A state statute prohibiting parties from using for advertising purposes the word “Texas” in combination with “workers' compensation” or “workers' comp” cannot be analyzed under the First Amendment through reference to legal paradigms established with respect to trademark infringement cases, the U.S. Court of Appeals for the Fifth Circuit held Oct. 30 (Gibson v. Texas Department of Insurance, 5th Cir., No. 11-11136, 10/30/12).
The Texas statute is attempting to prohibit the use of words than are in the public domain, the court said. As such, it determined that trademark infringement jurisprudence, which as a rule concerns confusion that could arise from the use of proprietary words and phrases, “is unique to the field of trademark infringement.” The court held:
[T]he regulation at issue is forward-thinking; intended to prohibit confusion for individuals seeking information from the government agency. It is not retrospective in the same way as most trademark litigation, which is generally intended to preserve the reputation that has been built upon a trade name.
The district court applied the First Amendment test for commercial speech as set forth by the Supreme Court in Central Hudson Gas and Electric Corp. v. Public Service Commission of New York, 447 U.S. 557 (1980), which asks whether the speech is about lawful activity and not misleading, whether there is a substantial governmental interest at stake, whether the statute directly advances that interest, and whether it is narrowly tailored to serve that interest.
The district court found that the URL was misleading, a conclusion it arrived at only after looking to cases involving the use of trademarks in URLs, such as Coca-Cola Co. v. Purdy,382 F.3d 774, 72 USPQ2d 1305 (8th Cir. 2004). However, those cases concern likelihood of confusion and “No such risk is present here,” Judge Edith Brown Clement said.
“Therefore, the domain name at issue is entitled to some First Amendment protection,” the appeals court said. The constitutionality of the statute will thus hinge on an application of the remaining Central Hudson factors, the court said.
“However, Texas concedes that it has not yet compiled the record necessary to demonstrate satisfaction of theCentral Hudson test as a matter of law,” the court said. It accordingly remanded the case for further factual development.
Judges Thomas Morrow Reavley and James L. Dennis joined the court's opinion.
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