IP Views

An analysis of the Iancu v. Brunetti (2019) doctrine taken in the Philippine context

Authors:
- Joseph Christopher C. Balagtas
- Marinella Isabelle Capistrano
- Jonathan Peter A. Gregorio
- Augusto Rahabam G. Santos IV

I. Background

Erik Brunetti sought federal registration of the trademark “FUCT.” It is pronounced as four separate letters. The U.S. Patent and Trademark Office (USPTO) denied the application on the ground that the Lanham Act prohibits the registration of a trademark that consists of, or comprises immoral or scandalous matter. Brunetti challenged the denial, alleging that “immoral or scandalous” violates the First Amendment, or the freedom of speech.

The Court ultimately ruled that the Lanham Act’s prohibition of immoral or scandalous trademarks violates the First Amendment. Matal v. Tam held that if a trademark registration bar is viewpoint based, it is unconstitutional. In Matal, the Court declared unconstitutional the Lanham Act’s ban on registering marks that disparages any person, living or dead.

“Immoral or scandalous” was considered as similarly viewpoint based. Expressive material is considered as immoral when it is inconsistent with rectitude, purity, or good morals, wicked, or vicious. Material is scandalous when it gives offense to conscience or moral feelings, excites reprobation, or calls out condemnation. The prohibition in the Lanham Act, on its face, distinguishes between those aligned with conventional moral standards and those contrary to them. The Court noted how the USPTO has refused to register immoral or scandalous views about drug use, religion, or terrorism, while registering more accepted views on these. The “immoral or scandalous” ban was considered as substantially overbroad. There are too many immoral and scandalous ideas in the world and the Lanham Act would cover them all.

Furthermore, the Court did not agree with the Government’s claim that the statute could refer only to the mode of expression, regardless of whatever is expressed. These referred to mostly lewd, sexually explicit, or profane modes of expression. The Court ruled that to interpret the statute in this manner would go beyond interpretation. It would ultimately fashion a new statute altogether.

II. Should the Philippines adopt the Iancu doctrine?

Under the principles of statutory construction, when foreign statutes are adopted in this country or when local laws are patterned form parts of the legislative history of the latter, the decision of the courts in such country construing those laws are entitled to great weight in the interpretation of such local statutes.

Many of the provisions of the IP Code were lifted directly from the Lanham Act, which is why the Lanham Act has been cited in several cases under Philippine jurisdiction. In all cases, the Lanham Act was used to justify a certain ruling or decision of the Philippine Supreme Court in interpreting or applying the Philippine IP Code.

Following statutory construction then, the decision of the US Supreme Court in Iancu v. Brunetti on the unconstitutionality of the words “immoral” and “scandalous” in the Lanham Act regarding Trademark Registration should be accorded great weight by the Philippine Supreme Court if the same provision under the Philippine IP Code is under scrutiny.

But in such a hypothetical case, our Supreme Court, in deciding whether the words “immoral” and “scandalous” do infringe on the constitutional right to free speech and expression, should not be restricted with how the Iancu v. Brunetti case was decided.

In Francisco, Jr. v. House of Representatives, the SC ruled that:

As held in the case of Garcia vs. COMELEC, "[i]n resolving constitutional disputes, [this Court] should not be beguiled by foreign jurisprudence some of which are hardly applicable because they have been dictated by different constitutional settings and needs." Indeed, although the Philippine Constitution can trace its origins to that of the United States, their paths of development have long since diverged. In the colorful words of amicius curiae Father Bernas, "[w]e have cut the umbilical cord."

In Ejercito v. COMELEC, the SC, citing its ruling in Central Bank Employees Assoc., Inc. v. Bangko Sentral ng Pilipinas, reiterated the above ruling and held that:

“. . . [A]merican jurisprudence and authorities, much less the American Constitution, are of dubious application for these are no longer controlling within our jurisdiction and have only limited persuasive merit insofar as Philippine constitutional law is concerned. . . . [I]n resolving constitutional disputes, [this Court] should not be beguiled by foreign jurisprudence some of which are hardly applicable because they have been dictated by different constitutional settings and needs." Indeed, although the Philippine Constitution can trace its origins to that of the United States, their paths of development have long since diverged.”

It is thus clear that in deciding the constitutionality of a statute or a provision of a statue, the SC should rely on its own reasoning, as the US and the Philippines have different constitutional settings and needs. Even in light of the Iancu v Brunetti ruling, the SC can apply its own tests and standards in deciding whether the terms “immoral” and “scandalous” do indeed infringe on the constitutional right to free speech and expression.

III. Should Sec. 123.1 of the IP Code be deemed unconstitutional?

A. Issue on the overbreadth doctrine

The US Supreme Court ruled in Iancu that the “immoral or scandalous” bar is substantially overbroad. There are too many immoral and scandalous ideas in the world and the Lanham Act would cover them all. On the other hand, the IP Code of the Philippines has a similar provision. In spite of this, it can be argued that in the Philippines, it would not be declared as overbroad.

Estrada v. Sandiganbayan clarified that in applying the overbreadth doctrine as a facial challenge to a legislative act, the challenger must establish that no set of circumstances exists that would make the Act valid. Estrada further provided that "[w]hen statutes regulate or proscribe speech and no readily apparent construction suggests itself as a vehicle for rehabilitating the statutes in a single prosecution, the transcendent value to all society of constitutionally protected expression is deemed to justify allowing attacks on overly broad statutes…”

In other words, when there is no apparent construction that favors its constitutionality, the constitutionally-protected freedom of speech justifies the facial attack. However, Estrada clarifies that “[a] statute is not rendered uncertain and void merely because general terms are used therein, or because of the employment of terms without defining them; much less do we have to define every word we use. There is no positive constitutional or statutory command requiring the legislature to define each and every word in an enactment.”

Although the IP Code does not provide an exact definition to “immoral” or “scandalous,” the IPO is an administrative agency tasked to determine the registrability of marks, as defined by the IP Code. The IPO is deemed to have the necessary expertise and technical knowledge in applying and enforcing the IP Code so, although the law may not have defined the exact meaning of all the words, the IPO was given the task of enforcing the IP laws. In the case, it has the discretion to approve or deny the registration of marks, on the basis of being immoral or scandalous.

B. Issue on viewpoint discrimination

The US Supreme Court in Iancu and Matal struck down as unconstitutional the provisions in the Lanham Act which it found to discriminate on the basis of viewpoint. Similarly, viewpoint discrimination has been recognized by the Philippine Supreme Court as a form of content-based regulation on protected speech. As elucidated in Diocese of Bacolod v. COMELEC, content-based regulations, which are generally prohibited, can either be based on the viewpoint of the speaker or the subject of the expression. The Court further discussed that in the construction of the guarantee of freedom of speech and expression, it has always been wary of censorship or subsequent punishment which entails evaluation of the speaker’s viewpoint or the content of one’s speech. It is also well-established that violations of the free speech clause may involve either prior restraint or subsequent punishment.

As prevailing case law now holds, discrimination based on viewpoint or content violates the right to speech and expression and is therefore unconstitutional when it is the cause for prior restraint or subsequent punishment. In view of this, it can be argued that there is no such violation when the mere registration of trademarks and not the use is disallowed on grounds possibly entailing an evaluation of the viewpoint of the trademark owner. When trademark registration is refused trademark owners are not prohibited from expressing their views through the use of their trademarks nor are they punished therefor. Given this, there would be no “chilling effect” on speech which the Constitution seeks to prevent as a result of restrictive regulations. Registration, as the IP Code provides, merely confers rights on the mark sought to be registered but is not necessary for the use of such mark.

It may be contended that the IP Code provisions on the non-registrability of immoral, scandalous, or disparaging marks are regulations - not on speech - but on the mere registration and the grant of benefits arising therefrom. This kind of regulation could thus be considered permissible when the doctrine on prior restraint and subsequent punishment is strictly applied. Such strict application by the Philippine SC may be warranted by the different constitutional, social, and cultural settings of the country.

It should be noted as well that the case of Diocese of Bacolod discusses the importance of the accommodation of diverse ideas and the prohibition of viewpoint discrimination in the context of the elections. It focused on speech with political consequences and highlighted the social value of the exchange of ideas in such context. The Court has held that some types of speech may be subjected to some regulation by the State by virtue of its pervasive police power. In Chavez v. Gonzalez, the Court justified the difference in treatment of certain types of speech because of the varying relevant interests involved (e.g., political speech as compared to obscene speech). There is thus sufficient ground to make distinctions in the analysis and evaluation of the permissible scope of regulation on such various types of speech. Applying the foregoing in the case of immoral and scandalous trademarks, it can be argued that it is within the power of the State to regulate the registration of the same as these fall under the category of speech subject to a lower threshold of protection.

The Court in Pita v. Court of Appeals has held that “immoral” lore or literature undoubtedly comes within the ambit of free expression, but not its protection. Furthermore, it was held in Fernando v. Court of Appeals that the State can justify regulations on unprotected speech such as obscenity by invoking its mandate to protect, as parens patriae, the public from obscene, immoral and indecent materials. Based on such prevailing jurisprudence, thus, it can be reasoned that the provision on the non-registrability of trademarks found to be immoral or scandalous is a valid regulation of a form of “unprotected speech,” notwithstanding any viewpoint bias on the matter. Moreover, it can also be argued that scandalous marks are in fact viewpoint-neutral as the restriction applies to the mode rather than the content of the expression. The Iancu case holds otherwise. In any case, a different interpretation from that of the US SC may be adopted by the Philipine SC in light of the prevailing local jurisprudence and the country’s distinct cultural and social context.

Another argument supporting the constitutionality of Sec. 123.1 of the IP Code is that the type of speech covered is commercial speech. The Court in Disini, Jr. v. Secretary of Justice clarified that commercial speech belongs to a separate category of speech. It is less preferred for it does not enjoy the same level of protection as other forms of expression but it is nonetheless protected. In Pittsburg Press Co v. Human Relations Commission, it has been held that commercial speech is unprotected when it is false, misleading, or it proposes an illegal transaction. However, even if commercial speech speaks of lawful acts and the truth, it is protected and subject to regulation provided it complies with the Central Hudson test which requires that (1) the government has a substantial interest to protect, (2) the regulation directly advances that interest, and (3) the regulation is not more than necessary to protect that interest.

Commercial speech has generally been referred by courts as that which solely proposes a commercial transaction. In other instances, a broader view is given to classify speech as commercial though it has both commercial and non-commercial aspects. United States Courts, In classifying commercial speech, apply the Bolger Test which considers three factors: (1) whether the speech is advertising, (2) whether the speech refers to a specific product; and (3) whether the speaker has an economic motivation for the speech However, it is not required to meet all three to pass as commercial speech.

In light of this, it is reasonable to argue that a trademark is a form of commercial speech. Trademarks are used even in advertisements with which a commercial transaction is proposed. In addition, trademarks have both commercial and non-commercial aspects. It is specifically registered to point out distinctly the origin and ownership of the goods. It is sought for as a protection of one’s good will and the right to prevent others from using the same in connection to the use and sale of the latter’s goods. Ultimately, it serves to ensure that the owner reaps unhampered economic benefits. Clearly, one who registers a trademark is most often than not economically motivated. Let us recall, that to remain protected, actual use is required. Moreover, trademarks remains expressive for they have likewise been used to incidentally forward a political cause or express socially aware statements.

Under this perspective, a law regulating commercial speech would be subjected to intermediate scrutiny. Thus, it has greater chances of passing the muster of constitutionality.

SOURCES:

1. Ruben Agpalo, Statutory Construction (6th ed. 2009).
2. Societe des Produits Nestle, S.A. v. Court of Appeals, G.R. No. 112012, April 4, 2001
3. McDonald's Corp. v. L.C. Big Mak Burger, Inc., G.R. No. 143993, August 18, 2004
4. Tuna Processing, Inc. v. Philippine Kingford, Inc., G.R. No. 185582, February 29, 2012
5. Fredco Manufacturing Corp. v. President and Fellows of Hardvard College, G.R. No. 185917, June 1, 2011
6. W Land Holding, Inc. v. Starwood Hotels and Resorts Worldwide, Inc., G.R. No. 222366, December 4, 2017
7. Ejercito v. Commission on Elections, G.R. No. 212398, November 25, 2014
8. Francisco, Jr. v. House of Representatives, G.R. Nos. 160261, 160262, 160263, 160277, 160292, 160295, 160310, 160318, 160342, 160343, 160360, 160362, 160370, 160376, 160392, 160397, 160403 & 160405, November 10, 2003
9. Diocese of Bacolod v. COMELEC, G.R. No. 205728, January 21, 2015
10. Chavez v. Gonzalez, G.R. NO. 168338, February 15, 2008
11. Pita v. Court of Appeals, G.R. No. 80806, October 5, 1989
12. Fernando v. Court of Appeals, G.R. No. 159751, December 6, 2006
13. Estrada v. Sandiganbayan, G.R. No. 148560, November 19, 2001
14. Pittsburg Press Co. v. Human Relations Commission, 413 U.S. 376 (1973).
15. Jennifer E. Rothman, Commercial speech, Commercial Use, And The Intellectual Property Quagmire, 101 Virginia Law Rev. 1929, 1961 (2015).
16. Bolger v. Youngs Drug Products Corp., 463 U.S. 60 (1983).
17. Butler v. Michigan, 352 U.S. 380 (1957).
18. In re: Old Glory Condom Corp., 26 U.S.P.Q. 2d (1993).

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