Matal v. Tam — What it Means for US Trademark Law

Yesterday the Supreme Court of the United States released something rare in the intellectual property law world — an opinion striking down an entire clause of the Lanham Act, the primary governing federal trademark law of the United States of America.

In Matal v. Tam the Court reached an unanimous 8–0 decision (newly appointed Justice Gorsuch did not take part) to find in favor of the the Asian-American rock band “The Slants” and named plaintiff, lead singer Simon Tam.

The Supreme Court. (Jonathan Newton/The Washington Post)

History of Dispute

The Slants, via Tam, had originally filed for a federal trademark in class 041 for “Entertainment in the nature of live performances by a musical band” services with the United States Patent and Trademark Office (USPTO) in 2010. Their application was denied when the examiner of record found the name in violation of the Disparagement Clause of the Lanham Act, which had been interpreted to prevent the federal registration of marks that disparage the members of a racial or ethnic group.

Tam re-filed the application in 2011 after the initial refusal, and appealed through the USPTO Trademark Trial and Appeal Board system. The new application was subsequently refused registration again, as the mark was concluded to be a disparaging term for Asian-Americans, with the reasoning that the term referenced “slant eyes” which could still be disparaging against members of the racial group even if the mark was owned and used by members of that same group.

The group then took the case to the Federal Circuit in DC in 2015 where they maintained their argument the term was not intended to be disparaging, as they were looking to take back an otherwise unflattering racial moniker as a took of empowerment. More crucial was their argument that the Disparagement Clause itself was flatly unconstitutional as a restriction on free speech protected by the First Amendment. The USPTO, under then Director Michelle Lee, appealed to the Supreme Court, who granted Centiorari to hear the case during the October 2016 term as a case of first impression on that issue.

The Opinion

The Lanham Act, (15 U.S.C. §§ 1051 et seq) was passed in 1946 and has rarely come under constitutional scrutiny over its long life. §1052(A) of the Lanham Act, “Trademarks registrable on principal register; concurrent registration” states that marks can be refused registration if:

(a) Consists 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; or a geographical indication which, when used on or in connection with wines or spirits, identifies a place other than the origin of the goods and is first used on or in connection with wines or spirits by the applicant on or after one year after the date on which the WTO Agreement (as defined in section 3501(9) of title 19) enters into force with respect to the United States.

Justice Alito outlined the history of the case in the unanimous Part I through III-A portions of the opinion and agreed that Tam’s mark, under the historical reading of the Disparagement Clause was in violation of said clause. However, he agreed with the District Courts holding that the Disparagement Clause itself was in violating of the First Amendment’s protections of freedom of speech, finding the governments arguments that federal trademarks granted registration by the USPTO were government, not private, speech unpersuasive. The main concern was that if a private property interest such as a trademark could be passed off as government speech simply by having been granted federal approval than it opened the door of the government silencing or muffling unfavorable viewpoints.

There was a 4–4 split divergence however in some parts of the decision. In Parts III-B, III-C, and IV of the opinion Justice Alito was joined by Chief Justice Roberts, Justice Thomas, and Justice Breyer to find against additional USPTO arguments such as the government subsided-speech clause (where government speech may be interpreted when cash is paid by government to commission art), that the Disparagement Clause was valid as under the “government program doctrine” as government speech under a government framework to create a limited federal forum allowing for more restricted areas of speech, and not deciding the case on any commercial speech grounds as the USPTO case had already failed the initial federal restriction of speech scrutiny test under Central Hudson by not serving a substantial interest nor being narrowly drawn.

Justice Kennedy, joined by Justices Ginsburg, Sotomayor, and Kagan, wrote a concurring in part opinion, agreeing with Part I through III-A that the First Amendment does not allow the federal government to punish or suppress speech based on disapproval or ideas inherent in the speech itself and that trademarks are private, not government, speech. They looked at the test through the viewpoint discrimination test which invokes heightened scrutiny of the governments restrictions on speech and based that the primary reasoning behind their decision while remaining silent on other arguments by the USPTO as they were unnecessary to come to the ultimate conclusion of the court and that the case does not present questions on how other provisions of the Lanham Act should be analyzed by the First Amendment.

Justice Thomas offered one final concurring opinion stating his continual belief that regardless of this particular case itself that government regulations on commercial speech, which was danced around by the other Justices, should be subject to strict scrutiny.

What it Means Moving Forward

Simon Tam and The Slants will likely get their trademark, as well as other applicants for trademarks that have been rejected or disputed on the basis of the Disparagement Clause, including, mostly famously, the Washington Redskin football team.

The bigger question is the sort of hole this punches in the federal framework of the USPTO and may bring other sections of the Lanham Act, as well as other forms of IP law and protection in the United States, under future review as well. This will likely lead to a glut of trademarks testing the boundaries of other elements of §1052 as well that can currently not obtain federal protection. The Court’s disagreement and failure to agree on the commercial clause application to the case opens up future avenues to review the boundaries of what sort of speech commercial goods and services under a brand name may be tested in this regards in the future have in the future.

On a personal level, defenders of the clause may find it troubling that there is no longer a check for granting federal protection for inherently insulting racial or xenophobic trademarks to obtain protection from the federal government moving forward. Under the decision of the court, the place to determine that may be the marketplace itself.

Proponents of open and complete freedom of speech and against blanket government regulations of it will be pleased however, as the case was a clear victory for First Amendment protections against unpopular types of speech.

Adobecity World LLC © Copyright Carlos F. Romero