Redskins Redux: In re: Simon Shiao Tam and the Fate of “Disparaging” Trademarks

Last year we reported on the hotly debated ruling of the U.S. Patent and Trademark Office’s (“USPTO”) Trademark Trial and Appeal Board (“TTAB”) in Blackhorse v. Pro Football, Inc., which cancelled six trademarks belonging to the Washington Redskins football team on the grounds that those marks were disparaging to Native Americans.  While the district court appeal of that decision remains pending in the summary judgment phase, a new dispute concerning another racially charged trademark has paved the way for a potentially significant ruling by the full U.S. Court of Appeals for the Federal Circuit on the key underpinning of the Blackhorse case: the constitutionality of Section 2(a) of the Lanham Act, 15 U.S.C. § 1052(a) (“Section 2(a)”).

Appellant Simon Shiao Tam, the lead singer of an all-Asian-American dance-rock band called The Slants filed an application to register the band name THE SLANTS, but was twice rejected by the USPTO under Section 2(a) on the grounds that the mark was disparaging to people of Asian descent.  That section prohibits the registration of marks that, inter alia, consist of “matter which may disparage . . . persons, living or dead, institutions, beliefs, or national symbols, or bring them into contempt, or disrepute.”  Mr. Tam appealed to the TTAB, which affirmed the refusal on the same grounds.  The TTAB pointed to evidence in the record of individuals and groups in the Asian community objecting to the band’s use of the name THE SLANTS despite Mr. Tam’s stated intent to “own” the stereotype the word represents.  Mr. Tam appealed the TTAB’s ruling to the U.S. Court of Appeals for the Federal Circuit, arguing that the TTAB’s decision was erroneous and that Section 2(a) is unconstitutional.

A panel of the Federal Circuit unanimously affirmed the ruling of the TTAB in an 11-page opinion that succinctly addressed the issue of disparagement and Mr. Tam’s four constitutional arguments.  The court held that the record supported the finding that the mark refers to people of Asian descent, and that substantial evidence – including dictionary definitions, brochures from Asian-American citizens’ groups, and news articles and blog posts – supported the TTAB’s finding that THE SLANTS “is likely offensive to a substantial composite of people of Asian Descent.”

As to constitutionality, the court largely relied on its predecessor court’s 1981 decision in In re McGinley, 660 F.2d 481 (C.C.P.A. 1981) in rejecting Mr. Tam’s arguments.  The court held that Section 2(a) does not violate the First Amendment because, according to McGinley, it does not condition the benefit of trademark registration on “relinquishment of speech” since “the PTO’s refusal to register [a] mark does not affect [the registrant’s] right to use it.”  The court rejected Mr. Tam’s vagueness, due process, and equal protection arguments in under three pages of analysis.

The court’s relatively short and straightforward opinion was not the unusual aspect of this decision.  Rather, the distinguishing feature of In re Tam was a lengthy “additional views” opinion – a creature of the Federal Circuit akin to a concurrence – filed by Judge Moore, who also was the author of the main opinion.  Judge Moore’s supplemental opinion spans 24 pages of deep constitutional analysis and begins with the unexpected thesis that “[i]t is time for this Court to revisit McGinley’s holding on the constitutionality of § 2(a) of the Lanham Act.”  Judge Moore expressed concern that McGinley’s ruling that Section 2(a) does not violate the First Amendment was “without citation to any legal authority” and has been “widely criticized” by courts and commentators.

Starting with the premise that trademarks are protected by the First Amendment at least as commercial speech, Judge Moore explained that Section 2(a) abridges speech by withholding the benefits of federal registration from disparaging marks.  Judge Moore noted that, without federal registration, a trademark user loses “important legal rights” such as exclusive nationwide use of a mark, the presumption of validity, the opportunity for incontestability, recourse in federal (and most state) courts, treble damages, and the assistance of U.S. Customs and Border Protection.  She concluded that Section 2(a) conditions these benefits ”on the applicant’s selection of a suitable mark,” having nothing to do with the mark’s source-identifying function, and allows the USPTO make “a moral judgment based solely and indisputably on the mark’s expressive content,” thus “severely burden[ing] use of such marks.”

Judge Moore continued by discussing, at length, the “unconstitutional conditions” doctrine, which states that “the government cannot deny access to a benefit because of the recipient’s exercise of constitutionally protected speech.”  Judge Moore concluded that the “unconstitutional conditions” doctrine would apply to trademark registrations and would subject the USPTO’s actions to constitutional scrutiny.  Since “Section 2(a) discriminates against disparaging or offensive viewpoints,” it is content-based and viewpoint-discriminatory, and, in Judge Moore’s opinion, would not survive even intermediate scrutiny because there is no substantial government interest in barring disparaging marks (aside from subjective disapproval).  She reiterated that “[t]he Supreme Court has ‘consistently held that the fact that protected speech may be offensive to some does not justify its suppression.’”

It is not immediately obvious why Judge Moore chose the strategy of drafting this extensive “additional views” opinion, but recent procedural developments may shed some light on her decision.  On April 27, 2015, the Federal Circuit decided, sua sponte, to vacate the panel’s April 20 opinion and re-hear Mr. Tam’s case en banc, focusing on whether “the bar on registration of disparaging marks in [Section 2(a)] violate[s] the First Amendment”.  Perhaps Judge Moore believed she could induce an en banc rehearing by authoring an opinion showing that the panel had no choice but to rule in accordance with Federal Circuit precedent, but to bolster that opinion with “additional views” that painstakingly explain why the court’s 34-year-old precedent is and the language of the 1946 Lanham Act, in her view, problematic.  Whatever her strategy, it was effective, and Mr. Tam’s opening brief is due June 11, 2015, with oral argument yet to be scheduled.  Soon the precedential value of McGinley and the constitutional validity of Section 2(a) will be before the Federal Circuit’s 11 judges, and the status of the disparaging trademark could well change.  We will continue to report on any significant developments.