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January/ February 2014 The Corporate “Free Speech” Racket

How corporations are using the First Amendment to destroy government regulation.

By Haley Sweetland Edwards

Our modern imagination of the First Amendment as a robust, powerful, content-blind doctrine didn’t even really hit the scene until about fifty years ago, in the 1960s and ’70s, when the definition of “speech” began to stretch and morph, becoming both more generous and more distorted in its scope. It was then that liberal Americans and the broader legal establishment began to embrace for the first time the rather radical notion that the First Amendment protects all political speech, regardless of who said it, or what was said. Almost overnight, acts that would have been considered seditious, blasphemous, or profane, and therefore jailable offenses just a generation before, became, by the late ’70s, cultural touchstones, symbols of an age defined by radical individualism. Under the banner of the First Amendment, a teenager could wear a jacket printed with the words “Fuck the Draft”; a man could burn the American flag; the New York Times could print top-secret government records that would help bring down a president.

By the end of the ’70s, it was written squarely into First Amendment case law that, aside from a handful of exceptions for libel, slander, and hate speech, no government—federal, state, or local—could pass a law that abridged citizens’ political speech, no matter how unpopular or despicable the speaker, no matter how unsavory his message. This idea was sanctified in American lore in 1977, when the American Civil Liberties Union stepped in to defend the Nazis’ First Amendment right to parade through the predominately Jewish streets of Skokie, Illinois.

That’s generally where our high school textbooks stop. But a less-well-known redefinition of the First Amendment was beginning to appear at the same time. In the early ’70s, intellectual contrarians like Martin Redish, ingenious lawyers working for businesses and corporations, and liberal purists, who distrusted any constraints on any speech, began to promote in legal journals and the occasional lawsuit the idea that companies’ advertisements and marketing campaigns ought to count as “speech,” too. Conservative jurists like Robert Bork dismissed these ideas as wrongheaded and dangerous, writing that “the protection of the First Amendment must be cut off when it reaches the outer limits of political speech.” And for years, most legal experts shared Bork’s view. The notion that commercial entities possessed the ability to “speak,” much less that such “speech” should be afforded constitutional rights, was laughable.

But again, that changed almost overnight. In 1975, the consumer group Public Citizen, then still controlled by Ralph Nader, sued the state of Virginia over a law restricting pharmacies from advertising the price of their drugs. In that now-famous case, known as Virginia Pharmacy, Public Citizen argued that since consumers could benefit from “hearing” that speech—they could get a better deal by comparing pharmacies’ prices—the government should not be allowed to limit such speech without a “compelling state interest.” It’s important here to note that Public Citizen was arguing that commercial speech is deserving of protection only insofar as it’s valuable to the public. But the Supreme Court’s decision in 1976, in which it sided with Public Citizen and struck down the Virginia law, made a much larger point. It established, first, that a commercial entity can be legally defined as a “speaker” with limited claims to free speech, and second, that even “purely economic” speech, like advertising and marketing, enjoys some First Amendment protections.

Having flown us up to 10,000 feet and opened the hatch, however, the justices forgot to show us how to work the parachutes. “[W]e of course do not hold that [commercial speech] can never be regulated in any way,” wrote Justice Harry Blackmun for the majority. “Some forms of commercial speech regulation are surely permissible.” In other words: commercial entities’ economic speech is protected, but at a lower standard of scrutiny than citizens’ political speech. What, exactly, was that “lower standard of scrutiny”? It was left unsaid.

While liberals celebrated the decision as a win for consumer rights, conservatives like Rehnquist saw the writing on the wall. “The logical consequences of the Court’s decision in this case, a decision which elevates commercial intercourse … to the same place as had been previously reserved for the free marketplace of ideas, are far reaching indeed,” he wrote in a dissenting opinion.

The years that followed would bear out his warnings as the legal establishment fumbled with the parachute strings. A handful of cases in the 1980s attempted to address the questions that the Supreme Court had left unanswered: What is the definition of commercial speech? What forms of commercial speech regulation are permissible? And under what circumstances can commercial speech be abridged? A tangled and sometimes contradictory “doctrine of commercial speech” emerged, which attempted to set down criteria under which the government can regulate commercial speech—for instance, if the regulation is “narrowly tailored” to address a “substantial” government interest—and under which companies have the right “not to divulge accurate information.” But these criteria and definitions have been Silly Putty in the hands of clever industry lawyers, stretched and molded over the years to fit their needs.

Take, for example, the very definition of “commercial speech.” In the Virginia Pharmacy opinion, Blackmun wrote almost exclusively about advertising and other marketing materials designed for consumers. But in subsequent years, lawyers have stretched that definition, sometimes successfully, to include basically anything whatsoever that involves information—a very, very broad umbrella in today’s information economy—including the act of accessing or transferring digital data. That 2011 Supreme Court decision striking down the Vermont law barring data miners from selling information to pharmaceutical companies hinged on the assumption that the act of purchasing and utilizing digital records to facilitate a marketing strategy fell under the auspices of First Amendment-protected commercial speech. A dismayed Justice Stephen Breyer asked in his dissent why the Court had not given “significant weight to legitimate commercial regulatory objectives,” as precedent demanded. “The far stricter, specially ‘heightened’ First Amendment standards … are out of place here.”

In the midst of this intellectual tumult in the mid-’70s, another, even more powerful, idea began to take root. If commercial entities’ economic speech is protected by the First Amendment, but at a lower standard of scrutiny, and citizens’ political speech is protected by the First Amendment, at the highest standard of scrutiny, then what would happen if a commercial entity issued political speech? Would that get the highest standard of scrutiny, too?

Haley Sweetland Edwards is an editor of the Washington Monthly.

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