Federal Circuit Opens the Door to Scandalous Trademarks

Federal Circuit Held That Bar On Registering Scandalous Trademarks is Unconstitutional

The Court of Appeals for the Federal Circuit recently held that the federal bar on registering immoral or scandalous trademarks is unconstitutional. The decision follows the U.S. Supreme Court’s similar ruling with respect to “offensive” trademarks.

Under the Lanham Act, the U.S. Patent and Trademark Office (USPTO) may refuse to register 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.” A mark was considered scandalous or immoral if a “substantial composite of the general public” would find the mark “shocking to the sense of propriety, offensive to the conscience or moral feelings or calling out for condemnation.” 

Supreme Court’s Decision in Matal v. Tam 

In June, the U.S. Supreme Court struck down a federal ban on registering disparaging trademarks, holding that it violated the First Amendment to the U.S. Constitution. The U.S. Patent and Trademark Office (USPTO) initially denied Simon Shiao Tam’s application to register the mark “The Slants” in connection with his American-Asian dance band of the same name, concluding the mark was disparaging to people of Asian descent. Tam challenged the denial, arguing that the Lanham Act’s prohibition of disparaging marks was unconstitutional under the First Amendment. The Federal Circuit struck down the disparagement provision as unconstitutional, and the Supreme Court affirmed. “We now hold that this provision violates the Free Speech Clause of the First Amendment,” Justice Samuel Alito wrote. “It offends a bedrock First Amendment principle: Speech may not be banned on the ground that it expresses ideas that offend.” 

Trademarks at Issue in In re Brunetti 

In 2011, Brunetti filed a trademark application for the term FUCT for use on athletic apparel. The Trademark Examining Attorney refused registration of the mark under Section 2(a) of the Lanham Act, citing that it comprises immoral or scandalous matter. According to the Trademark Examining Attorney, the term “Fuct” is the phonetic equivalent of the word “Fucked,” and, therefore is “vulgar, profane and scandalous slang.”

The Trademark Trial and Appeal Board affirmed the denial, agreeing that “a substantial composite of the general public would find this designation vulgar.” It also concluded that “the Trademark Trial and Appeal Board is not the appropriate forum for re-evaluating the impacts of any evolving First Amendment jurisprudence within Article III courts upon determinations under Section 2(a) of the Lanham Act.” On appeal, the Federal Circuit asked the parties to submit briefs explaining how the constitutionality of the scandalousness provision should be resolved in light of the Supreme Court’s decision in Tam, on the related issue of disparaging trademarks.

Federal Circuit Strikes Down Scandalous Trademark Ban

While the USPTO argued that the ban on scandalous trademarks is distinct from the ban on disparaging marks because it is not based on the speaker’s viewpoint, the Federal Circuit ultimately concluded that it also violated the First Amendment. “[W]e conclude the provision impermissibly discriminates based on content in violation of the First Amendment,” the Federal Circuit’s opinion states.

In reaching its decision, the appeals court rejected the USPTO’s argument that Section 2(a) did not implicate free speech concerns because trademark registrations are a government subsidy or a limited public forum. It also concluded that ban on scandalous trademarks would not survive even under the less onerous intermediate scrutiny standard for commercial speech.

Notably, the Federal Circuit did agree that the “trademark at issue [‘FUCT’] is vulgar.” Nonetheless, it concluded that the “government has offered no substantial government interest for policing offensive speech” in the context of its trademark registration program. “There are words and images that we do not wish to be confronted with, not as art, nor in the marketplace,” the court noted. “The First Amendment, however, protects private expression, even private expression which is offensive to a substantial composite of the general public.”

Do you have any questions? Would you like to discuss the matter further? If so, please contact me, David Einhorn, at 201-806-3364.