Supreme Court of the United States
ANDREI IANCU, UNDER SECRETARY OF COMMERCE FOR INTELLECTUAL PROPERTY AND DIRECTOR, UNITED STATES PATENT AND TRADEMARK OFFICE, PETITIONER
BRIEF FOR THE PETITIONER
CONSTITUTIONAL AND STATUTORY PROVISIONS INVOLVED
The First Amendment provides in pertinent part that "Congress shall make no law abridging the freedom of speech." U.S. Const. Amend. I.
This case involves a facial First Amendment challenge to a century-old provision of federal trademark law that directs the United States Patent and Trademark Office (USPTO) to refuse registration of trademarks containing "scandalous" or "immoral" matter. Respondent sought federal registration for the mark "FUCT" in connection with a clothing line including children's and infants' apparel. The USPTO refused registration under Section 1052(a) based on evidence that the mark would be perceived as equivalent to the vulgar word for which it is a homonym. The court of appeals agreed that the mark is "scandalous" within the meaning of Section 1052(a), but the court struck down the provision denying federal registration of scandalous or immoral marks as facially invalid under the Free Speech Clause of the First Amendment.
1. The principle underlying trademark protection is that distinctive marks-words, names, symbols, and the like-can help distinguish a particular artisan's goods from those of others. By preventing others from copying such marks, trademark law helps assure a producer that it (and not an imitating competitor) will reap the financial, reputation-related rewards associated with a desirable product. Trademark law likewise reduces the customer's costs of shopping and making purchasing decisions, by assuring a potential customer that this item, the item with this mark, is made by the same producer as other similarly marked items that he or she liked or disliked in the past.
Trademarks and their precursors have ancient origins, and trademarks were protected at common law and in equity at the time of the founding of our country. At common law, one who first uses a distinct mark in commerce acquires rights to that mark. Those rights allow the owner of the mark to prohibit the use of it so far as to protect the owner's good will against the sale of another's product as his. The owner can enforce those rights under state common law, or if the mark has been registered in a State, under that State's registration system.
"Though federal law does not create trademarks, Congress has long played a role in protecting them. In 1946, Congress enacted the Lanham Act,, the current federal trademark scheme. Under the Lanham Act, the owner of a mark used in interstate or foreign commerce, whether registered or not, may sue for trademark infringement in federal court if another is using a mark that too closely resembles the plaintiff's. Certain federal remedies for dilution and unfair competition are likewise available to owners of marks used in commerce, regardless of whether the mark is registered.
The Lanham Act confers additional benefits on owners who federally register their marks. For example, registration serves as nationwide constructive notice of the registrant's claim of ownership of the mark, and foreclosing certain defenses in infringement actions. It also is "prima facie evidence of the validity of the registered mark and of the registrant's exclusive right to use the registered mark in commerce on or in connection with the goods or services specified in the registration." In addition, after five years of registration, the owner's right to use a trademark can become "incontestable," so that it may be challenged only on limited grounds.
To obtain the benefits of registration, an owner of a trademark used in commerce applies to the USPTO to record the mark on the agency's principal register. The application must include a description of the goods in connection with which the mark is used. If the USPTO grants the application, it issues the owner of the trademark a certificate of registration in the name of the United States of America, and the owner may give notice that his mark is registered by displaying with the mark the words 'Registered in U.S. Patent and Trademark Office' or 'Reg. U.S. Pat. & Tm. Off.' or the letter R enclosed within a circle.
Only marks that satisfy the statutory criteria can be registered. Congress has directed the USPTO to refuse registration of, among others, marks that are deceptive; marks containing a flag, coat of arms, or insignia of the United States, a State, or a foreign nation; marks that include a name, portrait, or signature of a living person without his or her consent; marks that so resemble other marks that they are likely to cause confusion; marks that are merely descriptive; and marks that are functional.
This case concerns a Lanham Act provision that directs the USPTO to refuse registration of marks consisting of or comprising "immoral" or "scandalous" matter. Such a provision has been a feature of federal trademark-registration programs since 1905. Although the Lanham Act precludes registration of "scandalous" and "immoral" marks, the USPTO has long treated the two terms as composing a single category, and we accordingly refer to the prohibitions collectively as the "scandalous-marks" provision.
To determine whether the scandalous-marks provision applies to a particular mark, the USPTO asks whether a "substantial composite of the general public would find the mark scandalous." The agency generally defines "scandalous" as "shocking to the sense of truth, decency, or propriety; disgraceful; offensive; disreputable; giving offense to the conscience or moral feelings; or calling out for condemnation." The agency understands, and the Federal Circuit has held, that the term includes vulgar marks, i.e., those "lacking in taste, indelicate, and morally crude." Over the years, the USPTO has invoked this provision as a basis for refusing to register a variety of vulgar and lewd marks, including depictions of individuals engaged in sexual activity, for which the USPTO has refused registration.
2. This case arises from the USPTO's refusal of respondent Erik Brunetti's application to register the mark "FUCT" for a clothing line that includes children's and infants' apparel. Respondent has used the mark in connection with his clothing line since 1991. In 2011, the USPTO received an application for federal registration of the mark. A USPTO examining attorney refused registration under Section 1052(a) based on evidence that the mark consisted of "scandalous" matter.
The USPTO's Trademark Trial and Appeal Board (Board) affirmed. The Board observed that the term 'fuct' is recognized as a slang and literal equivalent of the word for which it is a homonym, and that respondent used the mark in connection with apparel and promotional material displaying "strong, and often explicit, sexual imagery." Based on that evidence, the Board found that the mark as used by respondent would "be perceived by his targeted market segment" as the profane word for which it is a homonym. The Board concluded on that basis that the mark was vulgar and therefore unregistrable. Although respondent argued that the scandalous-marks provision violated the First Amendment, the Board found the resolution of that constitutional question to be beyond its statutory authority.
3. a. Respondent sought review of the Board's decision in the Federal Circuit. While the case was pending in the court of appeals, this Court issued its decision in Matal v. Tam, concerning the constitutionality of Section 1052(a)'s separate ban on federal registration of "disparaging" trademarks. All eight Justices who participated in Tam agreed that the disparagement provision discriminated based on the speaker's viewpoint, and that the provision was facially invalid under the First Amendment.
b. After supplemental briefing and reargument in light of Tam, the court of appeals reversed the Board's decision in this case. The court first upheld the Board's determination that respondent's mark is "scandalous" under Section 1052(a). The court held that substantial evidence supported the Board's findings that respondent's mark is a phonetic twin of a vulgar term, and that a substantial composite of the American public would find the mark vulgar. The court further held that, given those findings, federal registration of the mark was barred by Section 1052(a)'s scandalous-marks provision.
The court of appeals concluded, however, that Section 1052(a)'s scandalous-marks provision is facially invalid under the First Amendment. While assuming arguendo that the provision is viewpoint neutral, the court held that "the provision impermissibly discriminates based on content in violation of the First Amendment." In reaching that conclusion, the court began from the premise that content discrimination of any kind is subject to strict scrutiny unless some alternative First Amendment framework applies. The court then rejected each of the government's arguments that the statutory criteria for obtaining the benefits of federal trademark registration should not receive the same First Amendment scrutiny that applies to a content-based restriction on speech.
The court of appeals rejected the government's argument that the trademark-registration program should be analyzed as a government subsidy for marks that the government wishes to promote, rather than as a restriction on speech. The court distinguished prior decisions recognizing Congress's broad authority to define the scope of government programs, on the ground that "trademark registration does not implicate Congress' power to spend funds." The court concluded that the constitutional principles applicable to government subsidies apply only to Spending Clause legislation, and that the trademark-registration program is not a Spending Clause program. The court also distinguished precedents related to limited public (or nonpublic) forums, concluding that limited-public-forum principles apply only when the government excludes speech from its own property.
Having rejected the subsidy and limited-public forum frameworks, the court of appeals analyzed the scandalous-marks provision as a direct restriction on speech. The court concluded that the ban on registering scandalous marks regulates speech based on its expressive (and not just commercial) content; that it is not related to the trademark-registration program's commercial purpose of facilitating source identification; and that it is therefore subject to strict scrutiny. Noting that the government had not suggested that the provision could survive strict scrutiny, the court concluded that the scandalous-marks provision is facially invalid.
In the alternative, the court of appeals held that the scandalous-marks provision could not survive scrutiny under the First Amendment standards that apply to regulation of commercial speech explaining that First Amendment analysis of restrictions on commercial speech turns on whether (1) the speech being regulated concerns lawful activity and is not misleading; (2) the asserted government interest is substantial; (3) the regulation directly advances that government interest; and (4) the regulation is more extensive than is necessary to serve that interest. The court concluded that the government has no legitimate substantial interest in declining to encourage graphic sexual images as source identifiers in commerce, because registration does not associate the government with those marks and because speech cannot be suppressed merely because it will be off-putting to others. The court further held that, even if the government interest in protecting the public from such marks were viewed as legitimate, refusing to register those marks would not directly advance the government's interest because it would not directly prevent applicants from using their marks. The court further found that the refusal to register scandalous marks under Section 1052(a) is not sufficiently tailored to the government's interest because, in the court's view, there is no clear standard for determining which marks are "scandalous" and the USPTO has applied the provision inconsistently in the past.
4. The court of appeals denied the government's petition for rehearing en bane without noted dissent.
SUMMARY OF ARGUMENT
The scandalous-marks provision in 15 U.S.C. 1052(a) is facially constitutional under the Free Speech Clause of the First Amendment.
A. This case presents an issue that the Court's decision in Matal v. Tam did not address. In Tam, the Court struck down, as a violation of the Free Speech Clause, a provision of Section 1052(a) that directed the USPTO to refuse to register disparaging marks. Although most of the Court's First Amendment analysis was split between two opinions, neither of which secured a majority, all eight Justices who participated in Tam agreed that the disparagement provision discriminated on the basis of viewpoint. That unanimous agreement made it unnecessary to address in detail the First Amendment analysis that should apply to federal-registration criteria that are viewpoint-neutral. Because the scandalous-marks provision at issue here is viewpoint-neutral, the decision in Tam sheds little light on the question presented in this case.
B. In declaring the scandalous-marks provision facially unconstitutional, the court of appeals subjected the provision to strict scrutiny. Strict scrutiny, however, is unwarranted here for three related reasons.
First, the scandalous-marks provision is not a restriction on speech. Rather, it is a condition on the availability of government benefits, namely, the benefits of federal trademark registration. This Court has recognized that the justification for strict scrutiny is generally absent when, as here, the government does not restrict speech, but rather declines to promote it. Second, although the scandalous-marks provision turns on the content of the mark for which registration is sought, such content-based distinctions are an "inherent and inescapable" part of the federal trademark registration program. Application of strict scrutiny to such criteria would fundamentally disrupt the operation of that program. Third, the scandalous-marks provision is viewpoint-neutral. It bars registration of scandalous marks not because such marks are thought to convey offensive ideas, but because they reflect an offensive "mode of expressing whatever idea the speaker wishes to convey."
C. As in other contexts where the government does not restrict speech but rather declines to promote it, the Court should examine whether the statute is reasonably related to a legitimate government interest, and whether it imposes an unconstitutional condition on the exercise of free speech.
The scandalous-marks provision is a longstanding and reasonable means of vindicating a number of legitimate government interests. By creating a practical disincentive to the use of marks that contain sexually explicit or profane material, the provision advances the government's interest in encouraging the use of marks that are appropriate for all audiences, including children. By discouraging the use of marks that a substantial segment of the public would find shocking, the provision advances the government's interest in the orderly flow of commerce. And by withholding government benefits from such marks, the provision advances the government's interest in avoiding any appearance of government approval of them. The commercial character of trademark protection highlights the government's broader authority in the commercial sphere, and reinforces the conclusion that the scandalous-marks provision is constitutional.
The scandalous-marks provision also does not run afoul of this Court's unconstitutional-conditions doctrine. The USPTO's registrability analysis focuses solely on the trademark the applicant seeks to register, and a refusal to register the mark does not impose any adverse legal consequences outside the trademark registration program.
D. In declaring the scandalous-marks provision facially unconstitutional, the court of appeals committed at least four important errors. First, the court erred in treating the provision as a restriction on speech rather than as a condition on the availability of government benefits. Second, the court erred in treating as irrelevant this Court's decisions involving governmentestablished subsidies and forums. Those cases concerned similar limits on access to government support. Third, the court of appeals erred in suggesting that the First Amendment analysis would necessarily be the same for a hypothetical statute that imposed content-based conditions on copyright registration. That suggestion overlooks fundamental differences between trademarks and copyrights and the legal regimes that protect them. Fourth, the court erred in relying on a concern that the scandalous-marks provision has been applied inconsistently. Any alleged inconsistencies in prior USPTO decisions provide no sound basis to conclude that the provision is incapable of principled application or facially invalid.
The judgment of the court of appeals should be reversed.