On demand 1h 2m 22s Intermediate

Class Actions, Telemarketing, and the First Amendment: Has the Supreme Court Effectively Eliminated the Central Hudson Commercial Speech Doctrine?

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Class Actions, Telemarketing, and the First Amendment: Has the Supreme Court Effectively Eliminated the Central Hudson Commercial Speech Doctrine?

This course will discuss in-depth class litigation and the expansion of telemarketing Regulations, including the rent increase in state mini-TCPA’s and/or adding private causes of actions. We will then take a deep dive into the First Amendment “Commercial Speech” Doctrine discussing its outright exceptions and developing regulations, noting the difference between viewpoint and content based restrictions. Lastly, we will analyze a trio of recent cases that have raised the possibility that Central Hudson is becoming “Zombie precedent.”

Transcript

- [Jacob] Welcome everybody to today's CLE entitled "Class Actions, Telemarketing, and the First Amendment. Has the Supreme Court Effectively Eliminated the Central Hudson Commercial Speech Doctrine?" Very long title, but be that as it may. My name is Jacob Phillips and I'll be presenting it today. And so I hope you enjoy it. Basically what we're going to be discussing, it can be broken down into three parts. The first part will be a discussion of class litigation, and particularly the proliferation of telemarketing regulations. And, you know, obviously these telemarketing regulations can implicate, well, they are speech regulations and therefore can implicate whether they are consistent with First Amendment jurisprudence. We'll then shift to giving sort of a background on First Amendments, commercial speech doctrine historically, and where that, you know, sort of came from and how it developed up to modern times. And we'll be discussing particularly Central Hudson, which is the critical commercial speech case from the Supreme Court. And then we're going to, in part three, be discussing some recent Supreme Court cases that have, that have called into question whether Central Hudson is still good law or whether it is becoming a zombie precedent or ghoul precedent as I call it, which essentially means that it's, you know, even if it hasn't literally been overturned by the Supreme Court, it's essentially been cabinet stacks or is is no longer ever really applied or will no longer be applied. And so we're gonna be discussing that and, and the implication on class litigation and the context of telemarketing. So let's jump right in by talking about robocalls telemarketing. As you can see on your slide, I was trying to think of some things that Americans all pretty much agree on, but things that unite us, what are some of those things? And so I came up with a few that are good things. One of them is Dolly Parton. I think if I was at a party and someone came up and said, "You know who I really can't, stand Dolly Parton", the rest of the people at the party would look at that person and say, "Are you crazy? What is matter with you?" Everybody loves Dolly Parton. Everybody also loves Thanksgiving leftovers. And everybody of course loved Pixar from Toy Story up through Toy Story three. Those are things that every American agrees on. I think there's also some bad things I've posted a few, Nickelback, everybody agrees that Nickelback is terrible. Everyone agrees the flu terrible. Everybody agrees that the comment section online is terrible and everybody agrees that telemarketing robocalls are extremely annoying. There's a quote from Justice Kavanaugh, a recent Supreme Court case where he said, "Americans passionately disagree about many things, but they're largely united in their disdain for robocalls." And then there's another fourth Circuit case. And basically what these courts have pointed out is that everybody hates robocalling. Nobody likes it, everybody wants it to go away. Unsurprisingly then Congress state and federal legislatures have, have sort of responded to this by regulating Robocalling and especially telemarketing on the federal level. That's through the Telephone Consumer Protection Act, TCPA. But then there are also various state legislations as well, beginning with the TCPA. There's basically two main components to the TCPA, which is the federal regulation on robocalling, the first component is that it prohibits calls placed via an automated dialer, an auto automatic telephone dialing system, or a prerecorded voice. And that doesn't distinguish between commercial and non-commercial speech. So that doesn't implicate anything that we're gonna be talking about today. The second component is that it prohibits, it has prohibitions specifically on telemarketing, where telemarketers place calls to phone numbers that have been placed from the Do Not Call registry. So if your phone's not on the Do Not Call Registry, now you should add it. And that is focused specifically on telemarketing. So if you, anybody here calls someone who happens to be on the Do Not Call Registry, you're not under any potential TCPA violation, but a telemarketer is. And so that does implicate First Amendment commercial speak. Juris Brunett, the TCPA was passed in 1991, but particularly in the mid two thousands, there were thousands, thousands of these cases being filed every single year. As you can see on the slide, the peak was in 2016, over 4,600 TCPA cases were filed in 2016. And but ever since then, there's been a pretty rapid decrease. in the amount of TCPA cases that are being filed, 44% decrease from 2016 to 2020. Why is this? A couple different reasons, but probably the two most important are, one, the expansion of Article three jurisprudence for the Supreme Court and various appellate courts is they've essentially been requiring more in order to establish Article three standing, which makes it more difficult to file statutory cases where essentially what you're alleging is that there was a statutory violation, but there's no, there's no additional harm beyond that. You weren't damaged in the sense you didn't suffer monetary damage or what have you. They just violated your statutory right. And it's becoming more difficult to do that under TransUnion and Spokeo and what have you. And then the other reason is that appellate courts began imposing a more restrictive interpretation of what automated dialer means. So previously there had been most courts to address what, what does it mean to be an automated dialer? Their interpretation of the statutory definition that, that if a dialer operated by, essentially you upload a list of numbers and the dialer essentially selects out of that list the numbers to be called and does it without human intervention. But the point is, those numbers were uploaded into the system that that constituted an automated dialer. But the Supreme Court in 2021 and a few appellate courts in 2019, 2020 began saying, no, that's not an automated dialer. An automated dialer has to automatically essentially generate the number and then call it, not just select a free populated list of the numbers to be called. And as I'm sure you can imagine, not very many telemarketers are utilizing a system that just spits out random numbers and hopes that it happens to be the number of someone who might be interested in their product. And so essentially very few automated dialers, if any, you know, are being operated in this realm. As a result, a lot of state legislatures began either creating or beefing up what some call many TCPAs basically state versions of the TCPA. And that includes Florida, Oklahoma, Washington, Georgia, I think New York beefed it up. A lot of states and a lot of them are modeled after the Florida Mini TCPA, the Florida Telemarketing Sales Act, which is Florida statute 501.059. What that says is that a person may not make or knowingly allow a telephonic sales call to be made if such call use as an automated system for selection or dialed telephone numbers. Essentially it's like the TCPA, the first part of the TCPA and that banning calls placed by automated dialers, albeit a much broader definition of what an automated dialer is. But it's also like the second part of the TCPA and that it specifically targets commercial speech telemarketing is commercial speech. That's what's specifically targeted here. And it's distinguishing, they're discriminating against commercial speech by only regulating these calls if they're telephonic sales calls, if they're essentially, if they're commercial speech related, which obviously implicates whether such regulations on speech are consistent with First Amendment, which is essentially what the slide said. I got a little bit ahead myself, didn't I? So that brings us to the second part, which is, okay, so we've established that there's all these regulations out there they're specifically targeting commercial speech. So what is the First Amendment commercial speech jurisprudence, which is what we will get to next. So as I'm sure everyone is aware, the actual text of the First Amendment says that Congress shall make no law doing a lot of different things. But for our purposes here, most importantly, Congress shall make no law a bridging the freedom of speech, obviously taking those words literally that makes it sound like you can't pass a law at all that that abridge of speech whatsoever. There's no exceptions here, right? And we know that the First Amendment has been also applies to state governments through the 14th Amendment. So taking these words on their face, it looks like nobody commit past any laws that restrict speech in any manner or whatsoever. Well that hasn't been, what courts have found of course, quickly became clear that certain regulations speech is absolutely allowed. So the first category we might think of is, is just outright exceptions. And I've listed a few here, incite and defamation child porn for all and fighting words. These are categories of speech that, that have no protections. You're just not entitled to be able to incite violence. You're not entitled to defame someone. And so Congress or state governments can regulate these categories of speech, essentially all that they want. So let's assume that there's not an outright exception though then where do we go? So assuming the law is not regulated in these exceptions, whether it passes constitutional scrutiny, turns on what it is that the, what it is that the regulation is targeting. And in some cases the intents behinds the regulation. So first we have time, manner, and place regulations, you know, which are what they sound like. It's not necessarily restricting speech, it's just making sure that there's some regulation of how that speech occurs. You know, if you wanna do a protest or a political speech on state property, you got to, you know, apply and it has to be before, you know, 8:00 PM or what have you. Or you know, you can have a concert, but it's gotta be in these areas so that you're not interfering with, you know, people sleeping and, and what have you. Those are time, manner, and place restrictions, they're subject to intermediate scrutiny. Next we have content based regulations, which are subject to strict scrutiny. We'll talk a little bit more about that in a second. And then we have viewpoint based regulations, which are subject to what I'm calling the now dog test, which means, yeah, they're, they're not gonna pass scrutiny. For those of you who listened, I did steal that from the Advisory Opinions podcast. So let's talk about content-based and viewpoint based discrimination for a second. What's the difference? The difference essentially is that if, if the entire topic is being regulated, you cannot talk about this topic, whether you're for it, whether you're against it, whether you hate it, whether you love it. We're just not letting you talk about this topic on state grounds or what have you. That's content based. If instead the regulation says you can't talk about topic X, if your opinion on topic X is not a good opinion, if we don't agree with you, well that's not content based or it's not just content based and that they're not banning anyone from talking about it. They're only banning people whose views they don't like. That's viewpoint discrimination. So an example which we put on the slide is, you know, no speeches advocating for or against legalization of drugs. That's a content-based regulation. Whereas no speeches advocating against legalization of drugs, that's viewpoint discrimination. So the former is subject to strict scrutiny, which is gonna be difficult to meet while the ladder is subject to the the naw-dog doctrine. You're not gonna be able to show a sufficient basis to survive constitutional scrutiny, in that case. So what is strict scrutiny? Content-based regulations are subject to strict scrutiny. We have one there, sort of the test from Reed about what is content-based scrutiny. Government regulation of speech is content-based if the law applies to particular speech because of the topic discussed or the idea or message expressed. And we, you know, so saying these, this type of speech is, is being regulated because of the type of speech that it is because of the topic discussed. That's gonna be subject to strict scrutiny, it's gonna be presumed to be unconstitutional. And then we have the, what I'm sure is a familiar test. Content-based regulations only survive strict scrutiny if they are necessary to serve a compelling state interest. And if they are narrowly tailored to achieve that end, which that courts have explicated that a little bit. Essentially what it means is that there are not any more limited alternatives to achieving that compelling interest than the regulation itself. Now there are some exceptions to the application of strict scrutiny, even if the regulation is content based. We put a couple examples up there. Adult entertainment regulations, so basically regulations on adult entertainment, strip clubs, you know, new dancing restaurants and what have you. Those are gonna be subject to still more, it's not gonna be rational basis review, like the time place, or sorry, it's not gonna be a rational basis review, but it, so it's gonna be a heightened form of scrutiny, but it's gonna be something more like intermediate scrutiny and it has its own test. Another example would be expressive conduct. So when a regulation is regulating something that's both non-speech and speech, it's conduct, but you're gonna be communicating something through that conduct that's also not gonna be subject to strict scrutiny that's gonna be subject to a form of intermediate scrutiny. And historically, one of these exceptions to the application of strict scrutiny, even when the regulation is content-based, is commercial speech regulations of commercial speech are certainly content-based. The speech is being regulated because it's commercial as opposed to non-commercial. It's being regulated because of the topic discussed or the idea or message conveyed. Ie, please buy my widget, but it is not subject to strict scrutiny as, as the "Went for It" case that we have on the slide says the "Supreme Court has been careful to distinguish commercial speech from speech at the First Amendments core." And so historically strict scrutiny has not been applied to content-based commercial speech regulation. Instead it is subject to what is known as the Central Hudson test comes from a 1980s case and it provided the relevant standard. And that standard essentially is that deregulation has to serve a significant or a substantial state interest as opposed to strict scrutiny, which recall under strict scrutiny, the regulation would have to serve a compelling state interest. Next the regulation must directly advance that interest. And then third, it can't be more extensive than necessary in order to advance that interest. And what sort of subsequent to Central Hudson as this doctrine continued to be developed, the Supreme Court made clear that what this means is that commercial speech regulations in the context of commercial speech regulations, the state is not going to be forced to show that there was no other, there was no less restrictive means of achieving the significant state interest. Instead they just have to show that basically that the, the fit between the regulation and what it's trying to achieve is reasonable. That it's not necessarily the best way of doing it or the least restrictive means of doing so. But it's proportional, it's reasonable, it passes the smell tests essentially. And we have a case you should have in your notes or on the slide board of trustees versus Fox that's sort of explicated that a little bit more, as long as there's a reasonable fit between the interest and the regulation, then you know the courts are gonna leave it to the, to the legislature. So they're gonna leave it to the governmental decision makers to judge what manner of regulation may be best employed. So obviously this is a far less significant, as is often the case, it is a far less significant burden on the state in order to justify a regulation on commercial speech as, as opposed to non-commercial speech to regulate speech. Because it is commercial, it's gonna be far easier for a state to justify that regulation than it is going to be if it was a, if it was a different type of content based regulation. I'm sure a lot of, you know, everybody listening to this is, is probably aware of the mantra that, you know, rational basis review, the state wins, strict scrutiny, the state loses the plaintiff wins intermediate scrutiny, the judge wins, you know, the judge, the judge gets basically just to make up his or her own minds in the context of intermediate scrutiny and probably isn't gonna get reversal appeal either way. For that reason then clearly it is critical whether strict scrutiny or whether Central Hudson test applies, right? We have compelling versus significant. All you have to show is significant under Cental Hudson as opposed to compelling, under strict scrutiny and then under strict scrutiny, the state has to show that it's the least restrictive means of achieving the compelling interest as opposed to under Central Hudson when it, when all that has to be shown is that there is a reasonable fit between the regulation and the significant state interest. So that lends itself to the question is Central Hudson still the test? And that is what we'll be covering in part three. So is Central Hudson becoming ghoul precedent? We know that it hasn't, spoiled alert, we know that it hasn't actually been overturned, but has it been effectively overturned and, and I'm getting ghoul precedent from the, from a 1993 case where, and I have the quote in there from Justice Scalia who concurred, you know, "like some ghoul in the late night horror movie that repeatedly sits up in its grave and shuffles abroad after being repeatedly killed and buried. Lemon stalks are establishment clause jurisprudence once again threatening the little children in school attorneys of Center Moriches Union Free School District." Anyway, I think it's a funny quote, but the idea here is that the Lemon test, which had previously been the applicable standard to cases alleging that there was a violation of the religious establishment clause and over the course of several years the Supreme Court functionally overturned Lemon, but never said that that's what it was doing. And so courts continued and have continued to this day, lower courts have continued to apply lemon and I think there's been five or six cases in the past couple years. And for each one, you know, the lower court applies the lemon test. You know, the ones that finds that they're under the lemon test, that there is an establishment clause violation and go up to the Supreme Court. Supreme Court reverse says there is no establishment clause violation, but doesn't overturn lemon and Justice Gorsuch always writes a concurring opinion crying out in the wilderness, can we please just tell everybody that we've overturned lemon so they stop applying that test. That's ghoul precedent, right? It's still there, but it's not doing anything. But it's scaring the district courts because it hasn't been overturned. So they properly think, "Well it must still be applicable 'cause it hasn't been overturned yet." And alas get overturned properly if it goes up on appeal. So is that what's happening now with Central Hudson? The reason why it's a question and the reason why some people think that it is or will be soon is because of a trio of cases in the last 10 years or so. The first is Sorrell versus IMS Health. That case addressed the law that was restricting the sale disclosure and use of pharmacy records if they revealed the, if the pharmacy records then has revealed the prescribing practices of individual doctors and there was some specific prohibitions that it had, it prohibited the sale of such information, it prohibited the use of the information by pharmacies for marketing purposes prohibited the use of such information by pharmaceutical manufacturers for marketing purposes. And this was a problem for the manufacturers in particular because if the manufacturer knows the prescribing habits or the prescribing patterns of a given doctor, that can be extremely helpful to them. And tailoring your sales pitch to doctors as far as why they should prescribe a certain drug or why their drug is better than the one that the doctor is prescribing currently, or you know, what have you. If they know the doctor never prescribes, you know, whatever, I can't even think of an example. If they know that a doctor never, just never prescribes a certain type of drug, then they're likely not gonna waste their time sending a sales rep to that doctor to say, here's why our version of that drug is better than all the other ones, which you also don't prescribe. But if they know that a doctor is consistently prescribing a certain type of drug, then that will inform what they tell their sales rep and he can go and put a presentation about why our version of this type of drug is better than the others in the market by passing this regulation. Then the pharmaceutical manufacturers could no longer have that information. They could no longer tailor their, you know, their sales pitches to doctors in Vermont. Supreme Court struck the law down, said, no, no, no, no, that's a speech violation. The problem was that it was pretty muddled and what test it was applying. So first it established, yes, this is a content-based regulation aimed specifically at commercial speech and then said that at one point it said that because it was a content-based regulation, it was subject to "heightened scrutiny". Well, this is not very helpful because that just raises the question heightened compared to what? Central Hudson is heightened when compared to normal review to rational basis review. So it is a heightened form of scrutiny, but even time placing manner restrictions are subject to intermediate scrutiny. So they would also be considered heightened scrutiny by comparison or is it heightened compared to time, place, and manner. So for example, if what it's being compared to, if the baseline is rational basis review, then both Central Hudson and strict scrutiny would fall within the bucket of heightened scrutiny. It's just that strict scrutiny would be more heightened, if you will, than Central Hudson. But if the baseline, if what it's being compared to are time, place, and manner restrictions, which is intermediate scrutiny, then Central Hudson would no longer be, would probably no longer be considered heightened scrutiny. Although strict scrutiny would be, in other words, central Hudson is no, although it's not exactly intermediate scrutiny, it is a form of intermediate scrutiny. So they're the same in that sense. One's not more or less difficult or heightened than the other, but strict scrutiny would be heightened compared to intermediate scrutiny obviously. And so if the baseline is time, place and manner then by saying that content-based regulations on commercial speech are subject to heightened scrutiny, then Justice Alito was necessarily saying that they're now subject to strict scrutiny. But the opinion never cited Central Hudson and never said, and it didn't exactly apply the strict scrutiny test. It didn't really say what test it was applied. And the dissent Justice Breyer, who dissented with two other judges, I believe made clear that how he interpreted the majority opinion was that it was imposing or it was at least applying a more stringent test in Central Hudson. In other words, either it was literally imposing a more difficult test in Central Hudson or it was imposing Central Hudson. But the way that it was applying the Central Hudson test was much more difficult than the Supreme Court had applied it previously. That it was essentially applying Central Hudson, if at all, and name only. And certainly Sorrell appears to suggest that even if the preexisting commercial speech standard still applied and not the normal, you know, content-based strict scrutiny that in other words, if it was still applying Central Hudson, it wasn't overturning it and saying that strict scrutiny now applies that courts should be giving Central Hudson a more muscular application. I think we can take that at least as the implication of Sorrell, the seconds in the trio of cases. And probably the most important is a case called Reed versus town of Gilbert, which is a 2015 case in which Justice Thomas wrote for the majority. And the facts in Reed is that they were, Reed was addressing a regulation, I think a city regulation, I don't think it was a state, I'm pretty sure it was a city regulation on the display of outdoor signs without a permit. And they basically said, you can't, you can't display signs outdoors unless you have a permit to do so. But there are some exceptions. So there are some signs that you can display even without a, a permit. One example is ideological signs, whatever that means, whatever those are, you can so long as actually I did define ideological signs, they defined it as a sign communicating a message or idea very helpfully. You can display those types of signs without a permit. You can also display political signs, for example without a permit. But then there was differences on the size of, so like a political sign you can display without a permit if it's less than 32 square feet and only during an election season, blah, blah, blah. Another exception is, was a temporary, temporary directional sign, which was defined as a sign directing the public to a church or other qualifying event. Those are allowed to be displayed outdoors without a permit, but no more than four of the signs and those could only be six square feet, not 32 square feet. What Justice said, what Justice Thomas said is that this is a content-based restriction. So you're differentiating between certain types of speech, certain messages being conveyed, and if it's a certain topic, if the topic is come to my church, well those can only be six feet big if the topic is vote for my preferred local candidate. Well, those could be 32 feet in size. And Justice Thomas said, "that's a content-based restriction." And as a content-based restriction, it is subject district scrutiny period without referencing a single exception. Which if the failure to identify an exception to that assertion means that there aren't any, that means Central Hudson is no longer a good law. Now, the three exceptions to the regulation, so not, I'm not talking here about exceptions to strict scrutiny, I'm talking about the actual regulation. The three exceptions that we discussed in here are the three that Justice Thomas highlighted. So he highlighted ideological signs, political signs and temporary directional signs. None of those, although they're content based, none of those obviously are commercial speech necessarily, although I guess theoretically the ideological sign could be, but let's assume for a second that it's not, none of these exceptions are commercial speech, ergo. He wasn't necessarily discussing commercial speech, but several of the 23 exemptions were, and so theoretically should have been subject to Central Hudson scrutiny. And theoretically, although the regulation might not have, might not have survived strict scrutiny analysis, maybe it could have survived the Central Hudson analysis, but Justice Thomas never mentioned it. Commercial speech therefore wasn't at issue. And so all we're left with is in a non-commercial speech context, the assertion that strict scrutiny applies to content-based regulations on speech without referencing an exception. Does that mean that there aren't any exceptions to that rule that if it's a content-based commercial speech or not, any type of content-based regulation is now subject to strict scrutiny. Justice Breyer concurred in the judgment actually, but he concurred because he did not believe that he thought the regulation was silly and didn't pass any form of scrutiny. And so he concurred in the judgment, but again, he reiterated his concern that the court was beginning to apply what was functionally a strict scrutiny test even to commercial speech. I'm gonna come back to read it a little bit, but let's go to the third case real quick, which is BARR versus American Association of Political Consultants, which is a 2020 case. And this case actually did address the TCPA, but it wasn't addressing the regulate, the second component of the TCPA which is the regulation on commercial speech, specifically the regulation that only applies to commercial speech and therefore if there's non-commercial speech, you don't violate the statute commercial speech, you do violate the statute. That would be a content-based regulation. Barr did not address that component of the TCPA. It was actually addressing the, it was addressing the first restriction, which is the restriction on robocall, automated dialers, which is not content based mostly. It's certainly not content based on commercial speech. There was a exception to that first aspect of the TCPA, the prohibition against automated dialers. There was an exception added, I believe in 2015 that applied to anyone calling, anyone placing a call related to government backed debts. So basically you cannot use a automated dialer to call people without their consent. That's the rule, right? But you can, if you're calling about a debt that you owe that the recipient owes to government. So basically Congress was giving itself, it was giving the government favored treatment and the Supreme Court. And so the question in BARR was, is that Constitution and the Supreme Court said that no, it is not. And doing so in Barr holding that, that the exception was unconstitutional, the court applied strict scrutiny and once again had the blanket assertion that this law is content based and therefore is subject to strict scrutiny, period, not referencing any exceptions. It then severed the exception, basically wrote it out of the, out of the TCPA rather than finding the whole statute was unconstitutional. And so once again, justice Breyer descents says, "what are we doing here? Why are we applying strict scrutiny," not necessarily commercial speed, but why are we, why are we pretending that every time there's a content-based regulation that it's always and forever subject to strict scrutiny, why are we at least not clarifying and what have you? So those are the three cases. Nothing, none of them addressed commercial speech necessarily, although in the case of Reed, that was because the court chose not to, but all of them to one degree or another, seem to indicate that the court is not interested anymore in distinguishing between different types of content based regulations. What it seems like the court is indicating is that, look, if it's a content based regulation, it's subject to strict scrutiny. That's how this works now. When discussing whether Central Hudson's becoming precedent and being cabin to its facts basically or being functionally overturned, it's also probably worth considering that in addition to these three cases, the sort of directional move of the Roberts Court, ever since chief, just ever since John Roberts became the chief justice, the direction of the Supreme Court has been, there's been a clear move towards providing greater protection of speech, right? And to be more suspicious of regulations of, of any type of speech. And there, you know, there's a lot of example, there was actually a symposium, and I think we put this in the course materials. There was a symposium at Brooklyn Law School maybe about a year or two ago that was symposium was essentially about what is the Chief Justice Roberts courts jurisprudence and free state free speech. And is that becoming sort of like the legacy of, of the Roberts Court and the, and there's a lot of examples of this. There's a case called Matal versus Tam, I think that's how you pronounce that, which limited government speech precedent, which is free from the strictures of Viewpoint mutual neutrality. There was a case Mahanoy area School district versus B.L commonly known as the angry cheerleader case. And in that case, the plaintiff had been subject to some form of, I think she had been maybe kicked off the cheerleading team. She had been subject to some form of school discipline for, for a post that she had made on, I wanna say either TikTok or Snapchat or something that was critical of the school or, you know, but it was off of school grounds. The point, so it was speech from a student, but not while the student was on School grounds, but speech related to the school. So it was, in other words, it was speech directed critical of some aspect of the school, but after school and not on school grounds. So the question was, does the tinker principal that students don't shed their rights at the school house gate? Does that apply even to off-campus speech? And the Supreme Court said that it did. Another example is the Janus Case, which actually reversed existing precedent in that case. And that was about whether employees could be forced to pay union fees or whether that was a speech violation. And so, you know, obviously the argument is most of the time at least even if you don't join, if you're employed at a place where there is a large union, even if you don't join that union, if the sort of benefits of being part of the union and nor to you, right? Because if the union negotiates higher wages for everyone, then you got, you're gonna get higher wages just like anybody else's. If they negotiate a different type of health benefits as part of the employment contract, well that's gonna benefit you even if you're not part of the union. And so for that reason, the Supreme Court previously had said that basically we're not gonna allow freeloaders if, you know, if you decide to enter into employment, sign an employment contract at a place where there is a union and you're going to be benefited by that union, well then you can be forced to pay union fees. Now the flip side of that is that unions obviously do more than just negotiate contracts and negotiate benefits. They also, you know, they also lobby congress for more favorable employment laws. They contribute to political campaigns of political candidates who they think will be more favorable to employees. And so you can see the problem where, you know, if a person joins a union and doesn't want their money going to fund speech that with which they disagree or political candidates with whom they disagree, that I can't be compelled to, to essentially participate in that speech. And the Supreme Court said, yeah, that's a violation of the First Amendment to force someone to contribute to union fees even if they don't want to. Another example, you know, obviously is Citizens United, very minor case that I'm sure nobody has ever heard of. But anyway, that's just another example of protecting speech. Obviously I'm sure everybody's aware that Citizens United was where the Supreme Court held that federal bans on corporate expenditures is, is an unconstitutional abridgment of speech and Oh yeah, there it is. So I actually included it in the slide, that symposium that you can go and find a bunch of transcripts of talks that we gave in. I think a lot of 'em been turned into law review articles and what have you. So if you're interested in sort of the Roberts Court speech jurisprudence in general, I think that's a, a good place to start. So in light of the three cases we discussed, Sorrell Reed and Barr, hence the question, have those three cases essentially Abrogated Central Hudson that they functionally overturned Central Hudson in this commercial speech now subject to strict scrutiny rather than to the Central Hudson test. The Sixth Circuit certainly thinks that it is in 2020, the sixth circuit had a case International Outdoor Inc. Versus City of Troy and in that case, like Reed, the issue was regulations of billboards. But there was essentially two components of it, and one of it was commercials was the, the distinction was between commercial and non-commercial speech. And so non-commercial speech wasn't subject to the billboard regulation, whereas commercial speech was, so in one sense it was more, Reed was more directly applicable because at least the topic here is we're talking about regulations on billboard dance. So that in that sense it was exactly like Reed, but in another sense it wasn't because the issue was the distinction, the content-based distinction was commercials versus non-commercial, whereas Reed didn't address that at all. But nevertheless, the Sixth Circuit helds that in light of Reed, Central Hudson no longer applies, no longer applies if the regulation of commercial speech is content-based. Basically what the court said is that Central Hudson might still apply. If the regulation is content neutral, then we might still apply Central Hudson. If the challenger is, let me, let me see if I can say this better. Basically, if a content neutral regulation is challenged by someone who is being prevented from giving non-commercial speech, it's analyzed under the time, place and manner that would be because it's not content based, it's time, place and manner that would be under the intermediate scrutiny time place and manner standard. If however, it's a content neutral regulation and it's being challenged by someone prevented from providing commercial speech under that circumstance, central Hudson would apply. So you can imagine what that would look like, say there was the same, say there was the same billboard ban except there was no exceptions, just straight up you are no longer allowed to display billboards, display signs outdoors without a permit. And someone who wants to put up a temporary directional sign a sign saying go turn here to go to my building or my church or my whatever, and they challenge the law and they say, that's unconstitutional. You can't outright stop me from doing this because it's content neutral and because it's not commercial speech according to the sixth circuit, that would be under the time place and manner analysis test, if you will. But if it's a restaurant that challenges this content neutral outright ban on outdoor signs and the restaurant says, I want to put up a sign telling people, Hey, come to my restaurant and buy my delicious burgers for eight bucks, so, I'm challenging it. I want to speak like speech happens to be commercial under the six circuits analysis that would be under Central Hudson because it's commercial speech and it's a content neutral regulation, but according to the sixth circuit, if the regulation is content based, if the regulation is non-commercial speech allowed commercial speech, not, then that's no longer subject to strict or sorry, that's no longer subject to Central Hudson and our post Reed world that's now subject to strict scrutiny. Now the problem, so to speak, with same Central Hudson still might be applicable, but only if it's a content neutral regulation that is being challenged by someone who happens to want to be providing commercial speech as a practical matter. There is no real difference between intermittent scrutiny and the Central Hudson test, as we discussed earlier, they, they're phrased somewhat differently, but in effect, in numerous court have found this in effect there's not really any difference. So it's a practical matter, it makes no difference whether you're subject to time, place and manner review intermediate scrutiny or the Central Hudson test. The whole point of Central Hudson was to be an exception to the application of strict scrutiny, even though it was a content-based regulation. That was the whole point of Central Hudson is that, okay, we have a content-based regulation that's gonna be subject to strict scrutiny and Central Hudson's like, ah, no, no, no, no, no. Not, if the distinction, the content-based distinction is between commercial and non-commercial speech, we're going to allow more regulation of, of commercial speech and we're not going to apply strict scrutiny, so if the six circuits correct that, that's now no longer the case, well then in effect Central Hudson's been overturned or certainly the point of it, it's been abrogated partly because it, you know it well for two reasons. A, as I said before, it makes no difference whether you're subject to intermediate scrutiny or Central Hudson and effectively the same, and two, you know, these regulations of commercial speech are regulating commercial speech for that reason, you're very rarely going to have a challenge to a content neutral regulation that just happens to be burdening someone who wants to be providing commercial speech as, as opposed to non-commercial speech. So if the sixth circuit is correct, effectively Central Hudson has been overturned. The 11th circuit thinks that it's probably been overturned but not enough to overturn its own precedent. And so the Supreme Court that so explicitly, so you know, and most circuits including the 11th circuit, A, the Supreme Court has to actually overturn its own precedent before the 11th Circuit will acknowledge that it has. What that means is if the Supreme Court comes out with, with an opinion that is addressing some other issue and makes it pretty clear the logic of which is pretty clear that some other law is that some other cases is no longer a good law, the 11th circuit isn't going to then say look, obviously they haven't done it yet, but obviously they're going to, so we're going to assume that they will. No, the Supreme Court has to actually say that's no longer good law before the 11th circuit will stop applying it. So in the Flanigans case in 2017, the 11th circuit was addressing the secondary effects doctrine, which has its own standard, but it's essentially another exception to the application of strict scrutiny, it's a content-based regulation, it has its own standard, it's not Central Hudson and it's not time, place and manner, but it's a form of intermediate scrutiny. And the court acknowledged, the 11th circuit acknowledged in that case that there's no question that Reed has called into question the reasoning undergirding any exceptions to the content-based strict scrutiny standard, including the secondary effects doctrine. They're saying there's no question we agree that Reid has definitely called that into question, but it nevertheless applied the pre-existing secondary effects standard because of the legal principle we discussed previously, which is that even if a case is severely undermines or called into question or curtailed or what have you, lower courts should not consider it no longer good law until the Supreme Court explicitly overturns it. But clearly the 11th circuit was with, was in effect agreeing with the sixth circuit that, yeah, looks like this is the way that it's going. It just hasn't happened yet. Now what can happen a lot of times in these contexts where, you know, the a legal principle or a case is severely undermines by the Supreme Court but not yet outright overturned. What often ends up happening is that courts find ways of avoiding its application, or at least in effect avoiding the application of it. So you could imagine, if you will, a court that very much thinks that Central Hudson has effectively been overturned or has been aggregated, you could see a court easily saying like I really do think strict scrutiny could, should apply here and that the Supreme Court would apply it to the next case to a case that goes up that squarely addresses commercial speech. I think that the Supreme Court will apply strict scrutiny, but technically it hasn't overturned Central Hudson yet. So applying Central Hudson analysis and I finds that the regulation fails to comport even with Central Hudson, even though it probably does comport with Central Hudson, it would fail under strict scrutiny. So I'm just gonna say that it, that it fails even under Central Hudson. Now having said that though, and not withstanding the sixth circuit in the 11th circuit, there have been a trio of recent cases addressing the FTSA I have those listed recall that the FTSA is a content-based regulation, one commercial speech. And so, and all three cases the defendant challenged the FTSA as unconstitutional and claimed that it was a unconstitutional regulation of speech and argued that strict scrutiny should apply and that Central Hudson should not apply. There was the Turizo Case against Subway that was in the southern district in front of Judge Ruiz, I believe, a Smile Direct Club which was also in the Southern district. And then the Built USA case, which was in the middle district in front of Judge Mary Day, I believe, and all three, all three courts rejected that strict scrutiny applied, all three applied Central Hudson and founds that the FDSA satisfies the Central Hudson form of scrutiny. These cases clearly indicate that some courts at least do not believe that Central Hudson is ghoul precedent although the sixth does and the 11th, it probably is. But that's often what happens, I mean, if you, even if you look at the, we previously we talked about the quota Justice Scalia and talking about the establishment clause in the women desk. Well that was in 1993, we're in 2022 and courts are stills applying the lemon test because it has not been overturned. Some of them are, but the way that it's applied is different. So some courts will still apply the lemon test as it was meant to be applied. And those cases are often overturned. Some courts apply the lemon test, but do it in such a way that what would be found to be an establishment clause violation under lemon if it was properly applied, is not found to be an establishment clause violation, which probably is consistent with current Supreme Court jurisprudence, in other words, they probably found, they probably found the same thing that the Supreme Court would've found that the case had gone up there, but they found it under lemon, even though if lemon had been applied as originally understood, it would've been established a cause violation of, hopefully that makes sense. And then some courts sort of reference lemon but then apply a completely different test. And so they reference it, they don't really apply it or it's applied, but it's applied differently than is originally understood, or it's courts are confident enough to say, look, this Supreme Court is made clear, this is no longer a good law. So the fact that there are still courts that are, there are still district courts saying, well, that has been overturned, you know, may or may not be evidence of whether it's becomes, whether it's becoming ghoul president. The real question is, look, we have, we have a pretty clear circuit split already, right? We have the sixth circuit on one side, we have the second Circuit and 10th circuit on the other as far as whether Central Hudson still applies to commercial speech, content-based regulation. It's gonna go, the question's gonna go up to the sixth report. I don't see any way around it. I think maybe the reason why it hasn't gone up already is because the split isn't very good. The second and 10th circuits assumed Central Hudson applied without really, without much analysis and didn't discuss Reed. And so in that sense you have a circuit split, but not a very well developed one. And obviously the Supreme Court likes to have these circuit splits develop and, and have strong arguments on both sides and what have you before they'll take something up. But eventually that's going to happen, especially since the sixth Circuits case, you know, the next time this goes up to an appellate court, eight circuit, fourth, three, and have you, you know, the plaintiff is, you know, gonna be pointing to the sixth Circuit case and say yes, yes, yes. See as they said, it's strict scrutiny now. And so if that court disagrees, they're going to have to, unlike the second intent circuit, they're gonna have to, you know, show their homework as far as why the sixth Circuit got it wrong. So the question is, when this, when this decision goes up to the Supreme Court, not, sorry, not when this decision, when this issue goes up to the Supreme Court, what's the Supreme Court gonna hold? You know, and obviously that's a question of about which reasonable minds might disagree. I guess my personal opinion to the extent that it matters is that it, I mean it, it just certainly seems like the, this current iteration of the Supreme Court is very suspicious of speech regulations and is not inclined, to find exceptions to the application of strict scrutiny. if there's a content-based regulation, certainly a plurality, but it does seem like most of the court is going that way. And so my personal thing is yeah, this, when this question gets in front of the Supreme Court, if it's the current iteration that Central Hudson would be, would definitely have a difficult day and, and likely would be overturned. But certainly there's, there's good arguments going the other way too. There's good arguments that the court wouldn't, I think, I think Justice, Justice Alito could have probably in Sorell if he really wanted to and they didn't. Also, Justice Alito concurred in an interesting concurrence in Reed, which can be read as sort of indicating that if this had been a different case, if this had been a commercial speech case, it may have come out a different way, which would mean that in his view, content-based commercial speech regulation would not be subject to strict scrutiny. So there are good arguments the other way, but I think it's, you know, at the very least, this is an issue that is worth preserving. If you're a defendant and if you're a plaintiff, it's probably worth devoting more time than you otherwise would establishing that whatever regulation that you're defending, essentially, even though your plaintiff, then it would satisfy strict scrutiny. So obviously we started this by talking about class litigation and in that context, you know, the, the plaintiff is the one defending the law, right? So, you know, you're assuming a defendant for violating the FTSA or the TCPA or one of these other state, any TCPAs, you're assuming a defendant for violating that statute. The defendant challenges the statute as unconstitutional. The plaintiff is now in the position of defending the constitutionality of the statute. Normally, if Central Hudson hadn't been called into question, if this predated Reed say there would be no reason to really spend, even if the defendant argued this should be overturned, like strict scrutiny should apply, that Central Hudson should be overturned and strict scrutiny should apply. You don't really spend any time showing that the, that the statute survives strict scrutiny. You would spend all your time saying, no, it's Supreme Court law, right to employ and this satisfies Central Hudson. Now I think it's worth devoting some time establishing that it survives strict scrutiny and the events that even an intermediate appellate court would say, no, we don't think Central Hudson applies anymore. If you've already shown that it survived strict scrutiny, the point's kind of moved, right? And so that's been, I've been the plaintiff, the class counsel in a few of these cases. And that was kind of our strategy is that we, you know, we wanted to show that it satisfied both, even though, you know, maybe five or six years ago we wanted, wouldn't have even worried about showing that it survives strict scrutiny. Now, the, I mean, as, as you can show this slide that I just put out, my personal opinion is probably yes, but see the Lemon lifestyle lifespan of Ghoulishness which still exists today, that's what we're discussing before, it could very well be the case that the, that because of the Supreme Court and essentially what happened to Lemon happens with Central Hudson, where they still don't necessarily say yes, this is a content-based regulation. And so strict scrutiny applies, even though the distinction is between commercial and non-commercial speech. They may not say that it may be the case that, like I said, that they do essentially what they did with Lemon in the context of establishment clause, which is that they sort of kind of apply Central Hudson sort of, but they do it in such a way that it, it's in effect strict scrutiny in other words, if they had applied Central Hudson the way it had been applied for 25 years, the regulation would survive, but they quote unquote apply Central Hudson. But doing it such a way that the regulation is, is found to be unconstitutional, that's, you know, there's a good chance of that too, which would be the most annoying thing for everybody. But who knows? That is pretty much all I have today. Thanks for joining. I hope this was interesting to you. These are some of my favorite topics and I hope you found 'em enjoyable as well. If you have any questions or just want to talk, I love talking about these things, so yeah, if you want to chat with something or you wanna argue with me or tell me why I'm wrong, feel free to reach out to me, shoot me an email. My email is Jacob.Phillips@Normand, like the invasion, but with a D at the end, normandpllc.com. Otherwise, hope everybody has a great rest of your week.

Presenter(s)

JPJ
Jacob Phillips, JD
Attorney
Normand PLLC

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