Disparaging, Immoral, and Scandalous? Oh my! Will SCOTUS Decide that Anything Goes?

When Cole Porter wrote that “Good authors, too, who once knew better words now only use four-letter words writing prose…Anything goes!” he could have been describing the current state of affairs at the U.S. Patent and Trademark Office. Since 1946, The Lanham Act has given USPTO authority to reject trademark applications that might be deemed offensive. But, after chipping away at Lanham in 2017, SCOTUS might be poised to take a sledgehammer to the Act and to deprive USPTO of the power to make judgments based on taste or morals.

At issues is Section 2(a) of the Lanham Act, which prohibits registration of a mark that:

Consists of or comprises immoral, deceptive, or scandalous matter; or matter which may disparage … persons, living or dead, institutions, beliefs, or national symbols, or bring them into contempt, or disrepute….”

The Supreme Court of the United States examined the constitutionality of barring so-called “disparaging” trademarks in 2017, in Matal v. Tam, 582 U.S. ___ (2017). In that case, Simon Tam, the leader of a rock band comprised of ethnic Filipinos, called The Slants, sought to register the band’s name. The application was rejected Because USPTO recognized the term as an ethnic slur against Eastern Asians. Mr. Tam has stated that his intent was to “reclaim” the term and “take ownership” of Asian-American stereotypes.

SCOTUS ruled unanimously in Mr. Tam’s favor, holding that “The disparagement clause violates the First Amendment’s Free Speech Clause. Contrary to the Government’s contention, trademarks are private, not government speech.” That clause was struck from Lanham 2(a), but the other prohibitions survived. Until now.

Two years later, SCOTUS will decide whether USPTO has the power to bar registration of marks that are “immoral” or “scandalous.” According to a case analysis from IPWatchdog, “Streetwear entrepreneur Erik Brunetti had long sought to register the name of his apparel brand…. His concern was that, without a federal registration, it would be difficult to police the extensive counterfeiting of the brand on e-commerce sites.” Unfortunately for his application, Mr. Brunetti had chosen the named FUCT. USPTO rejected the registration as “immoral and scandalous” in violation of Lanham 2(a). Mr. Brunetti appealed the rejection to the U.S. Court of Appeals for the Federal Circuit, which, following the reasoning from Tam, voided the immoral and scandalous prohibitions. USPTO filed a writ of certiorari, and SCOTUS agreed to hear the case.

At recent oral arguments, several concerns were expressed:

  • Lanham 2(a) is vague and overly broad, and USPTO has a long history of inconsistent application of the prohibitions, granting some registrations while denying similar ones.
  • Is USPTO in a position to judge what the public would find shocking and offensive?
  • Is the government’s interest in protecting “unwilling viewers” a strong enough justification for limiting free expression?
  • Is Mr. Brunetti’s FUCT the expression of an idea in the same sense of Mr. Tam’s use of his band’s name, or is it simply a word chosen to shock?
  • Can there be any restrictions at all on vulgar terms in trademark?
  • Should SCOTUS be concerned about the coarsening of society if vulgar terms become ubiquitous in advertising?

Given the totality of these concerns, analysts believe SCOTUS will rule against the immoral and scandalous prohibitions, but leave room for Congress to craft legislation that does not offend the First Amendment.

So, where does that leave future trademark applicants? Certainly, you will have greater latitude to protect a mark that previously would have been rejected. This is good news, for example, for entrepreneurs in the burgeoning cannabis product market, whose proposed marks could have been ruled scandalous or immoral by a random USPTO bureaucrat who disapproves of the direction public sentiment is trending. However, it would not be prudent to invest heavily in a shocking mark that pushes the envelop for vulgarity, because we still need to see the Court’s opinion and anticipate how Congress might respond.

For knowledgeable assistance in developing your trademark and other elements of your company’s branding, talk to an experienced IP attorney today.

UPDATE: SCOTUS sides with Brunetti on FUCT trademark

On June 24, 2019, the U.S. Supreme Court ruled six-to-three in Brunetti’s favor, holding that the federal government’s ban on registering “immoral” and “scandalous” trademarks violates the First Amendment. The syllabus prefacing Justice Elena Kagan’s majority opinion summed up essential conflict as follows:

the Lanham Act allows registration of marks when their messages accord with, but not when their messages defy, society’s sense of decency or propriety. The statute, on its face, distinguishes between two opposed sets of ideas: those aligned with conventional moral standards and those hostile to them; those inducing societal nods of approval and those provoking offense and condemnation. This facial viewpoint bias in the law results in viewpoint discriminatory application. The PTO has refused to register marks communicating ‘immoral’ or ‘scandalous’ views about (among other things) drug use, religion, and terrorism. But all the while, it has approved registration of marks expressing more accepted views on the same topics.”

The government had argued in favor of the Lanham Act, claiming “the statute is susceptible of a limiting construction that would remove its viewpoint bias.” The majority was not persuaded, since a restrictive reading of the statute (refusing to register marks that are lewd, sexually explicit, or profane) would not be a fair reading of the law.  “To cut the statute off where the Government urges is not to interpret the statute Congress enacted, but to fashion a new one.” In the majority’s opinion, a fair reading of the law required the Court to declare it unconstitutional.

Justice Sotomayor dissented, fearing the decision would “beget unfortunate results.” With this ruling,  “the Government will have no statutory basis to refuse (and thus no choice but to begin) registering marks containing the most vulgar, profane, or obscene words and images imaginable.” Justice Sotomayor felt this result was “eminently avoidable” if the Court had only been willing to read the Lanham Act’s prohibition “of ‘scandalous’ marks to address only obscenity, vulgarity, and profanity.”

But Justice Alito, who concurred in the opinion, voiced his own fears that “a law banning speech deemed by government officials to be ‘immoral’ or ‘scandalous’ can easily be exploited for illegitimate ends.” He felt the ruling “does not prevent Congress from adopting a more carefully focused statute that precludes the registration of marks containing vulgar terms that play no real part in the expression of ideas.”

Justice Alito criticized Mr. Brunetti’s trademark, writing that “The term suggested by that mark is not needed to express any idea and, in fact, as commonly used today, generally signifies nothing except emotion and a severely limited vocabulary.” He seems to agree with Justice Sotomayor when he writes “The registration of such marks serves only to further coarsen our popular culture.” However, Justice Alito appeared to be bound by his interpretation of the separation of powers and the principle of judicial restraint, expressing that “we are not legislators and cannot substitute a new statute for the one now in force.”

Justice Roberts, who also voted with the majority, likewise opened the door to congressional action to address Justice Sotomayor’s concerns. He wrote separately that “The Government …has an interest in not associating itself with trademarks whose content is obscene, vulgar, or profane. The First Amendment … does not require the Government to give aid and comfort to those using obscene, vulgar, and profane modes of expression.”

So, for now, the door is open to registering “obscene, vulgar, and profane” trademarks. But would it be prudent to do so? The Court has signaled it would not object to a new law prohibiting such marks. If a company invested heavily in developing its branding around such a mark, it could lose all federal protection if Congress were to amend the Lanham Act along the lines the Justices have proposed.