A recent decision from the U.S. Supreme Court held that the disparagement clause of the Lanham Act violates the Free Speech Clause of the First Amendment. The disparagement clause has received close public scrutiny in recent years due to certain high-profile cases. The case capturing the most attention involves the decision of the Patent and Trademark Office (PTO) to cancel the Washington Redskins’ trademarks on the grounds that the term is disparaging to Native Americans. Representatives of the team are hopeful that this recent decision from the U.S. Supreme Court will assist in their own case, which was put on hold by the court of appeals pending this decision.
The Lanham Act
The Lanham Act allows for federal registration of trademarks that are used in commerce. While unregistered marks can be used in commerce and may be enforceable under §43(a) of the Act or other federal and state laws, registration has certain benefits. The registration constitutes prima facie evidence that (1) the mark is valid, (2) the holder is the owner of the mark, and (3) the owner has the “exclusive right to use the registered mark in commerce on or in connection with the goods or services specified in the certificate.” Additionally, the mark becomes incontestable once it has been registered for five years.
Certain trademarks are barred from registration on the principal register. Among those barred are trademarks “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.” Examiners at the PTO implement this provision using a two-part test requiring determinations on the likely meaning of the matter in question and whether a substantial composite of the referenced group may find the mark to be disparaging. The PTO notes that it is not determinative that the applicant is a member of the group in question or that the applicant has good intentions for the use of the potentially disparaging term.
The recent opinion from the U.S. Supreme Court addresses the PTO’s denial of trademark registration for the band name “The Slants.” The PTO examiner determined that the term “slants” is generally understood as a derogatory term for persons of Asian descent and that a substantial composite of persons would find the mark offensive. The registration applicant, singer Simon Tam, was aware that the term was derogatory but claimed that its use by the band, which consists of Asian-Americans, was intended to reclaim the term and deplete its derogatory nature by mocking existing stereotypes.
The Court’s Opinion
In support of the disparagement clause, the government advanced the arguments that trademarks are government speech, that trademarks are a government subsidy, and that the constitutionality of the disparagement clause should be evaluated using a new “government-program” doctrine. The Court discredited each of these arguments before directly addressing the constitutionality of the disparagement clause. The parties disagreed over which standard of constitutional review was appropriate in this case. While the government argued that trademarks are commercial speech subject to a more relaxed standard of review, Tam argued that trademarks have expressive content and therefore are entitled to a higher standard of review.
The Court declined to decide which standard of review was appropriate but determined that the disparagement clause is unconstitutional even if the more relaxed standard of review is applied. The relaxed standard of review still requires that a restriction on free speech serve a substantial interest and be narrowly drawn. Although the government has an interest in preventing offensive speech, particularly regarding commercial speech that is demeaning to underrepresented persons, the Court explained that:
[T]he idea that strikes at the heart of the First Amendment Speech that demeans on the basis of race, ethnicity, gender, religion, age, disability, or any other similar ground is hateful; but the proudest boast of our free speech jurisprudence is that we protect the freedom to express ‘the thought that we hate.’”
The Court also concluded that the disparagement clause is overly broad. If the purpose of the clause is to prevent the registration of marks that “support invidious discrimination,” then the current law is broader than is necessary to meet that goal. The disparagement clause therefore violates the First Amendment and is unconstitutional.
For more information on the Lanham Act, see O’Connor’s Federal Intellectual Property Codes Plus.
 Matal v. Tam, ___ U.S. ___ (2017) (No. 15-1293; 6-19-17).
 See Andrew Chung, U.S. Top Court Finds Law Banning Offensive Trademarks Unconstitutional, Reuters, June 19, 2017; Is Canceling Disparaging Trademarks Unconstitutional? ‘The Slants’ Boost Washington Redskins’ Appeal, O’Connor’s Annotations, Mar. 29, 2016; Federal Judge, Media Outlets Censor “Redskins” Name, O’Connor’s Annotations, Sept. 10, 2014.
 See Adam Liptak, Justices Strike Down Law Banning Disparaging Trademarks, N.Y. Times, June 19, 2017.
 Matal, ___ U.S. at ___; see 15 U.S.C. §1051(a)(1).
 Id.; see also 15 U.S.C. §1125 (also known as §43 of the Lanham Act; creating a federal cause of action for trademark infringement).
 Matal, ___ U.S. at ___.
 See 15 U.S.C. §1052.
 Id. §1052(a).
 See Matal, ___ U.S. at ___.
 See id.
 See id.
 See id.; see also Central Hudson Gas & Elec. Corp. v. Public Serv. Comm’n of N.Y., 447 U.S. 557, 564-66 (1980) (providing an outline of the relaxed scrutiny standard).
 Matal, ___ U.S. at ___.
 See id.