In re Simon Shiao Tam

In the last several decades, the disparagement provision of § 2(a) of the Lanham Act has become a more frequent basis for rejection or cancellation of trademarks by the United States Patent and Trademark Office (PTO) and the Trademark Trial and Appeal Board (the Board). In the past year or two, the disparagement provision has seen significant analysis by the courts and legal experts with regard to a few high-profile cases, including the revocation of trademark registrations owned by the Washington Redskins. Now, the U.S. Court of Appeals for the Federal Circuit, sitting en banc, has resolved the debate regarding the constitutionality of § 2(a) and determined that the provision is unconstitutional since it permits the government to deny registration because it believes that the speech communicated by a trademark is likely to offend others. In re Simon Shiao Tam, Case No. 14-1203 (Fed. Cir., Dec. 22, 2015) (en banc) (Moore, J.) (O’Malley, J., concurring) (Dyk, J., concurring-in-part and dissenting-in-part) (Lourie, J., dissenting) (Reyna, J., dissenting).


Simon Shiao Tam is the lead singer of the Asian-American dance-rock band, The Slants—a name adopted, in Mr. Tam’s own words, to “take ownership” of Asian stereotypes. After the Board affirmed on examining the attorney’s refusal to register Mr. Tam’s application for THE SLANTS covering live music performances on the basis that the mark referred to people of Asian descent and would be disparaging to a “substantial component” of those people, Mr. Tam appealed. On appeal, Mr. Tam argued that the Board erred in finding mark disparaging and also challenged the constitutionality of §2(a) of the Lanham Act.

In its earlier panel decision opinion in this case, the Federal Circuit agreed with the Board that the relevant evidence, such as dictionary definitions, cultural slang and known ethnic slurs, news articles, the band’s own Wikipedia page and even past statements by Mr. Tam indicate that THE SLANTS likely refers to people of Asian descent and is likely offensive to a “substantial composite” of people of Asian descent. As to the constitutionality of §2(a) of the Lanham Act, the panel cited the 1981 precedent of its predecessor court (the CCPA),In re McGinley, and rejected Mr. Tam’s argument that §2(a) conditions the benefit of trademark registration on the relinquishment of speech. See IP Update, Vol. 18, No. 5.

In the panel decision, Judge Moore authored additional views noting Mr. Tam’s goals in seeking to register THE SLANTS, both as a source-identifier of the band’s services (i.e., for commercial purposes) and also for the purpose of political and cultural commentary. She urged the court to revisit, the In Re McGinley case en banc. Specifically, Judge Moore referenced the wide criticism that the McGinley decision has received over the past 34 years and noted that the protection afforded to commercial speech has evolved “significantly”.

Soon after, the Federal Circuit sua sponte vacated the panel decision and requested that the parties file new briefs addressing, for en banc review, the question of whether “the bar on registration of disparaging marks in 15 U.S.C. § 1052(a) [Lanham Act § 2(a)]violates the First Amendment.”

En Banc Decision

Starting from the premise that the disparagement provision is not content or viewpoint neutral and can therefore only be justified on the basis of a compelling state interest, the Federal Circuit explained that § 2(a) denies important legal rights to private speech on the basis of government disapproval of the message content, which renders the provision subject to strict scrutiny. Proceeding to find that the disparagement provision cannot survive strict scrutiny, the Court stated that “Section 2(a) is a viewpoint-discriminatory regulation of speech, created and applied to stifle the use of certain disfavored messages.” The Court further explained that the government cannot escape strict scrutiny review by arguing that §2(a) regulates commercial speech since it is always a mark’s expressive character and not its source-identifying function that is the basis for a disparagement refusal.

The government cannot refuse to register disparaging marks because it disapproves of the expressive messages conveyed by the marks. It cannot refuse to register marks because it concludes that such marks will be disparaging to others.

The government argued that § 2(a) does not implicate First Amendment rights at all because §2(a) does not ban speech, as Mr. Tam remains free to use the unregistered THE SLANTS trademark in commerce; trademark registrations constitute government speech, which the government can grant or deny without implicating the First Amendment; and §2(a) merely withholds a government subsidy, not speech.

Responding to the first argument, the Federal Circuit relied on its own precedent to conclude that federal trademark registration “bestowstruly significant and financially valuable” benefits upon the trademark owner and that denial of those benefits creates a “serious disincentive” to adopt a mark that the USPTO may deem to be disparaging. Moreover, the “may disparage” language of the statute was found to have a chilling effect on speech due to uncertainty surrounding the application of the law, which the Court confirmed by reviewing the record of the USPTO grants and denials of certain trademarks over the years, citing inter alia, the REDSKINS trademark cancellation case.

As for the second argument, that the trademark registration process and the accoutrements of registration, such as the use of the ® symbol and the issuance of a certificate of registration constitute government speech, the Federal Circuit distinguished this case from the Supreme Court’s 2015 decision in Walter, Sons of Confederate Veterans (specialty license plates) and concluded that trademark registration is not government speech, since the purpose of a trademark as a source-identifier of goods and services is “antithetical to the notion that a trademark is tied to the government.” Rather, the Court analogized the government’s arguments to a suggestion that the process of copyright registration is also government speech, which would allow the government to prohibit the registration of any works of authorship that were deemed disparaging to others—i.e., censorship; a result that is inconsistent with the First Amendment.

As to the third argument, the Federal Circuit confirmed that trademark registration is a regulatory regime, not a government subsidy. Under the unconstitutional conditions doctrine, the Court concluded that the denial of an otherwise available benefit is unconstitutional where it has a “significant chilling effect” on private speech. Explaining that trademark registration is not a program through which the government conveys a message by using the (filing) receipts for funding, the Court found that the process does not implicate the government’s power to spend.

Although the Federal Circuit determined that §2(a) regulates expressive speech (rather than commercial speech), the Court went further and additionally reviewed the issue under the intermediate scrutiny standard for commercial speech in accordance with the 1980 Supreme Court case Central Hudson Gas & Electric v. Public Service Commission (holding that restrictions on commercial speech likely to deceive the public are permissible). The Court found that §2(a) would also fail constitutional muster under intermediate scrutiny, as there is nothing illegal or misleading about a disparaging trademark, and because there is insufficient government interest in the government’s disapproval of a message.

The Federal Circuit made it clear that it did not endorse Mr. Tam’s trademark, and it acknowledged that its decision likely would lead to an increase in registration of marks that offend communities of people. However, the Court concluded that since the government did not present a substantial government interest justifying the §2(a) proscription on disparaging marks, the proscription of §2(a) failed to pass constitutional muster.

Concurrences & Dissents

In addition to the majority opinion, several members of the en banc panel authored and joined concurring and dissenting opinions. Judge O’Malley, joined by Judge Wallace, agreed with the majority that §2(a) is unconstitutional on its face, but further opined that §2(a) is also unconstitutionally vague under the Fifth Amendment due to the “may disparage” language, such that the proscription would be unconstitutional whether or not it survived the First Amendment challenge.

Judge Dyk issued an opinion concurring in part and dissenting in part, with Judges Lourie and Reyna joining in the dissent. Dyk agreed with the majority view that the proscription on registration of disparaging marks is unconstitutional as specifically applied to Mr. Tam, but argued that the majority “errs in going beyond the facts of this case.” In Dyk’s view, “the statute is constitutional as applied to purely commercial trademarks, but not as to core political speech, of which Mr. Tam’s mark is one example . . . The government need not support the inevitable consequence of this decision—‘the wider registration of marks that offend vulnerable communities.’”

Judges Lourie and Reyna each filed dissenting opinions stating that they would affirm the PTO’s decision to refuse registration of Mr. Tam’s mark and would not overrule McGinley. Lourie’s opinion noted that the statute was 70 years old and constituted “settled law.” He focused on perceived interference with the longstanding congressional policy of delegating authority to the PTO to filter out certain undesirable marks from the federal registration system and stated that it is not clear that a trademark is protected non-commercial speech. Lourie focused on the observation that Mr. Tam may still use THE SLANTS trademark in commerce, with or without a registration. Similarly, in his dissent, Judge Reyna focused on his belief that trademarks are commercial speech subject to intermediate scrutiny and that § 2(a) directly advances a substantial government interest in the orderly flow of commerce.

Practice Note: Although the en banc ruling overrules McGinley, it is specifically limited to the §2(a) disparagement provision. Other potential questions raised by §2(a), such as the constitutionality of the prohibition of immoral or scandalous marks, will have to await consideration by future courts. In the meantime, and as the Federal Circuit itself noted, this decision likely will result in the increased filing and registration of trademarks that may be seen as disparaging to groups of people. The ruling here carries a potential impact on Washington Redskins trademark cancellation case, presently pending on appeal at the U.S. Court of Appeals for the Fourth Circuit.