Posts Tagged: "Iancu v. Brunetti"

Two things are true about the world of trademarks—it is rarely boring, and something is always on the horizon. The following are some of the significant trademark decisions of 2019, as well as two critical cases to watch as 2020 begins: 1. The Supreme Court’s ruling in Iancu v. Brunetti rejected the Lanham Act’s ban on offensive marks on the grounds that such a ban violates the First Amendment Right of Free Speech. The case involved clothing brand FUCT, which stands for “Friends You Can’t Trust,” and its founder, Erik Brunetti, who sought to register the brand’s name with the U.S. Patent and Trademark Office (USPTO). The USPTO refused to register the name, determining it was immoral and scandalous. Brunetti argued to the Trademark Trial and Appeal Board (TTAB) that the mark was not vulgar, and that Section 2(a) of the Lanham Act was unconstitutional because it violated the First Amendment. However, the TTAB affirmed the USPTO’s refusal and Brunetti appealed to the U.S. Court of Appeals for the Federal Circuit (CAFC).

The Supreme Court issued its decision yesterday in Iancu v. Brunetti. As largely expected, the Court followed its own lead in Matal v. Tam and struck down the Lanham Act’s bar on “immoral or scandalous” trademarks as violating the First Amendment. Below are some insider perspectives on what the ruling means for brands and trademark practitioners going forward.

The Lanham Act’s ban on federal registration of “immoral or scandalous” trademarks is unconstitutional under the First Amendment.  So held the United States Supreme Court on Monday, resoundingly, if a bit uneasily, in Iancu v. Brunetti.  It’s a good result, and one that the trademark bar and the free speech community had broadly urged, including Debevoise’s client, the International Trademark Association (INTA), in an amicus brief that we had the privilege of writing. 

This week on Capitol Hill and vicinity, the Supreme Court issues its decision in Iancu v. Brunetti and issues orders in several other IP cases. Meanwhile, various House committees will explore the Federal Communications Commission’s broadband Internet coverage maps, state and local government cybersecurity issues, voting technologies, fintech, federal agency IT acquisition and artificial intelligence. Senate committee hearings this week will look at emerging technologies in surface transportation, the persuasive effects of machine learning in Internet platforms as well as a pair of drug patent bills. Elsewhere, the Information Technology and Innovation Foundation hosts an event looking at the effect of global trade tensions on technology supply chains and the Brookings Institution considers the potential of privacy legislation to address concerns with digital information-sharing systems.

On May 2, 2019, the USPTO issued a new examination guide titled “Examination of Marks for Cannabis and Cannabis-Related Goods and Services after Enactment of the 2018 Farm Bill.” A hasty reader may have assumed that this guide would offer options for the cannabis business whose federal trademark applications have been thwarted by the lawful use requirement, but this is not the case.The lawful use requirement, as explained by the USPTO, mandates that “use of a mark in commerce must be lawful use to be the basis for federal registration of the mark.” TMEP §907, citing to 37 C.F.R. §2.69 and §§1, 45 of the Lanham Act. In other words, if a product cannot be legally sold in interstate commerce then, according to the USPTO, the mark cannot be used legally in interstate commerce and, lacking trademark use, the trademark cannot be registered. Alas, the new examination guide only allows federal trademark registrations under very narrow circumstances. Under Sections 6 and 297A of the Farm Bill 2018, “the plant Cannabis sativa L. and any part of that plant, including the seeds thereof and all derivatives, extracts, cannabinoids, isomers, acids, salts, and salts of isomers, whether growing or not, with a delta-9 tetrahydrocannabinol [THC] concentration of not more than 0.3 percent on a dry weight basis” are removed from the Controlled Substances Act (CSA). In effect, these plants and their parts have become legal. Similarly, cannabidiol—commonly referred to as CBD—and those CBD products that have very low THC content, have become legal under the CSA. Being legal under the CSA means that these products can be legally sold in interstate commerce.

In Iancu v. Brunetti (Case No. 18-302), the United States Patent and Trademark Office (USPTO) is appealing to the Supreme Court from a U.S. Court of Appeals for the Federal Circuit decision that held the Lanham Act’s prohibition on “immoral” or “scandalous” marks violates the First Amendment’s free speech clause. The case is the second in two years that the High Court has taken on the subject, and was argued on Monday, April 15. The federal government’s petition specifically asks the Court to consider “whether Section 1052(a) [of the Lanham Act]’s prohibition on the federal registration of ‘immoral’ or ‘scandalous’ marks is facially invalid under the Free Speech Clause of the First Amendment.” At issue is Erik Brunetti’s FUCT trademark for clothing, which was refused in 2011 because it was considered a scandalous term under Section 1052(a) of the Lanham Act.According to the report from Monday’s hearing, the justices’ line of questioning indicated they are likely to follow their own lead in Matal v. Tam, which struck down the disparagement clause of the Lanham Act, by likewise striking down the restriction on federal registration of trademarks that are “immoral or scandalous” on First Amendment grounds. But, according to most observers, they are likely to take a relatively cautious approach in doing so. As is customary, IPWatchdog reached out to industry experts for some additional views on the hearing.

Following our visit to the Supreme Court for Monday’s entertaining oral argument in Iancu v. Brunetti, we can report that the Court seems likely to strike down, on First Amendment grounds, the statutory restriction on federal registration of trademarks that are “immoral or scandalous.”  It seems less likely that the case will generate a clear and ringing statement of First Amendment principles. Rather, the justices’ comments at argument seem to presage a limited, cautious opinion. The Court’s main legal concerns appear to be the facial overbreadth of the existing statute and its history of inconsistent application. Congress and the U.S. Patent and Trademark Office (USPTO) may  therefore be left with room to try again, seeking a narrower and more predictable approach to limiting the federal registration of dirty words as trademarks (especially given the Court’s main practical concern of the loss of civility represented by the proliferation of such marks).

This week on Capitol Hill, both the U.S. House of Representatives and the U.S. Senate are quiet for the next two weeks as the House enters district work periods and the Senate holds state work periods. However, various policy institutes around the nation’s capital continue to host events related to technology and innovation, and the Supreme Court will hear oral arguments in Andrei Iancu, Under Secretary of Commerce for Intellectual Property and Director, Patent and Trademark Offce v. Erik Brunetti. The week kicks off early on Monday with an all-day event at the Internet Society looking at the prospects of federal legislation to improve consumer data privacy from various angles and the Brunetti oral argument. The Cato Institute will host events related to government regulation of social media, as well as the section of U.S. Internet law which largely eliminates legal liability for online service providers based on user-generated content. The week wraps up with an event at the Center for Strategic and International Studies, which will look at U.S.-Australia cooperation in the digital economy, among other sectors. 

On April 15, the Supreme Court will hear oral argument in Iancu v. Brunetti, a case the International Trademark Association (INTA) has remarked raises a critical issue for all trademark owners—namely, which trademarks reliably can be expected to obtain registration under the Lanham Act. At the heart of the case, and of the amicus brief we helped file for INTA this week, is whether free speech concerns should trump the statutory bar on registration of “immoral” or “scandalous” marks. INTA says the First Amendment should win out, and the statutory bar should fall. The category of marks at issue is exemplified by the FUCT apparel mark, owned by Erik Brunetti, to which the U.S. Patent and Trademark Office (USPTO) denied federal registration. After the Federal Circuit reversed, holding that Section 2(a)’s bar on registering immoral or scandalous marks is an unconstitutional restriction of free speech, the U.S. government sought the Supreme Court’s review, and the Court granted certiorari. It must now decide whether the prohibition in Section 2(a) of the Lanham Act on the federal registration of “immoral . . . or scandalous” marks like FUCT is invalid under the Free Speech Clause of the First Amendment.

The U.S. Supreme Court on January 4th granted certiorari to take up Iancu v. Brunetti on appeal from the Court of Appeals for the Federal Circuit. The case asks the nation’s highest court to answer the question of whether the Lanham Act’s prohibition on the federal registration of “immoral” or “scandalous” trademarks is facially invalid under the First Amendment’s free speech clause.

The Solicitor General is arguing that Erik Brunetti has no right to require the government to register a scandalous mark or to inscribe the term on the Federal Register. Brunetti’s reply pushes back, pointing to instances where the USPTO approved trademark registrations for profane, excretory or sexual terms.

Whatever the Court decides, practitioners will welcome further clarity on the issue, since the Tam ruling was a 4 to 4 split decision with no real agreement on the rationale for the holding. “IP lawyers like certainty, and this case has created a lot of uncertainty,” said Monica Riva Talley. “There are a lot of applications on hold at the trademark office right now.”

On September 7, 2018, the government filed a petition for writ of certiorari in the case relating to Eric Brunetti’s clothing brand, called FUCT. Although Brunetti has marketed various apparel under the FUCT mark since the early 1990s, the application at issue in this case was filed in 2011. The examiner rejected the application under Section 2(a), finding that FUCT “is the past tense of F*CK,” and “is scandalous because it is disparaging and [] total[ly] vulgar.” The Trademark Trial and Appeal Board agreed, finding that “the Trademark Examining Attorney has shown by a preponderance of the evidence that a substantial composite of the general public would find this designation vulgar.” If the U.S. Supreme Court agrees to hear the Brunetti case, it could have a substantial impact on “shock value” marks in commerce.