Posts Tagged: "Central Hudson"

The U.S. Supreme Court and the Court of Appeals for the Federal Circuit recently struck down certain trademark registration requirements on First Amendment grounds. These cases raise questions about whether similar alcohol labeling requirements likewise violate the First Amendment. In the U.S., alcohol is a regulated product at both the state and federal level. Federally, the Alcohol Administration Act (FAA Act) sets forth the labeling requirements for distilled spirits, wine and malt beverages. Alcohol producers must get alcohol labels approved by the U.S. Department of the Treasury, Alcohol and Tobacco Tax and Trade Bureau (TTB). These approvals come in the form of a Certificate of Label Approval/Exemption or “COLA.” The labeling requirements of the FAA Act are detailed in 27 U.S.C. §205(e) and prohibit labels that “are disparaging of a competitor’s products or are false, misleading, obscene, or indecent…” See 27 U.S.C. §205(e)(4). The associated rules are promulgated in 27 C.F.R. Parts 4, 5, and 7. These rules similarly prohibit statements on labels that are “disparaging of a competitor’s products,” or which are “obscene or indecent.” 27 C.F.R. §4.39, §5.42, and §7.29.

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.

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.