even without a showing of willful infringement.
by Saval Desai