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Matal v. Tam: What to Do When an Application for a Disparaging Mark Targets Your Business

T he US Supreme Court’s Matal v. Tam decision holds that the disparagement provision in §2 (a) of the US Lanham Act violates the First Amendment. A win for free speech, trademark examiners will no longer refuse a mark after determining subjectively that the mark is disparaging. Some of the Justices acknowledged how “the commercial market is well stocked with merchandise that disparages prominent figures and groups,” accepting such disparagement as part of having free speech. There may be times, however, when an application for a disparaging mark crosses a line and will damage your business by causing consumer confusion or hurting your brand. If this happens, you should oppose registration.

After Tam, most Lanham Act provisions for opposing registration or obtaining cancellation continue to be available, such as the likelihood of confusion and no bona fide intention to use the mark. But Lanham Act provisions that raise free speech concerns similar to the disparagement provision, such as those related to immoral and scandalous matter, may not be available much longer.

Background

Asian-American rocker Simon Tam applied to have his band’s name THE SLANTS recorded on the federal trademark register. The USPTO refused to register the mark as likely disparaging to “persons of Asian descent” under the disparagement provision. Wanting the mark in order to reclaim the stereotypes about his ethnicity, Tam appealed. The case came before the Supreme Court, and Tam won.

The Court held that the disparagement provision was unconstitutional. A main concern involved the government having discretion to review the viewpoint conveyed in a registration application and then silence any disfavored speech by refusing registration. Not only could the government abridge free speech by denying trademark applications that may contain “powerful messages,” but also applications for copyright registration, which would be especially dangerous given the creative nature of copyright.

Under Tam, the USPTO will allow registration of disparaging marks. This likely means that the Washington Redskins will obtain registration of their team name. Additional examples of the types of marks that will not be refused because of disparagement can be found in the Trademark Examiner Manual § 1203.03(b)(ii):

Disparaging trademarks

Trademark Trial and Appeal Board decisions reviewing these marks provide a sense of what arguments against registration still work after Tam.

Immoral and scandalous

The Tam case involved only the disparagement provision, but it implicates other Lanham Act §2(a) provisions such as the requirement to refuse registration of immoral and scandalous marks. These provisions implicate the Court’s free speech concerns.

In the Trademark Manual examples, the TTAB held the defecating dog to be immoral and scandalous in 1998, but not SEX ROD 20 years later. The different holdings highlight the Court’s concern for allowing the government discretion in deciding registrations that may suppress disfavored speech, impinging on the right of free speech. Thus, a court could easily decide that the immoral and scandalous provisions of the Lanham Act are unconstitutional under the reasoning of Tam.

Note that finding the immoral and scandalous provisions unconstitutional may create a gap with respect to other issues, such as a mark containing speech that threatens public health and safety. If the courts allow scandalous marks, can US comedian Kathy Griffin register a mark that contains the image of her holding what appears to be the US president’s severed head?

Likelihood of confusion

Likelihood of confusion continues to be a strong basis for opposing registration. The Court in Tam described confusion as a reason a trademark cannot be registered. Assessing whether a mark will cause confusion does not require the government to review the viewpoint conveyed by the mark.

Confusion is a fact specific issue, and disparagement plays a role in the outcome. In the Red Sox case, The TTAB found no likelihood of confusion based on how the marks at issue contained different words, making them dissimilar. The “disparaging nature” of the SEX ROD mark supported the finding, because consumers “are not likely to believe that [the Red Sox ball club] is sponsoring or endorsing” the associated goods.1 According to this reasoning, the more disparaging a mark is, the less likely it will confuse consumers.

This does not mean that a disparaging mark cannot cause confusion. In the Greyhound case, the TTAB found the Greyhound’s dog to be its “alter ego… which points uniquely and unmistakably to [Greyhound’s] persona.”2 Thus, a consumer would see Greyhound’s dog “symbol shown in the act of defecating” when looking at the defecating dog mark.3 This conclusion is consistent with the handling of marks that parody existing brands — parody is not a defense where there is confusion.4 Thus, where there is great similarity between the marks and other factors tending to indicate likelihood of confusion, you can overcome an argument that consumers would not think a company would use a mark that disparages itself.

Dilution

In some respects, dilution by tarnishment as a basis for refusal appears to stand on shaky ground after Tam.  A mark that tarnishes or “harms the reputation” of another mark is not much different from one that “may disparage.” But tarnishment also requires that the harm arise from the similarity of the marks involved. Because a review for similarity of marks parallels a review for likelihood of confusion, the dilution by tarnishment provision has a better chance of surviving a constitutionality challenge than the immoral and scandalous provisions do.

Blurring, the other part of dilution, likewise requires similarity between marks and consideration of factors unrelated to the viewpoint conveyed by the mark. With respect to free speech, it falls into a different category than the immoral and scandalous provisions that involve only a review of the viewpoint conveyed.

Other bases for opposition and cancellation

In addition to likelihood of confusion, other bases for opposition and cancellation are still available that do not implicate the First Amendment as articulated by Tam. Common grounds include lack of bona fide intent to use, descriptiveness, fraud, and abandonment.

The Red Sox case demonstrates the importance of pleading all available arguments when opposing registration. In a post-Tam world where disparagement is not available, SEX ROD would have issued as a mark if the registrant could have shown a bona fide intent to use. Since this is a relatively easy hurdle for a serious registrant to overcome, it means that some disparaging marks that target business will survive opposition and cancellation efforts.

Conclusion

While it is unlikely there will be a flood of disparaging marks registered by the USPTO, it is likely that some such marks will issue. You can prepare to defend against such marks by registering both design and name marks for your business, which can serve to expand your arguments for a likelihood of confusion. If you encounter a mark that potentially disparages your business, you should (1) assert all possible defenses available in opposing or seeking cancellation of the potentially disparaging mark; and (2) consider the possible negative impact on your business, including the fact that a cyber-squatter might be able to defend a disparaging domain in an ICANN proceeding based on trademark rights obtained after Tam.
1. No. 91172268 at 28
2. No. 75652 at 4
3. Id. at 5
4. Nike, Inc. v. Maher, 100 USPQ2d 1018, 1023 (TTAB 2011)

About the Author

Noah WebsterNoah Webster is a trusted business advisor for AtHoc, a division of BlackBerry that provides networked crisis communication to government agencies and leading commercial enterprises worldwide. He cares for the company's general legal needs and has previously held roles at BlackBerry managing the global compliance program and leading the patent litigation team.

Noah thanks his friend Alain Villeneuve of the Vedder Price law firm in Chicago for providing valuable insight on this topic.



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