Today's Outcome: Understanding the cancellation of the Redskins' federal trademark

The Redskins are expected to appeal the USPTO's decision, which may cost the team millions if upheld.

Nick Wass/AP

For the second time in 15 years, the U.S. Patent and Trademark Office (USPTO) has cancelled the federal trademark of the Washington Redskins on grounds that the team name is disparaging to Native Americans. Through its Trademark Trial and Appeal Court, the USPTO first cancelled the trademark in 1999, but the decision was overturned by a federal court on appeal in 2003. The Redskins are likely to appeal this new cancellation as well and would retain federal trademark protection pending appeal. An appeal could take years to play out.

What today's cancellation means

While an appeal by the Redskins would stay any legal impact for some time, cancellation of registration means the Redskins name is no longer protected by the federal government as an exclusive trademark. A trademark is a mark, often a word or symbol, that distinguishes a source of goods from others. If it is registered with the USPTO, a trademark can be deemed exclusive to the registering businesses. Registration carries a number of advantages, including a legal presumption of ownership and the exclusive right to use the mark in connection with specific goods and services. Under the federal Lanham Act, a trademark may be cancelled if it brings a distinct category of people into disrepute.

In a 2-1 vote today, the USPTO concluded, just like it did in 1999, that the term "redskins" disparages Native Americans because of its historical meaning as a derogatory term. The USPTO cancellation was in response to a petition by Amanda Blackhorse and four other individuals who argued that "redskins" violates the law. As a result of the cancellation, the Redskins cannot use federal trademark protection to stop counterfeits and other businesses from commercially exploiting their name in selling merchandise and apparel. In theory, the Redskins and their owner, Daniel Snyder, could lose millions of dollars as a result of the cancellation. Revenue sharing by NFL teams on licensing contracts means the 31 other franchises could stand to lose millions as well.

What today's cancellation does not mean

Most importantly, cancellation of registration does not force the Redskins to change their name. Cancellation is only about legal protection for the exclusive use of the name under federal trademark law. The law cannot compel the Redskins to change the name. Instead, critics of the name can attempt to make it more difficult for the Redskins to profit off the name, and thus give the team financial incentives to voluntarily change it. Political pressure can also be applied on the Redskins. Last month 50 U.S. senators wrote a letter to NFL commissioner Roger Goodell urging him to recommend the team change its name. Last fall President Obama stressed, "If I were the owner of the team and I knew that there was a name of my team -- even if it had a storied history -- that was offending a sizeable group of people, I'd think about changing it." But this type of pressure cannot compel a change in team name.

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Cancellation of the registration of the Redskins mark also does not end the team's exclusive use of the Redskins logo and other distinctive art owned by the team. Also, cancellation doesn't nullify existing licensing contracts between the Redskins and businesses to produce memorabilia and other items using the word "Redskins." Royalties still must be paid on those licensing contracts. Significant adverse economic impact on the Redskins does not occur immediately.

Cancellation also does not preclude the Redskins from seeking other forms of legal protection for their name. First, the Redskins can still attempt to enforce exclusivity under federal law -- specifically Section 43(a) of the Lanham Act -- even with the cancellation. However, cancellation makes it more difficult to enforce exclusivity under federal law since the Redskins lose legal presumptions, customs and counterfeiting remedies.

Second, while federal trademark registration is a powerful form of trademark protection, it is not the only method of protecting a brand name. The Redskins are headquartered in Richmond, Va., and may enjoy legal protection under Virginia law and the laws of other states in which they do business. There are also court decisions in those states -- better known as "common law" -- that may be favorable to the Redskins for exclusive use of the team name. Indeed, the Redskins likely enjoy some protection under common law so long as the mark -- the Redskins -- is used in commerce. In other words, even if the USPTO ruling prevails over a Redskins appeal, the Redskins may continue to enjoy legal protection through other sources of law. Expect future litigation to determine the exact legal rights of the Redskins to enjoy exclusive commercial use of the team name.

Lastly, cancellation of the Redskins' federal trademark has no legal effect on other team names that arguably relate to Native Americans. The Kansas City Chiefs, Atlanta Braves, Cleveland Indians, Chicago Blackhawks and Golden State Warriors are not parties to the Redskins legal dispute, and actions by the USPTO on the Redskins name do not impact those teams.

Appeal

As noted above, the Redskins can, and likely will appeal the USPTO decision to cancel their federal trademark to a federal court. The Redskins may be confident the team would obtain a victory before a federal judge. The team won its appeal of the USPTO's cancellation in 1999 by convincing U.S. District Judge Colleen Kollar-Kotelly that there was insufficient evidence the Redskins intentionally disparaged Native Americans through the team name and that historical evidence of how Native Americans regarded the name was conflicting. Expect similar debates this time around, although those debates would be raised before a different judge, who may have a very different perspective on the Redskins. Kollar-Kotelly also ruled that the claim failed on procedural grounds since the plaintiffs could have challenged the Redskins trademark when it was originally filed in 1967 and failed to do so (an issue not at play with the current plaintiffs).

The legal battle over the Redskins has spanned two decades, but it may take several more decades before there is any final resolution.

Michael McCann is a Massachusetts attorney and the founding director of the Sports and Entertainment Law Institute at the University of New Hampshire School of Law. He is also the distinguished visiting Hall of Fame Professor of Law at Mississippi College School of Law.