Supreme Court to decide if offensive names such as 'Redskins' and 'Slants' can be trademarked

The Supreme Court agreed Thursday to decide whether The Slants, an Asian American rock band from Portland, Ore., can trademark its name despite the government’s objection that it is an offensive term.

This clash between free speech and trademark protection has drawn wide attention in part because the Washington Redskins football team is locked in the same dispute.

The court also said it will decide a free-speech dispute involving fees charged to merchants who accept credit cards. Under challenge are laws in California, New York, Florida, Texas and several other states that forbid retailers from disclosing the surcharge to customers who use a charge card.

Retailers challenging these laws say that revealing the fees to customers would put pressure on the credit card companies to lower them. “Because credit-card companies have been so successful in hiding the cost of credit from consumers, U.S. merchants pay some of the highest swipe fees in the world, about 3% of every credit-card purchase, or over $50 billion a years in fees,” they said in their appeal.

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The trademark dispute arose when Simon Tam, the founder of the band, chose the name the Slants to co-opt and make fun of a slur directed at Asians. But officials at the U.S. Patent and Trademark Office weren’t laughing, and they rejected Tam’s application for a protected trademark.

The decision did not prevent the band from using the name, but trademark status can be valuable in preventing others from using the same or similar name in marketing.

When Tam and the Slants sued, a federal appeals court struck down part of a 1946 law that tells the government to reject trademarks that “disparage … persons, living or dead.” The judges said the law violated Tam’s right to free speech.

“It is a bedrock principle underlying the 1st Amendment that the government may not penalize private speech merely because it disapproves the message it conveys,” the appeals court said in February.

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The Justice Department appealed to the Supreme Court and argued that awarding a trademark is a government benefit, not a limit on private speech. The law “does not prohibit any speech, proscribe any conduct or restrict the use of any trademark,” the department said in its appeal. Forcing the government to endorse the use of “a disparaging term as a trademark … would convey to the public that the United States regards racial slurs as appropriate.”

Lawyers for Tam said the trademark office had been inconsistent in how it has applied the law: "One of the most well-known and influential musical groups of the 1980s and 1990 was N.W.A., which fans knew stood for ‘Niggaz Wit Attitudes.’ While [such terms] certainly may be used in a disparaging way, the members of N.W.A. did not use the word that way, and the group's millions of fans did not interpret the name as disparaging."

"The same is true of The Slants," they said. "Simon Tam and his band members are not disparaging Asian Americans. They are doing precisely the opposite; they are appropriating a slur and using it as a badge of pride."

Last year, the court was closely split by a somewhat similar dispute involving specialty license plates. At issue was whether the words and symbols on license plate should be seen as state speech or private speech. Texas issued specialty plates for hundreds of groups, but refused when the Sons of Confederate Vets asked for one bearing a Confederate battle flag. The high court upheld the state’s decision by a 5-4 vote.

The justices met behind closed doors this week to sift through hundreds of pending appeals and announced they would hear eight new cases, including the trademark dispute in Lee vs. Tam.

Lawyers for Tam took the rather unusual step of urging the court to hear the appeal, and they said Thursday they “look forward to the vindication of his 1st Amendment rights.”

The outcome is likely to determine whether Washington’s NFL team will lose its trademark status. Native Americans have sued the team, contending the name Redskins is offensive and disparaging, and the government office agreed its trademark status should be withdrawn. The team has appealed that decision to the high court.

The credit card fee dispute arose when several merchants from California and New York sued over laws that make it illegal to disclose the surcharges for using credit cards, though the laws allow merchants to offer discounts equal to the fee to those paying with cash.

Last year, a federal judge in Sacramento ruled that California’s law violated the 1st Amendment, but the state appealed to the U.S. 9th Circuit Court of Appeals. New York’s law was also temporarily struck down by a federal judge, but the 2nd Circuit Court revived it on the grounds that it regulated prices, not speech.

Deepak Gupta, a consumer-rights lawyer in Washington, appealed on behalf of a New York hair salon and urged the justices to strike down “this industry-friendly speech code” that hides the cost of swipe fees. The case of Expression Hair Design vs. Schneiderman, like the trademark case, will be heard early next year and decided by late June.

The justices took no action on a pair of closely watched appeals involving college sports. Lawyers for the NCAA and former UCLA basketball star Ed O’Bannon have asked the court to consider whether the ban on paying college athletes violates the antitrust laws. 

david.savage@latimes.com

On Twitter: DavidGSavage

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UPDATES:

10:50 a.m.: This story was updated with additional background and details of the credit card case.

This story was originally published at 8:20 a.m.

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