On Monday, June 19, 2017, the Supreme Court released a decision in a high profile trademark case rejecting the Lanham Act’s rule against disparaging trademarks as being facially invalid and unconstitutional.

The Lanham Act, since its enactment in 1946, has contained a provision stating that a trademark should not be refused registration on the principal register unless it “consists of … matter 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.” (See 15 U.S.C. §1052). Since the enactment of the Lanham Act, courts have routinely found that the disparagement rule does not violate the First Amendment because it does not preclude actual use of the mark in commerce nor prevent the establishment of common law trademark rights, but is rather just a bar to federal registration.

The Slants have fought a long battle to overturn this enduring precedent which began several years ago when Simon Tam, an Asian-American band member of The Slants, attempted to federally register the band’s name as a trademark. The USPTO generally applies a two part test when deciding whether a trademark is disparaging. The examiner must first consider “the likely meaning of the matter in question” by taking into account “dictionary definitions, the relationship of the matter to the other elements in the mark, the nature of the goods or services, and the manner in which the mark is used in the marketplace in connection with the goods or services.” If the examiner finds that the meaning “refers to specific identifiable persons, institutions, beliefs or national symbols” then they must ask “whether that meaning may be disparaging to a substantial composite of the referenced group.” A substantial composite does not necessarily mean a majority of the referenced group.

In 2011 the trademark office refused registration of THE SLANTS trademark finding that the mark was considered “disparaging” to Asian-Americans after applying the two part test. The USPTO cited that the term is a widely known derogatory term used to refer to those of Asian descent. Tam vehemently argued that he chose the name “in order to ‘reclaim’ the term and drain its denigrating force as a derogatory term for Asian persons.” The group throughout their career has “draw[n] inspiration for its lyrics from childhood slurs and mocking nursery rhymes” and has given its albums names such as “The Yellow Album” and “Slanted Eyes, Slanted Hearts,” and, in 2017, “The Band Who Must Not be Named.”

After exhausting the administrative appeal process at the USPTO with no success, Tam brought a federal lawsuit. In 2015, the Federal Circuit agreed with Tam and overruled established precedent finding that by denying a mark owner of the benefits of a trademark registration for a mark considered to be disparaging, the mark owner was in fact being punished for use of a mark consisting of unpopular speech. The Appeals Court found that many of the marks which were rejected as disparaging for conveying hurtful speech were still protected because the First Amendment protects hurtful speech.

The Supreme Court affirmed the lower court’s decision in a 39 page opinion with multiple concurrences. Justice Alito wrote that the disparagement provision of the Lanham Act “violates the Free Speech Clause of the First Amendment” because it “offends a bedrock First Amendment principle: Speech may not be banned on the ground that it expresses ideas that offend.” (Matel v. Tam, 582 U. S. ____ (2017), 1-2).

The Government set forth three main arguments, contending that “(1) that trademarks are government speech, not private speech, (2) that trademarks are a form of government subsidy, and (3) that the constitutionality of the disparagement clause should be tested under a new ‘government-program’ doctrine.” Id. at 12. But ultimately the Supreme Court rejected these arguments and, for varying reasons, all eight justices held that the disparagement clause was unconstitutional because even if speech is demeaning or hateful, “the proudest boast of our free speech… is that we protect the freedom to express ‘the thought that we hate.’” Id. at 25.

This hard fought victory goes to Simon Tam and The Slants but its likely to have a huge impact on many others, such as the Washington Redskins whose marks were recently canceled for being disparaging to Native Americans. Though the Redskins’ case is still pending before the U.S. Appeals course, this ruling is certainly good news for them and others who seek the benefits of federal trademark registrations for disparaging marks. It should be interesting to see over the next couple of weeks or months if there is an uptick in the filing of arguably disparaging trademark applications at the USPTO.