Bar fight

July 02, 2018
Patterson Thuente IP

Just last year, in Matal v. Tam, the U.S. Supreme Court opened the door to the registration of trademarks that could be considered offensive when it ruled that the disparagement clause in the federal trademark law was unconstitutional. Now the U.S. Federal Circuit Court of Appeals has taken a similar stance, striking down the bar against the registration of trademarks that are “immoral or scandalous.”

 

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Trademark registration smacked down

Eric Brunetti owns the clothing brand “FUCT.” His application to register the term as a trademark was rejected as immoral or scandalous by the U.S. Patent and Trademark Office (USPTO). The examiner for the USPTO reasoned that FUCT is the past tense of a vulgar word and therefore scandalous. The Trademark Trial and Appeal Board (TTAB) affirmed that decision.

Brunetti appealed. He argued that the mark wasn’t vulgar and also challenged the constitutionality of the Trademark Act’s bar on immoral or scandalous marks. The Court of Appeals found that the mark was indeed vulgar and scandalous, but nonetheless reversed the TTAB’s holding, ruling that the bar unconstitutionally restricts free speech.

Bar defeated

The Federal Circuit specifically found that the bar violated the First Amendment by discriminating based on content. Content-based restrictions by the government on speech are presumptively invalid, and the government conceded that the bar is content-based.

The USPTO argued, however, that the bar was permissible because trademark registration is a government subsidy program and implicates the government’s spending power. The bar, the government claimed, was a reasonable exercise of its spending power.

Following the position of the Supreme Court in the Matal v. Tam case, the Federal Circuit dismissed the notion that a trademark registration is a governmental subsidy. A trademark applicant doesn’t receive federal funds on the grant of a trademark; rather, applicants pay registration fees that fund the USPTO. Therefore, Congress’s spending authority wasn’t implicated by the operating expenses required to examine a proposed mark or by the USPTO’s ultimate grant of registration.

The court also shot down the government’s assertion that trademark registration is a limited public forum in which the government may impose content-based restrictions on speech so long as the distinction is reasonable in light of the forum’s purpose. Because trademarks are, by definition, used in commerce, the registration program “bears no resemblance” to limited public forums, the court added. The speech that flows from registration isn’t tethered to a public school, federal workplace or any other government property. And the fact that registered trademarks are listed on the Principal Register doesn’t create a limited public forum.

Winning offense

The Federal Circuit further rejected the government’s attempt to classify trademarks as commercial speech, which can be subject to content-based restrictions tailored to substantial governmental interests. Even under that looser standard, the court found, the bar failed because the government hadn’t put forth any valid substantial interests. •

In re Brunetti, No. 15-1109, Dec. 13, 2017, Fed. Cir.

Matal v. Tam, No. 15-1293, June 19, 2017 (U.S.)

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