The Sports Esquires Putting Sports on Trial
For the second time in 15 years, the U.S. Patent and Trademark Office (USPTO) has cancelled the federal registrations for six trademarks of the Washington Redskins on grounds that the team name is disparaging to Native Americans.
The amount of incorrect information circulating about this decision is astounding. Particularly during the hours immediately following the decision, multiple major news sources were issuing incorrect or misleading reports about the impact of the USPTO’s decision. The biggest errors in reporting were that (1) the last appeal was overturned on a technicality, (2) that anyone can now produce Redskins apparel, and (3) that the Redskins are going to take a big financial hit.
This article will attempt to set the record straight by laying out the complete history of the case and it’s reasonably certain future. No opinion on whether the name should be changed will be given.[i]
This is complex legal and social issue. Reasonable minds can and will disagree about whether the name should change. It is important to have an educated opinion in order to have a civil discussion.
- History of the Case and the Etymology of Redskins
On September 10, 1992 Suzan Harjo and six other Native Americans (“Harjo Petitioners”) filed a petition to cancel six of the Redskins trademarks. In 1999, the Trademark Trial and Appeal Board (TTAB) an independent administrative tribunal within the USPTO issued a decision canceling six Redskins trademarks as disparaging to Native Americans.
The Washington Redskins appealed that decision to the United States District Court for the District of Columbia. In 2003, on motion for summary judgment, the D.C. District Court reversed the TTAB for two reasons: (1) the TTAB’s finding of disparagement was not supported by substantial evidence, and (2) the doctrine of laches – an equitable defense similar to a statute of limitations – precluded the TTAB from considering the case.
The case was appealed further by the Harjo Petitioners to the United States Court of Appeals D.C. Circuit Court. The D.C. Circuit Court remanded the case back to the District Court and eventually resolved the case solely on the basis of laches, never addressing the TTAB’s finding of disparagement on the merits.
Thus, the first case was not overturned on a technicality as most have reported. It was overturned on two distinct grounds, it just so happened that the “technicality” (a misnomer in the author’s opinion) was the focus of the appeal.
On August 11, 2006 Amanda Blackhorse and five other Native Americans (“Blackhorse Petitioners”) filed the petition to cancel which led to Wednesday’s TTAB decision to cancel six Redskins trademarks. The case was put on hold pending the outcome of the Harjo Petitioner’s appeal. The Blackhorse Petitioners relied on primarily the same evidence, but fixed the defects that led to the Blackhorse decision being overturned by laches.
The history and meaning of the word “redskin” is not entirely clear. Some have claimed that it arose out the act of paying a bounty for the scalp of an Indian. Others have claimed a much more benign beginning to the word.
Ultimately, the origin and history of the word and the team name is largely irrelevant for legal purposes. What mattered to the TTAB in cancelling the Redskins marks was whether the term “redskins” was disparaging at the time of registration (the marks were registered from 1967-1990).
- Just the Facts: The June 18, 2014 TTAB Decision
Wednesday’s decision to cancel six Washington Redskins marks was issued by a divided three-member panel of the TTAB in a 99 page decision. The fact that a dissent was issued in this case demonstrates that reasonable minds can and do disagree about this issue – a fact that neither side seems willing to concede. This is complex legal and social issue. Reasonable minds can and will disagree about whether the name should change. It is important to have an educated opinion in order to have a civil discussion. Both sides should recognize the merit in the other’s argument.
The decision applies solely to trademarks involving the word “Redskins” it does not apply to the team logo(s). However, two of the marks do include Native American imagery, but are no longer used by the team with any prominence.
- What Did the Redskins Lose? What is a Federal Registration?
The Washington Redskins ONLY lost the federal registration for six of their trademarks. So what exactly is a federal registration good for? In short, it makes enforcement of a trademark significantly easier for the mark holder. A federal registration allows for:
- A legal presumption of ownership of the mark and exclusive right to use the mark nationwide on or in connection with the goods/services listed in the registration;
- Public notice of claim of ownership of the mark;
- The ability to record the registration with the U.S. Customs and Border Protection Service to prevent importation of infringing foreign goods;
- The right to use the federal registration symbol “®”;
- The ability to bring an action concerning the mark in federal court; and
- The use of the U.S. registration as a basis to obtain registration in foreign countries.
That’s it. But, the Redskins don’t even lose those benefits until a final determination of the case is made. Pending the appeal of the case (which the Redskins have said they will do) the team will retain the federal registrations and all the benefits that go with them.
- What’s Next?
The Redskins will appeal the decision to either the United States District Court for the Eastern District of Virginia or the U.S. Court of Appeals for the Federal Circuit. Prior to 2011, the team would have appealed to the D.C. District Court and not the Eastern District of Virginia.
An appeal to the Eastern District of Virginia will allow the team to introduce further evidence and supplement the record. However, it will also require the team to pay all of the PTO’s “expenses” for the proceeding, including fees for the work performed by PTO attorneys and paralegals on the appeal.[ii] More importantly, an appeal to the Eastern District of Virginia could be problematic as the court has limited experience in trademark matters, particularly compared to the Federal Circuit which is referred to as the TTAB’s “primary reviewing court.”
The last set of appeals took 10 years. It is safe to assume that an appeal this go around would not take quite as long, but should still take several years to reach a conclusion.
- What Could Happen if the Redskins Lose the Appeal and the Benefits of Federal Registration?
Not much. Even absent the advantages provided by a federal registration for a trademark, the Redskins still have ample sources of protection for their marks.
State law, federal common law, and federal unfair competition law[iii] should still protect the Redskins trademarks; it will simply be more difficult and expensive to protect the marks. The biggest loss is likely the ability to prevent the importation of counterfeit merchandise at the border.[iv]
State trademark protections are very similar to federal laws; the primary distinction is that their reach is limited to their borders. The Redskins have registered marks in Virginia and Maryland, the primary location of their fan base.
Anyone who thinks Wednesday’s ruling opens the door to make an easy buck selling Redskins apparel is sorely mistaken. Absent the federal common law and unfair competition protections, Virginia law provides for criminal prosecution of the sale of counterfeit merchandise. If the offending party “possesses 100 or more identical counterfeit registered marks or possesses counterfeit items valued at $200 or more” may be guilty of a Class 6 felony.[v]
Moreover, even absent the federal registration, the Redskins can still protect their marks online. If someone attempts to ‘cybersquat’ on a domain bearing a Redskin mark, the team can still obtain a transfer or cancellation of that domain.[vi]
- Is This Going to Force the Redskins to Change the Name?
Probably not. The Redskins share the profits from the revenue of licensing their marks with 30 other NFL teams. It is 30 not 31 because the Dallas Cowboys license their marks separate from the other 31 teams.[vii] Therefore, any loss in sales and revenue from competitors (which as mentioned previously would be few and far between) would be spread among 31 teams. Additionally, this reduction in licensing revenue is likely to be miniscule in comparison with the team’s other sources of revenue.
However, loss of federal registrations and resulting loss in revenue may persuade the other NFL owners to pressure Daniel Snyder to change the name.
A bigger and more likely impetus to change the name is the desire for a new stadium. The Redskins current stadium lease ends in 2027. If the team would like to move into a new stadium either in the District of Columbia or Virginia, the government may condition the use of public funds to construct a new stadium on the team changing its name. A few million dollars may not mean much to Daniel Snyder. But what about 300 million? 400 million? Snyder would have to seriously consider such an offer. The process for building a new stadium is a decade long endeavor. Thus, we could see a name change in the next few years.
- Conclusion
SLOW DOWN. That is the lesson here. Legally, Wednesday’s decision by the TTAB changes nothing. In terms of public opinion and momentum it is certainly significant, but there is still a long way to go. To use a football analogy, the opponents of the name just got a first down and are now first and ten at their own 30 yard line. They still have a long way to go.
[i] The author is a lifelong Redskins fan. I have done my best to remain impartial and offer an unbiased analysis. This is purely a fact-based explanation of what happened and what can reasonably be expected to happen going forward. [ii] https://www.morganlewis.com/documents/ShammasOpinion.pdf [iii] 15 U.S. Code § 1125 [iv] Days before Super Bowl 49, Federal officials seized 163 web sites, and $21.6 million in NFL counterfeit gear. [v] VA Code § 59.1-92.13 A class 6 felony is punishable by “a term of imprisonment of not less than one year nor more than five years, or in the discretion of the jury or the court trying the case without a jury, confinement in jail for not more than 12 months and a fine of not more than $2,500, either or both.” The Maryland trademark code can be viewed here. [vi] See, Uniform Dispute Resolution Policy. WIPO Overview §1.7 An entity does not need a federal registration to prove that it has rights under UDRP Paragraph 4(a)(i). First Coast Energy, L.L.P. v. JIM BAZLEY / FIRST COAST ENERGY, FA 1554730 (Nat. Arb. Forum May 27, 2014). [vii] The NFL franchises license their marks to the NFL Trust which in turns license the marks to NFL Properties which is responsible for marketing and licensing the marks to the likes of Nike and Under Armour. See, http://www.forbes.com/sites/aliciajessop/2013/11/29/jerry-jones-1995-risk-allows-the-dallas-cowboys-to-become-leaders-in-the-growing-womens-sports-apparel-market/
