In a victory for the Asian-American rock band The Slants, the Supreme Court ruled on June 19 that the ban on the registration of disparaging trademarks under Section 2(a) of the Lanham Act violates the First Amendment.
The ruling follows a lengthy battle by The Slants as to whether it could obtain a federal trademark registration for its name, which the U.S. Patent and Trademark Office (“USPTO”) found “disparaging” under U.S.C. §1052(a) (“Section 2(a)”). As we discussed previously in a post about The Slants’ Federal Circuit case, Section 2(a) permits refusal of registration of a trademark that “[c]onsists of or comprises immoral, deceptive, or scandalous matter; or matter which may disparage or falsely suggest a connection with persons, living or dead, institutions, beliefs, or national symbols, or bring them into contempt, or disrepute.” In determining whether a mark is disparaging under this section, the USPTO considers the meaning of the mark in common parlance and whether that meaning may be disparaging to a substantial composite of the group referenced by the mark.
The rock band’s lead singer, Simon Tam, filed a trademark application in 2011 for the mark THE SLANTS, to be used in connection with “entertainment, namely, live performances by a musical band,” in an effort to reclaim the phrase that had been widely used as an ethnic slur against those of Asian descent. Citing Section 2(a), the USPTO refused registration of the mark on the basis of its derogatory nature and historically “offensive” connotation. Tam later brought the case before the Federal Circuit, where an en banc panel found the disparagement clause facially unconstitutional under the First Amendment’s Free Speech Clause.
After its petition for certiorari was granted, the government argued to the Supreme Court that (1) trademarks are a form of government speech not regulated by the Free Speech Clause, (2) trademarks are a form of government subsidy and (3) the constitutionality of Section 2(a) should be tested under a new “government-program” doctrine.
In an opinion written by Justice Alito, the Court held that trademarks are private speech, noting that “[t]rademarks have not traditionally been used to convey a Government message” and “there is no evidence that the public associates the contents of trademarks with the Federal Government.” Matal v. Tam, 582 U.S. ___ (2017). Particularly troubling to the Court were the implications for other federal registrations, such as copyrights, and the potential censorship of expressive content if the government’s argument were to be accepted. Furthermore, the Court held, trademarks are not a form of government subsidy – in fact, the opposite is true in that trademark owners pay filing and maintenance fees. And even though the benefits of trademark registration are somewhat traceable to the resources expended by the government during the registration process, this process is not akin to traditional government subsidy schemes involving cash subsidies or their equivalent. Finally, the Court rejected the government’s argument that a new government-program doctrine is applicable in cases involving trademarks, holding that viewpoint discrimination is forbidden even in cases in which a government unit creates a limited public forum for private speech. In the case of Section 2(a), “[g]iving offense is a viewpoint.”
Before turning to Section 2(a)’s constitutionality under the First Amendment, the Court addressed Tam’s argument that the clause does not apply to racial or ethnic groups at all, as it references only “persons.” Normally the Court would not address this issue, as Tam had not raised it before the USPTO or the Federal Circuit, but in this instance, the Court considered the matter because the issue could be dispositive. Ultimately the Court rejected Tam’s argument, finding that his reading of the statute was contradicted by its plain meaning – “institutions” and “beliefs” are clearly made up of multiple individuals.
Turning to constitutional issues, the Court never reached a resolution of the parties’ debate as to whether trademarks are commercial speech, instead finding that Section 2(a) cannot even withstand the relaxed scrutiny of the Central Hudson test, which allows the restriction of speech when it serves “a substantial interest” and is “narrowly drawn.” Acknowledging the government’s attempts to encourage racial tolerance, the Court found that ultimately the government had engaged in preventing speech that expresses offensive ideas, which “strikes at the heart of the First Amendment.” Nor did the Court accept the government’s interest in “protecting the orderly flow of commerce” by excluding discriminatory marks – instead, the Court found that the clause is not narrowly drawn to prevent only discrimination but reaches even those marks that attempt to use racial slurs in a positive or constructive way. In the words of Justice Alito, “it is not an anti-discrimination clause; it is a happy-talk clause.”
Justices Kennedy, Ginsburg, Sotomayor and Kagan concurred in part and in the judgment, adding that “whether a mark is disparaging bears no plausible relation to” the goal of trademark registration, which is to facilitate source identification. Justice Thomas also concurred in part and in the judgment, concluding that (1) the Court should not have addressed Tam’s statutory arguments about the entities to which Section 2(a) applies and (2) strict scrutiny would have been appropriate in this case.
This case has opened the door for not only minority groups who wish to reclaim racial slurs but also for trademark applicants who wish to express genuine discrimination. Whether a flood of disparaging marks now comes the way of the USPTO remains to be seen, as does whether this influx will negatively impact commerce to the extent the government argued it will.
The Supreme Court’s ruling will likely bring challenges to the USPTO’s similar provisions applicable to utility and design patent applications if the USPTO attempts to rely on those provisions. Those provisions, like Section 2(a) of the Lanham Act, permit rejection of applications that an examiner deems offensive to any race, religion, sex, ethnic group or nationality. Specifically, MPEP § 608 provides, inter alia:
If during the course of examination of a patent application, an examiner notes the use of language that could be deemed offensive to any race, religion, sex, ethnic group, or nationality, he or she should object to the use of the language as failing to comply with 37 CFR 1.3 which proscribes the presentation of papers which are lacking in decorum and courtesy. The inclusion of such proscribed language in a federal government publication would not be in the public interest. Also, the inclusion in application drawings of any depictions or caricatures that might reasonably be considered offensive to any group should be similarly objected to.
Similarly, MPEP § 1504.01(e), which concerns design patents, provides that applications that could be considered offensive to any of the groups above, “such as those which include caricatures or depictions,” should be rejected as nonstatutory subject matter under 35 U.S.C. 171.
It seems unlikely that those provisions would survive a constitutional challenge in view of the Supreme Court’s striking down of Section 2(a) of the Lanham Act. It seems equally unlikely, however, that the USPTO will ever attempt to rely on its seldom-used companion patent provisions.
 MPEP § 1504.01(e) advises that examiners make this rejection using Form Paragraph 15.09.01, which reads:
The disclosure, and therefore the claim in this application, is rejected as being offensive and therefore improper subject matter for design patent protection under 35 U.S.C. 171. Such subject matter does not meet the statutory requirements of 35 U.S.C. 171. Moreover, since 37 CFR 1.3 proscribes the presentation of papers which are lacking in decorum and courtesy, and this includes depictions of caricatures in the disclosure, drawings, and/or a claim which might reasonably be considered offensive, such subject matter as presented herein is deemed to be clearly contrary to 37 CFR 1.3. See MPEP § 608.