U.S. Supreme Court Strikes Down Trademark Disparagement Clause

Offensive balloonTrademark registration with the U.S. Patent and Trademark Office (USPTO) protects businesses’ rights to the exclusive use of names, logos, and certain other designs used in commerce. Business names, product names, and logos associated with either of these are eligible for trademark protection if they meet the criteria established by the Lanham Act, 15 U.S.C. § 1051 et seq. Section 2(a) of the statute prohibits the registration of “immoral, deceptive, or scandalous matter,” as well as “matter which may disparage” a wide range of individuals, institutions, or “national symbols.” Id. at § 1052(a). This provision, commonly known as the Disparagement Clause, was the subject of a dispute that went to the U.S. Supreme Court. In June 2017, the court held that the Disparagement Clause violates free speech rights under the First Amendment. Matal v. Tam, 582 U.S. ___ (2017).

The Lanham Act establishes the general principle that the USPTO may not reject a proposed trademark registration unless it falls under certain specified exceptions. These include flags, seals, or other official symbols of the United States or any U.S. state, city, or other local jurisdiction, or foreign country. A trademark is also ineligible for registration if it uses a person’s likeness without their permission. Any proposed trademark must not be so similar to an existing registered mark that it is likely “to cause confusion, or to cause mistake, or to deceive.” 15 U.S.C. § 1052(d).

The Disparagement Clause prohibits the registration of any trademark that “may disparage…persons, living or dead, institutions, beliefs, or national symbols, or bring them into contempt, or disrepute.” Id. at § 1052(a). Determining whether or not a proposed mark is “disparaging” is highly subjective. Perhaps the most famous example of a trademark disparagement claim involves the professional football team in Washington, D.C. In one decision from that case, the Trademark Trial and Appeal Board (TTAB) held that an evaluation of whether a mark is “disparaging” should look at the mark from the perspective of a “substantial composite” of the group allegedly being disparaged, rather than the point of view of the general public. Harjo v. Pro-Football, Inc., 50 U.S.P.Q.2d 1705 (TTAB 1999).

The Matal case involved a challenge to the constitutionality of § 2(a) on free-speech grounds. The plaintiff applied to register the name of his band with the USPTO. He acknowledged that the band name is “a derogatory term for persons of Asian descent,” but he stated that, as individuals of Asian descent, the band members wanted to “‘reclaim’ the term and drain its denigrating force.” The USPTO rejected the application under § 2(a).

The plaintiff appealed the USPTO’s decision all the way to the Supreme Court, which ruled in his favor. It held that the Disparagement Clause violates a fundamental principle of the First Amendment, which is that “[s]peech may not be banned on the ground that it expresses ideas that offend.”

Samuel C. Berger is a business lawyer who practices in the New York City and Northern New Jersey regions. Our firm represents business owners, businesses, and entrepreneurs by offering fixed-fee packages of legal services addressing a broad range of our clients’ legal needs. Contact us online, at (201) 587-1500, or at (212) 380-8117 today to schedule a confidential consultation with an experienced and knowledgeable business advocate.

More Blog Posts:

Intellectual Property for New Jersey Small Businesses, Part 1: Trademarks, Copyrights, and Patents, New York & New Jersey Business Lawyer Blog, May 18, 2017

Federal Administrative Board Dismisses Allegations of Fraud in Trademark Application, New York & New Jersey Business Lawyer Blog, February 4, 2016

How Intellectual Property Law Can Help New York and New Jersey Businesses Protect Their Products and Services, New York & New Jersey Business Lawyer Blog, January 21, 2016

Photo credit: User:Mercury13 (Own work) [Public domain], via Wikimedia Commons.