IP Law Daily Revised panel ruling holds university officials personally liable for discriminatory trademark policy
Wednesday, June 14, 2017

Revised panel ruling holds university officials personally liable for discriminatory trademark policy

By Cheryl Beise, J.D.

The U.S. Court of Appeals in St. Louis has reissued an earlier panel decision to clarify that the doctrine of qualified immunity does not apply to four Iowa State University officials who violated the First Amendment rights of two students in their implantation of the university’s trademark policy. In a decision issued earlier this year, a three-judge appellate panel affirmed the district court’s permanent injunction and summary judgment that the defendants engaged in political viewpoint discrimination by refusing to approve a student group’s request to use the university’s trademarks on t-shirts incorporating a marijuana leaf design. At that time, the panel declined to consider sovereign immunity, reasoning that the appeal involved only injunctive relief. Following a rehearing, the panel revised its earlier decision to expressly affirm the district court’s denial of sovereign immunity, which prompted a dissenting opinion by Circuit Judge Loken and concurring opinion by Circuit Judge Kelly (Gerlich v. Leath, June 13, 2017, Murphy, D.).

NORML is a national advocacy group that supports the legalization of marijuana for use by adults. The ISU chapter of NORML was an approved campus organization that was denied approval to use ISU’s trademarks on t-shirts that included a marijuana leaf design. On July 1, 2014, plaintiffs Paul Gerlich and Erin Furleigh—then president and vice president, respectively, of NORML ISU—filed suit in the federal district court in Des Moines against four ISU officials, under 42 U.S.C. §1983 for alleged violations of their First and Fourteenth Amendment rights. The defendants were ISU President Steven Leath, Senior Vice President of the Division of Business & Financial Affairs Warren Madden, Director of ISU's Trademark Office Leesha Zimmerman, and Senior Vice President for Student Affairs Thomas Hill.

The district court rejected the students’ arguments that the Trademark Guidelines were unconstitutional on their face, but held that the defendants’ trademark licensing decisions, as applied to Gerlich and Furleigh, violated their right to free speech because it was motivated by political viewpoint discrimination. The court granted summary judgment to the plaintiffs and permanently enjoined the defendants from violating the plaintiffs’ rights. Finding that the defendants were not protected by qualified immunity, the court directed the plaintiffs to submit their "claims for fees, costs, and expenses in accordance with 42 U.S.C. § 1988 and other applicable law."

On February 13, 2017, the Eight Circuit affirmed the district court’s summary judgment decision, but the panel did not address the issue of qualified immunity, stating only that "[q]ualified immunity is not an issue here because this appeal solely concerns plaintiffs' request for injunctive relief." The panel subsequently granted the students’ request for a rehearing. Following the rehearing, the court’s issued a revised decision, which was nearly identical to its earlier decision except that it expressly affirmed the district court’s ruling that the defendants were not entitled to qualified immunity. This time, Circuit Judge Loken filed a dissenting opinion and Circuit Judge Kelly filed a concurring opinion to rebut Judge Loken’s dissent.

Qualified immunity. The revised majority opinion included very little analysis on the issue of qualified immunity. The court explained that a review of denial of qualified immunity required examination of (1) whether the facts shown by the plaintiff make out a violation of a constitutional or statutory right, and (2) whether that right was clearly established at the time of the defendant's alleged misconduct. The court’s analysis in its earlier opinion supported both of these findings. "Because defendants violated plaintiffs' clearly established First Amendment rights, the district court did not err by denying qualified immunity to defendants and granting plaintiffs summary judgment on their First Amendment claims," the court said.

Dissenting opinion. Circuit Judge James B. Loken filed a dissenting opinion to express his disagreement with the majority’s conclusion that sovereign immunity did not apply in this case. Judge Loken also opined that a permanent injunction was warranted in this case, but that the district court’ order was overbroad.

Judge Loken characterized this case as a difficult one, "raising important First Amendment issues." In particular, Judge Loken would find that the case presented two uncertain First Amendment issues that warranted qualified immunity: (1) whether a trademark licensing program that allows student groups to associate their messages with the university’s symbol or logo is a form of government speech or a limited public forum; and (2) if the program is a limited public forum—as the majority and the district court held—whether administrators’ decisions to restrict the licensing of designs associating the university with unsafe or illegal activities such as drug use constitute unlawful viewpoint discrimination or permissible content regulation.

The district court permanently enjoined the defendants "from enforcing trademark licensing policies against Plaintiffs in a viewpoint discriminatory manner and from further prohibiting Plaintiffs from producing licensed apparel on the basis that their designs include the image of a similar cannabis leaf." In Judge Loken’s view, the term "viewpoint discriminatory" is too vague to satisfy Fed. R. Civ. P. 65(d), and compelling the defendants to approve any design with a cannabis leaf is overbroad.

Concurring opinion. Circuit Judge Jane Kelly filed a concurring opinion to rebut Judge Loken’s arguments. According to Judge Kelly, at the time of the challenged actions in fall 2012, the defendants were on notice of several cases that clearly established that their conduct violated plaintiffs’ First Amendment rights. She noted that in at least four cases, the Supreme Court has held that a university creates a limited public forum when it distributes benefits to recognized student groups. Judge Kelly also rejected the notion that the university’s trademark policy could be deemed to plausibly implicate government speech or permissible content regulation.

The case is No. 16-1518.

Attorneys: Robert Corn-Revere (Davis & Wright, PC) for Paul Gerlich. George A. Carroll, Attorney General's Office, for Steven Leath.

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