The Supreme Court’s recent decision in Matal v. Tam sounded a death knell for the Lanham Act’s disparagement clause and has implications for whether the scandalous clause of the Lanham Act still remains constitutional. See Matal v. Tam, No. 15-1293 (U.S. Jun. 19, 2017) (“Matal”). Section 2(a) of the Lanham Act, 15 U.S.C. § 1052(a), bars the registration of marks “which may disparage . . . persons . . . , institutions, beliefs, or national symbols, or bring them into contempt or disrepute,” or marks that “consist of or comprise” immoral or scandalous matter. These clauses, also known as the disparagement clause and the scandalous clause, were both challenged in separate proceedings as unconstitutional under the First Amendment. See Matal, No. 15-1293 (disparagement clause); In re Brunetti, No. 15-1109 (Fed. Cir.) (scandalous clause) (decision pending). On June 19, 2017, the Supreme Court issued its decision in Matal v. Tam, finding that the disparagement clause of the Lanham Act constitutes viewpoint discrimination and is unconstitutional.
In light of the Supreme Court’s recent decision in Matal v. Tam, the United States Patent and Trademark Office (“USPTO”) issued updated guidance for applications for marks that were previously subject to refusal under the disparagement clause and the scandalous clause. In this guidance, the USPTO noted that although the provisions regarding the disparagement clause in the Trademark Manual of Examining Procedure (“TMEP”) no longer apply, the provisions regarding the scandalous clause will still be applicable pending the constitutionality of this provision.
In addition to updated guidance from the USPTO, Matal will also likely have an apparent effect on the pending decision on in the Washington Redskins football trademark dispute. Following the decision in Matal, the Redskins will likely prevail in the team’s ongoing legal battle to prevent the cancellation of the team’s marks as disparaging to Native Americans. The holding in Matal will also have a much broader effect than a victory for the Washington Redskins—marks that were once unable to receive trademark protection or faced cancellation because the marks were considered “disparaging” will now be eligible for federal trademark protection. This decision affects both the way the USPTO will handle potentially disparaging or scandalous trademark applications and provide grounds for other trademark owners once facing risk of the cancellation of their marks to protect their marks under First Amendment grounds.
Trademark Office Guidance in the Wake of Matal
The USPTO issued Examination Guide 01-17 on Monday, June 26, 2017, entitled “Examination Guidance for Section 2(a)’s Disparagement Provision after Matal v. Tam and Examination for Compliance with Section 2(a)’s Scandalousness Provision While Constitutionality Remains in Question.” United States Patent And Trademark Office, Examination Guide 01-17 (Jun. 26, 2017) (“Examination Guide 01-17”).
This Guide explains how trademark applications with arguably disparaging or scandalous content will be examined in the aftermath of the Supreme Court’s decision in Matal, which was decided on June 19, 2017. The Supreme Court held that the disparagement provision of § 2(a) of the Lanham Act, which prohibits trademark applications with disparaging content to certain institutions or groups from being approved, contradicts the Free Speech Clause of the First Amendment. Matal, No. 15-1293. The similar scandalousness provision of the same law was challenged in a separate court action, In re Brunetti, No. 15-1109, which is still pending review by the Federal Circuit .
The Matal case stems from the denial of Simon Tam’s trademark application for his band name “The Slants,” an Asian American band, which was denied by the USPTO under the Lanham Act, because it was considered disparaging to those of Asian decent. Matal, slip op. at 1. “Section 2(a) of the Lanham Act, 15 U.S.C. § 1052(a), bars registration of marks that consist of or comprise matter which may disparage persons, institutions, beliefs, or national symbols, or bring them into contempt or disrepute (‘the disparagement provision’), and marks that consist of or comprise immoral or scandalous matter (‘the scandalousness provision’).” Examination Guide 01-17. In 2015, Tam appealed the USPTO’s decision to the U.S. Court of Appeals for the Federal Circuit, which held that “the disparagement provision constitutes viewpoint discrimination, and is facially unconstitutional under the First Amendment’s Free Speech Clause.” Id. (citing In re Tam, 808 F.3d 1321, 1358 (Fed. Cir. 2015) (en banc)).
The Supreme Court granted the USPTO’s writ of certiorari, and on June 19, 2017, the Court unanimously affirmed the Federal Circuit’s ruling, which invalidated TMEP § 1203 “that relate[d] specifically to examination under the disparagement provision.” Examination Guide 01-17. “Accordingly, that a mark may ‘“disparage . . . or bring . . . into contempt, or disrepute’” [any persons, institutions, beliefs, or national symbols] is no longer a valid ground on which to refuse registration or cancel a registration.” Id.
Examination Guide 01-16, which issued on March 10, 2016, set the precedent for Matal compliance with both the relevant provisions while their constitutionality was an open question. During that time, “the USPTO [had] been suspending action on pending applications involving marks subject to refusal under the disparagement and scandalousness provisions until the Tam and Brunetti litigations conclude[d].” Id.
New applications received during that period received only advisory refusals “on the grounds that a mark consisted of or comprised scandalous, immoral, or disparaging matter under Section 2(a). If a mark’s registrability under these provisions in Section 2(a) is the only issue, the examining attorney will identify the reasons for the advisory refusal and suspend action on the application in the first Office action.” United States Patent And Trademark Office, Examination Guide 01-16 (Mar. 10, 2016).
Action was likewise suspended before final action on any applications, examined before or after the Federal Circuit’s decision in Tam, where the examining attorney made other requirements or refusals in the first Office action. Id. Additionally, it was decided that “[a]ny suspension of an application based on the scandalousness provision of Section 2(a) will remain in place until the Federal Circuit issues a decision in Brunetti, after which the USPTO will re-evaluate the need for further suspension.” Id.
The Supreme Court’s ruling allows those applications that were suspended under the disparagement provision of § 2(a) to proceed to publication:
The portions of [the] Trademark Manual of Examining Procedure (TMEP) §1203 that relate specifically to examination under the disparagement provision no longer apply. Applications that received an advisory refusal under the disparagement provision and were suspended pursuant to Examination Guide 01-16 will be removed from suspension and examined for any other requirements or refusals. If an application was previously abandoned after being refused registration under the disparagement provision, and is beyond the deadline for filing a petition to revive, a new application may be filed.
Examination Guide 01-17.
The constitutionality of the scandalousness provision of the same section, however, remains an open question, one that depends upon the Federal Circuit’s decision in reviewing In re Brunetti. As of now,
the USPTO continues to examine applications for compliance with that provision according to the existing guidance in the TMEP and Examination Guide 01-16. Any suspension of an application based on the scandalousness provision of Section 2(a) will remain in place until the Federal Circuit issues a decision in Brunetti, after which the USPTO will re-evaluate the need for further suspension.
Id. In the interest of resolving this question, the “Federal Circuit has ordered the parties to submit supplemental briefing in Brunetti explaining how the constitutionality of the scandalousness provision should be resolved in light of the Supreme Court’s decision in Tam.” Id.
Implications of Matal v. Tam
However, the Supreme Court not only held that government approval or denial of a trademark application is not government speech, but also held that the law that prohibits offensive trademarks constitutes viewpoint discrimination, as the government cannot bar the expression of ideals merely because such ideals are offensive to part of the population. See Matal, slip op. at 12-18, 22-23. The core tenet behind viewpoint discrimination legislation is the notion that certain ideas or perspectives cannot be censored from the market of ideas without risking creating an ideological tyranny of sorts that favors only one position. See e.g., id. at 22-23.
The debate surrounding Matal centers on how a potentially offensive mark will be interpreted by the public. The goal of The Slants was to “reclaim” a disparaging phrase and negate the stereotype of the term for persons of Asian decent. Id., slip op. at 1. The Slants’ trademark application was initially denied because the USPTO imagined openly expressing the phrase might have the opposite effect for those of the Asian American population. Id. One implication of this case is efforts to turn a derogatory epithet into a badge of honor may have more merit, and this may contribute to a more liberal marketplace of ideas. However, the idea that new applicants will all have similar good intentions at heart may be a false hope.
The most immediate and apparent effect of the Court’s ruling is the impact the decision will have on the pending Washington Redskins football trademark dispute. The Matal ruling established that the government cannot decide how certain ideas will necessarily be interpreted by the public, so the name “Redskins” would likely be protected by virtue of the same argument that protects “The Slants.” In light of this, the Department of Justice dropped its fight to have the controversial football team name changed. See Justice Department drops Redskins name fight, CBS NEWS (Jun. 29, 2017, 6:21 PM), http://www.cbsnews.com/news/justice-department-drops-fight-over-redskins-name/. Taken together, the Matal decision and the Department of Justice’s decision to drop its fight against the Redskins indicate that it is likely that the Federal Circuit will reverse the judgement of the district court and rule in favor of Pro-Football, the company that owns the Redskins.
Interestingly, the circumstances of this case are the inverse of those of Matal—the group that felt disparaged by the term was protesting the term being trademarked by those who were not members of the same group. The owner of the Redskins, Daniel Snyder, has argued that the term represents honor and pride for Native Americans, despite how they themselves feel about it. Id. It would seem that in the eyes of Mr. Snyder, the phrase functions in the public eye much like Simon Tam’s band name does, as an effort to reclaim an offensive term and change the meaning into a source of pride. The flurry of controversy the Redskins trademark dispute has stirred up, however, would seem to indicate otherwise. The disparagement clause, which was struck down by the Matal ruling, vested a kind of authority in the government to protect certain groups from disparagement in the public sphere. The restrictions of the disparagement clause no longer exist, and as of yet, there are no apparent other restrictions on who can take advantage of the Matal decision to trademark offensive terms. The effect of this is that there appears to be little legal recourse to those dissatisfied in instances like the Redskins debate. The question now will center on whether there will be any restrictions on such controversial trademarks at all.
The Supreme Court’s ruling in Matal cleared the way for a slew of new and possibly offensive trademark applications of a kind that have been consistently denied since 1946. Whether this protection will be extended to a wider category of potentially incendiary marks hinges on the Federal Court’s pending review of Brunetti. In any case, it is clear that Matal marks a turning point in the Court’s interpretation of the Constitutional implications of trademark approval. Whether this decision will lead to other changes in the way trademarks are interpreted and processed remains to be seen.