The Volokh Conspiracy

The case is R.J. Reynolds Tobacco Co. v. United States FDA (D.D.C. Feb. 29); the opinion grants plaintiffs summary judgment, for much the same reasons given in November, when the court issued a preliminary injunction.

The FDA had mandated that “the top 50% of the front and back panels of every cigarette package” must include “color images of a man exhaling cigarette smoke through a tracheotomy hole in his throat; a plume of cigarette smoke enveloping an infant receiving a kiss from his or her mother; a pair of diseased lungs next to a pair of healthy lungs; a diseased mouth afflicted with what appears to be cancerous lesions; a man breathing into an oxygen mask; a bare-chested male cadaver lying on a table, and featuring what appears to be post-autopsy chest staples down the middle of his torso; a woman weeping uncontrollably; ... a man wearing a t-shirt that features a ‘no smoking’ symbol and the words ‘I QUIT’; ... [and] a stylized cartoon ... of a premature baby in an incubator.” R.J. Reynolds challenged this as an unconstitutional speech compulsion. And Supreme Court precedents had held that the government generally may not compel people or organizations to convey government-mandated speech, but had provided an exception for some speech on commercial advertising or labeling.

But the court in R.J. Reynolds concluded that this exception to the ban on compelled speech is limited to “purely factual and uncontroversial disclosures” “designed to protect the consumer from confusion or deception, [or] to increase consumer awareness of ... risks.” The graphics here, the court concluded, didn’t fall within this exception, but were instead advocacy “crafted to evoke a strong emotional response calculated to provoke the viewer to quit or never start smoking.”

In Justice Breyer’s dissent in Sorrell v. IMS Health, he cited United States v. Carolene Products, a Fifth Amendment due process case from 1938, for the proposition that “regulatory legislation affecting ordinary commercial transactions is not to be pronounced unconstitutional” if it rests “upon some rational basis within the knowledge and experience of the legislators.” Breyer adds, “To apply a strict First Amendment standard virtually as a matter of course when a court reviews ordinary economic regulatory programs (even if that program has a modest impact upon a firm’s ability to shape a commercial message) would work at cross-purposes with this more basic constitutional approach.”

The obvious problem, not directly addressed by Breyer, is that Carolene Products also states, in famous footnote 4, that “there may be narrower scope for operation of the presumption of constitutionality when legislation appears on its face to be within a specific prohibition of the Constitution, such as those of the first ten amendments, which are deemed equally specific when held to be embraced within the Fourteenth.” The Court ultimately concluded that it should stringently review legislation coming within the purview of the First Amendment. So it would seem that the lesson of Carolene Products, for the purposes of Sorrell, is that while the rational basis test applies to run-of-the-mill economic legislation, once the First Amendment is implicated heightened scrutiny applies. The Sorrell majority is therefore correct.

Breyer has an implicit response, which is that the core of the First Amendment is the protection of the “marketplace of ideas,” which reflects “the democratic importance of permitting an elected government to implement through effective programs policy choices for which the people’s elected representatives have voted.”

So a little history. The idea that the First Amendment is primarily about supporting the democratic process goes back to the Progressive era. Before World War I, most Progressive* jurists (Learned Hand excepted) opposed constitutional protection for freedom of speech for the same reasons they opposed constitutional protections for liberty of contract–they opposed judicial interference with the popular will. Herbert Goodrich’s views reflected the dominant Progressive attitude: “The same kind of argument and the same line of thought which upholds a law which restricts a man in the contracts he may make upholds a law limiting the exercise of his tongue when the majority wills it.” As late as June 1918, Holmes told Learned Hand that free speech “stands no differently than freedom from vaccination,”–the same example he used in his famous Lochner dissent.

Most Progressives eventually came around on freedom of speech for two reasons. First, they were traumatized by President Wilson’s suppression of leftists and dissidents during World War I. Second, Zechariah Chafee and others developed a theory of free speech that differentiated it from what they thought of as the obsolete, individualist, natural-rights based liberties of the American past. Freedom of speech–unlike, say, liberty of contract, or property rights–should receive constitutional protection not because it was an inherent individual right, but because of the importance of political speech to the functioning of a democracy. It helped that Justice Brandeis, in particular, supported this theory of free speech because he thought that the more his favored Progressive causes were publicly discussed and debated, the more popular support they would garner.

So here’s the irony. Breyer cites Holmes’s Lochner dissent for the proposition that when the USSC reviews economic regulations, it resulted “in the constitutionalization of economic theories preferred by individual jurists.” But the idea, adopted by Breyer, that the core of the First Amendment is about the marketplace of ideas and enhancing democracy, and therefore does not include commercial speech, is itself a judicial construct, based on the political theories preferred by Chafee, Holmes, Brandeis and other Progressives–and undoubtedly Breyer himself.

However, the First Amendment itself says nothing about democracy promotion or the marketplace of ideas. It refers only to the “freedom of speech.” Reasonable minds can certainly disagree about what the “freedom of speech” includes, and what standards the judiciary should use in scrutinizing laws that infringe on that freedom.

But it’s a bit rich for Breyer to first accuse the Court of risking a return to an era when the Justices relied on their own ideology to interpret the Constitution, while meanwhile insisting that the First Amendment’s scope must be limited by an atextual theory of interpretation that was invented by ideologically motivated judges and legal scholars in the late 1910s and early 1920s, and that just-so-happens to be consistent with Breyer’s own ideological preferences.

*It’s tiresome to keep repeating this, but when I talk about “Progressives” in the early 20th century, I’m not talking “people who had ideological preferences that would place them comfortably on the left-liberal side of things in 2011,” but people who were ideological fellow-travelers with the Progressive movement of the Progressive era, most of whom had at least some beliefs that modern left-liberals would find absolutely appalling, and indeed disqualifying for a modern progressive. It’s annoying that modern left-liberals have decided to call themselves “progressives”, thus making it virtually impossible to talk about the original Progressives without confusion.

Justice Breyer’s dissent today in Sorrell v. IMS Health Inc. led me to do a quick check, and I found that Justice Breyer has never voted for First Amendment protection for commercial advertising in a nonunanimous case. He was in the speech-restrictive 5-4 majorities in Florida Bar v. Went For It, Inc. (1995). He was in the four-Justice dissents in Lorillard Tobacco Co. v. Reilly (2001) and Thompson v. Western States Medical Center (2002), and now a three-Justice dissent in Sorrell. He also joined the least speech-protective opinion in 44 Liquormart, Inc. v. Rhode Island (1996), though his bottom line (striking down the law) was the same as all the other Justices’. And he took a narrow view of the First Amendment right in the compelled funding of advertising cases, Glickman v. Wileman Bros. & Elliott, Inc. (1997), United States v. United Foods, Inc. (2001), and Johanns v. Livestock Marketing Ass’n (2005). (I view those compelled funding cases as quite different from speech restriction cases, but the Court has generally viewed them as quite similar in many ways.)

Justice Breyer strikes me in this respect as much like Justice Rehnquist throughout most of his career; as best I can tell, Justice Rehnquist never voted for First Amendment protection for commercial advertising in a nonunanimous case until Edenfield v. Fane (1993). None of this is to say that Justice Breyer and Justice Rehnquist are wrong of course; I only want to point out Justice Breyer’s view on the subject. Justice Breyer’s fellow Sorrell dissenter Justice Ginsburg, by contrast, has generally taken a much broader view of the First Amendment in commercial advertising cases. (As to the other Sorrell dissenter, Justice Kagan, we just don’t have any data yet besides Sorrell.)

Today’s Sorrell v. IMS Health Inc. is a complicated case; I think the majority (the conservatives plus Justice Sotomayor) is basically right, but I don’t want to focus on the details of this particular case right now. Instead, I want to talk about what this case means to a much broader question having to do with the First Amendment and commercial advertising: May commercial advertising be generally restricted on the grounds that it might persuade people to do something that the government thinks is bad (as opposed to on the grounds that it’s false, or misleading, or improperly intrusive on its listeners, or some such)?

The Court had left this question unresolved for quite some time, but it looks like Sorrell might strengthen the case that the answer is “no” (at least setting aside the special case of speech that urges an unlawful commercial transaction). Let me chart the history of the debate.

1. From 1942 until the mid-1970s, the Supreme Court took the view that commercial advertising is entirely excluded from First Amendment protection. But in Virginia State Bd. of Pharmacy v. Virginia Citizens Consumer Council, Inc. (1976), the Court held that such advertising is generally protected (though less so than other speech). The case involved a ban on price advertising by pharmacies, and the government argued that such price advertising would lead people to go to the lowest-cost pharmacists, who would in turn provide less service; and other pharmacists would likely be lead by competitive pressure to have to similarly provide low cost and less service. But the Court disagreed: Under the First Amendment, speech can’t be restricted because it will persuade people to do something that’s supposedly harmful. “[The choice] between the dangers of suppressing information, and the dangers of its misuse if it is freely available, [is one] that the First Amendment makes for us. Virginia is free to require whatever professional standards it wishes of its pharmacists; it may subsidize them or protect them from competition in other ways. But it may not do so by keeping the public in ignorance of the entirely lawful terms that competing pharmacists are offering.”

2. Linmark Assocs v. Township of Willingboro (1977) took a similar view. The township had banned the posting of “For Sale” signs, apparently to limit white flight. The Court disapproved of this, because “The Township Council here, like the Virginia Assembly in Virginia Pharmacy Bd., acted to prevent its residents from obtaining certain information.... The Council has sought to restrict the free flow of these data because it fears that otherwise homeowners will make decisions inimical to what the Council views as the homeowners’ self-interest and the corporate interest of the township: they will choose to leave town.” And this, the Court said, was unconstitutional, because (quoting Virginia Pharmacy), “this kind of choice, between the dangers of suppressing information, and the dangers of its misuse if it is freely available, [is one] that the First Amendment makes for us.”

3. But then came Central Hudson Gas & Elec. Corp. v. Pub. Serv. Comm’n (1980). The case reached a speech-protective result, and announced a famous four-part test that the Court has since largely cited in commercial advertising cases. But behind the result lurked the endorsement of the principle that the government may indeed restrict speech because it might persuade people to do bad things.

In Central Hudson, the Public Service Commission of New York banned “all advertising that ‘promot[es] the use of electricity,’” reasoning in part that such advertising would persuade listeners to use more electricity, and would interfere with “the State’s interest in energy conservation.” And Justices Brennan, Blackmun, and Stevens would have rejected this argument on the Virginia Pharmacy grounds that I described above. But a five-Justice majority seemed to take the view that a restriction that was limited to advertising that indeed promoted wasteful uses of electricity would be constitutional. “[T]he State’s [substantial] interest in energy conservation is directly advanced by the Commission order at issue here. There is an immediate connection between advertising and demand for electricity. Central Hudson would not contest the advertising ban unless it believed that promotion would increase its sales. Thus, we find a direct link between the state interest in conservation and the Commission’s order.” The majority struck down the law only because it concluded that the law also banned advertising of “electric devices or services that would cause no net increase in total energy use.” So restricting commercial advertising because it might persuade people to do harmful things was constitutional under the majority’s view, so long as the restriction was indeed limited to persuasion to do harmful things and didn’t cover persuasion to do harmless things.

Continue reading ‘Restricting Commercial Advertising Because It Might Persuade People’ »

Several manufacturers of disposable plastic bags have filed suit against reusable bag maker ChicoBag for false and misleading claims about the environmental superiority of its reusable bags over disposable bags. The complaint claims that ChicoBag’s advertising and promotional materials violate the federal Lanham Act and the South Carolina Unfair Trade Practices Act. According to the complaining bag makers — Hilex Poly Co., Superbag Co. and Advance Polybag Inc. — they have been harmed by ChicoBag’s exaggerated claims about their products. Among other things, ChicoBag created the “BagMonster” to symbolize the number of disposable bags used by the average American, and has also launched this site about the suit.

There appears to be no dispute that ChicoBag made some incorrect or poorly substantiated claims. A company website acknowledges that it had relied upon some out-of-date sources, and has since updated and documented the claims made on its “Learn the Facts” page and elsewhere. This has not stopped the suit, however. Here’s more from the New York Times, San Francisco Chronicle, and Chico News & Review.

The context of this dispute is a broader debate about the merits of disposable products. ChicoBag may exaggerate the threat posed by the accumulation of solid waste, but there are other environmental (and even economic) reasons one may prefer reusable bags. The ChicoBag itself is a handy little product, even if it won’t save the earth.

As this litigation proceeds it will be interesting to see whether ChicoBag mounts a First Amendment defense. The company’s claims are as much about spreading an environmental message as they are promoting a product — and public debate over such questions would seem to be worth constitutional protection, even if economically motivated claims about a specific product are not. Somewhat ironically, one of the last companies to make this argument, Nike Inc., did so against environmentalist and human right activist attacks. That case went to the U.S. Supreme Court, but the justices punted in Nike v. Kasky. Perhaps Hilex Poly v. ChicoBag will provide the Court with an opportunity to revisit this issue and determine when a company’s commercial claims end and participation in public debate begins.

This important commercial speech and business law case was just argued this Tuesday, and my Mayer Brown LLP colleague Andrew Tauber has a very helpful and substantive summary of the oral argument; I highly recommend it to anyone who is interested in the subject.

Last month, in International Dairy Foods Association v. Boggs, the U.S. Court of Appeals for the Sixth Circuit struck down Ohio’s regulations barring dairy processors from labeling milk as “rbST-Free,” but upheld the agency’s ability to require disclaimers for some rbST-related product claims, subject to First Amendment constraints.   In the process the decision illustrated how environmental preferences, such as for “organic” food, benefit from constitutional protection of commercial speech, including product labels.

Some milk producers administer recombinant bovine somatotropin (rbST, aka recombinant bovine growth hormone or rbGH) to their dairy cows to increase milk production.  Although there is (as yet) no scientific evidence that the use of rbST poses any health risk to humans, or even that rbST can be detected in milk from treated cows, some consumers prefer to purchase milk from untreated cows.  In response to this concern, some producers (including members of the Organic Trade Association) sought to label their milk products as “rbST-free” or to otherwise indicate that their milk did not come from rbST-treated cows.

The Ohio Department of Agriculture, pursuant to an Executive Order by Governor Ted Strickland, adopted rules governing the such voluntary labeling of milk products.  Specifically, these rules barred the use of  ”rbST Free” or equivalent composition claims on milk labels.  In addition, the rules required that any production claims about milk, such as “this milk is from cows not treated with rbST,” be accompanied with a prominent disclaimer noting that the FDA has determined that there is no significant difference between  milk from cows administered rbST and those that have not.  The rules were influenced by, and largely followed, a 1994 FDA guidance on milk labeling.

ODA defended its rules as reasonable measures to prevent false and misleading product claims about milk.  The Sixth Circuit disagreed.  Subjecting the rules to First Amendment scrutiny, albeit under the lesser protection afforded  commercial speech, the court concluded that ban on rbST-related composition claims was more extensive than necessary to serve the state’s interest in preventing false or misleading speech.  The court found there is  a sufficient difference in milk from rbST-treated and non-treated cows to reject ODA’s claim that an “rbST free” label is inherently misleading, and held that any potential consumer confusion could be alleviated by accompanying the claim with anappropriate disclaimer.  The court also concluded that the mandatory disclaimer for production claims was reasonably related to the state’s interest in preventing false or misleading claims, but that some of the specific requirements (such as that the disclaimer appear in the same label panel) were more extensive than necessary.

The Sixth Circuit’s decision is entirely consistent with International Dairy Foods Association v. Amestoy, a 1996 Second Circuit opinion striking down Vermont’s mandatory labeling requirements for milk from cows that have been administered rbST.  Both cases affirm that product labels, while commercial speech, still receive First Amendment protection.  Consumers may or may nor prefer milk from cows that were administered rbST, and producers should be free to use their labels to identify their products as potentially desirable to consumers with particular preferences, but should not be forced to do so.  The government’s role is to ensure that whatever information is disclosed is truthful and not misleading, not to mandate disclosure of product characteristics important to some consumers but not others.

This decision also illustrates a point I made in my post about labeling genetically modified salmon (and in this paper on labeling nanotech products).  Just because a government agency does not mandate disclosure of a particular fact — such as whether milk came from rbST-treated cows or a fish filet came from an AquaBounty salmon — does not mean the information will not be disclosed.  In a competitive market, producers have every incentive to differentiate their products in accord with consumer preferences.  And insofar as some consumers prefer a particular type of milk or salmon, producers of products with the relevant characteristics will inform consumers of these facts.  So long as the failure to disclose a product characteristic will not cause harm to the uninformed consumer, the government should stay its hand.

The Food and Drug Administration is considering whether to approve genetically modified salmon for human consumption.  Aquabounty Technologies has submitted its “AquAdvantage” salmon, an Atlantic salmon genetically engineered to mature faster than wild salmon, for FDA approval.  Thus far, things look good for Aquabounty, as the FDA’s staff review concluded that AquAdvantage salmon are as safe to eat as other Atlantic salmon.  Further, the staff found “no biologically relevant difference” between the fish.

If the FDA approves AquAdvantage, it is unlikely that the FDA will require that AquAdvantage be labeled as genetically modified.  Indeed, the FDA may lack authority to require such a label.  As the Washington Post reports, if the FDA concludes that AquAdvantage salmon are not materially different than other salmon, there is no basis to mandate disclosure, as failure to label the fish does not mislead the consumer.  Failure to disclose how a product is made — in this case, that an eel gene was inserted in the salmon to make it grow faster — is not misleading to consumers.  Under existing law, so long as the genetically engineered salmon is not materially different than other salmon, the fact that it was genetically engineered is no more relevant than what it was fed, the size of its pen (assuming farm-raised salmon), or how it was killed.  Producers are free to disclose such process characteristics, but the FDA will not mandate it.

Would the FDA’s failure to mandate the labeling of AquAdvantage salmon be a problem?  I think not.  It is one thing to require producers to label their products so that consumers are aware of potentially harmful characteristics.  It is quite another to force a producer to label a product to disclose a non-material fact about the product that some consumers may dislike, such as how it was produced.  The former is disclosure for consumer protection; the latter approaches forced stigmatization.  If, as the FDA apparently believes, the genetically engineered salmon is just as safe, healthful, etc. as other salmon, what basis is there for requiring a label?  If the government mandates a label, it is sending the message that a particular product characteristic is particularly important and should matter to consumers more than others.  It’s a non-so-subtle suggestion that something may be wrong.  Indeed, why else would there be a label?

Mandatory product labels typically provide consumers with information necessary for them to protect themselves from otherwise unknown product characteristics (as well as to identify and contact the producer).  Forcing candy makers to disclose the presence of peanuts protects those with allergies.  Nutritional content labels protect those with particular dietary needs.  Product safety labels can protect those who might be unaware of the danger a specific product may pose, and so on.  In such cases, the failure to label can leave consumers exposed to risks about which they were unaware.  In this case, however, the FDA has concluded there is no such risk, so this traditional labeling rationale is absent.

If consumers really care whether or not their salmon was genetically engineered — and I suspect some do — competing salmon producers have ample incentive to label their products as “natural” or “non-genetically engineered.”  Sellers of wild, non-farm-raised salmon are not shy in promoting this fact about their product.  Organic labeling has proliferated without forcing “conventional” food producers to label their products as such.  Why is this any different?  If the non-use of modern genetic modification techniques is that important to consumers, the information will out, label mandate or not.

That some consumers may want to know about how a product was produced should not, by itself, be sufficient for mandatory labeling.  Consumers may want to know all sorts of things about how products are made, or who made them, but we typically let the market provide such information.  Some consumers care about whether their clothes were made by unionized workers or poor children in developing nations.  Some want to know whether their food is organic, kosher, or produced humanely.  Still others may care whether a company’s executives support particular politicians or specific policies. (Just ask John Mackey.)  In all such cases, so long as there is no material difference in the product that could adversely effect the consumer, we leave the disclosure of such things to the private marketplace.  Why should genetically modified salmon be any different?