Landmark Trademark Rulings of 2020 Redefine Consumer Perception and Remedies Under the Lanham Act

The year 2020 featured several high-profile trademark disputes that have significantly shaped the legal landscape. Notably, the Second Circuit vacated Tiffany & Co.’s $25 million summary judgment win against Costco Wholesale Corp. over Costco’s use of the term “Tiffany” to describe a six-prong diamond ring setting in Tiffany and Co. v. Costco Wholesale Corp., 971 F.3d 74 (2d Cir. 2020). Additionally, the Southern District of New York held that the First Amendment shields the use of Humvees in the video game Call of Duty from trademark infringement and dilution claims in AM General LLC v. Activision Blizzard, Inc., 450 F. Supp. 3d 467 (S.D.N.Y. 2020). The Western District of Texas denied a preliminary injunction sought by Future Proof Brands, LLC against Molson Coors over the competing “Vizzy” hard seltzer brand, ruling that both “Brizzy” and “Vizzy” derive from the common descriptive term “fizzy” in Future Proof Brands, LLC v. Molson Coors Beverage, 2020 WL 3578327 (W.D. Tex. Mar. 24, 2020), aff’d, 2020 WL 7064607 (5th Cir. Dec. 3, 2020).

Among these, two Supreme Court decisions stand out for their lasting impact on trademark law. In United States Patent and Trademark Office v. Booking.com B.V., 140 S. Ct. 2298 (2020), the Court addressed whether adding a generic top-level domain, such as “.com,” to a generic term can create a protectable trademark. This case was historic as the first U.S. Supreme Court oral argument conducted telephonically due to the COVID-19 pandemic and the last opinion authored by Justice Ruth Bader Ginsburg.

In an 8-1 decision, the Court held that Booking.com’s domain name is eligible for trademark registration. It rejected the USPTO’s proposed per se rule that any generic term combined with “.com” is automatically generic and unregistrable. Instead, the Court emphasized that trademark eligibility depends on consumer perception. Evidence demonstrated that consumers recognize BOOKING.COM as a brand rather than a generic term for online hotel reservations, entitling Booking.com to trademark protection.

The Court clarified that the genericness inquiry focuses on whether the term, as a whole, signifies the category of services to consumers. Since consumers do not perceive BOOKING.COM as generic, the mark is protectable. The Court also noted that the USPTO’s proposed per se rule lacked support in trademark law and policy and would threaten numerous existing registrations, citing examples like ART.COM and DATING.COM. It expressly rejected reliance on a 132-year-old precedent involving Goodyear Rubber Co., which held that adding “Company” to a generic term remains generic.

Following the ruling, the USPTO issued an Examination Guide on “generic.com” domain names to align with the Court’s decision. However, critics argue the Guide insufficiently embraces the consumer perception standard, reverting toward the discredited per se approach by emphasizing factors beyond consumer perception. Since the decision, hundreds of applications for generic.com trademarks have been filed, with some, such as wine.com, already refused registration on genericness grounds, signaling potential for further litigation.

In Romag Fasteners, Inc. v. Fossil Group, Inc., 140 S. Ct. 1492 (2020), the Supreme Court resolved a circuit split regarding whether willful infringement is required to award profits under the Lanham Act. While some circuits mandated willfulness, others did not. The Court unanimously held that willfulness is not a prerequisite for disgorgement of profits in trademark infringement cases.

Justice Gorsuch, writing for the Court, emphasized that the Lanham Act’s text does not impose a willfulness requirement for awarding profits. Although the statute requires willfulness for dilution claims, it is silent on intent for infringement remedies. The Court rejected the argument that “principles of equity” imply a willfulness standard, noting Congress explicitly included mens rea requirements elsewhere in the Act but omitted them here.

Nonetheless, the Court acknowledged that a defendant’s intent remains a crucial factor in equitable decisions on awarding profits. Post-Romag, district courts have applied this principle. For example, in PlayNation Play Sys., Inc. v. Velex Corp., 2020 WL 6895302 (N.D. Ga. July 9, 2020), the court ordered disgorgement based on unjust enrichment and deterrence, considering the defendant’s intent to obfuscate facts. Similarly, in Vitamins Online, Inc. v. HeartWise, Inc., 2020 WL 6581050 (D. Utah Nov. 10, 2020), disgorgement was granted partly due to the defendant’s willful false advertising and manipulation of online reviews.

The First Amendment’s protection of parodic commercial goods also expanded in 2020. The Ninth Circuit ruled in VIP Prods. LLC v. Jack Daniel’s Prop., Inc., 953 F.3d 1170 (9th Cir. 2020), that a squeaking dog toy resembling the Jack Daniel’s whiskey bottle is an expressive work entitled to First Amendment protection. The toy, “Bad Spaniels Silly Squeaker,” parodied the whiskey label with humorous alterations such as “Old No. 2 on your Tennessee Carpet” and “43% POO BY VOL.”

The district court had previously held the toy was not an expressive work and thus not protected, applying traditional trademark infringement and dilution analysis without balancing free speech interests. The Ninth Circuit’s decision broadens First Amendment safeguards beyond traditional expressive works, potentially increasing exposure of brand owners to parody-based infringement claims.

These landmark rulings and decisions reflect evolving judicial approaches to trademark registration, remedies, and free speech defenses. They underscore the importance of consumer perception in trademark eligibility, clarify the scope of equitable remedies under the Lanham Act, and highlight the expanding role of First Amendment protections in trademark disputes. Practitioners should closely monitor USPTO examination practices and emerging case law as these developments continue to unfold.