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In June 2017, Pinnacle Financial Partners, Inc. (NASDAQ: PNFP) closed a $1.9 billion merger with BNC Bancorp (NASDAQ: BNCN) pursuant to which BNC merged with and into Pinnacle. With the completion of the transaction, Pinnacle becomes a Top 50 U.S. Bank. The merger will create a four state footprint concentrated in 12 of the largest urban markets in the Southeast. 

Bass, Berry & Sims has served Pinnacle as primary corporate and securities counsel for more than 15 years and served as counsel on the transaction. Our attorneys were involved in all aspects related to the agreement, including tax, employee benefits and litigation. 

Read more details about the transaction here.

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Regulation A+

It seems that lately there has been a noticeable uptick in Regulation A+ activity, including several recent Reg A+ securities offerings where the stock now successfully trades on national exchanges. In light of this activity, we have published a set of FAQs about Regulation A+ securities offerings to help companies better understand this "mini-IPO" offering process, as well as pros and cons compared to a traditional underwritten IPO.

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Supreme Court Holds that First Amendment Protects Disparaging Trademarks

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June 22, 2017

Speech that demeans on the basis of race, ethnicity, gender, religion, age, disability, or any other similar ground is hateful; but the proudest boast of our free speech jurisprudence is that we protect the freedom to express "the thought that we hate."1

This week, the U.S. Supreme Court emphasized the importance of broad free speech protection in striking down a statute that allows the U.S. Patent and Trademark Office (USPTO) to refuse registration of disparaging trademarks. Although the justices all agreed on the outcome, they issued a splintered opinion that arguably leaves open critical questions, including whether government restrictions on trademarks relate to "commercial speech," and are therefore subject to a lower level of constitutional scrutiny.

The case involves a dance-rock band named "The Slants." All four members of the band are Asian-Americans, and lead singer Simon Tam stated he chose the band name "to 'reclaim' and 'take ownership' of stereotypes about people of Asian ethnicity."2 Tam filed an application to register the band name as a trademark with the USPTO in 2011. The examining attorney rejected the application based on Section 2(a) of the Lanham Act, which permits refusal of a trademark if it "[c]onsists of . . . matter which may disparage . . . persons, living or dead, institutions, beliefs, or national symbols, or bring them into contempt."3 The examining attorney found that the statutory restriction prohibited registration of the mark, because it "may disparage" persons of Asian descent. The Trademark Trial and Appeal Board affirmed.

On appeal, the U.S. Court of Appeals for the Federal Circuit struck down the Lanham Act's disparagement clause as unconstitutional under the First Amendment's free speech clause. The U.S. Supreme Court affirmed, agreeing with the Federal Circuit that the disparagement clause is unconstitutional.

Justice Alito's opinion for the unanimous Court concluded that the disparagement clause was an unconstitutional form of viewpoint discrimination.4 In other words, the disparagement clause would prohibit a negative viewpoint about a particular topic, but would permit a positive viewpoint. The Court rejected the government's argument that trademarks registered by the USPTO are a form of government speech, and the government is not required to be viewpoint neutral when it speaks.

From there, additional opinions were entered, with none garnering enough votes to be strictly binding authority. One split regarding whether trademarks are "commercial speech" is worth particular note. In a portion of Justice Alito's opinion — joined only by Chief Justice Roberts, Justice Thomas and Justice Breyer — he found it unnecessary to decide whether trademark registration is "commercial speech" subject to relaxed scrutiny rather than the strict scrutiny traditionally applied to First Amendment review. He concluded that the disparagement clause would be unconstitutional viewpoint discrimination even under the lower standard of review, because it is not narrowly drawn to serve the government's interest in preventing invidious discrimination.

Justice Kennedy — joined by Justices Ginsburg, Sotomayor and Kagan — opined that, even if trademarks are considered commercial speech, any viewpoint discrimination is subject to strict scrutiny. He concluded, "[a] law that can be directed against speech found offensive to some portion of the public can be turned against minority and dissenting views to the detriment of all. The First Amendment does not entrust that power to the government's benevolence."

Justice Thomas wrote a separate concurrence to emphasize his opinion that viewpoint discrimination, even in the context of commercial speech, should be subject to strict scrutiny. However, he noted that he joined Justice Alito's opinion, because it held the disparagement clause unconstitutional even if a lower standard applied.

Of course, many business owners refrain from using disparaging marks in view of the negative commercial impact disparagement may have on the business. However, the disparagement clause has also been at issue in connection with the Washington Redskins football team and other high-profile marks. Although the Tam decision gives some comfort to owners of other allegedly disparaging marks, the splintered decision lacks the certainty many would have preferred. For example, if Congress were to develop a new statute targeting discriminatory marks more directly (rather than all "disparaging marks"), Tam might leave open the question of whether that statute would be subject to strict scrutiny or some lower standard.


1 Matal v. Tam, 582 U.S. ___, Case No. 15-1293, Slip. Op. at 25 (June 19, 2017) (Alito, J.).
2 Slip Op. at 7 (quoting In re Tam, 808 F.3d 1321, 1331 (Fed. Cir. 2015) (en banc), as corrected (Feb. 11, 2016).
3 15 U.S.C. § 1052(a) (2017).
4 Justice Gorsuch took no part in the consideration or decision of the case.

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