Under seal but not under law: In re City of Houston's effect on municipal insignias.

• Author: Helsel, Tyler M.

1. INTRODUCTION II. TRADEMARK LAW THROUGHOUT THE YEARS (AND ITS RELATION TO MUNICIPALITIES) A. Trademark Act of 1905 B. Trademark Act of 1946 C. Paris Convention D. In re City of Houston III. SECTION 2 ANALYSIS A. The Court's Analysis May Have Been Right. B. But the Court's Outcome May Have Been Wrong. 1. TMEP Changes C. Implications of Houston's Holding 1. Domestic a. Impact on Municipalities b. Impact on Law. c. Impact on Legislation. 2. International Impact and the Paris Convention. IV. SECTION 2 SHOULD NOT APPLY TO GOVERNMENT ENTITIES. V. CONCLUSION. I. INTRODUCTION

   Trademark law has developed in a broad context since its first creation. In 1870, the first federal trademark law was enacted, but was struck down by the Supreme Court nine years later in In re Trade-Mark Cases because Congress did not have the authority to enact such legislation through the copyright clause. (1) Next, Congress passed the Trademark Act of 1905 through the commerce clause; the 1905 Act was the most comprehensive federal trademark Act since the Trade-Mark Cases. Congress again changed trademark law in 1946, when it adopted the Lanham Act. The Lanham Act is the most comprehensive federal trademark law in the United States. The Lanham Act's largest change expanded the rights of mark holders to a lifetime right.

   Trademark law has had a volatile interaction with municipalities and their identity. Prior to the 1905 Act, municipalities had little protection for their marks beyond state law. The 1905 Act furthered the lack of protection to municipalities and created a bar to protection for all municipal marks. (2) The Lanham Act adopted similar language to the 1905 Act. (3) It had been unclear, under the 1905 Act, if a government entity is an applicant under [section] 45, and whether [section] 2(b)'s bar to registration included government entities.

   Section 45 defines "applicant" for trademark registration. According to [section] 45, applicants are "legal representatives, predecessors, successors and assigns of such applicant or registrant." (4) Additionally, the word "person" is considered an applicant in regards to trademark protection. (5) Therefore, under this broad language, a governmental entity is considered a person and considered an applicant. So, when two municipalities, Houston and the District of Columbia (the District), applied for trademark protection, the Court of Appeals for the Federal Circuit held that the two municipalities were persons under [section] 45, and the [section] 2(b) bar on trademark registration of government municipality seals, flags, and other insignias applied.

   This Comment will analyze the Federal Circuit's holding in In Re City of Houston, and will argue that although statutory construction may bar municipalities from protection, common sense and practical application suggests that registration should be granted to municipalities applying to protect their own marks. This Comment will also analyze the United States Patent and Trademark Office (USPTO) application process to determine why thirteen municipal marks were granted protection prior to Houston and the District. This Comment will then analyze the impact Federal Circuit's holding, both domestically and internationally. Finally, this Comment will conclude that congressional action is likely necessary to give municipalities the protection they need, yet Congress has failed to give protection so far.

2. TRADEMARK LAW THROUGHOUT THE YEARS (AND ITS RELATION TO MUNICIPALITIES)

   Federal law did not govern much of trademark law in the 1800s, and state law governed most trademarks. For example, Massachusetts had trademark protections on sailcloth. (6) Although states adopted more general trademark laws, little protection was afforded to marks. (7) Congress enacted the first federal trademark statute in 1870 pursuant to the intellectual property clause in the United States Constitution. (8) This statute was struck down in In re Trade-Mark Cases. (9) The Supreme Court held that the intellectual property clause of the Constitution did not authorize Congress to pass the trademark clause. (10)

   Congress then passed the Trademark Act of 1881 (hereinafter, 1881 Act), which was pursuant to the commerce power. (11) The 1881 Act set out basics for registration and did not mention municipal seals, flags, or other insignias. Under the 1881 Act, registrants were granted protection for thirty years, and eligible for extension for an additional like period, or twenty years. (12)

   Through these early laws, municipalities' seals, flags, and other insignias were not regulated through federal trademark laws. (13)

   1. Trademark Act of 1905

      Congress eventually enacted the Trademark Act of 1905 through the power of the commerce clause. (14) The 1905 Act expanded the rights of mark holders, yet it was unclear as to the protections afforded to mark holders. (15) Marks continued to be registered even when the mark holder did nothing to preserve the mark. (16) Additionally, if there was infringement on the registered mark, there was little remedy available to the mark holder. (17)

      Included in the 1905 Act was a bar on registration of municipal seals, flags, and other insignias, stating

      That no mark by which the goods of the owner of the mark may be distinguished from other goods of the same class shall be refused registration as a trade-mark on account of the nature of such mark unless such mark

      ....

      (b) Consists of or comprises the flag or coast [s/c] of arms or other insignia of the United States or any simulation thereof, or of any State or municipality or of any foreign nation, or of any design or picture that has been or may hereafter be adopted by any fraternal society as its emblem, or of any name, distinguishing mark, character, emblem, colors, flag, or banner adopted by any institution, organization, club, or society which was incorporated in any State in the United States prior to the date of the adoption and use by the applicant.... (18)

   2. Trademark Act of 1946

      The Lanham Act was a response to the weak 1905 Act. (19) Amended as recently as 1999, the Lanham Act expanded the rights, policies, and acquisitions of all United States marks. (20) The Lanham Act included [section] 2, which outlined specific circumstances where a trademark would be barred. (21) Section 2(b) of the Lanham Act adopted language from the 1905 Act, which stated any mark would be barred if it "[c]onsists of or comprises the flag or coat of arms or other insignia of the United States, or of any State or municipality, or of any foreign nation, or any simulation thereof." (22) The broad language of [section] 2(b), although similar to the original [section] 2 language in the 1905 Act, left the USPTO and the Federal Circuit with leeway in deciding what marks would fall within this bar.

   3. Paris Convention

      The Paris Convention of 1883 also considered municipal marks and trademark laws. The District put forward the argument in In re City of Houston that rejecting municipalities' application for seals, flags, and other insignias was a violation of the Paris Convention. (23) In the District's appeal brief to the Court of Appeals for the Federal Circuit, the District quoted Article 6(a) of the Paris Convention, which states "[e]very trade mark duly registered in the country of origin shall be admitted for registration and protected in the form originally registered in the other countries of the Union under the reservations indicated below." (24) The argument further points that this language is a counterpart to [section] 2(b) of the Lanham Act, which bars municipal seals, flags, and other insignias. (25) The primary argument was that because the United States had agreed to this convention, the United States thereby agreed to recognize all other countries municipal trademarks. (26) Therefore, if the United States recognizes their municipal marks, the other countries are to recognize the United States' municipal marks.

   4. In re City of Houston

      The Court of Appeals for the Federal Circuit in In re City of Houston affirmed the USPTO's holding that [section] 2(b) of the Lanham Act bars the United States or any of its municipalities from trademarking their city flags, seals, or other insignias. (27) Section 2 expressly lists marks that will be refused registration. (28) This section bars marks that "[c]onsists of or comprises the flag or coat of arms or other insignia of the United States, or of any State or-municipality, or of any foreign nation, or any simulation thereof." (29) Prior to the City of Houston (Houston) and the District's filing for trademark registration, the USPTO granted as many as thirteen trademarks to municipalities. (30) The District filed for trademark protection on January 6, 2009 (31) and Houston filed for trademark protection on February 1, 2009. (32) The District was denied trademark protection on October 13, 2009 (33) and Houston was denied protection on July 21, 2010. (34)

      Both the court of appeals and the Trademark Trials and Appeals Board (TTAB) held that [section] 2(b) was unambiguous and the statute applied to both Houston and the District. (35) Houston argued that it was not an "applicant" under both 15 U.S.C. [section] 45 and [section] 1 127. (36) The court of appeals held that [section] 45 "recites various government entities, including 'the United States,' (37) 'any State,' and 'any instrumentality of a State,'" and Houston and the District both would qualify as applicants. (38) Therefore [section] 2(b) applies to the District and Houston. (39) Alternatively, the District's argument that [section] 2(b) was in violation of the Paris Convention was simply brushed aside by the court of appeals, stating the convention applies "to emblems of countries, not emblems of local public bodies such as municipalities." (40)

3. SECTION 2 ANALYSIS

   1. The Court's Analysis May Have Been Right

      Analysis of the statute will determine that the statute is likely unambiguous. Despite the...