What's In a Name? Booking.com and Consumer Perception Evidence

The USPTO's past practice demonstrates exactly how the analysis of whether a mark is generic is supposed to work — on a case-by-case basis — and why the Court was correct to reject the per se rule offered by the USPTO.

A good case study is provided through the prosecution history for the WAFFLE HOUSE trademark. The Waffle House has over 1,500 restaurant locations in 25 states, and is particularly well-known in the South. In 2002 it applied to register its eponymous name as a trademark for "restaurant services." (It previously had registered a design mark in 1987.) The USPTO initially refused registration on the ground that the mark is merely descriptive and "appears to be generic as applied to the services." The USPTO looked at the dictionary definitions for the constituent parts "waffle" (a light, crispy battercake baked in a waffle iron) and "house" (a facility, such as a theater or restaurant that provides entertainment or food for the public), and concluded that the proposed mark is "incapable of identifying the applicant's services and distinguishing them from those of others" because it combines "highly descriptive terms that have no separate or distinct commercial impression apart from what one who understands the individual meanings of the terms would expect."

The Waffle House responded by agreeing to disclaim "House," apart from the mark as a whole, and submitting survey evidence to the USPTO showing that 92% of survey respondents believed that WAFFLE HOUSE is a brand name, with only 6% identifying it as a generic term. The Waffle House also submitted over 150 affidavits from actual customers of diner-style restaurants who stated that they understand WAFFLE HOUSE to be a brand name and not a generic term. Examples of some of the affidavits include:

• "Waffle House is a particular restaurant chain. 'Waffle House' is a brand name like 'Coca-Cola.'"
• "I understand the sign 'Waffle House' as a particular restaurant with a particular known taste and style. I look for the 'Waffle House' sign just as I look for the golden arches."
• "Waffle House is a brand that, like McDonald's, you depend on for consistency. Waffle House is a particular restaurant chain."
• "Waffle House is a particular restaurant brand. There are other similar restaurants such as 'Huddle House' and "Waffle King.' But Waffle House is its own brand."

After considering this powerful evidence that consumers understand WAFFLE HOUSE, when considered as a whole, to be a brand name rather than a generic reference, the USPTO registered the mark.

This evidence was similar to the survey evidence that Booking.com presented to the trial court. Booking.com's survey showed that nearly 75% of respondents identified BOOKING.COM as a brand name. Under the USPTO's proposed per se rule, this evidence would have been disregarded because a generic.com term would be deemed generic as a matter of law. The Supreme Court recognized that would be the wrong approach. Instead, consistent with the USPTO's ultimate determination that WAFFLE HOUSE could be registered because the evidence showed consumers understand to be a brand name, the Supreme Court held that the USPTO must consider evidence of consumer beliefs rather than per se rules in assessing whether a mark is generic. Such evidence can come from a variety of sources, including consumer surveys, dictionaries, usage by consumers, usage by competitors, and any other source of evidence bearing on how consumers perceive a term's meaning. All of that evidence, the Court concluded, may inform the relevant inquiry of whether consumers perceive a generic.com term as identifying a class of goods or services (in which case it would be generic) or whether they perceive it as a term capable of distinguishing among members of the class (in which case the term may be eligible for trademark protection, though secondary meaning would still need to be shown for compound terms that are descriptive).

The Fourth Circuit's 2000 decision in Ale House Mgmt. Inc. v. Raleigh Ale House, Inc., 205 F.3d 137 (4th Cir. 2000), demonstrates how consumer perception evidence (or the lack thereof) can also be used to show that a name is generic rather than a trademark. In that case, the plaintiff in an infringement action (the owner of facilities selling food and beer) claimed that it held common law trademark rights in the mark ALE HOUSE. The defendant presented extensive evidence, including citations to newspapers, dictionaries, books, and other publications, showing that the term "ale house" is generic because it refers to several types of facilities. For example, the defendant presented one Internet search showing well over 100 facilities denominated as "ale houses." The defendant also presented Internet restaurant reviews, referring to, for example, an "ale house" as "an eatery and bar" and a "neighborhood alehouse" that serves food and drink. In contrast, the plaintiff offered no evidence that consumers understood "ale house" as a brand name. Based on the evidence presented, the court determined that "ale house" was a generic term for a place that serves food and drink, not a brand name.

In contrast, the Supreme Court in Booking.com observed:

[I]f "Booking.com" were generic, we might expect consumers to understand Travelocity — another such service — to be a "Booking.com." We might similarly expect that a consumer, searching for a trusted source of online hotel-reservation services, could ask a frequent traveler to name her favorite "Booking.com" provider. Consumers do not in fact perceive the term "Booking.com" that way, the courts below determined. … That should resolve this case: Because "Booking.com" is not a generic name to consumers, it is not generic.

The Supreme Court's decision recognizes that there is nothing inherently different about generic.com terms that would require a per se rule treating them any differently than marks like WAFFLE HOUSE and ALE HOUSE. The Court's decision underscores the paramount importance of consumer perception evidence in determining whether a term is a brand name or a common name, and practitioners therefore should consider all forms of consumer perception evidence that may be at their disposal when trying to demonstrate than an arguably generic term is understood by consumers as a brand.

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David H. Bernstein is a partner at Debevoise & Plimpton, where he chairs the firm's Intellectual Property Litigation Group. Jared I. Kagan is an associate in Debevoise's IP Litigation Group. Messrs. Bernstein and Kagan were co-counsel to Booking.com, N.V. before the U.S. Supreme Court in the case discussed in this article.