In Re steelbuilding.com

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United States Court of Appeals for the Federal Circuit

04-1447
(Serial No. 75/934,927)

IN RE STEELBUILDING.COM

Michael M. Zadrozny, Shlesinger, Arkwright & Garvey, LLP, of Arlington, Virginia,
argued for appellant.

Nancy C. Slutter, Associate Solicitor, Office of the Solicitor, United States Patent
and Trademark Office, of Arlington, Virginia, argued for the Director of the Patent and
Trademark Office. With her on the brief were John M. Whealan, Solicitor, and Cynthia C.
Lynch, Associate Solicitor.

Appealed from: United States Patent and Trademark Office, Trademark Trial and
Appeal Board
 United States Court of Appeals for the Federal Circuit

04-1447
(Serial No. 75/934,927)

IN RE STEELBUILDING.COM

___________________________

DECIDED: July 11, 2005
___________________________

Before MICHEL, Chief Judge, RADER, and LINN, Circuit Judges.

Opinion for the court filed by Circuit Judge RADER. Opinion concurring-in-part and
dissenting-in-part filed by Circuit Judge LINN.

RADER, Circuit Judge

The Trademark Trial and Appeal Board (Board) affirmed the refusal of the United

States Patent and Trademark Office (PTO) to register the mark STEELBUILDING.COM

to appellant Steelbuilding.com. The Board held the mark was either generic or merely

descriptive and without secondary meaning. In re Steelbuilding.com, 2003 WL

23350100 (TTAB Mar. 24, 2003). This court vacates the Board’s determination that the

mark is generic, but affirms its findings on descriptiveness and the absence of

secondary meaning, and therefore affirms the denial of the application.

I.

Appellant filed an intent-to-use application under 15 U.S.C. § 1051(b)(1) to

register the mark STEELBUILDING.COM as a service mark on March 3, 2000. In its

original application, appellant stated that it intended to use the mark in connection with

the “[s]ale of pre-engineered metal buildings and roofing systems.” The examining
attorney initially denied registration on the ground that the proposed mark was merely

descriptive, under 15 U.S.C. § 1052(e)(1). Appellant then amended its application and

requested reconsideration. In the amendment, the applicant changed the identification

of its services to “computerized on-line retail services in the field of pre-engineered

metal buildings and roofing systems.” Appellant also filed an allegation of use under 15

U.S.C. § 1051(c), submitted samples of advertising that described the interactive

design/purchase capabilities of its service, and submitted evidence of acquired

distinctiveness. The examiner again refused registration, this time finding that the mark

was generic for the specified goods and services without any acquired distinctiveness

under 15 U.S.C. § 1052(f).

The Board affirmed the PTO’s rejection on the ground that

STEELBUILDING.COM is generic for “a website that provides computerized on-line

retail services in the field of pre-engineered metal buildings including steel buildings.”

Steelbuilding.com, 2003 WL 23350100, at *8. The Board also found that “if the terms

‘steel building’ [sic] and ‘.com’ are not generic, they are at least highly descriptive.” Id.

at *11. The Board noted that the addition of the term “.com,” a top level domain (TLD)

indicator, was without source-identifying significance, citing In re Martin Container, Inc.,

65 USPQ2d 1058 (TTAB 2002) and In re CyberFinancial.Net, Inc., 65 USPQ2d 1789

(TTAB 2002). Steelbuilding.com, 2003 WL 23350100, at *5. Finally, the Board found

appellant’s evidence inadequate to show acquired distinctiveness.

II.

To deny the registration of a mark as generic, the PTO has the burden of

“substantial[ly] showing . . . that the matter is in fact generic . . . based on clear

04-1447 2
evidence of generic use.” In re Am. Fertility Soc’y., 188 F.3d 1341, 1346 (Fed. Cir.

1999). This court reviews a holding of genericness or descriptiveness for substantial

evidence. In re Oppedahl & Larson LLP, 373 F.3d 1171, 1173 (Fed. Cir. 2004). A

generic term, by definition, identifies a type of product, not the source of the product. In

re Gould Paper Corp., 834 F.2d 1017, 1018 (Fed. Cir. 1987). A generic term cannot

function as an indicator of the source of a product, and thus as a trademark, because

the relevant public understands the term primarily as the common name for the product.

In re Dial-A-Mattress, 240 F.3d 1341, 1344 (Fed. Cir. 2001). This court’s test for

genericness has two parts: first, the court determines the genus of goods or services at

issue, and second, the court determines whether the term sought to be registered is

understood by the relevant public “primarily to refer to that genus of goods or services.”

H. Marvin Ginn Corp. v. Int’l Ass’n of Fire Chiefs, 782 F.2d 987, 990 (Fed. Cir. 1986).

An inquiry into the public’s understanding of a mark requires consideration of the mark

as a whole. Even if each of the constituent words in a combination mark is generic, the

combination is not generic unless the entire formulation does not add any meaning to

the otherwise generic mark. Am. Fertility Soc’y, 188 F.3d at 1347; Dial-A-Mattress, 240

F.3d at 1345.

A merely descriptive mark describes “the qualities, ingredients or characteristics

of” the goods or services related to the mark. Estate of P.D. Beckwith, Inc. v. Comm’r of

Patents, 252 U.S. 538, 543 (1920). A mark is “merely descriptive” if it “immediately

conveys . . . knowledge of the ingredients, qualities, or characteristics of the goods . . .

with which it is used.” In re Gyulay, 820 F.2d 1216, 1217 (Fed. Cir. 1987). However, if

a mark is not merely descriptive, because some imagination, thought, and perception

04-1447 3
are required to arrive at the qualities or characteristics of the goods, it may still qualify

for registration. See In re Nett Designs, Inc., 236 F.3d 1339, 1341 (Fed. Cir. 2001).

Descriptive marks can qualify for registration on the Principal Register if they acquire

secondary meaning, i.e., distinctiveness. See 15 U.S.C. § 1052(f) ; Two Pesos, Inc. v.

Taco Cabana, Inc., 505 U.S. 763, 769 (1992). To show that a mark has acquired

distinctiveness, an applicant must demonstrate that the relevant public understands the

primary significance of the mark as identifying the source of a product or service rather

than the product or service itself. Qualitex Co. v. Jacobson Prods. Inc., 514 U.S. 159,

163 (1995).

Only in rare instances will the addition of a TLD indicator to a descriptive term

operate to create a distinctive mark. Oppedahl, 373 F.3d at 1175. In those rare

instances, a term that is not distinctive by itself may acquire some additional meaning

from the addition of a TLD, such as “.com,” “.net,” etc. See id. at 1175-76. In those

unusual circumstances, the addition of the TLD can show Internet-related

distinctiveness, intimating some “Internet feature” of the item. See id. at 1178.

Because the evaluation of a mark proposed for registration requires consideration of the

mark as a whole, the distinctiveness derived from a connection to the Internet, as

indicated by the TLD indicator, is a part of the calculus for registration.

III.

The Board defined the genus for appellant’s goods or services as “the sale of

pre-engineered ‘steel buildings’ on the Internet.” Steelbuilding.com, 2003 WL

23350100, at *7, and “computerized on-line retail services in the field of pre-engineered

metal buildings including steel buildings.” Id. at *8. The Board, with this definition of

04-1447 4
genus in mind, first considered “STEELBUILDING” in isolation, and then considered the

effect of adding “.COM.” The Board found that “applicant’s competitors use the term

‘steel buildings’ generically,” giving several examples of the use of “steel buildings” by

competitors. The record shows, however, that the evidence cited by the Board relates

to the phrase “steel building” or “steel buildings”; none refers to “steelbuilding” or

“STEELBUILDING.” Despite this distinction, the Board found STEELBUILDING.COM to

be “simply the name of a website that sells, inter alia, steel buildings.” Id.

As an initial matter, this court examines the Board’s understanding of the genus

of goods or services at issue. The applicant defined its goods and services, in its

amended application, as “computerized on-line retail services in the field of pre-

engineered metal buildings and roofing systems.” Although the definitions of the

applicant and of the Board appear nearly identical, the parties understand the phrase

“computerized on-line retail services” differently. Applicant sells steel buildings on line,

but the record indicates it provides services beyond mere sales. In other words, the

services at issue are far more than an on-line catalogue. The applicant’s web site

permits a customer to first design, then determine an appropriate price for, its own

unique design. Finally, the customer may purchase its unique building on line. The

web site features a process that facilitates the customer’s design of his building at his

own computer via a complex interactive process.

The STEELBUILDING.COM web site thus includes more than a mere shopping

guide for metal building structures. As the program-user develops the design, the

program re-calculates design elements as necessary to meet codes and other

engineering requirements. The program then calculates a price for the designed

04-1447 5
building. The purchaser can compare prices of different designs, and finally purchase a

preferred design. Therefore, while correctly concluding that “[a] significant, if not

primary feature, of applicant’s services is the sale of steel buildings,” id. at *4, the Board

fails to acknowledge the interactive design feature of the applicant’s goods and

services.

Although the Board’s misunderstanding of the proper genus for

“STEELBUILDING.COM” alone requires this court to vacate its decision on

genericness, this court also examines generally the Board’s finding on this matter. In

deciding whether the relevant public uses the term STEELBUILDING.COM as the

genus or name of the genus of the specified goods or services, the Board considered

“STEELBUILDING” and “.COM” separately. The Board decided that STEELBUILDING

by itself is a generic term. Id. at *5. The Board apparently concluded that

STEELBUILDING is generic for “steel buildings.” The Board does not seem to

acknowledge an alternative genus, namely the “the building of steel structures.” In this

case, the genus might be both formulations. The Board does not adequately define the

genus.

In any event, the record does not show substantial evidence that

“STEELBUILDING,” in common usage, is a compound word used to mean either “steel

building” or “steel buildings.” See Gould, 834 F.2d at 1018 (“the PTO has satisfied its

evidentiary burden if . . . it produces evidence including dictionary definitions that the

separate words joined to form a compound have a meaning identical to the meaning

common usage would ascribe to those words as a compound”). In Gould, the applicant

attempted to register “SCREENWIPE,” but this court held that the applicant’s own

04-1447 6
description of the product as “a . . . wipe . . . for . . . screens” provided adequate

evidence that merely combining the words “screen” and “wipe” did not render the mark

registerable, and held that “the terms remain as generic in the compound as

individually, and the compound thus created is itself generic.” Id. at 1019. In Gould, the

applicant admitted that “screenwipe” denoted a “screen wipe.” In contrast, the applicant

here denies that “STEELBUILDING” describes merely “steel buildings.” The record

does not contain any examination of dictionary definitions or other sources that might

have indicated that joining the separate words “steel” and “building” would create a word

that, in context, would be generic. The Board merely cited evidence that showed that

when customers or competitors talked about a steel building, they used the phrase

“steel building.” That evidence shows that “steel building” is generic, but does not

address directly the composite term STEELBUILDING.

The Board considered the effect of attaching the term “.COM” to

“STEELBUILDING.” The Board construed “.COM” as no more than a designation of a

commercial entity on the Internet, like “company.” Therefore, the combination of

“STEELBUILDING” and “.COM” was, to the Board, no more registerable than

“STEELBUILDING” alone. Steelbuilding.com, 2003 WL 23350100, at *6 (citing

Goodyear’s India Rubber Glove Mfg. Co. v. Goodyear Rubber Co., 128 U.S. 598, 602-

03 (1888) (“nor will the incorporation of a company in the name of an article of

commerce, without other specification, create any exclusive right to the use of the

name”)). However, Goodyear’s did not create a per se rule for TLD indicators. In fact,

in rare circumstances, as noted before, “a TLD may render an otherwise descriptive

term sufficiently distinctive for trademark registration.” Oppedahl, 373 F.3d at 1177. In

04-1447 7
this unusual case, the addition of the TLD indicator expanded the meaning of the mark

to include goods and services beyond the mere sale of steel buildings. Specifically, the

TLD expanded the mark to include internet services that include “building” or designing

steel structures on the web site and then calculating an appropriate price before

ordering the unique structure. The record therefore does not contain evidence sufficient

to support the board’s finding that “STEELBUILDING.COM” is generic for applicant’s

services.

In sum, the Board erroneously: (1) construed the genus of applicant’s services

and goods too narrowly; (2) discounted the ambiguities and multiple meanings in the

mark; and (3) dismissed the addition of the TLD indicator despite its expansion of the

meaning of “STEELBUILDING.COM.”

IV.

The Board also considered whether the mark STEELBUILDING.COM was, if not

generic, then at least merely descriptive. The applicant’s web site lists as its first

feature: “Design your steel building with our advanced interactive system.” (Emphasis

added). One of applicant’s advertisements includes the following sentence: “E-

Commerce website offers instant pricing and on-line sales of steel buildings, mini

storage systems, building accessories, component parts and all-steel homes.”

(Emphases added). Based on this evidence and more in the record, this court concurs

in the statement of the Board: “[w]e, frankly, are at a loss to understand that if the retail

sale of steel buildings is not the primary feature of applicant’s services, what is.

However, whether steel buildings are the ‘primary feature’ of applicant’s services is not

determinative, because they are at least a significant feature of applicant’s services.”

04-1447 8
Steelbuilding.com, 2003 WL 23350100, at *9. For descriptiveness, the record shows

that a consumer would recognize the compound word “STEELBUILDING” as conveying

the same impression, at least for trademark purposes, as the phrase “steel buildings.”

The Board also considered how the addition of the TLD indicator may have

affected descriptiveness. The Board correctly observed that adding “.COM” to

“STEELBUILDING” “simply means that services associated with the generic term are

performed in an on-line or ‘e-commerce’ environment.” Id. at *10. Indeed, the TLD

indicator describes a significant feature of applicant’s services, namely, the Internet

commerce connection. Thus, the record sustains the Board’s determination that

applicant’s mark is “merely descriptive” for the on-line services specified in the

application.

V.

Finally, the Board considered whether the mark had acquired distinctiveness, or

secondary meaning. In determining whether secondary meaning has been acquired,

the Board may examine copying, advertising expenditures, sales success, length and

exclusivity of use, unsolicited media coverage, and consumer studies (linking the name

to a source). Cicena Ltd. v. Columbia Telecomms Group, 900 F.2d 1546, 1551 (Fed.

Cir. 1990). On this list, no single factor is determinative. A showing of secondary

meaning need not consider each of these elements. Rather, the determination

examines all of the circumstances involving the use of the mark. See Thompson Med.

Co., Inc. v. Pfizer Inc., 753 F.2d 208, 217 (Fed. Cir. 1985). Finally, the applicant’s

burden of showing acquired distinctiveness increases with the level of descriptiveness;

a more descriptive term requires more evidence of secondary meaning. In re Bongrain

04-1447 9
Intern. (Am.) Corp., 894 F.2d 1316, 1317 (Fed. Cir. 1990) (“the greater the degree of

descriptiveness the term has, the heavier the burden to prove it has attained secondary

meaning”).

The Board considered evidence of print and Internet advertising, declarations

from competitors and the applicant’s own officers, sales data, web site traffic data, and

customer communications. The Board assessed the evidence on advertising by

comparing applicant’s advertising expenditures with those of the unsuccessful applicant

in In re Leatherman Tool Group Inc., 32 USPQ2d 1443, 1443 (TTAB 1994), finding

them to be “at a much smaller level.” Steelbuilding.com, 2003 WL 23350100, at *11.

The Board noted that applicant’s advertising expenses “rely heavily on Internet banner

advertisements.” Id.

The Board considered applicant’s Internet poll on name recognition. The poll, at

a web site named MetalBuilding.com, first asked visitors a few questions about current

events or sports, e.g., “Who will win Election 2000? Who will win the NBA title?,” then

asked “which one of the following building manufacturers is the most recognizable?” In

the poll, the applicant was more recognizable than the others on the list: “Package

Industries,” “Parkline,” Steelox,” and “US Structures.” This court agrees with the Board

that this particular poll lacked sufficient signs of reliability. For instance, the poll results

do not indicate the number of actual participants. The poll did not attempt to prevent

visitors from voting more than once. The poll did not prevent interested parties, such as

friends or associates or even employees of the applicant, from voting multiple times to

skew the results. In sum, this poll does not even remotely follow the precepts of

standard trademark name-recognition polls. Although the Board was correct to consider

04-1447 10
the survey for its very limited value, the survey did not show sufficient reliability to

constitute sufficient evidence of acquired distinctiveness. Id. at *12 (“occasionally,

people may recognize applicant’s term as a trademark but much of this evidence may

be attributable to domain name recognition”).

The Board considered other evidence as well, but none of that evidence

established the proposed mark’s distinctiveness. The proposed mark is highly

descriptive. Therefore, applicant had the burden to show a concomitantly high level of

secondary meaning. The Board correctly determined that, on this record, “applicant’s

evidence falls far short of its burden.” Id.

VI.

In this case, the Board did not correctly describe the genus of goods and

services offered by the applicant. Even using the Board’s understanding of the genus,

however, this record does not support a finding that “STEELBUILDING.COM” was

generic. On the other hand, the record suffices to show that the proposed mark was

merely descriptive. This court also agrees that the applicant did not meet its high

burden of showing acquisition of secondary meaning. For these reasons, this court

affirms the decision of the Board, but only on grounds of descriptiveness and absence

of distinctiveness.

COSTS

Each party shall bear its own costs.

VACATED-IN-PART and AFFIRMED-IN-PART

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United States Court of Appeals for the Federal Circuit

04-1447
(Serial No. 75/934,927)

IN RE STEELBUILDING.COM

LINN, Circuit Judge, concurring-in-part and dissenting-in-part.

I agree with the majority’s well-reasoned analysis in all respects but one.

I dissent only from the majority’s decision to sustain the Board’s finding of no acquired

distinctiveness. Because the Board legally erred in according too little weight to some

of the evidence submitted to show the acquisition of secondary meaning, and because

the Board acted arbitrarily in not considering other evidence, I would vacate the Board’s

determination of no acquired distinctiveness and remand for further consideration.

I agree with the majority that the poll results are inconclusive and do not prove

acquired distinctiveness. However, applicant submitted declarations from competitors

and others with industry knowledge, as well as customer letters, that demonstrate that

individuals view STEELBUILDING.COM as source identifying. The Board found that

these letters “provide some de facto evidence” of a recognized mark but accorded them

little weight because “much of this evidence may be attributable to domain name

recognition.” In re Steelbuilding.com, 2003 WL 23350100, at *11 (TTAB Mar. 24, 2003).

The Board’s finding that the mark is also a domain name provides it no legal basis to

discount this evidence of acquired distinctiveness. The question before the Board is

whether consumers consider STEELBUILDING.COM to identify the source of

Applicant’s interactive, on-line, steel-building services. In re Oppedahl & Larson LLP,
373 F.3d 1171, 1176 (Fed. Cir. 2004) (explaining that domain-name marks may obtain

registration upon a showing of secondary meaning); 1 J. Thomas McCarthy, McCarthy

on Trademarks and Unfair Competition § 7:17.1 (4th ed. 2005) (noting that a domain

name can become a service mark if it is used to identify and distinguish the source of

services).

In the Internet world, domain-name recognition is a form of source identification

and may even evidence the acquired distinctiveness of the domain-name mark. See

Paccar Inc. v. Telescan Techs., L.L.C., 319 F.3d 243, 250 (6th Cir. 2003) (“[W]ords in

many domain names can and do communicate information as to the source or sponsor

of the web site.”); Brookfield Communications, Inc. v. W. Coast Entm’t Corp., 174 F.3d

1036, 1055 (9th Cir. 1999) (“The domain name is more than a mere address: like

trademarks, second-level domain names communicate information as to source.”);

Panavision Int’l, L.P. v. Toeppen, 141 F.3d 1316, 1327 (9th Cir. 1998) (“We reject

Toeppen’s premise that a domain name is nothing more than an address. A significant

purpose of a domain name is to identify the entity that owns the web site.”); Xuan-Thao

N. Nguyen, Taxing the New Intellectual Property Right, 56 Hastings L.J. 1, 49-50 (2004)

(“Courts have consistently held that domain names are not merely addresses, but

powerful source indicators on the Internet.”). The Board legally erred in discounting this

evidence on the basis that the mark is also a domain name. Its decision must be

vacated. See Recot, Inc. v. M.C. Becton, 214 F.3d 1322, 1327-28 (Fed. Cir. 2000)

(holding that the Board legally erred in not according sufficient weight to evidence of a

mark’s fame in a likelihood of confusion analysis, vacating, and remanding for further

consideration); see also Sec. & Exch. Comm’n v. Chenery Corp., 332 U.S. 194, 196

04-1447 2
(1947) (holding that a reviewing court may not supply a reasoned basis for the agency’s

action that the agency itself has not given); In re Thrift, 298 F.3d 1357, 1366 (Fed. Cir.

2002) (applying the Chenery rule to decisions of the Board of Patent Appeals and

Interferences); In re Sang-Su Lee, 277 F.3d 1338, 1342 (Fed. Cir. 2002) (“Tribunals of

the PTO are governed by the Administrative Procedure Act, and their rulings receive the

same judicial deference as do tribunals of other administrative agencies.”).

The Board also erred in giving Applicant’s advertising through banner ads and

other Internet channels too little weight, Recot, 214 F.3d at 1327-28, and acted

arbitrarily in ignoring Applicant’s evidence of consumer recognition based on the

number of consumers who return to the site regularly and login, see Sang-Su Lee, 277

F.3d at 1343-45 (finding arbitrary the Board’s finding of obviousness because of

inadequate explanation on motivation to combine, vacating, and remanding); Gechter v.

Davidson, 116 F.3d 1454, 1457-60 (Fed. Cir. 1997) (finding arbitrary the Board’s finding

of anticipation because of inadequate explanation on how the reference disclosed claim

elements, vacating, and remanding). Applicant spent at least $99,000 on Internet

advertising in 2001, and about $98,000 on print ads. Applicant purchased keyword

Internet banner ads—ads that appear as links on a search engine after a user has

searched a keyword—and “pay-per-performance” ads, which allow a company to garner

a top ranking on a user’s returned-search-result list.

Success of Internet ads is often measured by the “click-through rate.” Applicant’s

banner ads appeared 75,000 times per month and enjoyed a click-through rate as high

as 8% on search terms like “metal building.” A click-through rate of only 4% would yield

roughly 3,000 visits to the steelbuilding.com website per month. “Pay-per-performance”

04-1447 3
advertising would lead to several thousand more visits per month. Applicant presented

evidence that each day 200 new users and 200 repeat users logged on to the

steelbuilding.com website to request price quotes. Indeed, Internet advertising cost-

effectively generated site traffic, which caused an association between Applicant’s

services and its domain-name mark. See, e.g., Michael Korybut, Online Auctions of

Repossessed Collateral Under Article 9, 31 Rutgers L.J. 29, 54 (1999) ("By targeting the

specific market segment and continuous delivery over the Internet, online advertising

can efficiently reach the appropriate audience, in sharp contrast to traditional mass

marketing where the target audience is constantly exposed to advertisements in which

they have no interest."). The Board’s reliance on In re Leatherman Tool Group Inc., 32

U.S.P.Q.2d 1443 (TTAB 1994), in summarily dismissing Applicant’s Internet advertising

evidence is misplaced. Leatherman was decided long before Internet advertising

became a cost-effective alternative to traditional advertising media, and its relevance to

the facts of the present case is questionable.

The Board also failed to address evidence that Applicant’s sales rose quickly as

a result of its advertising. In 2001, cumulative sales rose from $500,000, for the first

four months of the mark’s use, to $4,500,000 over the next seven months. The

company was featured prominently in the trade press for its innovative services.

Because the Board did not discuss this evidence, we are left with no basis to determine

whether the Board considered this evidence in determining the extent to which

Applicant might have leveraged the Internet and its mark’s domain-name status to

acquire secondary meaning, even with only modest advertising expenditures.

04-1447 4
 For the reasons articulated, I believe the Board committed legal error in weighing

the evidence and acted arbitrarily in not considering evidence. These errors had a

“bearing on . . . the substance of the decision reached” by the Board. See In re Watts,

354 F.3d 1362, 1370 (Fed. Cir. 2004) (internal quotations omitted). Therefore, I would

vacate the Board’s determination of no acquired distinctiveness and remand for

reconsideration consistent with this opinion.

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