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They broke the law by using the Presidential seal in its publication. Clearly, this must be a violation since I had such difficulty obtaining an image of the seal myself, for use in my blog. And I've never seen it used outside of official use before, like on Saturday Night Live, or Mad TV, or... wait, yes I have!
It's not one of our more guarded national treasures, apparently.
But that doesn't give The Onion the right to use it. But I think something else does... hmmm... it's that pesky First Amendment again! No wonder Ann Coulter's not a fan.