Burrowed away in § 2 (15 U.S.C. § 1052) of The 1946 Lanham Act is the following provision: “No trademark by which the goods of the applicant may be distinguished from the goods of others shall be refused registration on the principal register on account of its nature unless it— (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.”
Immoral. Deceptive. Scandalous. Disparage. How on earth does § 2(a) of The Lanham Act, a July 1946 Act of Congress, get reconciled with the First Amendment to the United States Constitution which states: “Congress shall make no law respecting an establishment of religion, or prohibiting the free exercise thereof; or abridging the freedom of speech, or of the press; or the right of the people peaceably to assemble, and to petition the government for a redress of grievances.”
Since the McGinley case of 1981, Americans courts have reconciled the tension between the Lanham Act’s content-based judgments against the First Amendment by noting that Congress had the authority to refuse special protections for speech based on undesirable viewpoints, and the First Amendment itself would not be implicated unless the commercial organization was prohibited from its use of the material it sought to trademark.
The McGinley Court stated in 1981: “With respect to appellant’s First Amendment rights, it is clear that the PTO’s refusal to register appellant’s mark does not affect his right to use it. No conduct is proscribed, and no tangible form of expression is suppressed. Consequently, appellant’s First Amendment rights would not be abridged by the refusal to register his mark.”
Simon Shiao Tam reopened this issue in December when he challenged the constitutionality of whether the Patent and Trademark Office complied with the First Amendment when it declined to grant a trademark for his band name “The Slants” because it was a disparaging term for people of Asian descent.
The Patent and Trademark Office concluded that the term was disparaging and then denied a trademark due to § 2(a) of The Lanham Act. Tam took this to a panel for review, and the panel concluded that the McGinley ruling foreclosed the possibility of evaluating the constitutionality of the Lanham Act itself–they would only review whether the sought trademark “The Slants” was in fact “disparaging” but did not have the authority to review whether the “disparaging” prohibition was consistent with the First Amendment.
However, the Court of Appeals for the Federal Circuit was willing to overturn the precedent set by McGinley in 1981, and ruled on December 22, 2015 that: “It is a bedrock principle underlying the First Amendment that the government may not penalize private speech merely because it disapproves of the message it conveys. That principle governs even when the government’s message-discriminatory penalty is less than a prohibition…The government cannot refuse to register disparaging marks because it disapproves of the expressive messages conveyed by the marks. It cannot refuse to register marks because it concludes that such marks will be disparaging to others. The government regulation at issue amounts to viewpoint discrimination, and under the strict scrutiny review appropriate for government regulation of message or viewpoint, we conclude that the disparagement proscription of § 2(a) is unconstitutional.”
The Tam Court acknowledged that the McGinley ruling: (1) had been widely criticized by First Amendment scholars; (2) was cursory and less than two paragraphs; (3) cited to no appropriate binding authority; (4) had been decided at a time before commercial speech doctrine evolved to increasingly apply the First Amendment to the expressive content of commercial speech.
What makes things interesting is that the Redskins trademark claim is being held in the Fourth Circuit so that this new ruling from the Federal Circuit is not binding. The Fourth Circuit is perfectly free to stick with the current precedent that “disparaging” remarks only deserve intermediate scrutiny, and it is permitted for the government to regulate disparaging terms so long as it is viewpoint neutral in not permitting disparaging terms to be trademarked.
But if I had to bet on it, I would guess that the Redskins will be able to keep the trademark when it’s all said and done. Either the Fourth Circuit will find the Federal Circuit’s reasoning persuasive and adopt it as its own, or the Redskins will have a strong argument on appeal to the Supreme Court by way of analogy to the Federal Circuit’s holding. Justice Kennedy tends to appreciate free speech in the commercial context, and he has even remarked in oral arguments that some citizens might value their free speech even more in the economic context than the political sphere because it directly affects their economic destiny. If the Redskins had a 55% chance of keeping their trademark before the Tam ruling, I’d move the odds up to 70% now. The Federal Circuit made such a strong case for disregarding the prior McGinley ruling that other courts will find the reasoning contagiously persuasive.
Notice: This article, which I believe may be of interest to readers, is for general information and entertainment purposes only. It only reflects my best understanding of the topic at hand and should not be relied upon as legal or investment advice.
Sources Consulted: https://www.law.cornell.edu/uscode/text/15/1052