United States: Federal Circuit Rejects Disparaging Trademarks' Ban On First Amendment Grounds

Last Updated: February 9 2016
Article by Kimberly Chow

A December ruling by the Federal Circuit emphasized the value of commercial speech through trademark registration, and the case may have implications for the Washington Redskins. The NFL team's Super Bowl dreams may be over, but the intellectual property battle over their name is still alive.

In a move that is likely to affect the Redskins' fight to keep their trademark, the Federal Circuit held December 22 in a separate case that the ban on "disparaging" trademarks is viewpoint discrimination that violates the First Amendment. The U.S. Patent and Trademark Office can still decide whether to appeal the decision, though it is unlikely that the Supreme Court will pick up the case without a circuit split. 

For years, the federal government has sought to justify section 2(a) of the Lanham Act, which allows the government to reject registration of trademarks it deems disparaging, immoral, or scandalous, by claiming that such registration constitutes government speech that is free from the protections of the First Amendment.  But in In re Tam, a case involving an Asian-American band called "The Slants" – which supposedly disparaged persons of Asian descent – the Federal Circuit rejected that argument, holding that the government's refusal to register trademarks of which it disapproves is viewpoint-based discrimination against certain types of speech.

"Every single time registration is refused or cancelled pursuant to the disparagement provision, it is based upon a determination by the government that the expressive content of the message is unsuitable because it would be viewed by the referenced group as disparaging them," Judge Kimberly Moore wrote for the majority.

Such discrimination, the court held, fails to hold up against both strict and intermediate scrutiny, because the government does not even have a legitimate interest justifying it.

The court additionally rejected arguments that would-be registrants were still allowed to use the name even if they could not officially register the trademarks, and thus their First Amendment rights were not violated. There are significant legal and economic advantages to registration, Moore wrote, and denial of those advantages discourages adoption of controversial trademarks and stifles speech.

The Federal Circuit's decision may have consequences for the Washington Redskins, whose trademark was canceled under section 2(a) in 2014 because the U.S. Patent and Trademark Office determined that it was offensive to Native Americans. At the time of the cancellation, the PTO cited a study indicating that 30 percent of Native Americans found the term "Redskins" disparaging. The National Football League team has its appeal of that cancellation, based on a Fifth Amendment due process argument, pending in the Fourth Circuit Court of Appeals. If the Fourth Circuit finds this latest decision persuasive, even though it is not binding, the Redskins might prevail. Even if the Fourth Circuit rejects the Redskins' challenge to section 2(a), the Supreme Court may take up the case to resolve the circuit split.

In emphasizing that the First Amendment protected trademark registration, the Federal Circuit made clear that commercial speech is fully deserving of protection when the government targets its expressive components.

"Commercial speech is no exception to the need for heightened scrutiny of content-based impositions seeking to curtail the communication of particular information or messages," wrote the court, pointing out that it may be even more important to consumers that commercial speech be unfettered than political speech.

The court's support for the free flow of commercial speech is heartening for the business community, which does have compelling interests in protection from government over-regulation of its expression. In this case, The Slants' front-man, Mr. Tam, sought to reclaim Asian stereotypes with his band name. The Federal Circuit's decision and the eventual outcome of the Redskins' case will play an important part in establishing the level of protection owed to commercial speech.

This article is presented for informational purposes only and is not intended to constitute legal advice.

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