US trademarks: Walking the line on free speech

Taken at face value, the terms ‘redskins’ and ‘slants’ are likely to cause offence.

One is a slang word to describe Native Americans, using skin colour as a defining characteristic. The other, making reference to the perceived shape of their eyes, is slang for people of Asian heritage.

But away from the obvious ability of those terms to cause hurt or offence two US courts are debating whether they should be granted trademark protection and enjoy the benefits it would bring.

As well as sparking debate about whether companies or individuals should be able to profit from offensive terms the cases have raised the issue of the First Amendment, the US’s statute that protects free speech. They concern whether the US Patent and Trademark Office (USPTO) should take into account morals and potential offence when assessing trademark applications.

In case you need reminding, let’s take a look at the parties involved.

Many in the US and elsewhere will be aware of the Washington Redskins and the struggles that the National Football League (NFL) club has faced as it looks to stop six of its trademarks from being cancelled.

In June 2014, the USPTO’s Trademark Trial and Appeal Board (TTAB) cancelled the six trademarks, all containing the term ‘Redskins’, for being too offensive. A group of Native Americans had sought to cancel the marks.

In a lawsuit filed in September, the club said it was suing those that brought the case in an attempt to directly overturn the TTAB’s decision. Despite the US District Court for the Eastern District of Virginia upholding the TTAB’s decision on July 9, the club has indicated it will appeal against the ruling.

The second dispute, perhaps not as well-known but fast becoming as closely monitored, centres on a trademark application filed by Simon Tam, the founder of rock band The Slants, for the group’s name. The USPTO rejected the application in 2010 and 2011.

In a 3–0 decision on April 17 this year, the US Court of Appeals for the Federal Circuit upheld the USPTO’s latest decision.

Although Tam said he would ask for a review en banc—before the court’s full set of 11 judges—it announced it would be re-hearing the case that way regardless.

Registration dilemmas

While different from one another, the two cases could both have a significant impact on what can be registered as a trademark in the US.

Richard Lehv, partner at law firm Fross Zelnick Lehrman & Zissu, tells WIPR that part of the current problem is that the Lanham Act, the US’s primary trademark statute, is too imprecise.

“The statute says you cannot register a mark that consists of ‘immoral deceptive or scandalous matter’, but what does that actually mean? There’s a really fine line here,” he says.

Lehv says that referencing the First Amendment as a reason for being granted a potentially disparaging trademark is a “compelling argument”.

“On the one hand, why should the government decide what constitutes disparaging, but on other, clearly there are some words that are so offensive you wouldn’t want the government to confirm their registration and be seen to be approving them,” he adds.

The argument about whether a trademark is disparaging is subjective, however.

Both Tam and the Redskins claim that their use of the terms is not meant to be taken in a demeaning or insulting way.

The Redskins claims its use of the word is, and always has been, a source of pride, while Tam argued that his band has reclaimed a racial slur.

Referencing the Slants case, Jeffrey Mitchell, partner at law firm Dickstein Shapiro in New York, says it is likely to go all the way the US Supreme Court.

In the April 27 ruling, Judge Kimberley Moore at the federal circuit wrote a strongly worded view on the subject of what can be registered as a trademark.

Moore did not dissent but instead suggested that the rules about registration should be revisited.

Noting that the additional views were in fact longer than the actual judgment, Mitchell says they have raised interesting questions.

“The federal circuit was in effect saying ‘we have to rule against this person and their mark because that’s what the law says, but we should really look at this again’,” he adds.

Mitchell explains that trademark registrations were previously financed by the government but that changed in 1991.

“Because trademark registration was funded by the government originally they could place restrictions on registration but that changed and trademark registration is now completely funded by applicants—in other words, taxpayers.

“Trademark rights arise from use, not registration; registration is purely optional, so the argument that anyone who loses a trademark cannot use and enforce that term is wrong.”

“In Moore’s view because the rule and manner of trademark registration changed, it’s now a public matter and the First Amendment argument should apply.”

Mitchell adds that there are also some words that are disparaging to some but not to others.

“Even if something is considered disparaging maybe someone wants to take ownership of that term and create a different point of view,” he says.

“Tam is an Asian American trying to use the word not just for a trademark but also to make a political statement. The Redskins argues that its marks are a source of pride.

“Does the fact that some people find it offensive outweigh the right to use that mark? Where do you draw the line? If no government spending is at issue why shouldn’t there be a free speech analysis? I think it’s a really compelling argument.”

“The statute says you cannot register a mark that consists of ‘immoral deceptive or scandalous matter’, but what does that actually mean? There’s a really fine line here.”

The Slants case is due to be heard in October, while the Redskins case looks set for another round.

Despite their differences, the two cases have recently been drawn closer together.

Last month, the Redskins filed an amicus brief with the federal circuit in support of The Slants. In its brief, the NFL club referenced a previous case that also centred on First Amendment rights (McGinley v US Court of Customs and Patent Appeals), from 1981.

In the McGinley case the federal circuit ruled that banning offensive trademarks does not violate First Amendment rights because the individual or business that lost the mark is still able to use the name.

But the Washington Redskins’s brief disputed the claim.

The club said that trademark cancellations or rejections “create a burden on speech, and burdens on speech are subject to First Amendment scrutiny just like bans”.

Mitchell says the McGinley ruling could still have an impact on both the Slants and Redskins cases.

“In McGinley the court found there was no First Amendment problem because you weren’t denied the right to use a term—you were simply denied a federal registration.

“The court said that the fact that you can still use a term without a federal registration means a First Amendment claim would not stand.

“But Moore said that by denying registration on grounds of disparagement you are denying the owner of the mark the ability to access federal courts and all the other things that come with a federal trademark registration, so you are losing something dramatic.”

But despite the negative side to failing to secure or being denied trademark registration, Lehv says there has been a “lot of misinformation” about what happens when a trademark is cancelled or rejected.

“Trademark rights arise from use, not registration; registration is purely optional, so the argument that anyone who loses a trademark cannot use and enforce that term is wrong,” he says.

Benefits that are lost, Lehv says, include the presumption of validity, ownership and exclusivity, nationwide rights, and the right to record the trademark with the US Customs and Border Protection to keep out infringing imports.

Whatever the outcome of the cases, they could have a significant impact on what can be registered as a trademark in the US.

On the one hand a ban on trademarks deemed to be disparaging could severely hamper what people can apply for—the USPTO could potentially reject any mark that anyone takes offence to.

However, if trademarks of this nature are allowed to proceed then it could pave the way for far more offensive terms being registered as trademarks under the justification of allowing free speech.

As Mitchell puts it, a decision will need to be somewhere in the middle.

“The court needs to find a place where they can draw an objective line. If you can find that line it probably avoids the worst case scenarios,” he says.