In re Elster

• Decision Date: 24 February 2022
• Docket Number: 2020-2205
• Citation: 26 F.4th 1328
• Parties: IN RE: Steve ELSTER, Appellant
• Court: U.S. Court of Appeals — Federal Circuit

26 F.4th 1328

IN RE: Steve ELSTER, Appellant

2020-2205

United States Court of Appeals, Federal Circuit.

Decided: February 24, 2022

Jonathan Taylor, Gupta Wessler PLLC, Washington, DC, argued for appellant. Also represented by Gregory A. Beck.

Joshua Marc Salzman, Civil Division, Appellate Staff, United States Department of Justice, Washington, DC, argued for appellee Andrew Hirshfeld. Also represented by Brian M. Boynton, Daniel Tenny ; Thomas L. Casagrande, Christina J. Hieber, Thomas W. Krause, Farheena Yasmeen Rasheed, Molly R. Silfen, Office of the Solicitor, United States Patent and Trademark Office, Alexandria, VA.

Matthew Albert Handal, New York, NY, as amicus curiae, pro se.

Before Dyk, Taranto, and Chen, Circuit Judges.

Dyk, Circuit Judge.

Steve Elster appeals a decision of the Trademark Trial and Appeal Board ("Board"). The Board affirmed an examiner's refusal to register the trademark "TRUMP TOO SMALL" for use on T-shirts. The Board's decision was based on section 2(c) of the Lanham Act, 15 U.S.C. § 1052(c), and the Board's finding that the mark included the surname of a living individual, President Donald J. Trump, without his consent. Because we hold that applying section 2(c) to bar registration of Elster's mark unconstitutionally restricts free speech in violation of the First Amendment, we reverse the Board's decision.

BACKGROUND

In 2018, Elster sought to register the phrase "TRUMP TOO SMALL" in standard characters for use on shirts in International Class 25. The class of goods encompasses:

Shirts; Shirts and short-sleeved shirts; Graphic T-shirts; Long-sleeved shirts; Short-sleeve shirts; Short-sleeved shirts; Short-sleeved or long-sleeved t-shirts; Sweat shirts; T-shirts; Tee shirts; Tee-shirts; Wearable garments and clothing, namely, shirts....

J.A. 1–2. According to Elster's registration request, the phrase he sought to trademark invokes a memorable exchange between President Trump and Senator Marco Rubio from a 2016 presidential primary debate, and aims to "convey[ ] that some features of President Trump and his policies are diminutive." J.A. 5.

The Patent and Trademark Office ("PTO") examiner rejected Elster's proposed mark on two grounds. First, the examiner concluded that the mark was not registrable because section 2(c) of the Lanham Act bars registration of a trademark that "[c]onsists of or comprises a name ... identifying a particular living individual" without the individual's "written consent." § 1052(c). Consistent with this provision, Elster's mark could not be registered because it used Trump's name without his consent. It did not matter, according to the examiner, that the mark was "intended as political commentary" because there is no statutory or "case law carve[ ] out" for "political commentary." J.A. 201. The examiner rejected Elster's contention that denying the application infringed his First Amendment rights, finding that the registration bars are not restrictions on speech, and in the alternative, that any such restriction would be permissible. In a separate decision, the examiner also denied registration of the mark under section 2(a)'s false association clause, which bars registration of trademarks that "falsely suggest a connection with persons, living or dead." § 1052(a). The examiner here also rejected a First Amendment defense.

Elster appealed both decisions to the Board, which consolidated the two cases. Elster argued that sections 2(c) and 2(a) constituted impermissible content-based restrictions on speech. He contended that strict scrutiny should apply, that neither provision was narrowly tailored to serve a compelling government interest, and that any government interest was outweighed by the First Amendment interest in allowing commentary and criticism regarding a political figure. The Board affirmed the examiner's denial of the mark in a decision that rested solely on section 2(c) grounds, finding it unnecessary to address the rejection under section 2(a).

Although the Board recognized that it does not have authority to declare statutory provisions unconstitutional, it noted that prior Board decisions have addressed the constitutionality of section 2(c) in light of the Board's experience and familiarity with the purposes underlying the statute, and it concluded that section 2(c) was not an unconstitutional restriction on free speech. The Board explained, "even if Section 2(c) were subject to greater scrutiny," it is narrowly tailored to advance two compelling government interests: protecting the named individual's rights of privacy and publicity and protecting consumers against source deception. J.A. 10. Elster appeals. We have jurisdiction pursuant to 15 U.S.C. § 1071(a).

DISCUSSION

I

Section 2 of the Lanham Act requires the PTO to refuse registration of certain categories of proposed trademarks. In the last five years, the Supreme Court has held unconstitutional two provisions of section 2. In Matal v. Tam , 582 U.S. ––––, 137 S. Ct. 1744, 198 L.Ed.2d 366 (2017), the Court considered a provision of section 2(a) of the Lanham Act, which directed the PTO to deny registration of marks that "disparage ... or bring ... into contempt[ ] or disrepute" any "persons, living or dead," 15 U.S.C. § 1052(a). The eight-Justice Court was evenly split between two non-majority opinions, but both sides agreed that the provision violated the First Amendment. See Tam , 137 S. Ct. at 1765. In Iancu v. Brunetti , 588 U.S. ––––, 139 S. Ct. 2294, 204 L.Ed.2d 714 (2019), the Court considered another provision of section 2(a) of the Lanham Act, which directed the PTO to deny registration of marks that "consist[ ] of or comprise[ ] immoral ... or scandalous matter," § 1052(a). Again, the Court held the provision unconstitutional. See Brunetti , 139 S. Ct. at 2302. The two opinions in Tam and the majority opinion in Brunetti each relied on a "core postulate of free speech law"—that "[t]he government may not discriminate against speech based on the ideas or opinions it conveys"—and concluded that "[v]iewpoint discrimination doomed" the two provisions. Id. at 2299.

The provision of the Lanham Act involved in this case, section 2(c), prohibits registration of a trademark that

[c]onsists of or comprises a name, portrait, or signature identifying a particular living individual except by his written consent, or the name, signature, or portrait of a deceased President of the United States during the life of his widow, if any, except by the written consent of the widow.

§ 1052(c). Neither Tam nor Brunetti resolves the constitutionality of section 2(c). Both holdings were carefully cabined to the narrow, "presumptive[ ] unconstitutional[ity]" of section 2(a)'s viewpoint-based restrictions, Brunetti , 139 S. Ct. at 2299 (quoting Rosenberger v. Rector & Visitors of Univ. of Va. , 515 U.S. 819, 829–30, 115 S.Ct. 2510, 132 L.Ed.2d 700 (1995) ), and Elster agrees that section 2(c) does not involve viewpoint discrimination, Oral Arg. at 45:49–46:35. We nonetheless conclude that as applied in this case, section 2(c) involves content-based discrimination that is not justified by either a compelling or substantial government interest.

II

While neither Tam nor Brunetti resolves this case, they do establish that a trademark represents "private, not government, speech" entitled to some form of First Amendment protection. Tam , 137 S. Ct. at 1760 ; see Brunetti , 139 S. Ct. at 2299. The cases also establish that trademarks often "do not simply identify the source of a product or service but go on to say something more" on "some broader issue." Tam , 137 S. Ct. at 1764 (Alito, J.). They frequently "have an expressive content" and can convey "powerful messages ... in just a few words." Id. at 1760. Even though the government in the trademark area has not imposed an absolute prohibition on speech, Brunetti further established that denying trademark registration "disfavors" the speech being regulated. 139 S. Ct. at 2297, 2300. We recognize, as the government contends, that section 2(c) does not prevent Elster from communicating his message outright. But whether Elster is free to communicate his message without the benefit of trademark registration is not the relevant inquiry—it is whether section 2(c) can legally disadvantage the speech at issue here.

The advantages of trademark registration are well known, including serving as "prima facie evidence of the validity of the registered mark and of the registration of the mark, of the owner's ownership of the mark, and of the owner's exclusive right to use the registered mark in commerce"; conferring "incontestable" status "once a mark has been registered for five years"; and enabling a mark holder to prevent the importation of goods "bearing an infringing mark" into the United States. Tam , 137 S. Ct. at 1753 (internal quotation marks omitted) (first quoting B&B Hardware, Inc. v. Hargis Indus., Inc. , 575 U.S. 138, 142, 135 S.Ct. 1293, 191 L.Ed.2d 222 (2015) ; then quoting id. at 143, 135 S.Ct. 1293 ; and then quoting 3 J. Thomas McCarthy, Trademarks and Unfair Competition § 19:9, at 19–38 (4th ed. 2017) ).

Nonetheless, the government argues that because trademark protection is the equivalent of a government subsidy, it is not subject to First Amendment scrutiny so long as viewpoint discrimination is not involved. This position has little support in the Supreme Court's opinions in Tam and Brunetti . Although the dissenting Justices in Brunetti suggested that trademark registration might be viewed as a condition on a government benefit, 139 S. Ct. at 2308, 2317 (Sotomayor, J. concurring-in-part and dissenting-in-part), Justice Alito's opinion in Tam , joined by three other Justices, stated that the "federal registration of a trademark is nothing like" government subsidy programs that provide cash benefits to private parties, and that cases addressing such programs are "not instructive in analyzing the constitutionality of restrictions on" trademarks, 137 S. Ct. at 1761 ...