In Re Tam

Simon Tam v. United States Patent and Trademark Office
Court	United States Court of Appeals for the Federal Circuit
Full case name	IN RE TAM
Argued	October 2, 2015
Decided	December 22, 2015
Citation(s)	808 F.3d 1321
Case history
Prior action(s)	108 U.S.P.Q.2d 1305 (finding THE SLANTS trademark invalid as disparaging under § 2(a) of the Lanham Act)
Holding
The disparaging provision of the Lanham Act is unconstitutional as it violates citizen's first amendment rights. Vacated and Remanded.
Court membership
Judge(s) sitting	MOORE, PROST, NEWMAN, O'MALLEY, WALLACH, TARANTO, CHEN, HUGHES, STOLL, DYK, LOURIE, REYNA
Case opinions
Majority	MOORE, joined by PROST, NEWMAN, O'MALLEY, WALLACH, TARANTO, CHEN, HUGHES, and STOLL
Concurrence	O'MALLEY, joined by WALLACH
Concurrence	DYK, joined by LOURIE and REYNA
Dissent	LOURIE
Dissent	REYNA
Laws applied
15 U.S.C. § 1052

In Re Tam 808 F.3d 1321 (Fed. Cir. 2015), was a case before the United States Court of Appeals for the Federal Circuit in Washington D.C.^[1] This case was heard on appeal after Simon Tam applied for a trademark on the mark "The Slants" for his band from the U.S. Patent and Trademark Office (PTO) and was denied.^[1] The opinion was heard en banc by the Federal Circuit and the majority, which was written by Circuit Judge Moore, determined that the Disparaging Provision (§ 2(a)) of the Lanham Act is unconstitutional and found that Simon Tam deserved trademark protection.^[1][2] Tam is represented by Ron Coleman of Archer & Greiner.

The United States government petitioned the United States Supreme Court for writ of certiorari, which was granted in September 2016. In addition to this case, there is another case before the Fourth Circuit, Pro-Football, Inc v. Blackhorse 112 F. Supp. 3d 439 (E.D. Va. 2015) to decide the same issue of whether or not the disparaging provision of the Lanham Act is unconstitutional.^[3][4]

Background

Section 2(a)'s ban on the federal registration of "immoral" or "scandalous" marks originated in the trademark legislation of 1905. A disparaging mark is a mark which "dishonors by comparison with what is inferior, slights, deprecates, degrades, or affects or injures by unjust comparison." Geller, 751 F.3d at 1358 (alterations omitted).^[5]

Mr. Tam is the "front man" for the Asian-American dance-rock band The Slants. Mr. Tam named his band The Slants to "reclaim" and "take ownership" of Asian stereotypes. On November 14, 2011, Mr. Tam filed the instant application (App. No. 85/472,044) seeking to register the mark THE SLANTS for "Entertainment in the nature of live performances by a musical band," based on his use of the mark since 2006. The examiner refused to register Mr. Tam's mark, finding it likely disparaging to "persons of Asian descent" under § 2(a). The examiner found that the mark likely referred to people of Asian descent in a disparaging way, explaining that the term "slants" had "a long history of being used to deride and mock a physical feature" of people of Asian descent. And even though Mr. Tam may have chosen the mark to "reappropriate the disparaging term," the examiner found that a substantial composite of persons of Asian descent would find the term offensive.^[6]

It is from this determination that Mr. Tam decided to appeal before the Federal Circuit.^[7]

Relevant Areas of Law

Lanham Act's Disparaging 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; or a geographical indication which, when used on or in connection with wines or spirits, identifies a place other than the origin of the goods and is first used on or in connection with wines or spirits by the applicant on or after one year after the date on which the WTO Agreement (as defined in section 3501(9) of title 19) enters into force with respect to the United States.^[8]

Viewpoint Discrimination

Viewpoint discrimination occurs when the government is not only banning certain content or topics, but certain ideas.^[9] The test for viewpoint discrimination is “[o]ther things being equal, viewpoint discrimination occurs when government allows one message while prohibiting the messages of those who can reasonably be expected to respond.”^[10] Additionally, viewpoint discrimination involves intent to discourage one viewpoint and advance another.^[11] The general concern being that the government will try to eradicate, not just content from the marketplace, but certain viewpoints—whether positive or negative.^[12] If something rises to the level of viewpoint-based discrimination, it is deemed to be unconstitutional.^[13]

Content Discrimination

In Reed v. Town of Gilbert, the court said that, “Government regulation of speech is content based if a law applies to particular speech because of the topic discussed or the idea or message expressed.”^[14] The Court further determined that, “This commonsense meaning of the phrase ‘content based’ requires a court to consider whether a regulation of speech ‘on its face’ draws distinctions based on the message a speaker conveys.”^[15] For that reason, content-based discrimination is presumptively invalid^[16] and if something is found to be discriminating on the basis of content, it must survive strict scrutiny.^[17]

Strict Scrutiny

According to Nat’l Assoc. of Mfrs. v. Taylor: “[t]o satisfy strict scrutiny, the government must establish three elements: (1) "the interests the government proffers in support" of the statute must be "properly characterized as 'compelling'"; (2) the statute must "effectively advance [] those interests"; and (3) the statute must be "narrowly tailored to advance the compelling interests asserted."^[18]

Central Hudson (Intermediate Scrutiny)

For Central Hudson to apply, the court would have to determine that the statute at issue deals with commercial speech.^[19] From Central Hudson, the Supreme Court developed a four-part test to determine whether a statute should pass muster.^[20] The test looks to see: (1) Whether the expression is protected by the First Amendment—for it to fall here, it must concern lawful activity and not be misleading; (2) whether the asserted governmental interest is substantial; (3) whether the regulation directly advances the governmental interest asserted; and (4) whether the regulation is no more extensive than necessary to serve that interest—there must be a “reasonable fit” between the government’s ends and the means of achieving those ends.^[21]

Government Speech

In order for something to be classified as government speech, the court looks at four factors: (1) the central purpose of the program in which the speech in question occurs; (2) the degree of editorial control exercised by the government or private entities over the content of the speech; (3) the identity of the literal speaker; and (4) whether the government or the private entity bears the ultimate responsibility for the content of the speech.^[22]

Issue

The central issue before the Federal Circuit was to determine whether or not the disparaging provision of the Lanham Act is unconstitutional and should therefore be voided?^[23]

Decision

Circuit Judge Moore decided that the disparaging provision of the Lanham Act is unconstitutional for various reasons and that Mr. Tam should be granted trademark protection on THE SLANTS.^[24][25]

Viewpoint v. Content-Based Discrimination

The court determined that the Lanham Act was viewpoint-based discriminatory because whenever the government chooses to deny trademark protection to a mark, it is doing so because of the message the mark conveys.^[26] The government tried to defend their position before the Federal Circuit by saying that they should be able to deny protection to the most vile racial epithets and images; however, the Federal Circuit said that "When the government discriminates against speech because it disapproves of the message conveyed by the speech, it discriminates on the basis of viewpoint."^[27] The Federal Circuit bolstered their stance that it is viewpoint discriminatory because the PTO refused to register "The Slants"; however, the PTO has registered marks such as "Celebrasians" and "Asian Efficiency".^[28] The Federal Circuit found the only difference between marks such as "The Slants" versus "Celebrasians" and "Asian Efficiency" is the messages conveyed. The Slants could be seen as being derogatory towards those of Asian descent versus positive. Since the court determined that the disparaging provision is viewpoint discriminatory, then it is immediately unconstitutional.^[29]

In the alternative, the Federal Circuit determined that the disparaging provision is content-based discriminatory, in addition to viewpoint-discriminatory.^[30] Additionally, the Federal Circuit came to the determination that even though trademarks inherently deal more with commercial speech versus expressive speech, that when the government cancels a mark under the disparaging provision, it is affecting more of the expressive aspects of speech and not the commerciality of it.^[31] Therefore, the Federal Circuit found that if the disparaging provision is not found to be viewpoint discriminatory (in light of a higher court potentially overturning parts of this case) that it must be content-based discriminatory and must survive strict scrutiny unless an exception applied.^[32][33]

Strict Scrutiny v. Intermediate Scrutiny (Central Hudson)

The government raised the argument that the disparaging provision of the Lanham Act should be reviewed under intermediate scrutiny by way of the Central Hudson test, because the inherent nature of trademarks are commercial.^[34] However, the Federal Circuit determined that when the PTO chooses to cancel trademarks under the disparaging provision of the Lanham Act, it is usually because of their expressive components and not their commercial components.^[35] The Federal Circuit went on to say that commercial speech mixed with expressive speech should be treated as expressive under deciding whether to apply strict or intermediate scrutiny.^[36] Therefore, the Federal Circuit decided that strict scrutiny should be applied.^[37][38]

Federal Circuit's Analysis under Central Hudson

In the Federal Circuit's effort to show the unconstitutionality of the disparaging provision of the Lanham Act, they chose to analyze the provision under the Central Hudson intermediate scrutiny.^[39] The part of the Central Hudson test that the Federal Circuit failed the Lanham Act on was the "legitimate Interest" element (See above).

For this element, the government raised three arguments for why they had a legitimate interest:

1. The Government argued that they have a legitimate interest to dissociate itself from speech it finds odious.
2. The Government argued that it has a legitimate interest in "declining to expend its resources to facilitate the use of racial slurs as source identifiers in interstate commerce".
3. The Government also argued that it has a legitimate interest in allowing States to make their own determinations about whether trademarks should be unenforceable on grounds of public policy.^[40]

The Federal Circuit determined that none of the arguments raised by the government created a legitimate enough interest to pass the Central Hudson test. Since it does not pass the Central Hudson test, the Federal Circuit determined that it would also not pass strict scrutiny, since strict scrutiny requires a statute to rise to a higher standard.^[41]

Government Subsidy

The Government raised the argument that the Lanham Act should be classified as a Government Subsidy and therefore exempt from the strict scrutiny requirement.^[42] The Federal Circuit ultimately determined that no taxpayer dollars are used in registering trademarks, that it is completely user-funded in their application fees; therefore, the Federal Circuit determined that this does not fall under the government subsidy exception to strict scrutiny.^[43]

Government Speech

The Government also raised the argument that the disparaging provision of the Lanham Act is government speech and should therefore fall outside of the purview of the first amendment.^[44] The government argues this because of the ability to place the "®" or "TM" on the registered mark.^[45] The government found this argument to be without merit.^[46] The Federal Circuit said that the only message the government conveys when a mark is registered with the PTO is that "a mark is registered."^[47] The court cited many reasons for their determination, but, most prominently, was a policy consideration.^[48] The Court was concerned that if they allowed this argument to win the day, then it would also affect other areas of law, such as Copyright and Patent law.^[49] The general concern being that the government could then control what they would and would not grant protections to and would therefore affect the types of speech expressed; this would have the effect of abridging free speech, which is a violation of the first amendment.^[50]

Concurrence by Judge O'Malley

In addition to agreeing with Circuit Judge Moore's opinion, Judge O'Malley added that she believes the disparaging provision of the Lanham Act is unconstitutional under the vagueness doctrine too.^[51]

Part Concurrence & Part Dissent by Judge Dyk

Circuit Judge Dyk generally agrees with the opinion of the majority in that the disparaging provision of the Lanham Act is unconstitutional; however, in his view, the majority err in going "beyond the facts of this case and holding the statute facially unconstitutional as applied to purely commercial speech."^[52] Judge Dyk also believed that many trademarks lack expressive characteristics that would merit First Amendment protection and therefore the analysis should be under the Central Hudson test and not strict scrutiny.^[53][54]

Dissent by Judge Lourie

Judge Lourie disagreed with the majority in many ways outlined below:

• Judge Lourie argued that the Lanham Act has dated back 70 years, it has been continuously applied during that time and it now being found to be unconstitutional seems bizarre.^[55] Judge Lourie cites to stare decisis as the first reason why the majority made a mistake.^[56][57]
• Additionally, Judge Lourie said that denial of an applicant's trademark does not deny their right to speak freely.^[58] Contending that the mark holder may still generally use the mark as it wishes; without federal registration, "it simply lacks access to certain federal statutory enforcement mechanisms for excusing others from confusingly similar uses of the mark."^[59]
• Judge Lourie also said that there are other ways for the mark holder to have protections, including common law rights.^[60][61]
• Finally, Judge Lourie also determined that trademarks are exclusively commercial speech and should therefore not be analyzed under strict scrutiny.^[62]

Dissent by Judge Reyna

Judge Reyna disagreed with the majority in the sense that trademark are exclusively commercial speech and should therefore be analyzed under the Central Hudson test and intermediate scrutiny.^[63] From here, Judge Reyna determined that the government does have a legitimate interest in promoting the orderly flow of commerce and therefore, should pass intermediate scrutiny.^[64] Judge Reyna stated that when you balance the legitimate interest of the disparaging provision versus how narrowly tailored the statute is, that is makes sense that the Lanham Act should survive scrutiny.^[65]

USPTO appeal

The United States Patent and Trademark Office appealed the decision to the United States Supreme Court which has decided to take up the case, with a decision expected by June, 2017.^[66]

References