First Amendment — Free Speech Clause: Commercial Speech
First Amendment
Congress shall make no law respecting an establishment of religion, or prohibiting the free exercise thereof; or abridging the freedom of speech, or of the press; or the right of the people peaceably to assemble, and to petition the Government for a redress of grievances.
Amdt1.7.6 Commercial Speech
Amdt1.7.6.1 Commercial Speech Early Doctrine
In the 1970s, the Court’s treatment of “commercial speech” changed from total nonprotection under the First Amendment to qualified protection. In 1942, the Court had stated that speech concerning commercial transactions is undeserving of First Amendment protection in Valentine v. Chrestensen.1 In Chrestensen, the Court upheld a city ordinance prohibiting distributing on the street “commercial and business advertising matter,” as applied to an exhibitor of a submarine who distributed leaflets describing his submarine on one side and on the other side protesting the city’s refusal of certain docking facilities. The Chrestensen doctrine was limited to expression promoting commercial activities; whether the speaker disseminated his expression for profit or through commercial channels did not subject it to any greater regulation than if he offered it for free.2 The doctrine lasted in this form for decades, until the Court’s approach began shifting in the 1970s.
Relying on the Chrestensen doctrine in a 5-4 decision issued in 1973, the Court sustained the application of a city’s ban on employment discrimination to bar sex-designated employment advertising in a newspaper.3 Suggesting that speech does not lose its constitutional protection simply because it appears in a commercial context, the Court nonetheless described placing want-ads in newspapers as “classic examples of commercial speech,” controlled by Chrestensen because they were devoid of expressions relating to social policy and “did no more than propose a commercial transaction.” But the Court also noted that the advertisements facilitated employment discrimination, which was itself illegal.4
In 1975, the Court overturned a conviction under a state statute that made it illegal for any publication by sale or circulation to encourage or prompt procuring an abortion. The Court held the statute unconstitutional as applied to an editor of a weekly newspaper who published an advertisement announcing the availability of legal and safe abortions in another state and detailing assistance that state residents could get to obtain abortions in the other state.5 Distinguishing Chrestensen, the Court discerned that the advertisements conveyed information of other than a purely commercial nature, that they related to services that were legal in the other jurisdiction, and that the state could not prevent its residents from obtaining abortions in the other state or punish them for doing so.
In 1976, the Court eliminated these distinctions by disclaiming Chrestensen’s commercial speech “exception” to the First Amendment as it voided a statute that effectively prohibited licensed pharmacists from advertising prescription drug prices.6 In a suit brought by consumers to protect their right to receive information, the Court held that speech that does no more than propose a commercial transaction is nonetheless of such social value and entitled to protection. Noting that consumers’ interests in receiving factual information about prices may sometimes be even “keener” than their interest in political debate, the Court concluded that price competition and access to information about it serves the public interest.7 The Court ruled that state interests in the ban—protecting professionalism and the quality of prescription goods—were either badly served or not served by the statute.8
Turning from the interests of consumers to receive information to that of advertisers to communicate, the Court in 1977 voided a municipal ordinance that barred displaying “For sale” and “Sold” signs on residential lawns, purportedly to limit “white flight” resulting from a “fear psychology” that developed among White residents following sale of homes to non-Whites. The right of owners to communicate their intention to sell a commodity and the right of potential buyers to receive the message was protected, the Court determined; the community interest could have been achieved by less restrictive means and in any event may not be achieved by restricting the free flow of truthful information.9
Notes
Amdt1.7.6.2 Central Hudson Test and Current Doctrine
The Supreme Court established the standard that generally governs government restrictions on commercial speech in 1980’s Central Hudson Gas & Electric Corp. v. Public Service Commission.1 In that case, the Court explained that commercial speech enjoys “lesser protection” than “other constitutionally guaranteed expression.”2 After emphasizing that First Amendment protection for commercial speech “is based on the informational function of advertising, ” the Court said that “there can be no constitutional objection to the suppression of commercial messages that do not accurately inform the public about lawful activity.”3 Accordingly, the Court held that the government may prohibit “forms of communication more likely to deceive the public than to inform it” as well as “commercial speech related to illegal activity.”4 But if the regulated “communication is neither misleading nor related to unlawful activity,” the government’s action is subject to intermediate scrutiny.5 Under Central Hudson’s intermediate standard, the government must prove that its interest is “substantial,” and that the regulation “directly advances” that interest and is “not more extensive than is necessary to serve that interest.”6 In Central Hudson, the Court ruled a state regulation banning promotional advertising by electric utilities unconstitutional.7 Although the Court recognized the state’s alleged interests in energy conservation and equitable pricing as substantial, it concluded the total ban was not sufficiently narrowly tailored to the government’s interest.8 The Court stressed that the state regulation extended to “all promotional advertising, regardless of the impact of the touted service on overall energy use”—including barring advertisements of more energy efficient products.9
The Court has since described Central Hudson as setting out a four-pronged test for restraints upon commercial expression.10 The test applies to commercial speech, which the Court has defined alternately as speech that “does ‘no more than propose a commercial transaction’”11 and as “expression related solely to the economic interests of the speaker and its audience.”12 The Court has also distinguished laws that regulate the conduct of sellers—an “area traditionally subject to government regulation”—from those that regulate a seller’s speech.13 In Expressions Hair Design v. Schneiderman, the Court held that a New York State statute that prohibited businesses from displaying a cash price alongside a surcharge for credit card purchases burdened speech.14 Relying on Supreme Court precedent suggesting that “price regulation alone regulates conduct, not speech,” the lower court held that the statute was constitutional.15 The Supreme Court disagreed, stating “[w]hat the law does regulate is how sellers may communicate their prices,” and “[i]n regulating the communication of prices rather than prices themselves, [the statute] regulates speech.”16 The Court, however, remanded the case to the lower court to determine in the first instance whether the law survives First Amendment scrutiny.17
Under the first prong of the test, certain commercial speech is not entitled to protection; the informational function of advertising is the First Amendment concern and if an advertisement does not accurately inform the public about lawful activity, it can be suppressed.18 Accordingly, a statute prohibiting the practice of optometry under a trade name was sustained because there was “a significant possibility” that the public might be misled through deceptive use of the same or similar trade names.19 Second, if the speech is protected, the interest of the government in regulating and limiting it must be assessed. The state must assert a substantial interest to be achieved by restrictions on commercial speech.20 Third, the restriction cannot be sustained if it provides only ineffective or remote support for the asserted purpose.21 Instead, the regulation must “directly advance” the governmental interest. The Court resolves this issue with reference to aggregate effects, and does not limit its consideration to effects on the challenging litigant.22 Fourth, if the governmental interest could be served as well by a more limited restriction on commercial speech, the excessive restriction cannot survive.23
Although Central Hudson described the fourth prong as testing whether a restriction is more extensive than necessary, the Court has rejected the idea that a “least restrictive means” test is required.24 Instead, what is required is a reasonable “fit” between means and ends, with the means “narrowly tailored to achieve the desired objective.”25 The Court, however, does “not equate this test with the less rigorous obstacles of rational basis review; . . . the existence of ‘numerous and obvious less-burdensome alternatives to the restriction on commercial speech . . . is certainly a relevant consideration in determining whether the ‘between ends and means is reasonable.’”26
In City of Cincinnati v. Discovery Network, Inc.,27 the Court showed the importance of the “reasonable fit” standard by striking down a city’s prohibition on distributing “commercial handbills” through freestanding newsracks located on city property. The city’s aesthetic interest in reducing visual clutter was furthered by reducing the total number of newsracks, but the distinction between prohibited “commercial” publications and permitted “newspapers” bore “no relationship whatsoever” to this legitimate interest.28 The city could not, the Court ruled, single out commercial speech to bear the full onus when “all newsracks, regardless of whether they contain commercial or noncommercial publications, are equally at fault.”29
Accordingly, as in Central Hudson itself, the Court has sometimes struck down total bans as insufficiently narrowly tailored. For instance, the Court held that a state could not forbid lawyers from advertising the prices they charged for performing routine legal services.30 The Court did not deem any of the proffered state justifications for the ban sufficient to overcome the private and societal interest in the free exchange of this form of speech.31 The Court also held that a state may not categorically prohibit attorney advertising through mailings that target persons known to face particular legal problems,32 or prohibit an attorney from holding himself out as a certified civil trial specialist,33 or prohibit a certified public accountant (CPA) from holding herself out as a certified financial planner.34
Nonetheless, as stated, the Court’s current commercial speech doctrine does not require the least restrictive means, and the Court has upheld a number of commercial speech restrictions under this intermediate scrutiny standard. For instance, in Ohralik v. Ohio State Bar Ass’n, the Supreme Court rejected a constitutional challenge to a state regulation restricting person-to-person solicitation of clients by attorneys.35 Similarly, the Court upheld a rule prohibiting high school coaches from recruiting middle school athletes, finding that “the dangers of undue influence and overreaching that exist when a lawyer chases an ambulance are also present when a high school coach contacts an eighth grader.”36 The Court later refused, however, to extend this principle to in-person solicitation by certified public accountants, explaining that CPAs, unlike attorneys, are not professionally “trained in the art of persuasion,” and that the typical business executive client of a CPA is “far less susceptible to manipulation” than was the accident victim in Ohralik.37 A ban on personal solicitation is “justified only in situations ‘inherently conducive to overreaching and other forms of misconduct.’”38 To allow enforcement of such a broad prophylactic rule absent identification of a serious problem such as ambulance chasing, the Court explained, would dilute commercial speech protection “almost to nothing.”39
Two additional cases illustrate application of the intermediate scrutiny standard. In 1993, the Court upheld a federal law that prohibited broadcasters from broadcasting lottery advertisements in states that prohibit lotteries, while allowing stations in states that sponsor lotteries to broadcast such ads. The Court held there was a “reasonable fit” between the restriction and the asserted federal interest in supporting state anti-gambling policies without unduly interfering with policies of neighboring states that promote lotteries.40 The prohibition “directly served” the congressional interest, and could be applied to a broadcaster whose principal audience was in an adjoining lottery state, and who sought to run ads for that state’s lottery.41
Six years later, the Court struck down a provision of the same statute as applied to advertisements for private casino gambling that are broadcast by radio and television stations located in a state where such gambling is legal.42 The Court emphasized the interrelatedness of the four parts of the Central Hudson test: “Each [part] raises a relevant question that may not be dispositive to the First Amendment inquiry, but the answer to which may inform a judgment concerning the other three.”43 For example, although the Court recognized the government had a substantial interest in reducing the social costs of gambling, the fact that Congress has simultaneously encouraged gambling, because of its economic benefits, made it more difficult for the government to demonstrate that its restriction on commercial speech materially advanced its asserted interest and constituted a reasonable “fit.”44 In this case, the federal law’s operation was “so pierced by exemptions and inconsistencies that the Government cannot hope to exonerate it.”45 Moreover, the Court noted “the regulation distinguishes among the indistinct, permitting a variety of speech that poses the same risks the Government purports to fear, while banning messages unlikely to cause any harm at all.”46
As mentioned above, the Supreme Court has sometimes suggested that the government has greater power to regulate commercial speech because it “occurs in an area traditionally subject to government regulation.”47In Posadas de Puerto Rico Assocs. v. Tourism Co. of Puerto Rico, the Court seemed to take this principle further when it asserted that “the greater power to completely ban casino gambling necessarily includes the lesser power to ban advertising of casino gambling.”48 Subsequently, however, the Court eschewed reliance on this language,49 and a majority of the Court ultimately rejected Posadas in 44 Liquormart, Inc. v. Rhode Island,50 striking down the state’s ban on advertisements that provide truthful information about liquor prices. The plurality opinion in 44 Liquormart called Posadas’s First Amendment analysis “erroneous,” declining to give force to its “highly deferential approach,” and proclaiming that a state “does not have the broad discretion to suppress truthful, nonmisleading information for paternalistic purposes that the Posadas majority was willing to tolerate.”51 Four other Justices concluded that Posadas was inconsistent with the “closer look” that the Court has since required in applying the principles of Central Hudson.52
The “different degree of protection” the Court accords commercial speech has a number of consequences as regards other First Amendment doctrine. For instance, somewhat broader times, places, and manner regulations are to be tolerated,53 and the rule against prior restraints may be inapplicable.54 Further, disseminators of commercial speech are not protected by the overbreadth doctrine.55 Nonetheless, there are circumstances in which the nature of the restriction placed on commercial speech may alter the First Amendment analysis, and even result in applying a heightened level of scrutiny.
For instance, in Sorrell v. IMS Health, Inc.,56 the Court struck down state restrictions on pharmacies and “data-miners” selling or leasing information on the prescribing behavior of doctors for marketing purposes and related restrictions limiting the use of that information by pharmaceutical companies.57 These prohibitions, however, were subject to a number of exceptions, including provisions allowing such prescriber-identifying information to be used for health care research. Because the restrictions only applied to the use of this information for marketing and because they principally applied to pharmaceutical manufacturers of non-generic drugs, the Court found that these restrictions were content-based and speaker-based limits and thus subject to heightened scrutiny.58 However, the Court declined to say definitively whether Central Hudson or “a stricter form of judicial scrutiny” should apply because, in the Court’s view, the law failed to pass constitutional muster even under Central Hudson.59
More recently, the Court noted, “several Members of the Court have expressed doubts about the Central Hudson analysis and whether it should apply in particular cases.”60 Sorrell’s suggestion that content-based regulations of commercial speech might be subject to “a stricter form of judicial scrutiny”61 may be further evidence that the Court is increasing protection of commercial speech. Nonetheless, the Central Hudson test remains the primary test for commercial speech restrictions.62
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