Are we heading for a constitutional showdown over Section 2(a) of the Lanham Act? Will the Supreme Court strike down this prohibition on disparaging marks as an abridgement of First Amendment rights? It is certainly beginning to look like a distinct possibility. Two developments lead me to this conclusion.
Disparaging Marks and Spending Power
The first development arises from two trademark cases that are now on appeal, In re Tam and Pro-Football v. Blackhorse. In In re Tam, a panel of the Federal Circuit affirmed the decision of the TTAB to refuse the registration of the mark THE SLANTS, holding that it is disparaging to persons of Asian descent. Judge Moore expressed in her “additional views” of that panel decision that the constitutionality of Section 2(a) is ripe for reexamination. In 1981, the predecessor court to the Federal Circuit in In re McGinley addressed the constitutional challenge to Section 2(a) of the Lanham Act. The McGinley court held that Section 2(a) is not an abridgement of the First Amendment because no conduct is proscribed and no tangible form of expression is suppressed. The McGinley court noted that registration is a statutory benefit, and the benefit derives in part from government funds. The fact that the trademark registration regime was supported by government funds was an important factor because the Supreme Court had held that the government has more discretion to curtail speech when imposing limits on government funding.
Judge Moore pointed out that there had been significant Supreme Court jurisprudence in the intervening thirty-plus years since McGinley had been decided, and a revisiting of the decision was in order. Judge Moore noted that the Trademark Office had moved to a fee-based regime, and this fact bears on the reasoning of McGinley with respect to Congress’ “spending power.” She also noted that the Supreme Court has found in cases such as Perry v. Sindermann that the government may not impose an unconstitutional condition on the grant of a federal benefit. The en banc Federal Circuit agreed to rehear the case, and it is scheduled for oral argument in early October.
Meanwhile, another appellate court has before it a challenge to the REDSKINS trademark, Pro-Football, Inc. v. Blackhorse. The district court in that case followed the reasoning of McGinley, finding among other things that trademark registration does not curtail speech. The case is now on appeal to the Fourth Circuit. So, after 30 years of relative quiescence, in a matter of months there will be two appellate court decisions on the constitutionality of Section 2(a) and, perhaps, a circuit split.
Lawn Signs and Free Speech
The second development is the Supreme Court’s recent willingness to employ higher level of scrutiny for content-based regulations of speech. This can be seen most recently in Reed v. Town of Gilbert, a case involving a municipal ordinance that restricts the use of certain types of lawn signs — signs that give directions — while allowing the use of other types of lawn signs. The Court, by a 6-3 vote, struck down the ordinance as a content-based regulation of speech. In so doing, the Court found the regulation to be content-based on its face and thus subject to strict scrutiny. It held that the Town had no compelling reason to restrict the signage on the basis of the message conveyed, and it struck down the ordinance.
While the decision itself was unanimous, the reasoning behind it was not, with three justices stating that the ordinance could have been struck down on much narrower grounds. Justice Breyer in concurrence warned that applying strict scrutiny to this regulation could lead to “judicial management of ordinary government regulatory activity.”
The Reed case follows another Supreme Court decision that applied heightened scrutiny in the case of commercial speech. In Sorrell v. IMS Health Inc., the same six justice majority as in Reed held that a content-based restriction on commercial speech should be subjected to “heightened” scrutiny. This level of scrutiny is more rigorous than “intermediate scrutiny,” which was the level applied by the Court in the Central Hudson case, the seminal case on commercial speech. Together, these cases signal a departure from prior jurisprudence and a willingness to employ increased scrutiny to assess the regulation.
The stars are aligning to put the question of the constitutionality of Section 2(a) before the Supreme Court at a time when a majority of the Court is signaling a willingness to scrutinize government regulation of speech. These developments indicate that we may soon see a big showdown on the registration of disparaging marks, and potentially a sea change in trademark law.
