Articles Posted in US Supreme Court

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Brunetti sought federal registration of the trademark FUCT. The Patent and Trademark Office denied his application under a Lanham Act provision that prohibits registration of trademarks that consist of or comprise "immoral[ ] or scandalous matter,” 15 U.S.C. 1052(a). The Supreme Court affirmed the Federal Circuit in holding that the provision violates the First Amendment. The Court noted that it previously invalidated the Act’s ban on registering marks that “disparage” any “person[ ], living or dead.” The “immoral or scandalous” bar similarly discriminates on the basis of viewpoint. Expressive material is “immoral” when it is “inconsistent with rectitude, purity, or good morals”; “wicked”; or “vicious”; the Act permits registration of marks that champion society’s sense of rectitude and morality, but not marks that denigrate those concepts. Material is “scandalous” when it “giv[es] offense to the conscience or moral feelings”; “excite[s] reprobation”; or “call[s] out condemnation”; the Act allows registration of marks when their messages accord with, but not when their messages defy, society’s sense of decency or propriety. The statute, on its face, distinguishes between ideas aligned with conventional moral standards and those hostile to them. The Court rejected an argument that the statute is susceptible of a limiting construction. The “immoral or scandalous” bar does not draw the line at lewd, sexually explicit, or profane marks. Nor does it refer only to marks whose “mode of expression,” independent of viewpoint, is particularly offensive. To cut the statute off where the government urges would not interpret the statute Congress enacted, but fashion a new one. View "Iancu v. Brunetti" on Justia Law

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Tempnology licensed Mission to use Tempnology’s trademarks in connection with the distribution of clothing. Tempnology filed for Chapter 11 bankruptcy and sought to reject its agreement with Mission as an “executory contract” under 11 U.S.C. 365, which provides that rejection “constitutes a breach of such contract.” The Bankruptcy Court approved Tempnology’s rejection, holding that the rejection terminated Mission’s rights to use Tempnology’s trademarks. The Bankruptcy Appellate Panel reversed, holding that rejection does not terminate rights that would survive a breach of contract outside bankruptcy. The First Circuit reinstated the Bankruptcy Court’s decision. The Supreme Court reversed, first holding that the case is not moot. Mission presented a plausible claim for damages, sufficient to preserve a live controversy. A debtor’s rejection of an executory contract under Bankruptcy Code Section 365 has the same effect as a breach of that contract outside bankruptcy and cannot rescind rights that the contract previously granted. A licensor’s breach cannot revoke continuing rights given under a contract (assuming no special contract term or state law) outside of bankruptcy; the same result follows from rejection in bankruptcy. Section 365 reflects the general bankruptcy rule that the estate cannot possess anything more than the debtor did outside bankruptcy. The distinctive features of trademarks do not mandate a different result. In delineating the burdens a debtor may and may not escape, Section 365’s edict that rejection is breach expresses a more complex set of aims than facilitating reorganization. View "Mission Product Holdings, Inc. v. Tempnology, LLC" on Justia Law

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Fourth Estate, a news organization that licensed works to Wall-Street.com, a news website. sued Wall-Street for copyright infringement of articles that Wall-Street failed to remove from its website after canceling the license agreement. Fourth Estate had applied to register the articles with the Copyright Office, but the Register had not acted on those applications. No civil infringement action “shall be instituted until . . . registration of the copyright claim has been made,” 17 U.S.C. 411(a). The Eleventh Circuit and a unanimous Supreme Court affirmed the dismissal of the suit. Registration occurs, and a copyright claimant may commence an infringement suit, upon registration; a copyright owner can then recover for infringement that occurred both before and after registration. In limited circumstances, copyright owners may file suit before undertaking registration. For example, an owner who is preparing to distribute a work that is vulnerable to predistribution infringement—e.g., a movie or musical composition—may apply for preregistration; an owner may also sue for infringement of a live broadcast before registration. The Court rejected Fourth Estate’s “application approach” argument that registration occurs when a copyright owner submits a proper application. In 1976 revisions to the Copyright Act, Congress both reaffirmed that registration must precede an infringement suit. The Act safeguards copyright owners by vesting them with exclusive rights upon creation of their works and prohibiting infringement from that point forward. To recover for such infringement, copyright owners must apply for registration and await the Register’s decision. An administrative lag in processing applications does not allow revision of section 411(a)’s congressionally-composed text. View "Fourth Estate Public Benefit Corp. v. Wall-Street.com, LLC" on Justia Law

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The rock group “The Slants,” chose that name to dilute the term’s denigrating force as a derogatory term for Asians. The Patent and Trademark Office (PTO) denied an application for registration of the name under 15 U.S.C. 1052(a), which prohibits the registration of trademarks that may “disparage . . . or bring . . . into contemp[t] or disrepute” any “persons, living or dead.” The Supreme Court affirmed the Federal Circuit in finding the clause unconstitutional. The Court first rejected an argument that the clause applies only to natural or juristic persons. The Court then held that the clause is subject to the Free Speech Clause, which does not regulate government speech. Trademarks are private, not government speech. "If trademarks become government speech when they are registered, the Federal Government is babbling prodigiously and incoherently.” The disparagement clause denies registration to any mark that is offensive to a substantial percentage of the members of any group. That is viewpoint discrimination. The “public expression of ideas may not be prohibited merely because the ideas are themselves offensive to some of their hearers.” The disparagement clause cannot withstand even “relaxed” review. It does not serve a “substantial interest,” nor is it “narrowly drawn.” View "Matal v. Tam" on Justia Law