By Scott Graham, From The Recorder

SAN FRANCISCO — It’s heady times for trademark attorneys.

On the heels of U.S. Supreme Court decisions on trademark tacking and TTAB preclusion, the U.S. Court of Appeals for the Federal Circuit on Monday agreed to decide en banc whether the Trademark Trial and Appeal Board can reject trademark applications as “scandalous” or “disparaging.”

The order came just one week after Judge Kimberly Moore raised the issue in a case involving an Asian dance band that wants to register “The Slants” over TTAB and U.S. Patent and Trademark Office opposition. The decision could also be influential in the Washington Redskins’ litigation to restore its trademark, even though that case is pending in a different court.

The U.S. Court of Customs and Patent Appeals in 1981 upheld the Patent and Trademark Office’s power to refuse registration to marks that are “immoral, deceptive, or scandalous” or that disparage “persons … institutions, beliefs or national symbols.” But Moore argued that intervening Supreme Court decisions and the PTO’s transition to user-funding undermine In re McGinley.

Given that the Federal Circuit took the case on its own motion without any petition for rehearing, the judges seem to be seriously considering Moore’s argument that the government has no business making content-based decisions about the offensiveness of a trademark. But it will likely require votes from six of 10 active judges. One seat is vacant, and Judge Raymond Chen—the court’s only Asian-American member—will likely be recused because he was the PTO’s solicitor while the case was litigated there.

Section 2(a) of the Lanham Act might seem somewhat obscure. “But for a trademark lawyer or brand lawyer it’s a very interesting issue,” said McDermott Will & Emery partner Joanne Ludovici, who is not involved in the case. “It’s something we wrestle with all the time—what does ‘disparaging’ mean?”

It’s a vexing issue for the students she teaches about trademark protection. “They can understand false designation of origin, or trying to trade on someone else’s name. When I get to disparagement, they all scratch their heads.”

Over the years, the PTO has turned down a winery’s application for a “Madonna” trademark, but more recently allowed “Badass” for a musical instrument. “Heeb Media” was rejected, while “Dykes on Bikes” was registered.

At the very least, Ludovici said, some concrete guidance narrowing the grounds for rejections would be helpful. Currently, any mark that carries a whiff of controversy seems to get shot down, she suggested.

In In re Tam, musician Simon Tam has tried twice to register The Slants for his Oregon-based Chinatown dance rock band. He was once quoted as saying the band is using the name to reclaim the stereotype and take power away from people who use it as a term of hate.

After the PTO rejected his first application he took a different approach, arguing that “slants” is a word with many innocuous connotations and there’s nothing inherently offensive about it. The TTAB rejected the application again, citing the context of the band’s Asian-themed imagery and some controversy around one of its concerts.

The Federal Circuit upheld that decision last week, but Moore wrote separately to say she has serious doubts about the constitutionality of Section 2(a). Tam’s attorney, Ronald Coleman, who grounded the band’s appeal in more technical arguments, seemed to take umbrage, issuing a blog post headlined, “Shut up about the Constitution already.”

The Federal Circuit indicated in Monday’s order that briefing would be “strictly limited” to the First Amendment issue. It also invited amicus curiae briefs from other interested parties. The American Civil Liberties Union, for one, has already filed an amicus curiae brief in the Redskins case in Virginia federal court urging that Section 2(a) be struck down.

A Federal Circuit decision striking down Section 2(a) would seem at a minimum to guarantee the Redskins a circuit split if the Fourth Circuit ultimately rejects the team’s constitutional challenge. But both outcomes could be determined by another government speech case, Walker v. Sons of the Confederacy, pending before the Supreme Court. In that case the justices heard argument last month over whether private messaging on state-issued automobile license plates can be subject to content-based regulation because it arguably carries the government’s imprimatur.

For more on this story go to: http://www.therecorder.com/id=1202724735990/Full-Federal-Circuit-to-Review-Ruling-on-Disparaging-Trademarks#ixzz3YcKb5OO6