Shiffrin tribute: philosophy discussion

Rob Kar: Fried says liberty is the central value, but how far does it extend? He didn’t hear much about democracy. Maybe restrictions on liberty are okay if self-authored, but then we need a careful definition of that process.

Fried: He has a political theory, not so much a First Amendment-specific theory. It’s important to begin with what liberty is and why it’s important. He thinks it extends all the way. That doesn’t answer the question of restrictions – only allowed when necessary – just puts the shoe on the right foot.

Baker: Fried uses precisely the notion of liberty Nozick uses. There’s a structure, in which freedom exists. Rawls was all in favor of freedom to work – the question is whether a person laid off by GM would like to be at dinner with us. Possibly, but the structure doesn’t allow that. Seana Shiffrin described a movement to make work more meaningful, and that’s really appealing. The issue is how to think about freedom in getting there.

Weinstein: Let’s call Fried’s view Lochner rather than making free speech jurisprudence more incoherent. To Baker: You haven’t given enough weight to listeners’ interests. The state’s reason for banning cigarette ads may be insulting, based on a lack of trust in the listener’s reaction.

Baker: He distinguishes formal and substantive autonomy. The First Amendment is about formal autonomy. Lots of information is useful to us but we don’t get it – it would be useful if people shared many secrets, for example. The information we get comes from our economic structure, not naturally. Government structures society; it would be paternalistic to say that citizens can’t choose to organize society in particular ways.

Redish: Baker’s argument isn’t just about commercial speech but also corporate noncommercial speech. He has a myopic view of what a corporation is. It’s a Jacksonian innovation – helping the common man compete with monied interests, allowing individuals to join for self-realization. Speech is always an attempt to advance one’s own interests by persuasion. Also, he underestimates the harm of taking corporate speakers out of the mix. Liberty requires information and opinion to be meaningful. If we take out the only party with an incentive to communicate information, we’re creating an externality.

Seana Shiffrin: Even if she’s overoptimistic, lots of noncorporate market actors act morally, and we might want to protect them against forced self-refutation. She wants to look across contexts – we shouldn’t insulate the First Amendment from contract law and corporate law. We should encourage market actors to think of themselves as moral actors. Some of her argument is particularly directed at Baker, asking what it would be like for a market agent to accept his account. She thinks it would be detrimental, because we should encourage people to take advantage of degrees of freedom for moral action.

Shiffrin tribute: my presentation

My turn: Dissent, and its translation into copyright’s fair use doctrine, has been a preoccupation of my work in copyright, and Shiffrin’s exploration of dissent as a central First Amendment principle is incredibly valuable because it emphasizes that dissent is not just something for crackpots. Dissent is communal and expansive, often seeking to persuade, participating rather than always walking away.

Because I’m not a philosopher, and come to these issues from a background in trademark and false advertising, I decided to focus my comments on questions surrounding falsity and misleadingness. In particular, I’m interested in the meaning of individual words and how we as a community make meaning. Much of the discussion at the conference assumed that, at the granular level, falsity judgments were relatively easy to make. But common fact patterns in trademark and false advertising cases cast doubt on this.

Two relevant quotes: First, Bill Clinton’s notorious claim that “It depends on what the meaning of ‘is’ is.”

Second, a quotation from Through the Looking Glass, featuring Alice and Humpty Dumpty.

“… There's glory for you!”

“I don't know what you mean by ‘glory,’” Alice said.

Humpty Dumpty smiled contemptuously. “Of course you don't -- till I tell you. I meant ‘there's a nice knock-down argument for you!’”

“But ‘glory’ doesn't mean ‘a nice knock-down argument,’” Alice objected.

“When I use a word,” Humpty Dumpty said, in rather a scornful tone, “it means just what I choose it to mean -- neither more nor less.”

“The question is,” said Alice, “whether you can make words mean so many different things.”

“The question is,” said Humpty Dumpty, “which is to be master -- that's all.”

The key parts of this dialogue are quoted literally hundreds of times in law review articles, usually as a disparaging reference to some strained or counterintuitive interpretation of a term. But Humpty is not engaged in an inherently illegitimate enterprise: It’s the combination of his undisclosed private meaning and Alice’s preexisting expectation that makes his use of “glory” infelicitous – not even misleading, because it obviously doesn’t mislead Alice, but a poor method of communication. In other circumstances, it’s perfectly reasonable to define a word for your purposes. Alice’s interaction with Humpty, indeed, continues beyond this oft-quoted exchange: Because he knows so much about words, she asks him to explain Jabberwocky, which is full of new words, and Humpty provides the now-standard definitions of Lewis Carroll’s various coinages. Humpty can be a reliable source of meaning, under the right circumstances.

So, while “that’s glory for you!” is a misstatement, “that’s a TiVo for you!” or “that’s a GPS receiver for you!” can be intelligible and even helpful. At what point do we allow individual commercial speakers to define or debate terms, the way we allow people to define and debate terms like “Democrat” or “family values”?

Many of the examples that follow already came up at the conference, often with the assumption that they were easy cases. I want to suggest that they’re not easy, even though we may want the government to step in and regulate them.

From trademark: “Glass Wax,” for a car polish that contains no wax. This raises the question: what does it mean to wax your car? Can you wax your car without wax? Ultimately, trademark’s answer is “yes,” but that’s not obvious.

Dolphin-free tuna: One possible definition of dolphin-free tuna is tuna caught in a net that didn’t happen to kill any dolphins. If the net brings up a dolphin, you throw out the whole catch. This doesn’t address the fundamental objection, which is that the method of catching the tuna routinely and predictably kills a lot of dolphins – but it remains the case that the cans of tuna don’t have any dolphins in them and didn’t even need to have dead dolphins picked out of them. The problem is in likely consumer understanding, as with Clinton’s parsing of “is.”

Not tested on animals: The Body Shop got in some hot water years back because of its definition of this term, which was that its particular products hadn’t been tested on animals. Some of the ingredients, however, were regarded as safe for cosmetic use because they had been tested on animals by others, and the Body Shop relied on that data. So is “not tested on animals” true or false?

Organic/made with organic: There has been substantial debate over the proper definition of “organic,” an official definition of which has now been adopted by the USDA. Products not meeting USDA standards, but meeting some other definition of “organic,” cannot be labeled organic. “Made with organic” is a separate standard, requiring at least 70% organic content. One effect of this rule is to decrease producers’ incentives to make processed food with organic content below the threshold, because they can’t truthfully advertise the organic content, and organic food is more expensive. It may also encourage producers to make more products with 70% or greater organic content and discourage them from adding a tiny bit of organic material to a conventional product in order to get the “made with organic” label. The overall effects are hard to predict.

Cajun: Can Cajun catfish come from China? This was the subject of a recent 11^th Circuit case, in which a panel decided that it was not inherently misleading to label Chinese catfish “Cajun.”

Cashmere: What is cashmere? If cashmere is “recycled” – the fibers torn apart and reprocessed, creating a cheaper product missing some of the characteristics of traditional cashmere – can it still be labeled cashmere? It depends on what the meaning of cashmere is.

Safe and effective: To the FDA, a drug is safe and effective if that is shown by two sufficiently large, well-controlled studies. One study won’t do, nor will anecdotal evidence. Though individual doctors can prescribe and even proselytize based on their own experience with off-label uses of drugs, the drugs’ manufacturers can’t make claims unless they meet the FDA’s standards, lest they be deemed to have misbranded the drugs. Is the FDA suppressing truthful information, or defining what “safe and effective” means, or both?

Miles per gallon and milligrams of tar: These are both measurement systems chosen by the government from various alternatives. An advertiser can’t use other measurements, even though the government standards have known flaws and even if the advertiser tells the consumer that it isn’t using the conventional measurement.

A fetus is a human being: The New Jersey Supreme Court recently heard arguments in a case about what a doctor must tell a patient before an abortion. The plaintiff argued that, if she’d known that a fetus was a human being, she wouldn’t have agreed to an abortion. The doctor argued that requiring such a statement would force him to take a controversial moral and ethical position, and that in any event the patient must have known that a pregnancy at term would produce a baby.

These examples illustrate the vast range of situations in which truth and falsity, even for a single term, are hotly contested. Falsity aside, sometimes government regulates out of a direct worry over deception, as with the dolphin-safe tuna example. It’s possible that the tuna makers could eventually change the meaning of the term for consumers, but that might take a lot of time and cause substantial confusion in the interim. Moreover, reliance on changing consumer perceptions would also make it harder for producers who used safer fishing techniques to explain the advantages of their version of dolphin-safe tuna, which would also have the disadvantage of being more expensive because of the different production method. Thus, government regulation of the use of the term is justified as the fairest and most efficient way of avoiding deception.

Other times, government regulates out of concern over communication itself, reasoning that a fixed standard – as long as it’s reasonable – is in consumers’ interests to decrease “noise” regardless of deception. Consumers benefit when they can make comparisons knowing, or assuming, that all producers use the same standard, whether for organic food or car mileage or milligrams of tar. This has costs in fixing meaning and possibly deterring improvements that won’t show up on the standard measures, but it also has all the benefits that standardization usually allows.

The tradeoffs of government regulation can also be seen in the fact that consumers aren’t monolithic. Information, or lack of information, that helps some hurts others. Many consumers benefit from the government’s system of grades for meat, but more discerning consumers may suffer because they can’t get information about the differences at the highest end. We choose who to help by regulating or by refraining from regulation.

A common solution to this problem is to focus on who gets to decide what is false – the FTC, the FDA, or a jury. (And it’s important to recognize that even the people like Judge Kozinski who advocate full constitutional protection for commercial speech usually claim to want to preserve the common-law cause of action for fraud, which means that a jury would decide what “dolphin-free tuna” means.) We solve the problem of definition, in other words, by changing the question. That isn’t a real solution, since the decisionmakers on whom we rely will have to decide whose meaning to endorse. My own suspicion is that juries may not be better at this, and may systematically be worse, than agencies with experience evaluating a variety of advertising claims over time.

Shiffrin tribute: philosophy

Philosophical Underpinnings of First Amendment Principles

Moderator: Lawrence Solum, University of Illinois College of Law

Seana Shiffrin, UCLA School of Law: Shiffrin’s prior defense of the right to voluntary association includes rationales for allowing associations to exclude people for any or no reason. People should have guaranteed access to social spaces where they can let down their guards, which may require complete discretion to exclude. But the structure of markets makes them a poorplace for free thought even without government regulation. Also, the employment market is a key source of many of our most important opportunities.

Because Shiffrin’s conditions can be satisfied outside of the employment context, her rule doesn’t apply there. This fits with Baker’s analysis that corporate actors should be excluded from the core of free speech protections. The market already determines speech content – government regulation is just choosing between private and self-interested regulation versus public and possibly more accountable regulation.

Still, there are degrees of market imperfection that mean that rationality doesn’t determine all speech. Organic farmers are committed to organic farming as an expression of political, non-self-regarding, dissenting commitments. Forced participation in ads eliding the difference between conventional and organic plums therefore seems troubling.

Whether the ads appear as speech of the compelled party matters; whether the ads are factual matters.

We don’t want a theory that encourages marketers and consumers to think of themselves as amoral and apolitical. We should recognize attempts to moralize the market from within. Some on the left are trying to do this, as are various religious groups. Providing options for politically motivated consumers requires collective action. Organic farmers are not best understood as amoral profit maximizers. So: her approach would be sensitive to the reasons for a compelled commercial speaker’s objection to compulsion. Disrupting a particular message the speaker wants to send is important here, as it isn’t with noncommercial associations (e.g., Hurley).

C. Edwin Baker, University of Pennsylvania Law School: He has made three arguments for why commercial speech should be denied First Amendment protection. For him, free speech is libertarian. Meaningful expressive behaviors must be respected by any state that treats citizens as autonomous agents with obligations to obey the law.

(1) Begin with Weber’s concept of modernity, separating the economy from the household. The market dictates to all that they must act efficiently or fail. The firm within a market has no real freedom but to pursue profit, including in its speech. Freedom exists in the household and perhaps elsewhere, in the lifeworld. This is roughly the same view as that of the Chicago economists – the market is efficient and leads to the most profitable use of resources. It is also the same view as Marx had. Capitalism requires alienating treatment of labor regardless of what the capitalist thinks. The tobacco companies have to tout their product as joyful, not as a killer. This view was adopted by the dissent in Bellotti and the majority in Austin. Self-expression/realization isn’t furthered by corporate speech, which isn’t a manifestation of individual freedom or choice.

(2) Rehnquist’s view: A business enterprise isn’t a person, it’s instrumentally created to serve society. Society should be able to limit it to serve social interests. Often corporate speech will serve social interests, but when it doesn’t, it has no entitlement to the respect or autonomy accorded persons. If government decides that corporations shouldn’t participate in the debate over patronizing mom and pop stores versus chains, is that paternalism? Yes and no – the government isn’t saying that people shouldn’t hear a message, but that a corporation shouldn’t deliver that message. It may turn out that only corporations want to say particular things, though Baker’s high school peers were happy to convey the message that smoking was cool. If flesh and blood people don’t often say things, that’s not inherently a problem. Not many people want to deny the Holocaust either. Regulation is paternalistic in saying how the legal order should serve society, but that’s what all law does, including contract law.

(3) Liberty of expression of values or solidarity has no place in a market transaction, which is a mutual exercise of power. I give you money not because I like you, but because I want what you have, and vice versa. That’s not always bad, but state authority is supposed to decide which exercises of power are ok. Lochner was wrongly decided. Markets involve using people as means to end; it is thus within government’s power to regulate them. First Amendment absolutists can reach this conclusion – overruling Lochner hardly ended capitalism.

Charles Fried, Harvard Law School: He couldn’t disagree with Baker more. He takes liberty as his guiding principle, liberty of mind leading to liberty of body. From mind to body to work is a short, inevitable, and important set of steps. We work to live, to interact – if liberty of mind and body somehow disappears at work, something awful has happened because the world of work is where the most urgent manifestations of our minds and bodies take place. (In my experience, we usually call that the boss, not the government.) Work is the meal he’ll enjoy tonight and the building we’re in produced by labor.

Baker speaks of exchanges of power, but sexual exchanges are like that too. Are we all dominated by power in our professional lives? Compelled to make the most money? Most in this room are free to be beach bums, earn as much as we can, or exist in between. (Yes, we’re quite the representative bunch.) Thus, Fried doesn’t see the market as a radical discontinuity from life. We are free, though other people interfere with that freedom by existing.

Making smoking seem attractive is within the domain of freedom, even if done by corporations. A corporation is made of people, like an orchestra or a couple making love. He would not reify it as anything else. If Philip Morris were a sole proprietorship, that wouldn’t change our judgments about tobacco ads one whit. (And, as they say, if my grandmother had wheels she’d be a wagon. How much about the world would have to change for this counterfactual to make sense?)

Shiffrin tribute: compelled commercial speech

It’s What’s for Lunch: Nectarines, Mushroom and Beef: The First Amendment and Compelled Commercial Speech

Moderator: James Weinstein, Arizona State University Sandra Day O'Connor College of Law

Kathleen Sullivan, Stanford Law School: Overview of the case law at the Supreme Court level – there are numerous other cases in the lower courts. She began with Barnette, Wooley, and Hurley: you have a right not to have speech forced upon you. A right not to become a platform for speech, even in the absence of viewpoint disagreement – a right not to sponsor speech; that’s PG&E v. Public Utilities Comm’n. Extension of that right was rjected when a corporate speaker wouldn’t be associated with the speech, as in PruneYard and Turner. You also have a right not to associate with members with whom you’d rather not associate – Boy Scouts. That also has limits, when the offending association isn’t really contrary to speech – Jaycees.

That’s the background for these cases, involving the compelled extraction of money to pay for speech with which you disagree. The opponents of compelled exaction rely on the Abood line: having to pay for speech is like forced speech, and if the exaction isn’t germane to a regulatory purpose you can get a refund. Limit on the Abood line: when you can’t disaggregate the germane from the nongermane – e.g., Southworth, where all the university’s activities, including funding student groups, were part of its expressive mission—you have no right to a refund. The ultimate limit: you have no right to reject paying your taxes.

Glickman: Upholds the stone fruit marketing scheme. (1) There’s no violation of conscience in promoting plums generically even if you think your plums are better than others’. (2) The exaction is germane to a larger neutral purpose of a Stalinist agricultural scheme, part and parcel of other collective requirements.

US v. United Foods: Invalidates compelled exaction for mushroom ads, because that wasn’t a general scheme, but only existed to generate speech.

Johanns v. Livestock Marketing: The Justices scatter like bowling pins in a new configuration, upholding an exaction for beef ads. It’s part of a broader marketing program, but the difference here according to Scalia is that the government is speaking, which can’t create a First Amendment problem. Except that the ads say “paid for by America’s Beef Producers.” Scalia admits a possible as-applied challenge, but it wasn’t proved on the record.

Robert Post, Yale Law School: It’s incoherent to ask whether there’s a right not to be compelled to speak. You can be subpoenaed to testify; you can be made to serve on a jury and vote; mandatory reporting of child abuse/car accidents/positive HIV tests all proceed without First Amendment challenge. We view compelled subsidization as a problem because it seems “like” compelled speech, but that analogy is already problematic. We’re five steps down the road from the problem of commercial speech in the first instance, and the Court stumbles because it lacks a theoretical understanding of why commercial speech is protected.

Glickman offers one powerful rationale – this is just economic regulation – and two less-powerful ones – this is non-ideological, and it’s germane to a broader program. United Foods then says that you can never be compelled to subsidize what you disagree with, which creates big problems if taken seriously. Are attorneys’ fees awards unconstitutional? The real problem, though, is taxes. Why should forced subsidization of government speech be unproblematic when forced subsidization of nongovernment speakers is an insurmountable insult to free speech? Also, why does Scalia say in Johanns that matters would be different were the speech attributed to the taxpayer? Wooley involved a compulsion to subsidize the state’s message with the individual’s property, which is what Scalia would allow in Johanns.

The problem for commercial speech: all the early commercial speech cases were about listeners’ rights. The speaker’s right to disseminate is deemphasized. Compelled disclosure is a routine remedy for misleadingness. You can’t do that to the NYT when the NYT leaves out facts in its reporting, because of the NYT’s autonomy interest. Compelling more speech increases its value to the audience. (Note: true only if the audience gets more from, instead of ignoring, the extra information.)

Those early cases contradict United Foods’s idea that a commercial speaker has an interest in not speaking truthfully. Johanns leaves that holding in place. We should recognize that public discourse must be divided from sales for these purposes.

Post sees the compelled association cases as a separate line. I don’t have a First Amendment right to incorporate, or to marry. I have a right to get together with others to do things the First Amendment protects, and likewise a right not to be forced to associate with a speaking organization. This is analytically distinct from the compelled exaction cases; I can be forced to associate with a union when germane, but can’t be forced to buy life insurance through a union.

One reading of United Foods is about coerced affiliation. If so, it stands for a right not to be forced to associate with an association that only engages in commercial speech. So, do I have a First Amendment right to affiliate with a commercial speaker, say an ad agency? (For a post-United Foods version of this problem, see Eric Goldman’s post on Langdon v. Google.)

Sullivan: Post’s reference to Zauderer suggests friendliness to compelled commercial speech, which is like Breyer’s view – Breyer likes to see First Amendment interests on both sides. (As do I.) But the comparison of Zauderer, which required the disclosure of efficiency-enhancing and factual, to the compelled speech here is misleading because here the speech is neither efficiency-enhancing nor factual. “Plums are good” is not “I will charge you court costs if you lose your lawsuit.” The government speaks out of both sides of its mouth: it promotes beef here, but its dietary guidelines say eat less mean. Moreover, this isn’t information to which producers have asymmetric access. It’s anti-efficient, because generic advertising prevents product and price discrimination and makes it harder to do niche plum advertising.

Sullivan is wary of accepting compulsion, even in the commercial speech context, because it can go too far and dry up speech. For example, the SEC says that if you say anything to a private gathering you have to file an 8K and tell everyone. Therefore, corporations won’t speak in private.

Post: There’s no issue of deception here, but Zauderer doesn’t depend on the strength of the state interest. It says only a rational basis is required because the reason we protect advertising is for information flow. You only need a little government interest to overwhelm the commercial speaker’s residual interest. (And presumably it is rational for the government to decide that certain individual plum producers are wrong; all plums really are the same.) If the speaker has a separate autonomy interest, that starts to undermine other regulatory regimes.

Sullivan: Souter endorses an autonomy principle. Post says it doesn’t have much bite here. But Souter is also making a political process argument. In the general taxation area, an invidious burden on unwilling speakers will even out over time and there won’t be entrenched losers. Spot taxes are different. Sullivan raises the question: Isn’t this Lochner? She may be objecting to the Stalinist regulatory scheme, not the speech regulation part of it.

Post: Thomas definitely wants to resurrect Lochner. Souter makes a second democratic accountability argument – the government speaks but doesn’t signal that it’s speaking -- but that doesn’t seem related to the autonomy of the individual beef producers who are paying. He does say that the payment makes the speech even more “galling.”

Consider tobacco companies forced to pay taxes to support anti-tobacco ads. Souter uses Jefferson’s justification for the Establishment Clause – it’s wrong to be forced to pay for a church against my conscience. But why is there a First Amendment right to separate accounting?

Volokh: The problem is that Abood is wrong. It’s all metaphor to say that this is compelled speech. There’s nothing wrong with compelled contribution of money. We don’t need to say much about the proper scope of commercial speech doctrine to deal with this. It’s just a bad analogy to say that compelled contributions are speech just because voluntary contributions are expressive.

Post: Sometimes we treat contributions as speech – Abood relies explicitly on symmetry with Buckley. Many times we don’t consider compelled contributions speech – specifically, when they’re compelled contributions to the government. That’s not my speech, but the state’s speech.

Seana Shiffrin: Three examples: (1) Spot tax for ads – “California recommends against smoking”; (2) spot tax for ads – “Paid for by tobacco producers. Smoking causes cancer”; (3) spot tax for ads – “Paid for by tobacco producers. Smoking is totally uncool.” She sees (1) and (2) as unproblematic, (2) because it’s information disclosure. (3) compels the companies’ involvement and self-representation, which is different.

Post: He agrees, and would apply an endorsement principle. If the state makes you endorse a nonfactual proposition with which you disagree, that’s compelled speech, and we must evaluate your interest as a speaker (if any). Here, he’d find a First Amendment problem in affecting the formation of public opinion. If you believe corporations lack autonomy interests you’d allow (3) too.

Sullivan: (3) is these cases – elite food producers try very hard to differentiate their products. This generic advertising destroys self-identity by identifying organic hybrid plums with mass-produced plums. There is blurring between merely commercial speech and broader political importance. The more we talk about identity through consumption – defining ourselves through what we buy – the further we get from the rationale for regulation. Thus, we are wrongly denigrating modern commercial advertising precisely because it supplies a mode of self-definition.

Question: Isn’t the justification for the compulsion the tragedy of the commons? That is, beef producers would like to free ride on generic advertising.

Sullivan: The record was that at least some producers wanted to use that money to advertise their own beef.

Post: Breyer analyzes it this way. Another point about Shiffrin’s example – he doesn’t want to elide the distinction between forced contribution and forced identification of an individual producer. Suppose California did (3) without a spot tax but still named the tobacco producers – the taxation isn’t doing the First Amendment work that makes us object.

Redish: Endorsement seems a risk even with a government-labeled warning – what if RJR disagrees with the Surgeon General? Are we back to Galileo and the Church, with the government deciding scientific truth?

Post: Look at the label on your clothes, which identifies their fiber content and origin. If you think that’s Galileo, you need to make some distinctions.

Redish: I’m assuming there are no factual disputes about the clothes.

Post: If the government prosecutes me for labeling clothes as 100% wool that aren’t, it’s a factual dispute but it’s still not a First Amendment question.

Panel on practice, discussion

Redish: If the caselaw is so incoherent, why not turn to theory?

Johnson: The doctrine’s built by the Supreme Court, with major influence by academics. But that results in the 3- or 4-part test problem: looks great to a reviewing court, but hard to apply for a trial court. Example: forced assessments for agricultural products. The Court decides that it’s ok to assess for ads on plums and peaches, but not mushrooms. Practicing lawyers have difficulty articulating the difference. It may have depended on the quality of oral argument, which is distressing for the rest of us bound by the decisions in future cases. Another example: the Children’s Television Council says nasty things about wrestling; the wrestling show sues for Lanham Act violations, and the judge refuses to dismiss because the Council included a fundraising appeal and was thus engaged in commercial speech. Years later, the same judge throws out a false advertising claim against a diet book that includes pitches to buy diet products on First Amendment grounds.

Vladeck: But the CTC case involved allegations of deliberate falsehood that would have been actionable under common law – the plaintiff at least alleged it could meet NYT v. Sullivan standards.

Question: The Court, when it finds an issue too difficult and not sufficiently momentous, often just ducks. The justices didn’t realize that Nike was a case like that until after the argument. In the Tony Twist case, the petition for cert was very clear on the conflicts, but cert was denied – too difficult, and not important enough.

Eugene Volokh: Johnson is right to identify the slippage of commercial speech arguments into other contexts. Courts and law review articles routinely say that “this is commerce, therefore it is commercial speech.” Perhaps this is about the power of labels: maybe commercial speech doctrine should have been called advertising speech doctrine.

There are difficulties in saying advertising for a book is subject to the same standards as advertising for another product, as in the Buena Vista case – are they really the same standards? (I’d say yes, with the caveat that the puffery doctrine would do a lot of work in making most statements about books nonactionable.)

The Court tried to clarify what it meant by “misleading” by distinguishing actually and potentially misleading speech. But all speech misleads someone. This is undertheorized. If misleading 10% is enough, lots of speech is regulable; if 90%, it’s close to the common law standard for fraud.

Johnson: Classic case: a weekly newspaper runs a joke, with a straight face, claiming that a judge had done something really stupid, so stupid that the writer thought it should have been obvious that it was a parody. Many judges in Texas, however, thought that the newspaper should have made it more clear to even the stupidest reader. What we need is a reasonableness requirement, which is imposed in the securities field. (Frankly, I think Lanham Act caselaw has a much better handle on this problem than First Amendment law. At least it’s grappled with the appropriate percentages, though Volokh would probably argue that the bar’s been set too low.)

Volokh: Even if a statement would be misleading to a reasonable person, there are multiple types of reasonable people. If 20% are misled – they may be just skimming, and it’s often reasonable to skim – is that enough?

Vladeck: This is the next hard issue. Suppose you have a dietary supplement, with one not very good study suggesting it may grow hair. The FDA has regulatory authority over this claim – can the FDA prohibit it? Require disclaimers? Suppose there are 8-10 studies suggesting it doesn’t work at all. The FDA, with respect to dietary supplements and food, doesn’t regulate most of these claims even though the statute requires significant scientific agreement before health claims are allowed. Instead, the FDA merely requires a disclaimer. This comes from Pearson v. Shalala, which has caused a substantial change in enforcement, which has also spilled over to the FTC. These claims are confusing, or, while literally truthful, they omit salient facts. Commercial speech doctrine has thrown 60 years of case law upholding regulations of such speech into doubt.

Lasnik: It’s easy to mislead people, as with Orson Welles and the War of the Worlds broadcast. We have to resist going too far down that path.

Lots of people leave out “reckless disregard” from the actual malice discussion. Reckless disregard is easier to find, and in this day of saved emails there is often enough evidence to show disregard for certain information. Then the question is whether the disregard was reckless. So maybe an actual malice standard for all speech is really the way to go. (Including for products liability-type cases, e.g. drug cases?)

Post: Clarify the difference between false and misleading?

Lasnik: It’s not false for Amazon to say their revenues went up. It’s misleading, though, if they don’t say that their returns also went up so much that if you subtracted revenues, their revenues went down.

Post: Isn’t that false?

Lasnik: It depends on what you mean by false.

Johnson: It’s partly a burden of proof issue. Misleadingness is a regulatory approach, which doesn’t turn on how any individual reacts, but on which direction it pushes people because of facts that may have been omitted or unfairly distorted.

Post: So maybe misleadingness is about impact on audience, where as falsity/truth is about evaluating a state of the world?

Lasnik: That makes sense. We really care about the audience’s reaction in these cases – what would a reasonable investor want to know?

Vladeck: Literal truth may be misleading if it omits an important fact.

Post: In defamation, we’d say that’s a case of false innuendo.

Question: Likelihood of confusion surveys are used to deal with this at the trial level. Invariably, the control cell shows some ambient confusion. (This produced a great deal of laughter from the audience; I myself am pretty sympathetic to the occasionally confused.) Five percent of jurors are also going to be ambiently confused. These cases don’t get simpler in reality than in theory.

Shiffrin: We haven’t talked about what the value is of noninformational advertising – the sexy car driving down the road. That may be the overwhelming majority of broadcast ads.

Right of publicity: Suppresses truthful advertising – “Elton John didn’t authorize us to tell you this, but he drives a Mercedes” would violate John’s right of publicity if Mercedes put it in an ad, but Newsweek could put that on the cover and be perfectly safe. The Tony Twist case is a real oddball, and is dead wrong. But the field is pretty messed up, and the Court has only had one, unusual case early on, Zacchini.

Johnson: This is not unique: the whole commercial/noncommercial divide in private causes of action is a total mess. Rudy Guiliani sued a magazine that used his image to advertise on buses – is that noncommercial speech? Even if it isn’t, should Guiliani win? It may be harder and harder to distinguish ads from non-ad content, especially on the internet. The distinctions are breaking down.

Question: Kasky went out of his way to allege no harm. One of the core reasons for regulating commercial speech is to avoid harm, and so his suit seems deeply problematic. Assume that Nike says to the NYT: we aren’t guilty of these wrongs alleged. There are consumers who take this into account in purchase decisions. Assume it makes the exact same statement to its stockholders. It seems that the statement to the stockholders can easily be regulated without much controversy, and yet a lawsuit based on the same statement to the general public triggers huge First Amendment outcry.

Johnson: Point of sale discussions ought to be regulated. But Nike didn’t involve a point of sale discussion. (I don’t find this responsive. What’s a point of sale discussion for a stockholder?) Where there’s no damage, the government has no interest in regulating speech on matters of public concern.

Vladeck: Shares the concern about the abstract nature of the claimed injury in Nike. But there are many statutes that permit people who haven’t suffered direct injury to sue, and it’s not clear those are wrong. The state can decide that some false claims pose too great a risk, and we need to enlist private attorney generals to help the state enforce its law against false advertising. Suppose a publicly traded company makes a misleading claim: we expect FDA approval of our new drug. An investor doesn’t have to prove individual reliance on that statement.

David Skover: The nature of advertising has moved so far from fact-based claims of the 1900s that Nike became inevitable: that is, we are now blurring the commercial/political line by deciding who we are through what we buy. I am a member of the Pepsi Generation, and this is important to who I am. To consume is to be a citizen. Whether this is good or not, it is true. So, what is this corporate beast doing when it is claiming to be a good citizen in Southeast Asia?

Vladeck: If you look at the Court’s recent rationale for commercial speech protection, you see a seismic shift. The early cases were all audience-centered. In more recent cases, the Court’s all of a sudden talking about the autonomy/self-expression rights of the commercial speaker. Image advertising relates to that because corporations are constructing personae through such advertising. The Court is suggesting it will protect that even though it’s just the advertiser’s strategic positioning.

Johnson: Generally, the audience’s reaction is something we keep out of doctrine, and yet it’s very much a part of commercial speech doctrine. (This is misdescriptive: what is defamatory depends on the audience’s reaction, as does whether a statement is fact or opinion. Johnson says the speaker’s intent is relevant because of NYT v. Sullivan, but so is the audience’s reaction.)

Tribute to Steve Shiffrin: Panel on Practice

First Amendment Principles in Practice, Moderator: Patrick Lynch, O'Melveny & Myers LLP

David Vladeck, Georgetown University Law Center: Why has there been so little post-Nike development in caselaw, despite predictions? Nike may have been an aberration, unlikely to recur. Most early commercial speech cases were brought against anticompetitive restraints on professionals and others that were unassailable under antitrust laws because of the state action bar. Virtually all commercial speech cases at the Court involve (1) regulation of professionals or (2) regulation of activities that were at one time thought to be sinful. Nike was the first private litigant case to reach the Court – the first without a specific government regulation.

One reason we haven’t seen more Nikes was that there was something aberrational about the commercial speech doctrine providing the rule in a private party v. private party case.

Also, commercial speech cases came in waves. Lawyers; then drugs and dietary supplements (a wave down in the DC Circuit). The FDA/FTC aren’t the pitbulls Shiffrin hopes they are; in response to evolving commercial speech doctrine – which is hardly “lite” – the regulatory agencies have retreated a lot. Sellers of food products can now make health claims that aren’t provably true, because the FDA doesn’t believe it could sustain those regulations.

Second reason for decline: the government is not trying all that hard to regulate commercial speech, Vladeck argues to our collective detriment. Also, the drug companies suffered enormous setbacks in what happened with their actual advertising – e.g., Celebrex. Now the drug industry asks the FDA to prescreen all direct to consumer ads, and is asking Congress to expand and accelerate FDA review, funded by the industry. (This is designed to get liability protection through preemption.)

There will be other waves. But the pace won’t be substantial.

Bruce Johnson, Davis Wright Tremaine LLP: Nike was odd; other reasons included (1) California’s consumer protection statute, since amended, allowing any consumer to sue without a purchase and without any damages, (2) Nike was subject to strict liability, (3) Kasky alleged misleadingness rather than falsity, and (4) Kasky’s allegations were largely based on press releases. This made Kasky’s claim very difficult to litigate for the defendant. ((2) and (3) are not at all unique to California law – state and federal advertising law, as well as the FTC/FDA regimes, have these features, which I think is often overlooked in discussions of Nike.)

The transactional test, requiring a connection to a proposed transaction before there's commercial speech, will force some discipline on these causes of action, as opposed to lawsuits based on feel-good corporate claims of being a “nice guy.”

Hon. Robert Lasnik, U.S. District Court for the Western District of Washington: These are difficult concepts to explain to a judge or a jury. Yet – when Bill Gates speaks about Microsoft, Lasnik has some skepticism about truth and motive, whereas when he speaks as the head of his foundation, Lasnik gives him more leeway. This is a commonsense rule, and judges and juries are always analyzing motives in this way. So when Amazon tells investment advisors that the company is doing really well, and the advisors talk to newspaper reporters, and the newspapers report it – where on that chain does the First Amendment kick in? Is there a kickback? What is really going on? That is the judge’s perspective.

Vladeck: Lasnik has laid out the underlying theory of commercial speech: commercial entities have a special incentive not to tell the truth. The doctrine is a sensible way to accommodate the enormous information value of advertising with the falsehoods and half-truths that permeate the market. The government alone can’t police the market; competitors and consumers also need to be able to enforce public norms, which is what drove the enactment of California’s consumer protection law.

Even with amendment, a new Kasky could sue if he actually bought the shoes and alleged that he acted in reliance. So the legal change isn’t a complete explanation for the lack of new cases.

Johnson: Six years into the Bush Administration, it’s odd to hear Vladeck speaking of commercial speakers’ peculiar incentives to lie. He also thinks there are problems with the indeterminacy of the test – did neo-Kasky really buy shoes in reliance on representations about labor practices? (Well, I do. I may be unusual but I’m not unique.) Commercial actors want to sell, not to further self-governance, so they will move on to the next sale rather than defend the last set of advertisements.

Lasnik: Companies want to get rid of bad publicity more than anything else. Likewise, the Nike plaintiffs were more concerned with making a political statement. Any company worth its salt is going to try to get this off the front page, regardless of the legal regime.

Johnson: There are two models of the First Amendment – marketplace and regulatory. (The marketplace doesn’t have regulators? Even the nightwatchman state has a nightwatchman.) They give different answers on how to control the market. Johnson sees the regulatory model as growing out of the guild system, and then the New Deal attempts to carve up the economy and allow corporations to regulate themselves. Deregulation coincided with the creep of the marketplace model into the First Amendment as well.

Lynch: But is the commercial speech doctrine keeping (good) information from the public that the public would otherwise get? Or is regulation too toothless now?

Johnson: Commercial speech surfaces in private cases in odd ways. That’s what’s next – copyright, trademark, false advertising all consider commercial use, which courts are now conflating with commercial speech. The Dustin Hoffman case, for example – Dustin Hoffman’s image altered to show off a dress in a magazine. If it was a regular feature, it was protected by the First Amendment and his right of publicity claim would fail; if an ad, he’d win. He lost. Book covers for the Beardstown Ladies Investment Guide promising investment returns that were, in fact, false – a New York court threw out a consumer lawsuit on First Amendment grounds, but a California court allowed an identical claim to succeed. The Tony Twist case, Doe v. TCI: the Missouri Supreme Court ruled that a comic book was commercial speech and Twist had a valid right of publicity claim. Either a comic book character is entitled to First Amendment protection or not, but there’s incoherence in the lower courts now.

Something is wrong when the First Amendment gives more protection to a comic book featuring half-worm creatures based on albino singers than to a letter to the editor debating working conditions in Southeast Asia.

We are now premising private causes of action on the commercial/noncommercial distinction, and commercial speech doctrine doesn’t match up well with the concerns of typical private cases.

Lasnik: Agrees. When even the judge seems to be floundering, litigants feel pressure to settle.

Vladeck: Let’s answer the question about the regulatory impact of commercial speech doctrine. Most of the statutes being enforced were written well before the doctrine existed, with no eye towards First Amendment review. This forces agencies to be gunshy. Also, those of us who worked on the early cases thought we were empowering consumers, not hamstringing government. There are problems in private cases, but more serious is the inability of the federal government to take regulatory measures to keep half-truths from taking over the marketplace. The pendulum has swung too far.

It’s true that Lanham Act cases have generated lots of confusion about commercial speech doctrine and its applicability in private cases. The Lanham Act simply federalizes common-law claims for product disparagement, and these problems predated it. That’s not a product of the commercial speech doctrine, but a longstanding problem that exists any time courts are asked to intervene and punish speech.

Panel on First Amendment principles: discussion

Responses: Robert Post, Yale Law School: Redish shares two widely held views: First, we start with the notion that the First Amendment protects speech, and any derogation needs justification. Second, any derogation is likely to be viewpoint discrimination and bad.

Post’s brief responses: First, those notions are wrong. We need to distinguish between First Amendment protection and coverage. Does the First Amendment extend to all speech acts? The answer is unequivocally “no.” All of contract; informed consent requirements; dozens of other speech acts. Whatever value you have for speech, it will single out some speech and not others – some speech is relevant to democratic self-government and some isn’t; etc. It makes a good deal of sense not to cover all speech acts because basically everything we do as human beings is done through speech. The First Amendment only covers those forms of speech dictated by the values we hold that justify protecting speech.

Second, on viewpoint discrimination as the original sin. We have viewpoint discrimination as the rule. If Condoleeza Rice said Bush’s foreign policy was a disaster, she’d be fired. If a student writes on an exam at a state school that the First Amendment doesn’t apply to the states, the student gets a bad grade. The government funds certain studies and not others. The doctor tells you you have cancer and really you have an ulcer; you can sue. Mostly, the state has to regulate or not based on truth, which is something we determine regularly in trials – epistemological humility is not the rule because the state needs to regulate on a regular basis. Only where we want to exercise epistemological humility, and treasure differences of opinion – mostly in politics – do we want the free speech principle to apply. The question is where to draw the line.

Every town meeting has an agenda. If an issue is not on the agenda, you can’t talk about the issue – is that viewpoint discrimination? It turns out to depend on your notions of baseline.

Post’s account of commercial speech: Start with the value of democratic self-governance. The ability to participate in the formation of public opinion, so I can view the government as responsive to me. There are speech acts that aren’t participating, and the normative question is which speech acts I attribute that value. When Chrysler sells cars, it isn’t participating in the relevant way. The First Amendment-lite protection for commercial speech is that the information communicated is valuable to public opinion – it’s not protected as participatory or autonomous, but only secondarily as an aid to others who are participating/autonomous. This has numerous doctrinal consequences, including protecting truthful communications and allowing required disclosures.

Redish says that Chrysler has personal autonomy; Post denies that this is true or that it is relevant to democratic self-governance. Post doesn’t need to reach the Consumer Reports question because he distinguishes selling cars from supporting Bush. Consumer Reports’ categorization is open for debate, but no matter how you come out on that, you can still reject equalizing Bush and cars. Thinking is about making distinctions; Redish’s slippery slope fears are implausible, and Post is convinced that treating everything the same will make even more of a mess.

Steven Shiffrin, Cornell University Law School: The question is whether commercial speech is different because of all of the reasons people offer taken together, not whether you can pick off one at a time. The deep structure of multifaceted principles can be difficult to articulate, and are often understood before they are defined.

The FTC says we will determine for you what statements are false and true. If Redish is right, the FTC and the SEC should be closed down, and that’s a pretty radical view – you don’t have to be anticapitalist to support these institutions. They make decisions for us because consumers don’t have the time to determine everything about products, and also because sellers and corporations cannot be trusted. We don’t engage in viewpoint discrimination in the sense that Consumer Reports both endorses some products and condemns others, but we do treat sellers differently.

Redish’s paper says his argument is confined to truthful advertising. Why? We impinge on autonomy by paternalistically taxing cigarettes to deter smoking. Why is speech special? Self-government can be impinged upon in various ways, not just-speech based.

Corporations don’t have a self-realization or self-government interest, only listeners. In that case, we already know that an individual’s interest is greater, so that corporate speech is of lower value than other forms of speech. That has nothing to do with an ideology about the message. (But this is vulnerable to the NYT Co. problem.)

All the other speakers believe in self-government. Shiffrin thinks this is one of the great fictions of the US. He doesn’t find himself in the government. It might be for the people, but it’s not of the people or by the people. A 1/300 million share isn’t the self. We think the perceived opportunity to participate is important, but self-government is an unnecessary and confusing term – it allows Redish to argue that self-government is even more implicated when a single person has 100% of a relevant “vote.” Information for consumers is important, but democracy is about justice and protecting dissenters, not self-government. Commercial speech is part of the problem, not the solution. When $30 billion is spent telling children to buy products, and 40% of children have already decided what car to buy when they grow up, and many children’s favorite ad is Budweiser, we are hardly promoting the sort of active citizenry of self-governers that we should want. Of course this is an ideological position, but we can still take it into account in our theory of the First Amendment.

Viewpoint discrimination is often bad. But sometimes it’s good, like special protection for parody under fair use, or educational uses. In the public figure/issue context, a public issue is something you’re supposed to be interested in, and a private issue is something you’re not supposed to be interested in. In intentional infliction of emotional distress, figuring out how a reasonable person would react involves viewpoint discrimination. Shiffrin would take into account the goals of democratic citizenship in setting the level of protection for different types of speech.

James Weinstein, Arizona State University College of Law: Redish takes the position that people who disagree with him are either fools or knaves, anticapitalist knaves at that. Do you have to be hostile to capitalism, as Redish says, to say that (truthful) commercial speech deserves less First Amendment protection than political speech? Rehnquist was an implacable foe of commercial speech protection. Was he an anticapitalist?

Even Redish is prepared to allow regulation of false commercial speech, but we don’t have enough jail space for politicians who speak falsely or misleadingly – is he engaged in viewpoint discrimination?

Weinstein is troubled by the California Supreme Court decision in Nike; if we keep the definition of commercial speech limited, the viewpoint discrimination problem is minimized. He is also interested in the Consumer Reports question: why does CR get NYT v. Sullivan-type protection, if it does? There is a difference in the social practice of selling something and evaluating a product (criticizing or praising). Weinstein might not give it political-level protection, but he wouldn’t reduce it to commercial speech.

Weinstein finds it a hard question whether you can have ascriptive autonomy for political/democratic self-governance questions and then also regulate, for example, doctor-patient relations with the premise that patients are vulnerable (or, likewise, working conditions with the premise that employers have structural power over employees). He thinks there are reasons we have to ascribe autonomy to people as voters, but those reasons don’t always apply to individuals who are in particular private relations, or even to aspects of decisionmaking like whether to smoke cigarettes. Weinstein would like a little more Lochnerism to protect against paternalism using substantive due process, but that doesn’t commit him to protecting commercial speech as strongly as criticism of government policy.

Redish responds: Shiffrin is the poster child for the views he opposes – Shiffrin doesn’t want kids deciding what types of cars to buy. This is discrimination! Why is the promotion of sale by the commercial seller less worthy of protection than CR’s evaluation of the sale? (I am now reminded of Catharine MacKinnon’s discussion of Aristotelean equality – what does it mean to treat likes alike and unlikes unalike? What does it mean under conditions of subordination, in particular?)

Moderator: how do we identify the proper underlying values?

Redish: Reverse engineering, reasoning from the premises of our democratic system.

Post: A Rawlsian reflective equilibrium, trying to make sense of our tradition through dialogue.

Shiffrin: Doesn’t believe in general theory; to have a system is to lack integrity, as Nietzsche said. The premises of the system are themselves contested, as with descriptions of democracy.

Weinstein: Are we being descriptive or normative? Redish is trying to give a descriptive account. What possible value/s account for most cases? With a rich tradition like the First Amendment’s, we can’t be completely descriptive.

Question: Contracts are speech, performative speech used to create a legal relation. If the law takes you at your word and imposes an obligation, e.g. marital obligations after you say “I do,” there’s no viewpoint discrimination. If so, “I am selling you this shirt along with a warranty” can also be enforced without a problem. We are taking the seller at its word, and the buyer and seller ex ante would both want that. Much of the speech regulated by the FTC/SEC etc. has to do with explicit or implied in law warranties.

Redish: Speech does transform into action, but not always. Blackmail and threats are coercive, not protected speech. Words part of a contract are performative, and not the same as other speech.

Shiffrin: The issue is what speech counts as a warranty. The SEC counts the same statements at issue in Nike. The SEC refutes Redish’s thesis because it’s clearly making decisions on what speech is appropriate for consumers here.

Post: If a political candidate promises to go into Iraq and doesn’t, has he violated a warranty? Can law enforce a remedy? Clearly not. We have to distinguish classes of speech.

Redish: What about NYT v. Sullivan? Intentional/reckless falsehoods get no First Amendment protection.

Post: There’s a fact/opinion divide; also, punishing falsehood is viewpoint discrimination on Redish’s terms.

Redish: No, ideas v. facts is something different. Viewpoint regulation is regulation of “ought” claims. Statements of fact are a different ballgame.

Post: “Clinton is immoral”: Fact or opinion?

Redish: Opinion, but if knowingly based on false facts it wouldn’t be protected.

Post: “The eggrolls at the restaurant were cold.”

Redish: This is Bose v. Consumer Reports – the question is whether you’re lying, which is also an issue of burden of proof.

Post: That goes to intent, not fact v. opinion. The question is what propositions can be regulated for validity. The answer is context-specific and differs in commercial versus political speech.

Shiffrin: Sullivan involves balancing reputation against press rights. Gertz strikes a different balance. Applying Sullivan to truthful commercial speech or other contexts where the opposing interest is something other than reputation isn’t the obvious solution. In copyright, for example, property rights outweigh truthful speech; also the tort of public disclosure of private facts.

Seana Shiffrin: Getting back to the difference between Chrysler and Consumer Reports, she wants to expand on Chemerinsky’s argument – it’s not just that Nike has market power, but it’s also better positioned with respect to information about Nike. We legally protect that position: ordinary people can’t go on tours of Nike factories. Trade secret, property law, employment law, confidentiality agreements, etc. all give companies special control over their information. We give these rights for instrumental reasons, not to protect companies’ intrinsic privacy rights. As a result, we can reasonably expect higher standards of accuracy from the company than from those external to the process.

Redish: Plausible, but we never apply that analysis anywhere else. Judith Miller had more access and protection for her confidentiality than almost anyone else. In other areas of the law, information disparities don’t justify these distinctions.

Also, CR has special access to information – who has more information than Consumer Reports? (Nike does, as does Chrysler. Testing ten cars or pairs of shoes isn’t the same as having special access to information.)

Tribute to Steve Shiffrin: Panel on First Amendment principles

Panel on First Amendment Principles

Moderator: Kurt Lash, Loyola Law School Los Angeles

Keynote Address: Martin Redish, Northwestern University School of Law

Opposing commercial speech protection is wrong and indeed pathological in regulating viewpoints. Government finds the viewpoint offensive, wrong, or dangerous – we consider regulation on that basis categorically unconstitutional because it violates democratic notions of epistemological humility. In a constitutional democracy, the electorate gets to make the choice of what positions to take. (Here I presume he means individual members of the electorate, since the viewpoint-based regulation comes from the elected representatives.) It’s a Rawlsian veil of ignorance: we make a rule without knowing who’ll be in power.

The Supreme Court may have mistakenly viewed some regulations as not viewpoint-based, but it’s never upheld a regulation as viewpoint-based. You can’t recognize one exception without recognizing all exceptions – if one thing can be regulated because it’s offensive, so can the next thing that’s offensive to someone else. (“Offensive” is a key word here, as opposed to “harmful” or some other word.) There are some hidden viewpoint regulations, such as bans on flagburning justified because flagburning is a fire hazard. When a regulation isn’t justified on the rational ground asserted, it’s furtive viewpoint discrimination. There are also judicially imposed viewpoint distinctions, some of which are exceptions to general rules. There are speaker-based viewpoint restrictions, e.g., no Democrat can speak. (Another key move, it seems to me.)

Commercial speech deals with the private political process, the process of making choices and decisions that affect the individual. Imagine a society where every decision – what mouthwash to use, what restaurant to patronize, etc. – is made by the entire collective. In those cases, speech trying to persuade the collective to choose a particular restaurant would be political. We need that speech for self-government. If we cede to the individual those decisions, the individual now has 100% of the vote instead of a tiny fraction, and it’s still a self-governing choice.

The Court defined commercial speech as proposing a commercial transaction. Ralph Nader’s criticism of cars isn’t commercial speech, but the manufacturer’s defense is. Once this is the definition, a type of viewpoint regulation is going on – a new kind. “Twilight zone” viewpoint regulation, not based on dislike for the speech or the speaker’s ideology, but the ideological ether surrounding the speech. The speech isn’t controversial, but the process from which it springs is ideologically offensive to those who want to regulation. In that way it’s like obscenity. Obscenity isn’t directly a political statement, but the regulation is based on opposition to the mores and sexual values contained in obscenity.

Three justifications for regulating: (1) Rationalist arguments purporting to ground regulation in neutral First Amendment values. E.g., commercial speech isn’t part of the political process: But Consumer Reports deals with the political process. Others argue that corporations aren’t speakers because they’re economic entities. But the recipients are the ones who are making self-governing choices, and they’re who matter. Also, the NYT Co. is an enormous corporation. Baker says the difference is the product – speech v. nonspeech. Redish says, so what? Speech has often been designed to persuade others to take nonspeech acts, and that’s a commonly understood First Amendment value. Also, if the corporation is a robotic profit-maximizer, its product shouldn’t matter in whether it has a speech interest.

(2) Intuitionist arguments that commercial speech is just different. Anti-intellectualism combined with intellectual arrogance, immune from any rational response. Redish’s intuitions differ!

(3) Ideological arguments: Commercial speech promotes materialism. But the people get to decide what they need. By not protecting commercial speech, we risk reverse dilution. When we regulate speech because we think people will be fooled into buying things, why doesn’t the same thing apply in the political area? The people might believe antiwar demonstrators and make silly decisions. Either people are capable of making rational decisions through open debate or they’re not. (Okay – so I’m just as capable of making a rational decision about which drugs are effective as I am about which color looks good on me? I’m just as capable of making a rational decision about whether my child is cute as I am about whether I should buy a new car? There’s absolutism of principle, and then there’s obliteration of distinctions.)

Commercial speech: Tribute to Steve Shiffrin

Commercial Speech: Past, Present & Future: A Tribute to Steven Shiffrin, sponsored by the Loyola Law School Los Angeles and the Loyola Law Review

Opening roundtable discussion, Ronald Collins, First Amendment Center, moderator.

Collins: Three questions to structure our discussion. Does the identity of a speaker as a corporation matter? Can lines be drawn between political and commercial speech? Can progressives endorse freedom of commercial speech?

Steven Shiffrin: Commercial speech should be lower in our hierarchy than other forms of speech because dissent should be higher. Other First Amendment theories also produce this result. In some circumstances, particularly informational advertising, there should be a measure of protection.

Erwin Chemerinsky: Disagrees with it all. Dissent is not the central/only purpose of the First Amendment; speech is also protected if it supports government or consists of art/music that is not about dissent. Even hate speech and sexually degrading speech are protected. Also disagrees with the idea of having a hierarchy or distinguishing speakers. The only relevant question: is there a compelling reason to ban speech? One can find such interests in many situations, and indeed in Nike v. Kasky. But we must remain focused on that question. (Isn’t that a hierarchy without the name? I suppose its benefit is that if your reason for a ban isn’t the usual reason for disfavoring a category of speech – e.g., Discovery Networks – then the regulation gets stricter-than-usual scrutiny.)

Kathleen Sullivan: She is closer to Chemerinsky than Shiffrin. Fear of government is an extra reason to protect commercial speech. We fear government more than markets, for antipaternalistic reasons specific to speech. We fear thought control more than wage and hour laws. (Why don’t we fear Enron’s paternalism and attempts to control our thoughts?) There may be good reasons to regulate, such as information asymmetries, but the solution is disclosure rather than leveling down through silencing.

Shiffrin: The SEC engages in paternalism – it doesn’t trust consumers in the absence of a policed market. The FTC engages in paternalism, and the FDA. When we talk about false statements, paternalism is at the center of what we do, not the margin. Why do we need a compelling state interest? NYT v. Sullivan involved balancing the interests in reputation with the needs of the press, which is a good strategy. It would radically change First Amendment doctrine to say there’s no hierarchy. He agrees with Chemerinsky that multiple values underlie the First Amendment that can’t be reduced to one. Protecting the practice of dissent is extremely significant, though, and commercial speech doesn’t maximize that.

Sullivan: The Sistine Chapel wasn’t created by a single artist, it came only from sponsorship. NYT v. Sullivan arose from an advertisement. Advertising is a late 20^th-century art form. Commercial speech is continuous with and perhaps indispensible to the rest of speech. Virginia Pharmacy recognizes that commercial speech is useful to people – economic decisions are important and commercial speech has a role in providing relevant information. It’s not for government to decide what matters. (Though she agrees on the potential for harm, so it apparently is for government to decide what harms, if not what helps.)

Liptak: Define commercial speech.

Chemerinsky: Bolger tried three factors – not exhaustive, but it’s a good starting point and shows that speech isn’t commercial just because it comes from a corporation.

Sullivan: Commercial speech is an offer of goods for a price. It’s not anything said with a motive of commercial gain.

Shiffrin: Media speech is not, with narrow exceptions, commercial speech. Ed Baker has it right: for media, the product is the speech, unlike Virginia Pharmacy where the product is drugs. Also, the press has a checking function that makes it special. He distinguishes informational advertising that’s true from false advertising – commercial speech encompasses many different kinds of problems, and is broader than just proposing a commercial transaction. The bigger question (which is not entirely overlapping because non-corporate entities run ads) is how to deal with corporate speech in general. Corporate participation in political campaigns is limited, even though that’s core political speech.

He also notes that Virginia Pharmacy is atypical of cases – you have an aged person who needs cheap drugs, versus an alcoholic looking for the cheapest high in a case like 44 Liquormart. John Stuart Mill, invoked by many (including Sullivan), didin’t think commercial speech should be protected.

Chemerinsky: He’s skeptical of distinguishing media from nonmedia corporations. Which is Time Warner? Media companies advertise to get you to consume more of their programs. Separately, he wants to emphasize that he might find a compelling interest in banning corporate campaign contributions, and definitely does in banning false advertising. Finally, cheap alcohol may be a valuable choice. It’s paternalistic to say it’s not valuable.

Shiffrin: On the compelling interest question – look at tobacco ads. Tobacco kills 400,000/year; ads reach children and create preferences in them. Do we have a compelling interest? As for distinguishing media/nonmedia: of course there are linedrawing problems. That doesn’t mean you give up.

Sullivan: The government shouldn’t be allowed to regulate truthful ads about lawful products. More speech drives out bad speech. Right of reply requirements on TV drove cigarette ads off TV. (Isn’t that silencing? Even intentionally discriminatory silencing, if the requirements are targeted at smoking? She quickly added that equal time requirements were compulsion.) Where government can provide contrary messages, it shouldn’t regulate. Also, we should regulate the product directly through bans and taxes. That’s always an alternative, so the state shouldn’t be able to prohibit truthful advertising.

Shiffrin: When 400,000 people die every year, efforts to prevent that are good even if you call them paternalistic. The alternatives have costs, such as black markets. It would be more effective to have counterspeech and ban ads.

Chemerinsky: Banning ads isn’t necessary to serve a compelling interest. The evidence doesn’t show that ad bans work. Also, he’s concerned about a slippery slope. What about liquor ads? Fast food/potato chip ads? If this were necessary, maybe he’d go along, but the evidence isn’t there.

Shiffrin: $265 billion is spent on ads in a year, contibuting to the creation of an apathetic, hedonistic citizenry. It’s problematic to find value in that. Would a ban on cigarette ads stop smoking by all kids? No. Would it help? Well, why do cigarette companies advertise? They think it works. As for the slippery slope: Many of these ads are targeted to kids, and Shiffrin sees no right to advertise to kids. Beyond that, corporate power will take care of itself. If bans did spread, he doesn’t see the harm.

Liptak: Another consideration: Corporate speech is powerful and can overwhelm counterspeech by repetition, according to the pro-regulation story.

Sullivan: She doesn’t start from the individualistic/dissent notion of speech. The First Amendment protects other values, including a system of free flow of information determined through private interactions. Markets are regulated but ideas aren’t. Regulation and taxation should be lexically prior to advertising bans and we haven’t exhausted the non-speech regulatory possibilities with respect to tobacco. We should protect advertising unless and until particular harms manifest. (The reverse precautionary principle! A couple of side notes: This discussion makes crystal clear why lots of people see the First Amendment as the new substantive due process. Also, I just read Shiffrin’s The First Amendment, Democracy, and Romance on the way out, and one of its many strengths is that it emphasizes that “dissenting” and “individualistic” are not synonyms. Dissent is often participatory, communal, and engaged – a point I’ve tried to make, though less well than Shiffrin, when discussing how free speech principles have been translated into fair use doctrine.)

Liptak: Given what Chemerinsky has said so far, why was he on Kasky’s side?

Chemerinsky: Nike was engaged in selling a particular product and was allegedly speaking falsely. Analogies: “dolphin-safe tuna,” “organic lettuce,” “not tested on animals.” These are important claims to consumers. California has other relevant laws, like those governing false “union-made” claims.

Sullivan: Nike went far beyond simple branding – its communications covered labor conditions and sweatshops and used long infomercials. It made broader claims about corporate behavior as part of a debate about exporting US labor standards. (So is “organic” part of a broader debate over agricultural policy. Kasky wasn’t alleging that any of Nike’s normative claims were false.) Nike deserved a chance to fight back against the anti-sweatshop campaign. There are other ways to stop a company’s false claims than suing – run a counter-ad or do an investigative report.

(This is one of the most unpersuasive parts of the Nike-side argument. You can run a counter-ad if you can afford to, and if a media outlet will run it, which they often won’t. Nike reaches a heck of a lot more people than a NYT investigative report. It’s often noted that lies can get around the world while the truth is still putting on its shoes (no pun intended), and that’s without considering resource disparities. Note also that Sullivan appears to be saying here that “not tested on animals” is also a claim that must be free from government regulation. That’s getting pretty extreme.)

Chemerinsky: Nike ran an ad; you can embed a claim about animal testing in a long paragraph too. How are people to evaluate this claim? The company has information competitors and consumers lack.

Shiffrin: He agrees that the existence of alternatives to speech regulation aren’t dispositive. If the SEC were regulating, Nike’s statements would be subject to strict liability despite the fact that the statements were part of a “dialogue” with political aspects. Nike was describing what it was doing. That’s relevant to a debate, but it’s put forward to sell products.

A new question: Should Kasky have had to show that Nike acted negligently to win his case when the SEC could use strict liability to govern the same statements? There’s a legitimate concern that private plaintiffs could bring actions against Nike that could chill its speech, but it’s not in the record. The California statute was on the books for more than 70 years. Strict liability is appropriate in the absence of contrary evidence.

Sullivan: This relegates misleading speech to oblivion. Ordinary fraud statutes can cover falsity, at least with intent (big caveat!), but misleadingness is more. In politics, false statements like “I won’t draw a salary if elected” are protected against liability. (Why is this a relevant example if you’re trying to distinguish between false and misleading speech and argue that only the former can be banned for commercial speech?) Shiffrin and Chemerinsky are presuming the Nike statement was false. The misleadingness standard chills speech about, say, how a company performed in its last quarter. The statements here are different than saying “I’ll sell you X product for Y price.”

(Really? What does “X product” mean? What happens when we replace that with “a product that will kill cold germs”? Also, Sullivan’s example of a truly regulable ad is, perhaps ironically, one where government regulation might seem least necessary. It’s often relatively easy to confirm price, though there are bait and switch laws regulating misrepresentations regarding price. If we trust consumers so much, why not trust them to figure out price as well?)

Shiffrin: The FTC can go after misleading speech, not just false speech.

Sullivan: Yes, but that applies to speech that’s not presumptively protected – advertising. You’re broadening that speech beyond consumer sales to anything designed to increase sales, which is everything a corporation says because it’s always designed to create goodwill.

Shiffrin: Note that the statements Sullivan worries about have to be included in SEC filings, and strict liability applies. (Sullivan is no longer worried about democratically/demagogically imposed government thought control, but government enforcement of a private party’s false advertising claim as well.)

Chemerinsky: Factual statements made to increase sales are commercial speech. Not all corporate statements are like this. That’s what makes Nike an easy case. Nike took out ads saying it didn’t use sweatshops. We aren’t presuming that Nike was speaking falsely: There was never a trial, but basic civil procedure is that you take the statements in the complaint as true for evaluating a demurrer. As for the SEC, it has a compelling interest in protecting investors.

Liptak: Isn’t the Shiffrin/Chemerinsky position viewpoint discrimination? And should we care?

Shiffrin: It’s often said that viewpoint discrimination is never allowed, and yet obscenity can be banned. Appeals to healthy sexual interest are ok, but not appeals to prurient and depraved interest. Judges are licensed to determine literary, artistic, political and scientific value. Copyright’s fair use test distinguishes viewpoints. (This is a debatable claim– there’s a good argument that even the transformativeness evaluation is more content- than viewpoint- based – but I’m with him on the bigger point.) The free speech exceptions are riddled with viewpoint discrimination.

Chemerinsky: Viewpoint aside, there’s a compelling interest: consumers can’t find out for themselves that Listerine doesn’t kill cold germs. Competitors may have no incentive to correct the falsehood (e.g., tobacco companies’ shared interests in ignoring health harms).

Liptak: But Consumer Reports could do a study on Listerine and get actual malice protection.

Chemerinsky: Yes, because the speaker – not the viewpoint – has different interests and incentives.

Audience questions: Bruce Johnson: Kasky and Nike’s representative both give interviews to the NYT. Commercial speech?

Chemerinsky: No.

Johnson: But under the California Supreme Court’s test?

Chemerinsky: Nike took out ads – start there. Statements to intermediaries are arguably commercial speech, but we need not get there.

Martin Redish: Should we adhere to Bolger? If Nike wanted to sue Bob Herbert, who works for a powerful corporation, Herbert gets NYT v. Sullivan protection. But Nike doesn’t get the same protection. This is viewpoint discrimination and manipulation. Nobody is on the other side of obscenity in the same way. (Really? What about producers of R-rated movies, who get to put out their view of proper social mores without regulation?) Judith Miller’s false reporting on Iraq did more harm than Listerine ever did.

Chemerinsky: Nike wasn’t engaged in a debate when it made false factual statements. Also, the most your argument can prove is that NYT v. Sullivan applies, and Kasky’s allegations included actual malice.

Charles Fried: The two leading cases, Virginia Pharmacy and 44 Liquormart, are not as they’re represented here. They didn’t serve interests in protecting professionalism or temperance. In both cases, they were protecting mom & pop stores who had state legislatures in their pockets. The regulations were corrupt. When we do theory, remember that.

Sullivan: Virginia Pharmacy also destabilized attorney fee schedules set by the bar. Lochner with respect to this type of corruption is entirely appropriate. (Here, I think, is a key source of my disagreement with Sullivan. I do think that regulating truthful advertising is different than regulating false and misleading advertising. But I include “misleading” in the regulable category, which leaves room for arguments about what is misleading – none of which were particularly persuasive, or even seriously offered, in the two named cases.)

James Weinstein: Equalizing protection for commercial and political speech would be dangerous, because then we’ll start to use Chemerinsky’s “soft” compelling interest test – allowing punishment of speech when it causes harm, which political speech often does.

Chemerinsky: We all agree the First Amendment involves value choices. Even false statements about the Iraq war are protected, and some advertising claims aren’t. How will we define the lines? He wants to do it openly, whereas predefined categories of speech seem to him to be a bad solution. Let’s have the value discussion and say that political speech is more important than the harm it causes even if the harm is big. The categories just hide that analysis.

Shiffrin: All of us on the panel think that truthful advertising should get some First Amendment protection. For Shiffrin, it’s because it furthers some but not all relevant First Amendment values. Commercial speech has importance in people’s lives and that’s what gives us reason to protect it, not because it’s the same as political speech.

Sullivan: She wouldn’t assimilate commercial to political speech, but would protect it all strongly, distinguishing content-based from content-neutral regulation. Copyright’s fair use doctrine, by the way, isn’t about viewpoint discrimination, it’s about transaction costs. (Even Wendy Gordon’s strong account doesn’t easily admit of this interpretation, because she counts certain noneconomically-based refusals to license as transaction failures, which is a viewpoint-based aspect of the analysis.) Sullivan is willing to tolerate more compulsion with commercial speech, not leveling down but leveling up through disclosure. Compelled disclosure is the greatest regulatory success of the 20^th century. (My lungs might vote for the Clean Air Act.) She would allow compelled disclosure as speech-enhancing as long as it doesn’t chill speech. (Another big caveat!)

Question: Is there any way to distinguish Nike’s defense from an attack? If I attack Nike because I have an economic interest in another shoe company, that’s not commercial speech. (The questioner seems not to know about the Lanham Act. Cases have applied the Act to statements by individuals within a corporation, at least, and the standard would be strict liability, not actual malice.)

Chemerinsky: Maybe we should use the same scienter standard. Nike, however, wanted absolute protection for its speech; at most it should get NYT v. Sullivan.

An amazing start to what promises to be a challenging conference.

A picture I didn't show in class

ConWest Resources, Inc. v. Playtime Novelties, 2006 WL 3346226 (N.D. Cal.)

Not a newly decided case, but we talked about it in my copyright class and I'm going to talk about it at the ABA IP meeting, so I figured I'd get my thoughts in order.

Plaintiff makes adult novelty items, including 12 sculptures of male genitalia, for which it was issued copyright registrations. After a licensing dispute, plaintiff sued defendant for copyright and trademark infringement based on its continued sale of the adult toys. This discussion considers only the validity of plaintiff’s copyright, not the first sale issues or plaintiff’s trademark claims, which the court also rejected.

Though the registrations were prima facie evidence of the validity of the copyrights, the court was skeptical of plaintiff’s likelihood of success. First, were the sculptures “useful articles”? Yes, because they had an intrinsic utilitarian function – they were designed to be used as sexual aids, as the advertising made clear when it touted them as dishwasher-safe and compatible with various types of lubricants. Like the mannequins in the influential Carol Barnhart case, these replicas of body parts are functional even though nonfunctional sculptures also exist.

Only features of useful articles that are separable from utilitarian functions can be copyrightable, and there are various confusing tests for separability. Plaintiff argued that there were conceptually separable features in these sculptures, which could “stimulate in the mind of the beholder an appreciation of the inherent beauty and power of male sexuality.” The sculptures’ price was well above the price of ordinary sex toys, and plaintiff argued that some collectors purchase them for display. Nonetheless, the court found that the sculptures were likely unprotectable – their design seemed inextricably intertwined with their utilitarian purpose. “[G]iven that the function is to arouse, design features that are intended to stimulate in the mind of the beholder the concept of sexuality are not truly independent from the utilitarian purpose of the object.”

This seems like the right result for the wrong reason. Causing “arousal” is no different than triggering any other emotional response, from pity to terror; evoking emotional responses is the classic function of expressive works. If the court believed that the sculptures stimulated the mind of the beholder, then conceptual separability was a possibility. Relatedly, if these sculptures weren’t copyrightable because they were so obviously sex toys, are there any sex toys that are copyrightable? The catalog of Good Vibrations contains many exotically configured devices that have sculptural elements, but are also clearly sex toys. Is this type of product simply excluded from the realm of copyrightability? That would seem like unjustifiable content discrimination.

I have more sympathy for defendants’ alternate argument that there is no copyrightable expression in the simple castings of the genitalia of actual men. As such, they portray facts, not expression, regardless of the skill that was required to copy them. The copyright examiner believed that the works contained some copyrightable sculptural authorship, and plaintiff alleged that its art department made “numerous artistic changes and refinements in both the size and the aesthetic look of the initial casts,” though defendants replied that the only differences were size and color, which are insufficient to establish originality. The court found unresolved factual questions and did not base its decision on this argument.

Copyright in architectural works: confusion piled on (lack of) confusion

Groff Construction, Inc. v. American Pride Building Co., 2007 WL 495316 (M.D. Fla.)

Plaintiff sought the dismissal of defendants’ copyright counterclaims/third party claims. Defendants (who include a builder) own a model home. Plaintiff (also a builder) sold defendants the model home, never told them it was covered by a copyright, and didn’t object to them using the model home as a model. Plaintiff is now claiming copyright infringement by defendants based on a 1996 registration for the house plans. Plaintiff advertises its business using photos of defendants’ model home, without defendants’ permission and without acknowledging defendants’ ownership. Defendants counterclaimed for, among other things, false designation of origin and false advertising.

Groff argued that the counterclaims failed to state a cause of action because, as the copyright owner, it has exclusive rights in the work, which include the rights to display the work and create derivative works. The defendants replied that ownership of a copyright is distinct from ownership of the physical object in which the copy is embodied, which is true but irrelevant. As the court pointed out, architectural plans don’t create any exclusive rights in the physical home, and it also noted that a copyright owner can’t prevent other people from taking pictures of an architectural work in a public place (also, by the way, irrelevant, because the copyrighted work here is the plans, not the architectural work, which if copyrighted would allow the owner to prevent construction of a substantially similar house). Because Groff’s copyright didn’t give it the exclusive right to take pictures, the court denied his motion to dismiss.

The copyright claim isn’t why the counterclaims should fail. The counterclaims should fail, on the facts as described, because it’s not false advertising or false designation of origin to advertise your construction business with pictures of a house you built, regardless of who owns the physical house now. The representation a picture makes in such a context has nothing to do with ownership and everything to do with construction. Indeed, were defendants to advertise their own construction business with these same photos, they’d be engaged in reverse passing off.

The federal government, false advertiser?

Americans for Safe Access has filed suit against the government under the Data Quality Act, arguing that the FDA has made false and misleading statements about marijuana's safety and efficacy. I don't know anything about the Data Quality Act, but perhaps I will learn from this suit.

Pitbulls dueling in court: so what else is new?

Slip-N-Slide Records, Inc. v. TVT Records, LLC, 2007 WL 473273 (S.D. Fla.)

Plaintiff SNS sued TVT for tortious interference and other claims based on the sale, marketing, and distribution of the album Welcome to the 305, which contained recordings by a rap artist, Armando Perez, who performs as “Pitbull.” Perez is currently signed to TVT, but made earlier recordings under another contract, to which SNS claims rights; its tortious inteference claims are based with TVT’s efforts to suppress the distribution of the 305 album. TVT counterclaimed for trademark infringement and Lanham Act violations based on TVT’s Pitbull mark and logo.

The court denied cross-motions for summary judgment on all counts. Among other things, there were factual disputes over whether TVT had protectable rights in its stylized Pitbull logo and over whether SNS’s use of the term (in lettering very similar to the Old English-style lettering TVT uses) was likely to cause confusion. (It seems like there’s a nominative fair use defense in there at least with respect to the name, but the court didn’t discuss it, perhaps because the use of similar lettering obviously goes beyond the ordinary bounds of nominative fair use.)

TVT counterclaimed for false advertising, arguing that SNS unlawully promoted the 305 Album as a “new” Pitbull album, when in fact it contained older recordings. SNS used recent photos of Pitbull in promoting the songs; the album cover didn’t have a disclaimer indicating that these were older, unreleased recordings; and ads stressed “new music from Pitbull.” At the preliminary injunction hearing, the magistrate judge rejected TVT’s claim, finding no evidence that SNS advertised the album as “new” or a “follow-up” to Pitbull’s album with TVT. He further determined that the photos weren’t false advertising because TVT had no rights in those photos and because there was no evidence that Pitbull’s look or style was related to any particular period in his career. Even if the public would be confused, the magistrate found insufficient evidence that TVT had been harmed. The court agreed, but considered it more appropriate for a jury to resolve the issue.

Commercial speech: political economy and public data

Dr. Karen Markin, Director of Research Development, University of Rhode Island, It’s Not the Thought that Counts: A Political Economy of Obscenity. She’s interested in obscenity as product – a book, a video, etc. When restrictions are commerce-based and not content-based, government can argue for greater control. There are many modalities of regulating obscenity, from zoning to banning the use of the postal service for sending obscenity. The spending power also enters the picture: US v. American Library Ass’n, requiring public libraries to use filters on internet access.

When obscenity is commodified, it’s easier for the state to control it, for example by making sure it’s limited on television. Commercial media are highly vulnerable to government control.

Reza Dibadj, University of San Francisco, The Political Economy of Commercial Speech. The First Amendment can be a way around Chevron deference – a way to assert institutional authority. Another question: why are we so eager to attack some regulatory regimes and not others? (My answer: I’m not sure a lot of the folks who want full protection for commercial speech like other kinds of regulation either.)

The general trend: increased protection for commercial interests, pushed by corporations portraying themselves as underdogs, e.g. Nike. Also, various front groups and think tanks with predictable political positions. Perhaps more important, some prominent and distinguished intellectuals support increased protection for commercial speech – the influence of the Chicago school, which is generally anti-regulation. They perceive similarity between the market for expression and the market for goods and services, and thus want laissez-faire for both. Likewise, the public choice school sees regulations of both speech and nonspeech as similarly troublesome because government is likely to be bad at whatever it does.

Yet commercial speech remains different from core First Amendment speech. The urge to increase commercial speech protection is a new form of attack on economic regulation. Kozinski equates speech with economic regulation in his criticism of the commercial speech doctrine; it’s also no coincidence that Virginia Pharmacy comes out of a deregulatory era. But the First Amendment is an odd source for a ban on types of economic regulation.

If corporate speakers are so concerned about government regulation, why don’t we see as many attacks on IP from the proponents of full protection for commercial speech? Because IP helps the big corporations. As Prof. Piety has written, Nike’s commitment to free circulation of information doesn’t extend to free circulation of the swoosh.

Returning again to corporate speakers as rights-bearers: when a corporation speaks, who is speaking? The managers? The shareholders? There are competing interests, and it’s not obvious where the “opinion” of the company comes from – it’s the managers in practice, but that might not be optimal.

Dr. Genelle Belmas, Cal. St. Fullerton Department of Communications, & Brian Larson, attorney, Second Class for the Second Time: How the Commercial Speech Doctrine Stigmatizes Use of Aggregated Public Records. New York prohibited the sale or release of lists of names and addresses if such lists would be used for commercial or fund-raising purposes. A property tax reduction service wanted access to the lists; a straightforward application of the law banned it. But it could have provided consumers with useful information. This is the core problem Belmas & Larson address: access to public records by commercial users.

State and federal access to information laws discriminate against commercial providers, either banning them or charging them more. Yet in some cases, commercial entities are in a better position to make beneficial uses of information than nonprofits or government.

Concerns: identity theft and general privacy concerns about inappropriate use of information. There’s also a more general concern over the “Big Brother” effect – so much information is available about us that it might be used against us. Also a desire for “contextual identity” – we share information for particular purposes, and passing it on for use in a different context might be wrongful.

Responses: identity theft is overblown by commentators and others. Most of the sensitive information isn’t in public records – most of it is credit card fraud. There were problems in Florida with people being erroneously kicked off the voter rolls because of a mistaken analysis by Checkpoint of who was a felon – but that was done on the government’s behalf, and the only reason we know about it was because of public access to the same records. Maybe in theory contextual identity makes sense, but in practice we have no idea how to manage that – we don’t know how to make case-by-case disclosure decisions. However, government should always redact certain information (SSN, bank accounts), and should abstract identifying information when specific identification isn’t required for the user’s purpose.

The authors aren’t interested in equalizing commercial/political speech. But the flow of information to commercial aggregators shouldn’t be limited based on commerciality; limits should be based on what the information is and how it’s used. Equal access should be the rule.

Examples: a reporter investigating accidents on the highway requests data. That’s a high-value use. A political party requests voter registration records to solicit political contributions. A great number of states limit access to voter registrations to ban solicitations, which the authors think doesn’t make much sense. Soliciting people arrested for drunken driving should also be considered a valuable activity.

At this point, I had to leave for the airport, so I missed the final discussion. Congratulations to the organizers for a wonderful conference.

Commercial speech conference: Tamara Piety on obscured-source speech

Tamara Piety, Florida State (visiting)/Tulsa, Flogging, Fronting and Fakery: Corporate Public Relations Advocacy, Research Groups & Commercial Speech. Corporations are using the First Amendment as a method of resurrecting substantive due process. We can make them citizens for certain purposes – jurisdiction – without letting them vote; we can deem them entitled to certain rights but not full First Amendment rights. This is consistent with the Framers’ suspicion of large accumulations of power. Unlike human beings, corporations are not ends in themselves. They are not appropriate holders of speech interests.

As a matter of corporate governance, anything a corporation says is directed at the bottom line, which is why Milton Friedman says that the only time corporate social responsibility is legitimate is when it’s insincere and the corporation is only doing it to boost its image. But she is not saying that corporations shouldn’t speak, just that avoiding false statements is enough reason to regulate.

Public relations speech is among the most problematic speech in this arena. There’s an ethos in PR that sometimes leads to slippage – thinking that curing perceptions is the same thing as curing problems. We have the tools to determine truth in many circumstances; courts decide questions of fact all the time.

Piety was solicited to represent the Sierra Club on behalf of Marc Kasky, and she’s published on this, but she invites you to look at the pleadings and the California decision. Nike was making representations about its labor practices; arguably the reason Nike didn’t bring a SLAPP suit is that then Nike would have borne the burden of proof on the truth of its representations. Kasky also claimed for fraud and deceit. The court of appeals accepted Nike’s demurrer – that even if Kasky’s claims were true, there was no cause of action. The California Supreme Court said that there was a factual issue and that discovery would be required. That’s far from nuts. The form – letter to the editor – should not dictate the result. Every time Nike’s representatives open their mouths on behalf of Nike, as opposed to on their own behalf, they are trying to serve Nike’s best financial interests.

Piety thinks there is a real problem with “front groups.” The Wal-Mart Across America blog is actually connected to a PR firm, but didn’t disclose it. It is hard to identify harm to any particular consumer, but there is something troubling. Likewise, for over 40 years, the tobacco industry created groups to speak for it and to generate doubt in the information environment over whether smoking harmed health, even when the industry knew internally that it did so. The technique of creating a “research council” is a valuable PR tool, because marketers understand that ads have less credibility and they rarely know when a particular ad works. Thus, getting someone else to carry your message, and keeping it from being identified with you, is really useful.

The tobacco industry had more information on smoking than anyone else, and suppressed it. This is typical of industries – they know more than we do and can manipulate the information we get. This dynamic is at work now with global warming.

Even so, not all these groups are created equal. Some are completely funded by PR firms. Others are composed of actual professionals. Austin suggests that we can create rules distinguishing between non-profits and profit-seeking or mixed groups, just as In re Primus distinguished between ACLU lawyers and lawyers seeking private payouts.

It can’t be the case that we’re powerless before the onslaught of large amounts of money used to create uncertainty and doubt about the safety of our food, our environment, our drugs. If what Nike initially proposed had been taken up by the Supreme Court, it would have been hard to prosecute the tobacco companies for conspiracy, because the entities speaking were somewhat removed from the companies itself. Yet we should be able to respond to grave public health problems and avoid unfettered misleading speech. To the extent that credibility comes from obscuring the source, that’s not a legitimate interest for a corporate speaker.

She always is surprised by paternalism critiques of advertising regulation. The advertising argument is always “tough love.” We said it, we intended for you to rely on it, and you did and were harmed, but you shouldn’t have listened to it. It will be good for you to stop relying on ads! That’s just paternalism of a different sort. She’s not sanguine about Exxon-Mobil deciding her fate; at least she has a vote and a stake in the government. (And as others have pointed out, if advertising really is misleading, it’s autonomy-enhancing, not to mention efficient, to ban it.)

Commercial speech conference: the basic debate over equalizing protection

Here, maybe less of a debate, since the speakers were largely critical of Central Hudson.

Conrad Shumadine, member, Wilcox & Savage, Commercial Speech: The Illusory Search for Absolutes. Shumadine argued for greater parity between commercial and political speech; if we trust our citizens to make political decisions based on free, robust and wide-open dissemination of information, we should trust them to make commercial decisions. (Or maybe there are situations in which we trust the government and others in which we don’t.)

Shumadine argued Edge Broadcasting -- lottery broadcasting across state lines -- and believes that the rules the Court applies are standardless and certainly not empirically based, a proposition with which I’d have to agree.

Question: what is useful information? Answer: information is inherently useful. Ignorance is never better than knowledge. (Does image advertising decrease ignorance, or just rearrange it? Is “Coke is it” informational? Is a statement by an actor that “playing the lottery is fun” informational?) The marketplace will take care of things like offensive lawyer advertising.

Bruce Johnson, partner, Davis, Wright, Tremaine, Amendment XXVIII? Defending Corporate Speech Rights. He’s a victim of commercial speech overregulation, from New York’s new attorney advertising rules – all lawyer websites must say “advertisement; results may vary.” From now on, his website biography says: results may vary. What does that mean? It’s characteristic of commercial speech regulation in being overzealous and somewhat useless.

This standardless system is ripe for abuse by ideologues. As Kozinski and Banner wrote, liberals mistrust commercial speech because it’s commercial; conservatives mistrust speech because it’s speech. This political valence is the enemy of consistent decisions.

Nike v. Kasky highlights all the doctrine’s problems, especially the dangers of moving speech beyond a transaction-oriented definition. (My own opinion is that the California Supreme Court applied current doctrine correctly in Kasky, and that the letters to athletic directors were uncomplicatedly commercial speech, even “transaction-oriented” speech.) California’s former consumer protection law allowed lawsuits without any harm, and business groups accused lawyers of creating shakedown systems. Marc Kasky wasn’t one of those, but he didn’t like corporations or free trade much. He’d never bought a Nike shoe and never would. The First Amendment bar ignored the case at the state level; the regular press ignored the case until the California Supreme Court decided it.

Notably, the four judges in the majority were the ones who regularly vote for the press in typical First Amendment cases, and the three dissenters were the ones who are least likely to accept average First Amendment arguments. Politics was very important here.

Johnson finds the California Supreme Court’s test for commercial speech to be a significant expansion of previous tests. He was surprised that SCOTUS dismissed the case as improvidently granted, because that leaves this test in place. There were more than 30 amicus briefs submitted, including one from reclaimdemocracy.org, which typifies the ideological problems in every non-transactional commercial speech regulation these days. This group believes in a constitutional amendment that would protect only living human beings, so corporations would have no constitutional rights. The state Democratic party in Washington has adopted this as part of its platform, as have some California municipalities.

But corporations include entities like Harvard College and the Washington Post. Also, speech by corporations comes from some human. Corporations don’t speak; people speak. Just like guns. If we use the Nike “commercial purpose” test, then any corporation can be found to be engaged in commercial speech at any time and its speech can be suppressed. (Caveat: under Kasky, this is only true if the speech is false or misleading. There’s no First Amendment interest in speaking falsely, though of course issues of burden of proof and chilling speech loom quite large.) Government should not be in the business of deciding that a business is too large to have a voice in public debates. And the public has an interest in receiving businesses’ ideas.

(I remember reading Kasky’s brief in opposition to cert and thinking that (a) the arguments about the vehicle defects that made this a poor cert candidate were entirely correct and (b) the arguments about the vehicle defects were unlikely to prevent the Court from taking such a sexy First Amendment case. As it turns out, I was right on both counts – not something that’s so common that I can afford to keep silent!)

Commercial speech: securities regulation

Trey Drury, Loyola-New Orleans, Disclosure Is Speech: Imposing Meaningful 1st Amendment Restraints on SEC Regulatory Authority. SEC disclosures should be recognized as commercial speech, which would invalidate some but not core regulations. The big hurdle is that the Supreme Court doesn’t agree with Drury, having assumed that it’s ok to regulate securities.

But the Court is wary of suppressing truthful speech and fears paternalism. (I view this as a normative claim – as he notes, the Court has no wariness in suppressing truthful speech when it doesn’t consider it within the bounds of the First Amendment at all.) The Court is willing to take on heavily regulated commercial fields like lawyer advertising and FDA regulations, so the Court should also analyze securities regulation as commercial speech regulation.

The theory of SEC regulation was required disclosure: You’ve got to register unless an exemption applies, e.g. one for small businesses and stock sales.

The type of speech involved is like commercial speech. It’s a corporation proposing a transaction to potential buyers. The SEC is concerned that if a corporation says things inconsistent with its prospectus, that will be misleading and drive up the stock price – which means that the regulations are intimately involved with proposing transactions. Also, the SEC recognizes that markets absorb information. At a first offering you must disclose everything, but later you don’t have to start from scratch – you can point people to prior SEC filings. Moreover, courts have imposed liability for making disclosures that third parties use to trade – they know third parties will make decisions in reliance on disclosures. (I am interested that this explanation of why SEC-regulated speech is commercial speech seems to concede everything the California Supreme Court majority said in Kasky. If you are trying to get your speech considered within the realm of First Amendment-governed speech at all, it makes sense to make this argument; but once within First Amendment-land, I would expect corporate speakers to start arguing for the noncommercial and thus fully protected nature of some if not most of this speech.)

Implications: Investors don’t need the same types of protection normal consumers do. Lacking information, you’re stuck with limited options, like buying prescription drugs from the nearest pharmacy, but in securities you get the benefit of others’ knowledge, through market signals and the consensus price.

There are numerous SEC regulations prohibiting truthful speech, requiring disclosure, and otherwise imposing on speech – the trifecta. Regulations that should be struck down: during the preregistration quiet period, when you’ve determined you’ll offer securities but haven’t yet done it, you can’t make any non-prospectus public disclosures, which means not offering ordinary information. The Google IPO was held up by a Playboy interview with the founders, in which they said innocuous things. Also, the Sarbanes-Oxley regulations banning non-GAAP financial reporting information on things like non-recurring charges, even though investors might want to see what the financial information looks like without the non-recurring charges; the SEC did not evaluate whether providing such information is misleading. Still, the vast majority of securities regulations would be left intact. Mandated positive disclosures are completely fine, like warning labels.

Antony Page, Indiana U., Taking Stock of the First Amendment’s Application to Securities Regulation. Other restrictions on speech in securities: the ban on selective disclosures in private. That’s content based, because it’s determined by its impact on listeners (I’m not sure this is a proper description of the test for content-based restrictions), and it’s not designed to further an antifraud goal. As a result, fewer companies now provide certain kinds of revenue guidance. Likewise, restrictions on general disclosure in private placements are problematic – the restrictions apply even if you don’t allow people to buy and thus don’t cause harm. There are flat bans on certain disclosures. For example, with oil reserves, there are proven (90% chance of recovery) and probable (50-90% chance of recovery) reserves. All else being equal, probable reserves would affect the value of an oil company, but the SEC doesn’t allow disclosure of probable reserves.

There is also compelled speech: certain minority shareholder proposals have to be included in proxy materials. (This sparked a discussion during the comments period – part of the issue of corporate speech is the question of who is speaking. If the managers can suppress shareholder speech, then the company’s resources are speaking for some but not others.) Also, tender offer filing requirements: you have to file any comments made to more than ten people, which can cost $50,000 – this has practical consequences, e.g. a website by an employee opposing a tender offer which gets taken down.

Page, following Fred Schauer, distinguishes between coverage and protection. All normative theories fail to explain the First Amendment’s coverage – nonlegal factors are more important – whereas they often do an ok job explaining what gets protected within the scope of coverage.

What are the coverage arguments about the SEC? An impending SEC/First Amendment collision was predicted 25 years ago, but Page is optimistic that things will change soon. The doctrinal justifications for excluding securities regulation are poor, based in dicta from the infancy of commercial speech doctrine. Other extensively regulated areas of economic activity are not exempt from First Amendment scrutiny – see cases on drugs, gambling and tobacco.

Some argue that securities are different – their value depends on firm-specific information which is hard to verify, making stocks a credence good. With a car, you can inspect and discover fraud much more easily. There are other credence goods, however, without this regulation and presumably covered by the First Amendment (comment: really? Why?). News is a credence good. Education is also a credence good – you have to believe that a law degree is worthwhile. Also, information intermediaries exist in securities as well – auditors and underwriters. Companies can make credible commitments through things like bank monitoring, which adds shareholder value.

If securities are different, why does the SEC allow purchases without information for exempt things like pink sheet stocks, foreign companies, and small offerings?

Some argue that the capital markets would collapse without regulation. But First Amendment coverage doesn’t mean that all regulation would be struck down. Anyway, the empirical evidence about the need for regulation is mixed.

Questions: Is corporate speech different because a corporation is not a person?

Drury and Page agreed that the best foundation for First Amendment protection for corporate speech was the listeners’ interests in receiving truthful information. My reaction: that justification allows more regulation than a speaker-focused theory of First Amendment rights, because the listener’s interests are not aligned with the speaker’s in many cases. Hearer-based claims are used instrumentally by corporate speakers to get within the scope of the First Amendment; once that happens, they start making claims to have independent rights as speakers.

Commercial speech conference: my comments

The thing that has always puzzled me about Central Hudson is that the first prong of the four-prong test means that false or misleading speech flunks the test at the outset and may simply be banned; the rest of the test is designed to evaluate the regulation at issue. The Supreme Court has haphazardly recognized that this makes falsity and especially misleadingess a crucial determination, even more so as the Court has raised the burden of proof on the remaining three prongs of the Central Hudson test.

The lawyer regulation cases represent the Court’s most significant attempts to deal with the false/true line. Potentially misleading speech can’t just be banned. Actually or inherently misleading speech, however, can just be banned. Ok, so what’s actually versus potentially misleading? The only real possibility from the case law is that speech that can be clarified with a disclosure is potentially misleading.

The justices are confident they understand lawyer advertising sufficiently to draw the line. But: (1) they’re not exactly ordinary clients, and it’s the client’s perspective that should matter. (2) The research on disclosures and disclaimers is that they don’t work. People miss “no” or “not.” They misread the disclaimers to reinforce the main claim. The Court wants to have its cake (significant freedom to make claims) and eat it too (no deception), but the choice is starker than that, because people are often bad at processing information, for perfectly good reasons. In a busy word, it’s rational to devote limited time to evaluating most claims.

Profesor LaFrance analogized trademark and false advertising to defamation laws, which is an interesting comparison given the level of scrutiny the Court imposes on the substantive and procedural aspects of those actions. There are some older cases about trademark – for my purposes, the key ones are Friedman v. Rogers, in which Texas was allowed to ban the use of trade names by optometrists, and the Gay Olympics case, in which the US Olympic Committee got to suppress the use of “Gay Olympics” by a San Francisco group because of a special law passed protecting the word “Olympics.”

In Friedman, the Court ruled that trade names lack inherent/intrinsic meaning and can be used to deceive about consistency of price and quality; therefore their use can be banned. This is pretty unpersuasive, given its conflict with the economic theory behind trademarks – that trademarks minimize search costs and encourage consistent quality, and that consumers can punish inconsistency on their own. Thus, the existence of the mark “McDonald’s” for fast food makes it easier and cheaper for consumers to understand their choices. By denying Texas residents the information that consistent optometric services were available, the Texas law interfered with truthful commercial speech. Friedman is a pre-Central Hudson case, and I consider it unlikely to be good law.

The Gay Olympics case suggests that Congress can determine that any unauthorized use of Olympic is misleading. It also relied on the theory that trademarks are property and thus their allocation to private entities doesn’t violate the First Amendment. The second rationale is a mistake – the label “property” for intangibles can’t solve First Amendment problems; see, e.g., the repeated introduction of bills making the US government the owner of intangible property rights in every American flag, such that “disrespectful” treatment would be illegal.

Current problems: partially useful information. Many uses of words and marks help some people while confusing others, which creates big issues for trademark and false advertising law. Examples: Park ‘n Fly is a trademark. Can an airport parking lot advertise “Park and Fly!”? Some consumers will understand that this is a description of services and their decisions will be improved; others will be confused. Likewise, studies have shown that many consumers misinterpret “low calorie” to also mean that a food is low in other negative qualities, like fat. But some correctly understand the limited claim. Which consumers will regulation favor?

The courts have been largely indifferent to First Amendment isues in private law cases, even though New York Times v. Sullivan is supposed to stand for the proposition that state authorization and enforcement of lawsuits against speech implicates the First Amendment. Perhaps unsurprisingly, courts are mostly willing to examine direct government regulations for First Amendment violations.

Recent cases: Piazza’s Seafood World v. Odom, dealing with Louisiana’s Cajun Statute, which required products labeled “Cajun” to be from Louisiana. Plaintiff’s catfish were Chinese, and the court struck down the law because it believed (without any evidence) that sophisticated wholesale consumers could understand the true origin; “Cajun” was just potentially misleading as applied to Chinese catfish. But this overlooks the potential government role (as in the Gay Olympics case) of establishing the meaning of a word, which can improve the efficiency of a market. When the government sets standards for defining the miles per gallon a car gets, or the amount of “tar” in tobacco, consumers have a standard that they can use to compare various products, without having to invest in figuring out which of many competing definitions a particular producer is using. If we really care about listeners’ interests, then we should give government significant leeway to stabilize meaning.

Another case involved the Indian Arts & Crafts Act, which bans the false suggestion that a product was made by an Indian. The Seventh Circuit upheld it against a First Amendment challenge as a trademark statute. But the court also held that the Department of the Interior regulation holding that unqualified use of the term “Indian” or the name of an Indian tribe was deceptive wouldn’t be enforced. Rather, plaintiffs (and the government, if the government ever prosecutes someone under the law) would have to prove misleadingness to the jury in every case. The court described the regulation as making “Indian” the trademark for Indian-produced products, like Roquefort is the name of a particular cheese.

Two points: First, this view of the IACA disregards other functions the law might serve than trademark purposes, for example cultural preservation or commercial morality, which might lead to a different view of permitted and prohibited acts. (See this student note for more.) Second, it is not clear why the jury is better at deciding what’s deceptive than the legislature or an administrative agency; on balance, a blanket rule might be right more often than case-by-case verdicts, especially if it’s really likely that the unqualified use of the term “Indian” is in fact deceptive. Who decides who’s fooled? Even defamation law recognizes certain terms as defamatory per se, without requiring an individual jury verdict on the point.

Finally, a looming issue if we continue expanding commercial speech doctrine to false advertising and trademark law: intent. It’s easy to use the word fraud in this context, but consumer protection law long ago left the common law requirements of fraud behind. Intentional deception is no longer a requirement; one can infringe or engage in false advertising merely by being wrong about the implications of one’s mark or claim. If we did treat advertising law like defamation, we’d have to rethink that – but there were good reasons to move away from the common law rule. We shouldn’t assume that the balance struck in defamation law is appropriate for advertising law.

Commercial speech conference: send lawyers, blogs and advertising

(With apologies to Warren Zevon.)

Anthony Ciolli, University of Pennsylvania (law student), Are Blogs Commercial Speech? Regulators have begun to look at blogs, but there’s considerable constitutional ambiguity. State bar associations (KY and NY) have proposed treating lawyer blogs as commercial speech. Lawyer blogs, they say, are primarily a means of advertising. A well-written and timely blog can certainly improve a lawyer’s prospects – there are even entire companies built around legal blogs as marketing tools. But attempts to call all lawyer blogs commercial speech have not been warmly received. Lawyers protest that their blogs are like law review articles and books, which are fully protected even though they may also confer professional benefits.

(Disclosure: Though my general stake in this issue is obvious, I have a specific interest: I am licensed in New York and thus the new New York rules apply to me. I believe that, though this blog constitutes fully protected noncommercial speech to which New York’s substantive rules could not constitutionally be applied, it is nonetheless in compliance with a proper application of those rules by disclosing my name and affiliation. I do note that New York’s rules as written apply to non-legal blogging by lawyers, and that I consider the rules entirely unconstitutional as applied to such blogging, especially as they purport to ban anonymous speech.)

Blogs that merely carry advertising (e.g. through Google’s AdSense), shouldn’t be considered commercial, though cross-promotion of legal services could be. Technological change, however, has often produced changes in legal standards, and that might happen here. Newspapers aren’t really proposing transactions when they run ads; they are conduits for ads paid a flat rate for circulation. Ads on blogs, by contrast, pay for performance. This causes many blogs to integrate ads with blog posts to encourage readers to click on links, or even integrate a partner Amazon link with a post about a book or other product. A court might be more likely to put such a blog in the commercial speech category. Given that some bloggers attempt to hide commercial connections, a minimum of disclosure rules might be a good idea.

James Lake, Thomas & LoCicero, Speaking Legally and Freely: Lawyers, Websites and the First Amendment. Lawyer advertising – or perhaps speech – on the internet makes the commercial/noncommercial divide very salient. Is anything a lawyer says on a webpage commercial speech? If it’s seeking clients, sure. Advertising our education and experience and noting that we provide legal representation are activities that serve our economic interests, and states have tended to treat such webpages like any other form of advertising – Iowa sanctioned a lawyer over a website claiming that “our firm’s scholarly achievements” were better than anyone else’s, and that the firm had obtained overwhelmingly favorable results in drunk driving cases. The fact that it was a website didn’t make a difference.

But we also use the internet to discuss developments in substantive areas of the law, post scholarly articles, etc. Much of that speech is calculated to impress existing and potential clients, but that’s not enough to make it commercial speech. Florida has applied disclosure requirements to websites, but without evidence that its requirements were insufficient, considered applying the same standards to websites as to TV or print ads, which would have banned statements about past results, testimonials, etc. The board also considered restricting access to law firm websites, such as with a password, to get to portions of a website that might have a lawyer’s resume. (What were they thinking?) This just ignores First Amendment interests.

Jay Bender, partner, Baker, Ravenel & Bender, South Carolina Attorney Advertising & Web Marketing Update. The South Carolina Supreme Court doesn’t much like lawyer advertising. The newest rules are from 2005, and hit all the problem areas defined by Central Hudson by limiting truthful and valuable speech, compelling speech in direct mail advertising, and taxing advertising by requiring every ad to be filed with the bar along with a $50 check. And to add insult to injury, they don’t even scrutinize the ads for truth, because that’s the attorney’s job. In a state that can’t compel people to use seatbelts in their cars, why can the court limit what truthful things we can say to people who might purchase our services?

The question is how much paternalism is constitutional. For years, it was illegal to advertise the price of eyeglasses in South Carolina. So, people would drive to Augusta, where price advertising was allowed and glasses were thus cheaper. For years, it was illegal to advertise the prices of milk. The political culture is willing to say that the government knows best.

Commercial speech conference: Mary LaFrance on dilution law

Mary LaFrance, Are Dilution Laws Unwarranted Restrictions upon Commercial Speech? Traditional TM and unfair competition laws easily survive First Amendment scrutiny because they target false and misleading speech, like defamation laws. Dilution laws, however, are not aimed at false or misleading speech, but at plugging a perceived gap in trademark law and allowing owners of famous marks to protect against nonconfusing uses that nonetheless affect the value of the mark. Examples of blurring: the song “Barbie Girl,” which leads consumers to think both of the song and the doll when they hear later references to Barbie; Utah’s advertising for “The Greatest Snow on Earth.” Other scholars describe this as a free-rider problem.

First Amendment concerns apply to a greater extent in the dilution context than in the traditional trademark and unfair competition context, because dilution laws lack the justification of protecting consumers, which provides built-in First Amendment insulation. Dilution penalizes nonfraudulent commercial speech, and protects only the TM owner. (Note: There is a growing tendency to justify dilution on consumer protection grounds with a theory of “internal search costs.” I’m writing about this now. I don’t think it solves dilution’s First Amendment problems, but one reason the theory is attractive is that it appears to rebut LaFrance’s position.)

The federal dilution statute has a generally effective exception for noncommercial speech referencing famous trademarks. Most state laws lack such an exception, and expressive works have unconstitutionally been subjected to liability under state laws by speech-insensitive courts. And of course the line between commercial and noncommercial speech can be elusive. People often enjoy ads as entertainment, and ads can challenge sensibilities and spark debate, as for example the Snickers Superbowl ad featuring an inadvertent male-male kiss that has been attacked as homophobic. Advertisers increasingly sponsor shows and integrate their products with storylines. Moreover, commonplace merchandise – coffee mugs and T-shirts – often have expressive meaning, whether it’s displaying the name of a sports team or making political commentary. Yet courts frequently treat these items as less entitled to First Amendment protection than traditional forms of expression. Dilution laws will chill these nontraditional yet highly effective forms of communication.

Today, however, LaFrance wants to focus on the most mundane commercial speech. If dilution laws are justifiable at all, it must be because they are justified with respect to mundane commercial speech – using marks to identify goods and services. The interest in protecting trademark owners, however, is insufficient to justify these restrictions absent a consumer protection rationale. This is especially true because injunctive relief is preferred in dilution cases, and because courts allow injunctions on proof of “likely” dilution without proof of actual harm. Blurring and tarnishment are ill-defined, and it’s difficult to see how one would find evidence of actual dilution.

Absent fraud, what property interest could justify denying commercial speakers’ ability to choose marks? Under Central Hudson, the asserted government interest must be substantial. The regulation must also advance the asserted government interest, and the government must demonstrate that the harms it identifies are real and that the restriction will alleviate those harms in a material way. Finally, there must be a reasonable fit between the ends and means – a tailoring requirement.

LaFrance believes that dilution flunks the substantial government interest prong. She is also interested in whether dilution is content-neutral. Tarnishment is not content-neutral, since the purpose is to allow the TM owner to prevent criticism and control how people feel about the mark (ultimately, this is also true of blurring, which can also dull the golden glow of a strong mark). This is why Christine Haight Farley calls dilution state-enforced mind control. LaFrance is less sure about blurring, since the defendant’s message is simply “buy my goods,” and the blurring doctrine isn’t designed to suppress that message, but rather to bar the use of a particular shortcut – copying a famous mark. (If the tarnishing use is pure commercial speech, this would also seem true of a tarnishing use – Tiffany’s strip club, for example, is using free riding to sell its product and only incidentally tarnishing the Tiffany’s mark. But perhaps this reduces to the question of whether there can be a tarnishing use that does not also blur.)

In copyright, the Supreme Court made clear that damaging a work’s reputation through parody is not tortious, but merely an expression of opinion. The same is true of tarnishing use; the government has no interest in suppressing such commentary, even in commercial speech. What about blurring? There’s never been any proof that a mark loses value by being shared. Free riding is not the same as stealing existing market value from the TM owner.

Perhaps it would be better to dispense with injunctive relief and require proof of damages. But legislative amendment in this direction is unlikely. Thus, courts should refuse injunctions on First Amendment grounds. Damages are available under the federal statute for willful dilution, if proved. If we did this, we could find out whether there is any harm from dilution, and maybe we’d get grounds for injunctive relief. LaFrance suspects, however, that no harm arises from dilution.

2007 AALS podcasts

Now available: the Jurisprudence/IP sections joint session on the morality of copyright disobedience (mp3) and the Art Law section session on antiquities law (mp3), which I moderated, as well as other sessions in which I was less involved.

Ellen Goodman on peer advertising

Ellen Goodman, Rutgers-Camden, Peer Promotion and Advertising Law. Advertising Age picked “the consumer” as the Agency of the Year for consumer-generated advertising. There are dramatic decentralizing shifts in the creation and distribution of information, including advertising. This has costs and benefits advertising law is not well-prepared to address.

Peer promotions present for advertising law the same challenges that distributed digital communications have for IP – can regulatory purposes be achieved when authorship is in flux and control is difficult? Marketers seek consumer-produced ads to create buzz around the brand and break through the clutter. Chevy allowed users to create their own promotions for the Tahoe, and some users mocked the Tahoe for its gas consumptions; executives insisted this was the price that had to be paid for engagement. Hoping to get the benefits of buzz and still retain control, marketers this year ran a contest to create amateur Superbowl ads.

Other forms of peer-generated marketing: wikis and blogs about products. People express enthusiasm while having no economic interest in the brand – for example, consumer imaginings of what the iPhone would look like before it was announced. Mixed production also exists, as with the Mentos/Diet Coke video that was peer generated but then advertiser adopted. User testimonials solicited by the advertiser – Volvo will now post both positive and negative comments on its official site. Peer-generated content may even be advertiser sponsored, as with a blog that told the stories of happy and grateful Wal-Mart workers sponsored by “Working Families for Wal-Mart,” which itself is sponsored by Wal-Mart. The author insisted that this was his own authentic, noncommercial speech, and that Wal-Mart funding was no different from being paid by a newspaper.

False peer marketing – advertiser-generated, but looks like peers. For example, a fake blog run on behalf of the Sony PSP. When Sony’s ownership of the domain name was made public, Sony took the blog down. Marketers have been more savvy on MySpace, creating “friends” to try to get buzz.

These developments are extensions of integrated marketing – integration between ads and PR; integration between consumer and brand; integration with branded entertainment; buzz marketing and peer-generated promotions are applications of the theory of total integration. It’s a third stage of marketing innovation, following innovation and then image advertising.

At each stage, law has had to ask how marketing can cause harm and whether regulation is worth the costs it imposes. Informational advertising prompted the development of the FTC and state regulation. The rationale is a search costs one: good information helps consumers and bad information hurts them, so we try to sort. Information theory quickly identified image advertising as beneficial to consumers as well – advertising is expensive, and so it’s a signal to consumers of product quality. But it may create false images, such as the association of Marlboros with masculinity, and may be far more persuasive than informational claims. But the law reflects the conclusion that this kind of harm isn’t within the law’s power to address without a factual claim; it’s too hard to regulate and too dangerous for free speech.

The effort to balance consumer harm and free speech is central to regulating integrated advertising as well. The Supreme Court allows regulation when the noncommercial elements are easily separable from the commercial. Nike rebutted child labor allegations in an integrated campaign that used ads, PR, communications with large-scale buyers, and other formats. Nike got sued, and the California Supreme Court held that false advertising law applied to some of Nike’s communications. This was a fairly faithful application of the mixed-speech case law, even though it’s been much criticized. It’s consistent with courts’ determinations of what’s commercial speech under the Lanham Act.

Doctrinally, applying advertising law seems relatively straightforward. Pure peer promotions are noncommercial speech; the consumer doesn’t stand to benefit from the transaction s/he suggests you enter into. This doesn’t mean there’s no harm – there can be all sorts of material misstatements. But even more than with image advertising, regulation’s costs would outweigh its benefits.

Once the advertiser adopts the peer-generated ad as its own, as with Superbowl ads, this would seem to become the advertiser’s speech, and purely commercial; the original source of the production doesn’t matter. The same can be said for false peer promotion. Far more difficult is peer-generated, but advertiser-sponsored, speech – like the Wal-Mart blog.

Authorship is not clear: if the consumer doesn’t know an advertiser is speaking, is the risk to the consumer greater or less? Is regulation more or less likely to chill speech? The law hasn’t addressed these issues yet. Advertisers assume that peer ads are highly credible, which supports regulation because it indicates that consumers are more likely to be misled. But if consumers are the real authors, then this means regulating noncommercial speech.

Maybe peer advertising is not credible, because consumers don’t believe the source has any special knowledge. In that case, the claims wouldn’t be material and false advertising law wouldn’t apply. Widespread skepticism could undermine the basis for all false advertising law; if nothing is believed, then no ads are materially false and regulation has no purpose.

Goodman believes that the harm of hidden sponsorship is a discourse harm, not a consumer harm. Hidden sponsorship destroys our trust in sincerity. The remedy is widespread sponsorship disclosure, currently embedded as a norm in journalism. The sponsor should disclose a relationship when consumers might not understand that the relationship exists and might be fooled.

Commercial Speech conference: Ann Bartow

Commercial Speech in an Age of Emerging Technology and Corporate Scandal, sposnored by the South Carolina Law Review, the USC School of Law and the USC School of Journalism and Mass Communication

Ann Bartow bravely stepped in for Alfred Yen, who was prevented from attending by weather-related delays.

Ann Bartow, South Carolina, Trademarks of Privilege: Naming Rights and the Physical Public Domain. Trademark law is about the power of words, getting lumped in with IP like patent and copyright, but it’s different – it is directed at the commercial power of words. We don’t need to incentivize the use of words as marks; you need to earn the right to do so in ways other than by creating or innovating.

Here, her topic is naming arrangements for public buildings. She’s not against philanthropy, but she’s not a fan of quid pro quo naming where the amount of the required gift is mysterious, flexible and subject to gaming. More related to TM, she objects to the failure of corporate owners to admit that “naming” is a non-TM use of marks, and can actually look like intentional deception of consumers. Enron Park is now Minute Maid Park; Minute Maid does not own the park, but just gave some money. It’s an ad, but it’s not a TM, educating consumers about the source of a good or service. Finally, she objects to honorific naming that free-rides on public facilities and public good will, for example public buildings named for current politicians, especially if the criteria for naming aren’t publicly articulated or accessible.

Why does Colonial Life get its name on the Gamecocks’ stadium? It is not clear what information the name is supposed to convey to consumers. Did Colonial submit the biggest bid? Does it participate in managing the stadium? Who knows?

Likewise, South Carolina has been Thurmondized – what exactly are the mechanisms of naming honors? Is Strom Thurmond a trademark, and if so what does it signify? South Carolina-ness? On occasion, politicians have renamed things – like Clark Hill Lake, SC – in Thurmond’s honor, without consulting locals.

Street names are also named by the government, but become part of one’s personal identity. In a way, they constitute compelled speech, especially if the government then changes the name on you. The standards for street naming are unclear and usually undemocratic, disproportionately given to politically connected white males. There are political tensions over the advisability and nature of the naming “honor” (e.g. Martin Luther King, Cesar Chavez, Rosa Parks, which are names that signal what kind of people live in that area; wealthy people resist renaming their streets in honor of Martin Luther King because it will lower their property values).

What’s the effect of naming? Visibility, endorsement, reward for service, elevates standing of the entire family. Naming has historical impact in communicating to future generations who we thought was important. In South Carolina, the Civil War is built into the public domain. Students in at least 20 districts attend public schools named after Robert E. Lee, whereas heroism in WWI and WWII has attracted less public memorialization.

Trademark law is premised on the commodification of associative value and social meaning. Bartow’s work asks us to interrogate the mechanisms and rationales for this process.

Love loses out

Just in time for Valentine's Day.

Love v. The Mail on Sunday, --- F.Supp.2d ----, 2007 WL 458050 (C.D. Cal.)

As the court notes with near-palpable weariness, this is the latest iteration of longrunning disputes involving the members of the Beach Boys. Here, plaintiff Mike Love alleged that defendants created and distributed a covermount CD of Beach Boys and Brian Wilson Material, performed by Brian Wilson. He claimed that the CD and associated advertisements violated various of his rights; the only claim at issue in this motion was the Lanham Act claim based on the CD’s use of Beach Boys photos that included Love’s image, and on the use of “The Beach Boys” on the CD and related ads.

The CD was distributed in the UK, and allegedly promoted on UK TV and the internet. Plaintiff’s claimed losses include damage to existing and future sales of Beach Boys albums and concert tickets and tarnishment of the Beach Boys mark.

The court ruled that plaintiff was seeking extraterritorial application of the Lanham Act, which was not available to him. In order for the Lanham Act to apply to foreign activities, (1) the alleged violations must create some effect on American foreign commerce, (2) the effect must be sufficiently great to create a cognizable injury, and (3) the interests of and links to American foreign commerce must be sufficiently strong in relation to those of other nations to justify assertion of extraterritorial authority.

Love’s claims flunked that test. The allegedly infringing acts occurred overseas and were not authorized in the US (in fact, Wilson’s lawyer apparently told one of the overseas parties to get permission from the individual Beach Boys to use their images, which he recommended against in any case since the CD was focused on Wilson). The CDs weren’t distributed in the US, and the US defendants didn’t engage in any distribution. The only evidence of distribution in the US is via the secondary market for used CDs on eBay, but the court disregarded evidence of a single US sale that way because plaintiff didn’t disclose that the sale was to his attorney’s confederate.

On these facts, there’s no evidence of any effect on US commerce. There was no evidence about the “attenuated” effect the CD might have on increasing demand for Wilson’s concert, in turn decreasing demand for Love’s concerts, other than Love’s own purely speculative declaration. Without effect (1), there could be no harm (2). Also, in relative terms, the UK had a far greater interest in the matter. English law governing Love’s claims differs significantly from U.S. law. English law doesn’t recognize a right of publicity, analogous to Love’s claim for wrongful use of his “persona.” Moreover, the analogous UK claim of false endorsement is narrower than the US version. Because the conduct may have been lawful in the country in which it occurred, US law shouldn’t be applied. Numerous other factors also supported this decision, including the fact that the parties who actually engaged in the allegedly infringing conduct are domiciled in the UK and had already been dismissed from the case for lack of personal jurisdiction. None of the cases cited by Love were sufficiently similar to the instant facts to change the court’s analysis.

On its own motion, the court dismissed Love’s claim for unfair competition under California law, since the only basis for alleging unlawful and deceptive conduct was the Lanham Act claim, now dismissed.

Seagull becomes albatross for multilevel marketer

Thanks to Greg Lastowka for pointing me to this case:

Bach v. Forever Living Products U.S., Inc., 2007 U.S. Dist. LEXIS 8424 (W.D. Wash. 2007)

Plaintiff Richard Bach wrote a book, Jonathan Livingston Seagull, which was published in 1970 with photographs by plaintiff Russell Munson. Defendants (FLP) make and distribute health and beauty products through multi-level marketing, and also provide management services for U.S. resorts. Plaintiffs allege that defendants used a copyrighted photo from JLS as their corporate logo, and have used excerpts from JLS in their advertising, promotional, and training materials directed at independent distributors and end-users. They allege this is copyright infringement as well as trademark infringement and false endorsement.

Defendants used the name and title of JLS, as well as the image of a white seagull on a blue background, extensively. For example, “in a 2003 promotional video, FLP's marketing director stated that FLP's brand is ‘the Jonathan brand,’ and that ‘Jonathan is really the basis of what Forever is about.’” FLP has called its seagull logo “Jonathan” or “Jonathan Livingston Seagull” since the company was founded in 1978. For over twenty years, it has given “Jonathan” bonuses to successful distributors, called its distributors “Jonathans,” given “Jonathan Livingston Seagull” statues to top sellers, and held “Jonathan Days” to motivate distributors. In a 2005 Style Guide, FLP specified how a white seagull on a blue background – an image “strikingly similar” to the cover of the U.S. edition of JLS – was to be used in signs, flags and banners.

In a sensible interpretation of Dastar (that is nonetheless, like many sensible things courts do, somewhat underexplained), the court ruled that both the copyright and trademark claims could proceed, because the two areas of law protect against different wrongs. The key is that there are two different wrongs in this case, though there may not always be. That is, plaintiffs’ copyright claims target defendants’ copying of the cover photo and excerpts from JLS, whereas the trademark claims target defendants’ use of the character/title/trade dress of the book in ways that served to brand defendants’ products. Though the court doesn’t use the term, the key here is defendants’ alleged use of Jonathan Livingston Seagull “as a mark” rather than their simple copying, which would be nonactionable under the Lanham Act after Dastar.

Significant issues of ownership of the alleged marks do remain; because they’re all unregistered, Bach has the burden of proof to establish his rights. Among other things, there’s a question whether Bach forfeited any trademark rights in “Jonathan Livinston Seagull” through naked licensing of the movie rights. The court found that a contract giving Bach approval rights for certain aspects of the film, like the score, the title, and the final cut, and evidence that he may have exercised informal control over movie merchandising, created a factual question for later resolution. Bach’s reservations of “droit moral,” however, did not factor into the court’s decisions, because he had no such moral rights in the US and thus that contract provision didn’t give him any relevant control.

A separate issue was whether plaintiffs owned trade dress rights in the book cover design, a white seagull in silhouette against a blue background. Not all editions of the book bear this design, creating further factual issues (framed here as ones of abandonment); because S&S exercised control in the US, and because S&S asserted that it would pursue trademark infringement claims against another book that looked like JLS, the court refused to rule in defendants’ favor at this stage. More interestingly, defendants argued that the owner of the rights, if any, was the publisher, Simon & Schuster. In April 2006, S&S conveyed any interest it owned in the book trade dress to plaintiffs, as did the heirs of the book cover designer in May 2006. Defendants argued – with reason, it seems to me – that the assignments were unhelpful because trademark rights can’t be transferred apart from the business with which the mark has been associated. But in this context, the court reasoned, the goodwill associated with the book was already more the author’s and the photographer’s than the publisher’s. Thus, the assignments were consistent with the trademark policy that goodwill should serve to maintain continuity between a source and a product or service.

Indeed, the court ruled, plaintiffs have standing to sue for infringement “regardless of whether they own or owned the trade dress rights” because, under the relevant portion of the Lanham Act, they have standing if they’re likely to be damaged by the defendants’ conduct. They have a commercial interest in the mark, based on the damages and profits to which they’d be entitled if they win. “Because Plaintiffs have a right to royalties from others’ use of the Jonathan Livingston Seagull mark and trade dress, Plaintiffs have standing to sue under section 43(a) of the Lanham Act regardless of whether they technically own the trade dress at issue.” (Put that way, it seems just a bit circular. I’m not sure the court is wrong in outcome, but the question whether plaintiffs used the mark in commerce in a way sufficient to create federal rights is at least tricky. I’m willing to entertain the idea that they are the beneficiaries of S&S’s use, but it can’t be the case that ownership is irrelevant.)

A final factual issue was whether plaintiffs could show secondary meaning sufficient to establish the existence of trade dress. The court denied summary judgment based on plaintiffs’ evidence that JLS is one of the most widely read novels of all time and received significant publicity. (Compare to the PTO rule that no single title is registrable, because it remains descriptive of the specific underlying work; only series titles can be deemed to have trademark meaning.) Plaintiffs also pointed to defendants’ intentional copying, which is often deemed evidence of secondary meaning.

Defendants’ evidence against secondary meaning – the idea that the trade dress identifies a source rather than a product -- was, nonetheless, pretty good. They offered a survey showing 0% unaided recall of plaintiffs or of JLS among participants when presented with a seagull on a blue background. After they were informed that the image was from a book cover (which they wouldn’t necessarily think when seeing defendants’ non-book products), only 5% mentioned JLS. Moreover, in deposition, S&S stated that it didn’t use the book cover to identify S&S, but instead as “a marketing tool” for the product – the book.

Still, there were genuine issues of material fact on secondary meaning.

On likelihood of confusion, plaintiffs submitted depositions from several distributors who believed that defendants had the permission “of the people who owned the rights to the book” for the use of the name and the character. A survey found that 35% of current, former and potential multi-level marketing distributors believed that defendants had permission from the “owners of the rights," for net confusion of 31%. The court accepted the “permission” form of the survey questions, and found that the rest of the defendants’ criticisms went to weight rather than admissibility.

Defendants offered three surveys of defendants’ distributors and general consumers, including the survey that found 0% unaided awareness of JLS (moving up to 44% with “highly aided” awareness), but that just created a factual dispute. Defendants argued that “permission” is not the same as endorsement or approval, but the court held that a factfinder could draw an inference from consumers’ perception of permission to consumers’ perception of endorsement or approval.

Given the intentional copying here, defendants had an upwards climb. But not an insurmountable one at trial, I think, given the unclear evidence of secondary meaning. And there may be unresolved statute of limitations/laches issues as well.

Obama bin Laden mark refused registration

An alert student in my trademark class pointed out this Smoking Gun report that OBAMA BIN LADEN has been refused registration for various promotional goods on multiple grounds. First, BIN LADEN is inherently scandalous because of its association with 9/11, and thus not registrable. Second, the mark falsely suggests an association with Barack Obama or Osama bin Laden. (Really? How many consumers would seriously think that? The mark falsely suggests an association between Obama and bin Laden, but not one that goes through the trademark owner.) Third, by using the names of identifiable living individuals without written consent, the mark falls afoul of 2(c) even absent false association.

I'm just surprised that the 2(a) refusals didn't include disparagement. If BIN LADEN is inherently scandalous, than associating it with Barack Obama should be disparaging.

Readers may also note that the examiner who refused the registration was also responsible for refusing LIAR LIAR BUSH ON FIRE and KATRINA BLOWS, BUSH SUCKS -- Karen Bush.

Consumer fraud liability for physicians?

Williamson v. Amrani, --- P.3d ----, 2007 WL 419698 (Kan.)

The Kansas Supreme Court held that the Kansas Consumer Protection act applies to physicians’ statements to patients in the course of providing care or treatment. Allegations of willful failure to state material facts or willful concealment of material facts, however, require expert testimony that a reasonable medical practitioner would make those disclosures under similar circumstances.

Williamson sought treatment from Amrani for an old, disabling back injury. Amrani recommended surgery involving a surgical device and a bone graft. After surgery, Williamson was still experiencing pain, and Amrani recommended a second surgery removing the device. Williamson’s suit alleged that Amrani made misrepresentations about the benefits of the surgery – specifically, that it had a high likelihood of successfully relieving her pain and allowing her to return to work, when in fact the surgery had been unsuccessful in the majority of cases Amrani had performed it. She also alleged that Amrani willfully misrepresented or concealed material facts in that he knew or should have known that the surgery had “bad results” for a majority of his patients.

Amrani argued that the KCPA doesn’t apply to doctors’ professional conduct, and that the KCPA claims were an impermissible attempt to plead malpractice. The trial court rejected this general assault, but did grant his motion to require expert testimony about whether Amrani had a duty to disclose particular facts. No expert testimony was required to establish whether Amrani affirmatively misrepresented his experience or success rate.

Prior to trial, a different judge ruled that Amrani was entitled to judgment as a matter of law, because the KCPA doesn’t cover the medically-oriented interactions of a patient with a doctor. Given that the plain language of the law was broad enough to cover physician-patient relationships, that doctors were not covered by one of the law’s specific exclusions, and that other states had enacted specific exceptions for physicians when that furthered state policy, the Supreme Court reversed.

As for the expert testimony requirement, Williamson argued that, while a negligence action focuses on whether a doctor has met the applicable standard of care, here, what information a reasonable doctor would disclose under similar circumstances, a KCPA claim should be based on what information a reasonable patient would consider important. Given the complexity of the subject matter, the court agreed that expert testimony would be required to establish a duty to disclose, though not to establish an affirmative misrepresentation. This difference is a consequence of the distinction that state consumer protection statutes generally make between affirmative statements and failures to disclose, the latter of which generally have to be willful. Before there can be a willful failure to disclose, the court ruled, there has to be a duty to communicate the fact. And here, duty can only be established with reference to the standards of the profession. (This strikes me as special pleading for doctors – which may be justified; but asking whether doctors would consider it important to disclose something is different from asking whether patients would consider it important.)

Two justices dissented, and would have held that applying the KCPA is inconsistent with the statutory and regulatory schemes governing physicians’ conduct.

Playing Hardball pays off for Paramount in Illinois

Muzikowski v. Paramount Pictures Corp., --- F.3d ----, 2007 WL 416983 (7th Cir.)

“Robert Muzikowski has devoted years of his life to coaching Little League Baseball teams in economically depressed areas of Chicago,” the court began. After assistant coach Daniel Coyle’s book about the league Muzikowski co-founded led to a movie, Hardball, Muzikowski sued for defamation, arguing that a character “easily identifiable” as Muzikowski was portrayed badly.

In the case’s first trip to the Seventh Circuit, the court concluded that the district court shouldn’t have granted Paramount’s motion to dismiss, because Illinois state courts’ heightened pleading standard doesn’t apply in federal court for a claim of defamation per se. The district court then granted summary judgment to Paramount (and sanctioned Muzikowski’s lawyers for failure to comply with procedural orders).

The film Hardball told the story of a Little League coach named Conor O’Neill. Though the movie claimed to be a fictitious story not based on actual persons, O’Neill had many similarities with Muzikowski. “Both came from Irish-Catholic working-class backgrounds; both were involved in a bar fight in which they cut their hand; both were jailed as a result; both experienced the death of their father and financial difficulties.” There were also differences; some were unremarkable, but others showed O’Neill in a bad light: “[U]nlike Muzikowski, who had a history of alcohol and drug abuse that he successfully overcame, O’Neill was still an alcoholic at the time of the events portrayed in the film; O’Neill was a compulsive gambler; and O’Neill’s original motivation for becoming involved in the team was a selfish desire to pay off a gambling debt.” Muzikowski sued for defamation and false light invasion of privacy.

Because he was claiming defamation per se, he was not required to prove damages. Even a statement that’s defamatory per se, however, may not sustain an action if it may reasonably be innocently interpreted or reasonably interpreted as referring to someone other than the plaintiff. Illinois has a high standard – if there are two reasonable interpretations of a statement, the innocent one prevails, because damages are presumed in per se actions. In earlier proceedings, the Seventh Circuit ruled that the complaint adequately alleged that the portrait of O’Neill as an unlicensed securities broker was defamatory per se (Muzikowski is a licensed broker), and that showing O’Neill committing crimes such as theft injured his reputation. On remand, Muzikowski had the burden of demonstrating that no one could think that anyone but him was meant, and that the changes, far from supporting the idea that O’Neill was a different character, only served to defame him. Muzikowski didn’t submit evidence that there was no reasonable innocent construction of the movie, and the district court granted summary judgment.

The court of appeals affirmed. It’s an open question whether liability can be avoided “if the only details that distinguish the plaintiff from the character described by the defendant are themselves defamatory,” and the court was far from confident that Illinois would follow a rule that, the more defamatory the movie, the better the studio’s defense. Nonetheless, there were also non-defamatory differences, such as the different names and different family status of Muzikowski and O’Neill. Thus, reasonable viewers could see the connection between the two, but they were not compelled to do so. Given that the “of and concerning” element of false light invasion of privacy is basically the same in Illinois as the innocent construction rule, the court affirmed the grant of summary judgment on that claim as well.

On remand, Muzikowski had added various false advertising and consumer protection claims under the Lanham Act and state law. He argued that Paramount’s promotion of Hardball as “inspired by a true story” was false because of the extent to which his life story had been changed. The district court held that he hadn’t submitted sufficient evidence that the ads were false or that consumers had been deceived. It’s literally true that the film was inspired by a true story. Muzikowski submitted 18 affidavits from people who knew him who had seen Hardball and all believed that O’Neill was portraying Muzikowski. Given that the movie grossed more than $40 million, the affidavits fell far short of proving that a substantial segment of the viewers was deceived. Eighteen instances of confusion, under the circumstances, were de minimis.

Virtual Women: Patents

Panel 3, She Blinded Me with Science: Gender Issues in Patent Law

Moderated by Deven Desai, Thomas Jefferson

Dan Burk, University of Minnesota, Do Patents Have Gender?

Although women in the life sciences don’t patent as often as men, their patents are cited more often. In some cultures, patents on women’s work have been taken out by men to avoid the stigma for a woman of publicly claiming patent rights.

PHOSITA shows up in lots of areas of patentability. S/he is a legal fiction, but tells us whether you’re an “inventor” – whether you’ve come up with something that counts as an invention. Compare to the “reasonably prudent person” in tort law; many scholars have analyzed the extent to which s/he is really the “reasonable man” even after a change in label. A feminist reasonable person might be concerned more with connections to the community rather than separation or freedom from its constraints.

What about PHOSITA? One court has stated that the proper test is to imagine PHOSITA working alone in his shop, with the prior art around him. Masculine, isolated, incorporeal – he is thinking and not tinkering in the court’s description – and his relationship to the prior art is oppositional in that prior art is something for him to overcome.

Ways of knowing – Burk defends the idea of situated knowledge, knowledge in context and community. Case study: Edison drew on prior art for the lightbulb, and was enmeshed in a matrix of other inventors, financiers, his patent attorney, members of his scientific team, prior art looking for a cost-effective lightbulb. All of those coalesced in the invention; inventors can’t be divorced from context in the way that PHOSITA pretends.

Michele Goodwin, DePaul, Xerox Babies: Race, Power, Private Ordering and Procreative Freedom

There’s huge demand for biological resources and we haven’t answered many open questions, especially when the donors are still alive. Now living donations outpace cadaveric donations, e.g. ova and sperm. The federal government has only dealt with organ sales, not with altruism. We tend to attribute to altruism all sorts of characteristics that may obscure its actual content.

Here, a story of forgotten people: Marion Sims, the father of gynecology. He wrote about having epiphanies at 2 am and going into the hospital so that he could wake up his slaves and continue to experiment on them. Sims was able to patent the equipment he developed through his experimentation. Sims has statues and hospitals named after him, but we don’t know the names of the women who also, unwillingly, helped us get the benefits he did provide.

Today, there are concerns about the use of preimplantation screening and manipulation to create “superbabies.” The darker side of choice isn’t recent, but dates back to parents using their children to engage in “reproductive altruism” – parents who want to create and use a child to satisfy the needs of another child. Strunk v. Strunk: two siblings, Tom and Jerry, from Kentucky. 27-year-old Jerry, with the capacity of a 6-year-old, was confined to the state mental institution. 28-year-old Tom suffered from deadly kidney disease. Their mother wanted Jerry to give Tom a kidney. In the 1969 court of appeals ruling in Kentucky, the judges ruled that Tom had a good quality of life, was married, and was in college, so it would be good for him to get Jerry’s organ, and Jerry would receive a psychological benefit, so the court ordered the removal of Jerry’s kidney.

Goodwin identifies Buck v. Bell as the genesis of the state’s authority to intervene in this way. Almost all of the similar cases come out in favor of the parents’ authority to invoke state power on their behalf. Being outside the market does not mean being free.

Eileen Kane, Penn State Dickinson, Molecules and Conflict: Cancer, Patents and Women’s Health

Does IP limit access to the advances it was supposed to bring us? Cancer research today looks for targeted approaches identified through molecular biology. Four relevant molecules: taxol, tamoxifen, and herceptin, which disrupt cancerous processes, and BRCA1 & BRCA2, which can identify genetic risks for breast and ovarian cancer.

Taxol’s history involves attempts to monopolize the molecule past legitimate patent rights, eventually resolved by antitrust claims that spotlighted loopholes in Hatch-Waxman. Patents can be used to delay true competition with “evergreen” patenting techniques.

Tamoxifen also involved a patent invalidity fight with a generic competitor, resolved by settlement that vacated the judgment of patent invalidity. This led to a class action suit alleging Sherman Act violations, given that this reverse payment settlement blocked generic Tamoxifen for almost 10 years. There’s a circuit split, but the Second Circuit held that the reverse payment didn’t violate the law; a petition for cert is pending.

Herceptin: a protein that targets another protein, used for women whose tumors have a particular molecular signature. Genentech holds patents to the antibody and to treatment methods. It costs $48,000 per year, which not all insurance companies will pay, creating significant access issues. The FDA doesn’t have a formal regulatory procedure for biotech generics, but it’s under increasing pressure to expedite the introduction of generic biologics. This is a key pressure point for women’s health advocates.

BRCA1 & 2: The patent holder’s strategy is to market a commercial genetic test sent to the patentee’s labs for analysis. There is scientific criticism about the technical shortcomings ensue when only one lab does the tests – there may be significant false negatives. This has caused concern with the use of the patent, especially in Europe.

Lesson: Women’s health must pay attention to paradigmatic patent conflicts.

Malla Pollack, American Justice School of Law, Towards a Feminist Theory of the Public Domain, or the Gendered Scope of United States’ Copyrightable and Patentable Subject Matter

Basic question for social movements: Should we focus on short-term goals of improving living conditions or long-term goals of basic social change? The risks are wasted effort at impossible change versus entrenching the status quo by assimilating into an unworthy society. Many of IP’s exclusions are gendered, but does that mean we want in or out? Should we choose to help women make more money with IP, or to strengthen the public domain?

She chooses the public domain, because women are not alone in the public domain. Powerless people get rights when the interests of the powerful align with those of the powerless. And many people – consumers, producers – have interests in a robust public domain who aren’t feminists.

An example: The lack of protection for the feminine arts. Liberal feminism would argue: women are entitled to what men are entitled to. Essentialist feminism revalues women’s asserted differences as superiority. Both approaches could easily lead to claims for IP rights too – we want the master’s tools.

Instead, we should reject the male concept of ownership and put more in the public domain. The structure of individual ownership in intangible creations is male. In most so-called communitarian societies, however, status actually controls a lot of distribution and women are low-status. A big public domain therefore isn’t enough; we need structures that support an “owned” public domain, where we have a Lockean idea – you can’t be excluded without your permission.

Virtual Women: Rochelle Dreyfuss

Keynote address: Rochelle Dreyfuss, NYU Law School, Girls Just Want to Have Fun: What Can Feminist Theory Tell Us About Incentives?

Dreyfuss started out as a scientist, and has seen many things that help explain the relative absence of women in science, including discrimination, a clash between reproductive and career interests, the two-body problem of scientists marrying other scientists, lack of mentorship (in her days at Berkeley, many men flatly refused to take female graduate students, and others did very little for them, and her reading of the literature indicates the problem persists).

There’s gender stratification in academic collaborations with commercial ventures – men and women work on patentable tech at equal levels, but men are disproportionately offered consulting, venture capital, board membership, etc. – women aren’t offered the entrepreneurial resources or education they need. Invisibility: Women are less likely to be recognized as principal investigators, and thus are less likely to enter the commercial pipeline. Female scientists often feel resistant to feminism because of pressure to be “macho” and thus have difficulty organizing for change.

Why do women stay? The pay is lousy, conditions like lab space are inferior, and women and men do appear to differ in some innate abilities. Most men who are good in science have a quantitative tilt, but women who are good in science tend to be good at other things too so they have alternatives. If we understood why women stay despite the absence of money, prestige, and power, we’d understand the determinants of creative progress better – when incentives are needed. If we paid attention to why women leave, we’d learn how to better encourage and maintain creative communities.

Studies of innovation communities, like fashion, extreme sports, and French chefs, show that copyright’s incentives are not always necessary. Indeed, copying is critical to the maintenance of the community and to the incentive to generate new ideas – what have you done for me lately? Reputation is a key factor. It’s not all sunshine and daisies, but competition to win benefits – just through non-IP ways, where innovators benefit from revealing information; reputation has economic rewards and brings people the benefit of others’ revealed information.

Many of these communities are male-heavy (top chefs, extreme sports, computer programmers). What would female communities look like? Women may not equate acting rationally with acting in one’s own self-interest. Looking at it from a feminist perspective might find some non-economic incentives and even non-reputational incentives: Quilting and knitting circles; women suffragists’ publishing houses; literary clubs; anthropological studies of women’s roles; cookery (as opposed to cuisine) and cookbooks created by civic groups and individual women; fan fiction. Studying women in science, which has denied women traditional rewards, would be a great addition to that literature.

One thing: the sheer joy and satisfaction that women derive from living a creative life. Girls just want to have fun. With literary societies, women read books, read their own poetry, performed plays, etc. Women’s cookbooks included elaborate illustrations and other creative flourishes – these weren’t intended for distribution, but they still cared about expressing themselves, writing themselves into culture. Fan fiction: women write it because they love it and love talking with other women about it. Female scientists also experience this joy.

Some studies also suggest that relationship-building is a key factor in creative incentives – cookbooks are made for friends, daughters, etc. to maintain social ties and cultural traditions. In traditional communities, women perceive themselves as developers and transmitters of knowledge – shared journeys (also fan fiction). And many female scientists find deep rewards in collaborating with colleagues and mentoring students. There are reciprocal forms of altruism in these practices too – literary societies that engaged in suffragist activities. Still, other-regarding creativity is important. Women’s altruism was genuine and not based on the expectation of reciprocal benefits.

Protectionist rhetoric needs to be viewed skeptically. Creative production doesn’t need external incentives in all cases. We need to think about how IP affects such non-economic creative practices. A true revealer won’t have IP rights of her own to use against an IP claimant. Genuine altruism may be genuine, but it also may be bounded: it may be highly disruptive to commercialize freely offered output. Thompson was willing to work on Rent for a nominal fee and was happy it was doing well, until she found out that the Larson estate was making millions and she was making nothing. The same thing happens when freely shared knitting patterns are compiled into copyrighted books. Likewise with Kevin Greene’s presentation on African-American music. We need to learn more about the limits of altruism.

We also need a strategy to make sure that materials stay in the public domain where they were put. Creative Commons requires creators to anticipate problems and be proactive, but as LaFrance pointed out, some situations make that type of pre-assertion unlikely. We need some strategies to keep people from having to join the IP regime – as Thompson ultimately did in claiming that a dramaturg’s role contributed copyrightable expression – or losing out entirely.

Dreyfuss doesn’t want to suggest that freedom and no-IP are always the right solutions. The interest of innovation communities might not be aligned with the public interest. Do we need as much innovation in fashion as the current system produces? Perhaps barring copying would improve public welfare by slowing innovation. Also, some innovation communities work by subordinating certain members; IP might help them. Women in science are a good example, because when there is a breakdown in the system, it’s often women who lose out. If “sharing” means that information is shared but material benefits aren’t, that’s a wrong that needs correction. Patenting has been extremely important to the women who did it, even though women haven’t used it as much as men.

Question: Single-sex education?

Dreyfuss went to Wellesley and had a number of single-sex classes in high school, and it left her more willing to ask questions than many other women – she expected to be part of the discussion. The issue is whether the opportunities will really be equal; if they are, it may be a good idea to do girl-only math and science classes.

Question from Eileen Kane: Sometimes women resist becoming the primary investigators because they feel they’ll have to leave real science for administration.

A: That’s a version of the “joy in science” issue – many women don’t want the power/rewards enough to give up time spent investigating.

Bartow: Does effort to get credit trade off with openness?

A: Various instances of fraud in science have created interest in accountability, and journals have started requiring people to say which part of the work they did. The NIH is also getting into the game with rules about claiming credit, and schools have been following their lead. The side benefit is credit where credit is due, even though the concern was more fraud-specific. The situation is much worse in copyright and outside of science.

Panel 2, Material Girl: The Culture of Gender and IP part 2

Me – I talked about my forthcoming piece My Fair Ladies: Sex, Gender, and Transformative Use, and the pornographer as the most favored creator in copyright law – he is able to appropriate other works and have that appropriation understood as transformative fair use, but also able to monetize any use and therefore to show market harm any time another actor (like Google) copies his work. In the pornographer’s market, nothing is unreasonable or unlikely to be developed. Of course pornographers will license 100-pixel images. Any variety or excerpt of sex is sex and carries with it the market value of sex. So, Perfect 10 convinces the district court that its case isn’t a replay of Kelly and gets rights against Google that a landscape photographer doesn’t have. In my view, this is a mistake.

What is a feminist/low-protectionist to do? First, recognize that lots of things can count as transformative or otherwise favored uses under the first fair use factor, rather than privileging sexualization. Second, harden our normative definitions of allowable markets for everyone, rather than accepting circular claims that licensability defines market harm.

Mary LaFrance, UNLV Law School, Working and Playing Well: Gender, Status and Culture in Collaborative Works

Anecdote: because LaFrance didn’t intend to stay at a law firm, she was able to refuse a request that she write an article for a partner without getting coauthorship credit. Most people wouldn’t have been in a position to refuse that. As coauthor of a casebook, it’s always a struggle to refuse to be drawn into a caregiving position and to assert that her interests have to be respected and considered as well.

IP law is not well positioned to acknowledge the collaborative and derivative nature of most works. Often, there isn’t one person who deserves full credit for any invention or work. Nonetheless, as a practical matter, we need to assign economic rewards to the person/people we’re most excited about incentivizing. So, how does the system decide this?

Within this incentive-based system, authors and inventors might be misidentified, influenced by inaccurate perceptions of their contributions based on stereotypes and behaviors related to gender, culture and status. Federal court opinions addressing claims of inventorship and authorship show this – she hasn’t looked at works for hire, but power differences obviously exist there too (as with her experience with the partner who wanted an article written in his name).

She found greater bias in the copyright system than in the patent system. People who are more diffident – which is affected by gender and culture – are more likely to be left out of an authorship determination because they don’t assert their claims in the terms required. If the test is that each person must perceive the other as an author, then one’s perception that the other is a mere assistant would defeat a joint authorship claim. This test has become popular in the courts – the 9^th Circuit describes putative joint authors as “claimjumpers,” conjuring images of grizzled miners staking their claims and threatening violence against interlopers. The worst of these cases, in her opinion, is the Rent case where the dramaturg doesn’t get any authorship rights despite her huge contributions because Larson’s perception that he was the sole author – his ego – determined the outcome of the case.

Contrast that to a patent case where a doctor worked with an electrical technician who didn’t have a college degree. Both were Korean, from a culture that demands a high degree of deference to persons of higher status; the technician’s interactions with the doctor were extremely deferential, and yet the Federal Circuit went to great trouble to identify his contributions to 2 of the 55 patent claims. Thus, he was the joint owner of the entire patent. The patent became unenforceable against an infringer. The patent system focuses more objectively on the contributions of the parties and not on the way they express their contributions to one another. The technician would never have asserted his rights without the infringer’s work tracking him down and financing his challenge. So the hurdles are still there in patent law. If more technicians come forward, will the patent rule shift and start to show more copyright-like bias against claimjumpers?

Another question: If we switch to first to file, will that make patent law less equitable in its ability to reward true inventors?

Christine Haight Farley, American University, Washington College of Law, The Feminine Mystique of Brands

Today, brands are feminine in trademark law. We’re in an expansionist era in trademark law, which is connected to the feminization of brands – the law runs to their aid, to give them protection. Brands were said to be “vulnerable,” attracting the attentions of bad actors, becoming prey to their advances; and when the brands had been used by those bad actors, they were damaged. Thus, a moral imperative to act against dilution.

This kind of protection comes with a lot of costs – speech interests, competition – so you need a good reason to outweigh those costs. In traditional trademark law, protecting consumers is that good reason. Confusion serves to limit the scope of the right. Dilution is difficult to prove. So what is the injury of dilution? “Association” arising from similarity that impairs the distinctiveness of the famous mark. How do we prove or measure impairment? We can’t. So trademark owners would like us to presume it will happen when someone else uses a famous mark.

We’re protecting the brand, not the consumer. It’s a reputational interest, like defamation. In traditional defamation law, impugning a woman’s chastity was defamation per se, with no need to show damage – because women’s reputation was valuable property (of men, not of the women itself) and harm to that reputation couldn’t be measured in the marketplace. Their harms were relational and associational – they might lose social connections or marriage proposals if their reputations were harmed. Also, women would naturally and inevitably be harmed by implications of nonchastity, so there was no need to prove harm in a particular case.

The logic here is similar – brands are very valuable, but also very vulnerable. Brands aren’t Victorian prudes; they flirt with the line between accessibility and inaccessibility, edginess and comfort.

The easiest path to success in a tarnishment claim has been something like sexual slander, something that sexualizes the mark. The Victor’s Little Secret case is an example of that, even though it went down on blurring grounds. Even sexy Victoria’s Secret can be tarnished by association with sex toys/lewd mugs/other trashy sexy stuff. Likewise, Barbie and the Dallas Cowboys Cheerleaders are vulnerable to sexual tarnishment. Most recently: Breast: The Other White Milk got a C&D from the pork industry.

This feminization of brands in the law may not be deliberate; marketers know quite well how to gender individual brands (Marlboro, Betty Crocker, Brawny). In any event, it works. Feminizing the brand helps brand managers/trademark lawyers put brands on a pedestal, out of reach of anyone but the owner (like a wife reserved to her husband).

Question from Ann Bartow: Tension between Tushnet and Farley – in copyright, sexualization helps the defendant, but in trademark it leaves the defendant open to a tarnishment claim. I think this is true, but we don’t know how the new trademark law and its exceptions will shake out – maybe a lot of these things will be deemed outside trademark owners’ rights.

Pollack: Men own women in two different ways – the pimp who owns and exploits his property’s sexuality in the marketplace, or the respectable man who has the woman on his arm who is valued for her purity, which is to say the fact that she is reserved to him. The tension in copyright/trademark is what kind of relationship owners will have to their property.

Panel 2, Material Girl: The Culture of Gender and IP

I'm going to break this up, both on ego grounds (I spoke in the middle) and because there were five panelists.

Moderated by Lisa Ramsey, University of San Diego School of Law

Dr. Boatema Boateng, University of California, San Diego School of Communications, “It’s These Same Women!” Gender, Cultural Appropriation and Intellectual Property Law in Ghana

Adinkra cloth as an example of the way in which cultural appropriation is gendered. There is both hand and mechanized production of fabric in Ghana, brought together by the local economy of cloth use. There is also legal protection for adinkra designs. Asante make adinkra, which features abstract designs stenciled onto cloth by craftsmen (almost exclusively men, though dyes are produced predominantly by women who also make other kinds of cloth). Individual symbols have meanings and names, and may refer to historical or life events. It’s traditionally used for mourning.

Mechanized cloth production involves women who control trading markets, and also sometimes in the factories. Female traders commission designs from factories or choose which designs to sell. (When Ghanaians say “cloth,” they are referring to African fabrics used for traditional outfits or uses; “material” is for things like Western suits and dresses.)

In the 1980s, imitation adinkra began to appear in mass-produced offerings, and the Ghanaian cloth-buying public accepted them as more practical alternatives – they could be washed, and they were cheaper. Some adinkra producers saw this as a threat not from factories, but from women – the cloth production sector is seen as controlled by women, and some adinkra-imitative designs had been commissioned by women.

So we have female appropriation of male cultural production. But the contradiction deepens when examined through law. Ghana has protected folklore since 1985, specifying adinkra designs. But the creators were seen as deceased and unknown, so the right to folklore reposes in the state. By contrast, the designs of locally produced textiles in the industrial sector were protected under a textile designs decree. Individuals – women – could and often did register the designs they commissioned. So men have no legal standing as folklore producers, but women could obtain protection as designers of mass-produced goods. A second inversion: women are the subjects of IP law.

Women’s success in capturing a sphere that is favored by the law has translated into a legal advantage.

Kevin Greene, Thomas Jefferson School of Law, IP at the Intersection of Race and Gender – Or, Lady Sings the Blues

His narrative: struggle, opportunity, reform. The historical ties between abolitionism and women’s suffrage have persisted, as have the ties between scholars of race and scholars of gender. There isn’t much out there on race and IP, and it may seem risky to talk about it. He’s been asked by a prominent scholar if he wants to be the black guy who talks about black stuff and IP. His decision: yes. (See Ann Bartow’s point from the previous panel: what’s wrong with being a dog?) Issues of appropriation from African-American artists have correspondences with the international cultural knowledge debates, and provide insights into gender/IP issues as well.

Scott Joplin’s music: a reminder of injustices done to African-Americans, who as a group created a huge amount of copyright value. These artists built the American music industry with amazing innovations, but didn’t get to realize the value. How did people who created so much receive so little out of a system designed to create financial incentives for creators?

Societal discrimination. Sure, all artists are taken advantage of. But there was a system that was just like sharecropping, employment discrimination, and other entrenched systems that meant that African-American innovators were treated worse. Bessie Smith’s contracts, for example, had her assign all her copyrights to an entity that’s now Sony – this is a part of the puzzle where we can find current beneficiaries of past discrimination, which gives it an advantage in the reparations debate.

Clearly, the incentives of copyright didn’t flow to the African-American community, so there must have been some other incentive to create. Traditional knowledge generates the same types of problems of ill-fit and failure to promote the interests of the non-dominant community. Greene also identifies the comparative weakness of moral rights and failure to protect performances as things that don’t serve African-American artists’ interests. Underexplored: the role of black women performers. How can the music industry rise out of its exploitative history and create productive copynorms?

Virtual Women: Emerging Issues in Gender and Intellectual Property Law

Thomas Jefferson School of Law, Feb. 9, 2007

Panel 1, What a Girl Wants: The Theoretical Underpinnings of Gender & IP

Moderated by Julie Cromer, Thomas Jefferson

Doris Estelle Long, John Marshall Law School, Women’s Art, Women’s Truth: Gender Discrimination and the Battle to Protect Traditional Knowledge

Perhaps surprisingly, traditional knowledge became an international IP issue at the same time as the internet did. Definition: tradition-based works, whether innovative, creative, or culturally expressive, transmitted through the generations. These arts got kicked out of copyright early on.

Traditional knowledge is relational. It is based on traditional needs, collaborative, collective, transmitted through time. Practitioners speak of it in terms of caregiving, spiritual connection, sacredness – an emotional, social process. Think of all that we denigrate as “artsy-craftsy” – not worthy of protection because it’s not serious. “Craft labor” is seen as not creative enough to participate in copyright.

Women were authors in the 18^th century, but as it began to move into the public sphere, there was a similar debate over how to value women’s writings (sentimental, emotional, not quite literature, prostitution-like) and women’s art. Women’s three basic roles: caregiver/nurturer, hearth/home arts, food – the woman as the center of the family. In indigenous groups, caregiving isn’t just children, but healing arts, use of plants for medicine – even traditional knowledge about seeds. They are repositories of traditional knowledge, storytelling, training in traditional arts. When it comes to copyright, these all suffer from being not quite original enough.

She gave a number of examples of celebrating traditional knowledge that involved, necessarily, celebrating the contributions of women, especially old women – grandmothers.

The same issues occur in the mainstream copyright market. By 1850, women were writing all sorts of works for large-scale publication; some women perceived themselves as professional authors. By 1890, 50% of US bestsellers were written by women. All of a sudden, we hear all of the language about women’s literature – sentimental, gothic, romances, not “serious” literature. Women’s writings aren’t part of the canon. Still happening today – “chick lit” – terminology that says that what women are creating doesn’t fit within our model.

Lesson: protecting TK will be a lot harder than some think, because it has to deal with gender stereotypes as well as other biases about what copyright should cover. Women need to be empowered to participate in the debate, as major carriers of tradition. Moral/spiritual connections need to be reaffirmed.

Panamanian molas: women now make blue molas for the export market, because apparently tourists like blue even though it’s nontraditional. They’re still using their traditional skills – and they still have designs they won’t share with us. These are the types of problems protection for traditional knowledge needs to address.

Dr. Carys Craig, Osgoode Hall Law School, Beyond Author v. Public: Relational Authors and the Public Interest

Craig is generally a restrictionist, but that stance is often vulnerable to the charge of neglecting the interests of authors in favor of the public. Canada, with Quebec’s civil law/moral rights system, offers a microcosm of the international clash between utilitarian/public interest and authors’ rights perspectives. Are the groups destined to talk past one another?

Craig’s work draws on feminist literary and political theory, which has made her more resistant to the criticism that she’s unduly instrumentalizing the author. The idea of balance is a metaphor, but one that requires us to divide the author from the public and pit them against one another. This dichotomy is illusive.

Canada introduced users’ rights in 2004, but it might do more harm than good by proliferating rights talk in IP policy. It reduces the public interest to an individualizable claim and focuses us on entitlement claims rather than the goals and consequences of the system.

Utilitarian justification for copyright in the US: does it reduce the author to a means to the public’s ends? The theory implies an opposition between author and public by prioritizing the public, and rejects the notion that the author’s relation to her work is important in its own right or has any relevance to copyright policy. But there’s a clear lay sense that the processes of authorship have significance to authors that can’t be reduced to financial incentives. Artists often insist that attribution and acknowledgement are more important to them than control and remuneration.

What can feminist theory do to help? A relational feminist account of authorship would recognize the author as embedded in her community, creating out of those discourses and texts around her. The community is involved as source and anticipated audience. Likewise, dialogic feminism emphasizes discourse, narrative, participation, all of which can enrich our understanding of authorship in copyright as a way in which authors can participate in the shaping of the world. This approach values authorship in its own right as a way to generate meaning and engagement in the world, but also contains its own limits – authorship must leave space for others to enter the cultural frame.

Copyright is a triadic relationship between the author, the public, and the work. No “pure” approach will work, whether focused on the author-work dyad (author’s rights) or on the public-work dyad (utilitarian approach). Feminist relational theory can help us break down the self/society divide and thus break down the author/public divide.

Ann Bartow, South Carolina Law School, Women in the Web of Secondary Copyright Liability and Internet Filtering

Her thesis, which can be seen in greater detail in her article: Internet law was characterized as “the law of the horse,” but it’s really “the law of the stallion.” The legal scholarship doesn’t recognize the web as it exists for women. Scholars hope and believe that the bodilessness of cyberspace erases gender, when all it does is erase the recognition of women as subjects (unless we fight for it). Anonymity facilitates abusive sexism online.

Theorists largely ignore porn: Yochai Benkler wrote a grand theory of the internet and peer production and doesn’t have a single word to say about porn. Did he not see it? Did he not think it worth talking about? We get lots of theorizing about the liberatory prospects of online games, but very few looks at the avatars available for women, which have distorted bodies and lots of skin showing. Second Life has “rape role play” games for participants to play (because, Bartow says, “apparently they think they want that”). There’s a game called Rape Lay specifically for players who want to rape unwilling characters. (NB: I love Ann and I love Ann’s works, together and separately. I too am appalled by Rape Lay. But I have serious problems with singling out rape fantasies without more careful examination of what functions they serve and what they are likely to mean for real women.)

There’s lots of essentializing women in discussions of “what women want” from games. The games’ “magic circles” exclude most women. Sexual harassment is pervasively tolerated and women who complain are further harassed. There are no data on gender or race of participants in online games or for a. On the internet no one knows you’re a dog, but what’s wrong with being a dog? Why is it liberating to not to “have” to be a woman?

Women are becoming content, in games and elsewhere. Anonymity is valuable, but it also enables discrimination and harassment. Cyberspaces are simply less amenable to women who identify as women, and there’s little in the way of legal recourse.

Cheryl Preston, J. Reuben Clark School of Law (BYU), Internet Autonomy and Intimacy

In the past, Preston has argued over whether a feminist focus on porn made strategic sense. We should, she concluded, redirect our energies from censorship to non-law avenues to put economic pressure on companies that use sexist advertising even in nonpornographic ways.

It’s time to revisit the issue. This is not your grandma’s porn. Quantity, reach, and nature all differ. Amateurs are “in,” and everyone is trying to make some money off of linking, showing pictures of amateurs, etc. Numbers of porn pages have exploded. There’s no way to impose norms on a porn site, to picket it, to shame the owner in front of his community. Teenagers have easy access to porn. Young girls are feeling the pressure to perform the acts they see and that boys have seen. You don’t have to take many risks to access pornography, to find things that didn’t exist in your state ten years ago.

What should be done? It is difficult – impossible – to speak for all women at once, but now we can perhaps make some choices about what will be allowed on our own (our family, our university, our work) computers. We can also bring more real life context to the abstract censorship debates. Women have an interest in sexual pleasure, but we live in a society dominated by men, and we are the guardians for most children. We need to protect our children from their inability to think through consequences – boys want to experience pornography, but they think that someday they want to find a life partner who isn’t a slut. (I don’t see that it’s the porn, as opposed to the double standard, that’s the problem – though I accept that the porn is likely itself to carry the message that the girls who participate are sluts and the boys are awesome.)

We’ve ignored women’s right to be left alone, even on computers. We need to debate porn as we know it – as it comes into our homes – now.

Notable comments: In response to questions, Preston said that porn users consume so much bandwidth that we’re all subsidizing them, and families should have a choice – in contradiction to “net neutrality” proposals – to only pay for “community use.”

Women who use pornography use it for relational purposes – they look at images, then enter chat rooms. Men who use it don’t want to interact.

Kings of Crunk reign in summary judgment

Christopher Baker of Kaye Scholer alerted me to the court’s grant of summary judgment in Wilchcombe v. Teevee Toons, Inc., 2007 U.S. Dist. LEXIS 6205 (N.D. Ga. Jan. 26, 2007), a case whose earlier proceedings I blogged about here. Wilchcombe involved a producer who created a song as an interlude for another performer’s rap album, wasn’t paid, and sued for copyright infringement and false advertising.

The court granted summary judgment against plaintiff’s copyright claim because it found that any reasonable jury would find that defendants had a nonexclusive oral license to use the work: the plaintiff knew that defendants planned to include the work in the album, submitted it to them for that purpose, and solicited their input to make it more suitable for the album. Plaintiff obviously has a breach of contract claim – he should be paid for his contribution – but not a federal copyright claim. (The court found that there were genuine issues of material fact about whether certain defendants were coauthors, based on changes they made to the work before putting it on the album. Coauthorship doesn’t relieve them of an obligation to pay; plaintiff would then have an interest in a share of the profits from the song. As far as I know, however, no one has litigated the case of the faithless coauthor who grants a zero-royalty license in order to harm the other coauthor, or in order to further his own individual interests, as might have happened here.)

Plaintiff’s false advertising claims had survived a motion to dismiss as sufficiently distinct from the reverse passing off claim rejected in Dastar. On summary judgment, however, as I expected, plaintiff couldn’t show the elements of a false advertising claim. Specifically, the court found that he hadn’t shown he was in competition with defendants (this is the only shaky part; he participates in the same market for rap recordings, so why wouldn’t he be a competitor as well as a collaborator?); hadn’t shown that the false credits were “commercial advertising or promotion,” since they were only visible to people who’d already purchased the album; hadn’t shown that the credits were material to consumers in any event; and hadn’t shown that he was likely to suffer harm from the false credits. A pretty comprehensive dismissal, reinforcing my conviction that the average Dastar-esque claim cannot be successfully repled as a false advertising claim. If an extraordinary false credit claim can meet these standards, then that’s good evidence that the law should grant a remedy in that unusual case.

The Indian Arts & Crafts Act as a trademark statute

Jennie D. Woltz, The Economics of Cultural Misrepresentation: How Should the Indian Arts and Crafts Act of 1990 Be Marketed?, 17 Fordham Intell. Prop. Media & Ent. L.J. 443 (2007): The most impressive piece of student writing I've read in a while. This note considers the IACA as a trademark and false advertising statute, going beyond the standard analysis (the law requires membership in an enrolled tribe as a condition of labeling arts & crafts "Indian-made," which creates problems of over- and under-inclusiveness for the "authenticity" that most buyers seek) to consider how the IACA compares to the Lanham Act. She concludes that IACA's rules on issues like strict liability should differ from Lanham Act rules, even though courts so far have treated IACA as just another trademark/designation of origin law. While Woltz's proposed solutions seem problematic, they are so precisely because the question of defining authenticity is so bound up with issues of power and control.

Trademark and advertising law always contain tensions between protecting consumers and regulating relations between businesses; IACA makes the tensions more explicit and more personal, and thereby offers us an opportunity to analyze what we really care about when we call ad claims "false" or "misleading."

Nontransferability of college credits justifies a consumer protection claim

Daghlian v. DeVry University, Inc., 461 F. Supp. 2d 1121 (C.D. Cal. 2006)

DeVry University is one of the largest publicly held for-profit higher education companies in the country, offering programs in technology, business, and management. According to the complaint, plaintiff Saro Daghlian was a DeVry student in California from April 2002 until October 2005, studing Electronics Computer Technology. Before he enrolled, he met with a DeVry recruiter, who told him that DeVry was an accredited college where students were able to obtain degrees, and that, unlike technical colleges that give students certificates that cannot be used towards advanced degrees, academic credits from DeVry were transferrable to a wide variety of other academic institutions. The recruiter did not give Daghlian any documents explaining that DeVry credits were not likely to be accepted by other colleges, and that he would have to start his education over if he chose to attend another college. Relying on DeVry's representations, Daghlian signed an enrollment agreement. He ultimately incurred approximately $40,000.00 of educational debt. He sued in state court; defendants removed, then moved to dismiss.

The court concluded that Daghlian was entitled to bring a private cause of action against DeVry under the California Private Postsecondary and Vocational Education Reform Act of 1989 (a question complicated by what the court determined was an obvious drafting/numbering error in the statute), which requires explicit written disclosures about transferability of credits, prohibits false and misleading inducements to enroll, and requires disclosure of all material information. Further, the court held that DeVry was not exempt from the disclosure requirements, despite a state administrative agency’s interpretation of the law to the contrary.

DeVry argued that Daghlian hadn’t established his standing to bring false advertising and unlawful, unfair, and deceptive business practices claims under Proposition 64’s requirements: he hadn’t actually attempted to transfer to another school that refused to accept his credits, so he hadn’t been forced to repeat courses or incur additional tuition costs. Proposition 64 requires injury in fact, but the court concluded that spending money in reliance on DeVry’s representations about transferability, as alleged, satisfies that standard. He received some value from his $40,000 in tuition, but not the advertised value.

National Geographic litigation: going out with a whimper?

Auscape Int’l v. National Geographic Society, 461 F. Supp. 2d 174 (S.D.N.Y. 2006)

Freelance photographers and writers who created images or wrote text that appeared in the National Geographic Magazine sued the National Geographic Society and a number of its licensees for reproducing their works as parts of CD-ROM collections of images of past issues of the Magazine. After their copyright and Lanham Act claims were rejected, and after the Second Circuit affirmed that result in a parallel case, the parties renewed their summary judgment motions on the remaining state-law claims for breach of contract, breach of fiduciary duty, and conversion against the Society, and for unfair competition, unfair trade practices under California law, unjust enrichment, involuntary trust, commercial misappropriation in violation of the common law right of privacy, and violation of California’s statutory right of publicity.

Preemption kicked out: (1) the unfair competition claims, which duplicated the Lanham Act false designation of origin claims (based on the Society’s placement of a copyright notice in its own name on the CD-ROMs); (2) the unjust enrichment claims, which were based on defendants’ profiting from copying plaintiffs’ pictures; (3) the involuntary trust claim, which was predicated on the theory that defendants misused plaintiffs’ property (their copyrighted photos); and (4) big chunks of the unfair trade practices claims. (The remaining unfair trade practices claims were also dismissed because the court found that plaintiffs’ allegations of unlawful conduct failed on other grounds.)

Because the court found that each annual edition of the CD-ROMs was a continuation of the initial conduct of producing the CD-ROMs, rather than a new breach or act, most of the contract claims were time-barred, since the plaintiffs didn’t sue for years after the CD-ROMs first existed. The remaining contracts allowed the Society to reproduce and to license others to reproduce entire issues of the Magazine, and because that’s all the CD-ROMs did, the court rejected the surviving contract claims.

Likewise, most of the tort claims were time-barred. California has enacted the Uniform Single Publication Act, which covers right of privacy claims specifically as well as other torts founded on publication. Under California precedent, a paperback edition of a work is a “new” publication, compared to a hardcover edition, and thus gives rise to a new libel claim, because the paperback is designed to reach a new audience that was unwilling to pay hardcover price. Here, however, plaintiffs had no evidence that later editions of the CD-ROM were less expensive or formatted differently so that they targeted a new market. Instead, successive editions include the entirety of earlier additions, plus new material. Thus, the instant case was more like a California case involving different editions of the same issue of a newspaper, which a state court held was a single publication under the USPA. Like a later edition of a paper updated with more timely information, the CD-ROMs targeted the same audience at a different time, and new releases didn’t restart the limitations period.

The remaining plaintiff argued that the Society owed a fiduciary duty to contributors to ensure that proper credit was given for each contribution and to prevent unauthorized copying of the contributions, which was breached because the CD-ROMs allow users to make unauthorized, uncredited copies of individual images outside of the context of the magazine. This seems clearly preempted. Since fiduciary duty isn’t based on agreement between the parties but imposed by law I can’t see an extra element here that would make this different from a contributory infringement claim. Nonetheless, the court resolved the claim on the ground that publishers are not in a fiduciary relationship with contributors, but rather a standard arms-length business relationship. Likewise, plaintiffs failed to make out a conversion claim for their transparencies and negatives under California law.

The court also determined that the parties’ contracts clearly gave the Society a right to use the plaintiffs’ names to identify them as photographers as part of the overall reproduction of the Magazine. That was the end of the privacy and publicity claims.

Sometimes a laundry list of causes of action can actually produce a success or two among failures. But, in an area in which courts are increasingly paying attention to preemption (and related interpretive concerns), often enough a loss on the big claims generates momentum on the minor ones.

Avocado's number: For Kraft, less than 2%

That is, avocados constitute less than 2% of Kraft's guacamole dip. This has produced a lawsuit, and a subsequent relabeling: it's going to be guacamole "flavored" dip.

There's a dip in here somewhere -- if not an avocado. The U.S. Food Policy blog has more on the relevant regulations. Here's a law firm soliciting "guacamole" complaints about various producers, including Kraft.

Buzz marketing becomes tick-tick-tick marketing

Marketers are trying increasingly extreme stunts to get our attention. In these security-conscious times, however, the results can be ... unanticipated. And invite federal charges.

Tragic irony or poetic justice?

Klayman v. Judicial Watch, Inc., 2007 WL 140978 (D.D.C.)

Larry Klayman is the founder of Judicial Watch, a nonprofit known for its litigiousness, mainly against various government officials. He and a Judicial Watch donor, Louise Benson, sued Judicial Watch after Klayman left the organization, alleging fraudulent misrepresentation, breach of contract, unjust enrichment, violation of the Lanham Act, violation of Florida’s statutory right of publicity, and defamation.

Benson’s claims centered on a $50,000 pledge she’d made to support Judicial Watch’s purchase of its building, $15,000 of which she’d actually donated before things broke down. She was promised some naming recognition in the building for the pledge, but allegedly the post-Klayman Judicial Watch abandoned plans to buy the building even as it continued to solicit donations by pretending that it still intended to do so. Though the court held that Benson had adequately pled the elements of fraudulent misrepresentation, breach of contract, and unjust enrichment, those claims only covered the $15,000 she’d already donated and thus did not meet the federal jurisdictional minimum. Because her claims were not related to the same nucleus of operative fact as Klayman’s federal claim, the court dismissed them.

Klayman did somewhat better. His allegations: In 2003, he decided to leave Judicial Watch to run for Senate in Florida. Thus, he executed a detailed severance agreement with Judicial Watch. Before he left, he discovered that, contrary to earlier claims, his potential successor Fitton didn’t have a college degree. As a condition of stepping down, Klayman insisted and Fitton agreed that Judicial Watch would hire a qualified person to head the organization. Instead, Fitton maintained control. Moreover, Fitton has been a poor steward of the organization and refused to pay Klayman amounts due under the severance agreement. Thus, Klayman sought recission – to be returned to the Chairmanship of Judicial Watch – as well as damages and specific performance. The court refused to dismiss his recission claim at this stage, though acknowledged that it might be a bit awkward to reinstate him.

Klayman also alleged that, more than a month after he stepped down, Judicial Watch sent a fund-raising letter that falsely represented that Klayman was still Chairman and General Counsel of Judicial Watch, and used Klayman's name and image without permission. Confused donors relied on Klayman’s supposed connection to the organization in making donations. This conduct is the foundation of Klayman’s Lanham Act and right of publicity claims. Though Klayman alleged both false designation of origin under §43(a)(1)(A) and false advertising under §43(a)(1)(B), the court pointed out that his allegations really were false designation of origin claims and analyzed them only on that basis.

Klayman sufficiently stated a claim for false endorsement: he alleged that he was a celebrity within the nonprofit/legal community, that Judicial Watch deliberately used his name and image to confuse donors as to his continuing affiliation with Judicial Watch, and that Judicial Watch’s actions succeeded in confusing donors and getting contributions out of them. The court reserved decision, however, on whether Klayman would ultimately have to prove that he has an economic interest in his name and likeness in order to prove that he has protectable rights under §43(a). This is rarely an issue that comes up in Lanham Act celebrity cases, because most celebrities do have monetizable personas. Whether Klayman could make any money through endorsements remains to be seen.

Florida’s right of publicity statute bars commercial or advertising use of a person’s name or likeness without express written or oral consent. The court refused to dismiss Klayman’s claim, but noted that it would require Klayman to explain why he should be allowed to use Florida law when the mailing came from DC, he’s suing in DC, and his allegations of injury in Florida are “sparse at best.”

Finally, Klayman alleged defamation based on three sets of false and misleading statements. First, in its 2003 and 2004 Form 990 tax returns, Judicial Watch allegedly made false and misleading statements that Klayman owed Judicial Watch money. The returns were published on Judicial Watch’s website. Second, after Klayman filed his initial complaint in this case, Judicial Watch allegedly told its employees that Klayman had sued because he owed Judicial Watch a significant sum of money, even though Judicial Watch knew that “Klayman did not, individually, owe Judicial Watch any money.” (I wonder what that “individually” means there.) Third, Judicial Watch allegedly made similar statements that were published in a number of media outlets, including The Washington Post, The Washington Times, World NetDaily.com, and Slate.com.

For the first category of statements, the court found Judicial Watch absolutely privileged. The common law provides that a person who’s required by law to publish something defamatory is absolutely privileged to do so. As a §501(c)(3) nonprofit, Judicial Watch is required to make its tax returns publicly available, and the IRS specifically provides that this may be done by posting the returns on a website. Klayman argued that Judicial Watch could have complied with the law by making the returns available on a more limited basis, but the court reasoned that it is the requirement of publication, rather than the scope of distribution, that triggers the absolute privilege. The other two sets of statements, however, were not absolutely privileged and were sufficiently specific to survive a motion to dismiss.

Separately, Klayman alleged defamation based on Judicial Watch’s alleged alteration of favorable press quotations originally made about Klayman so that they referred to Judicial Watch instead, and posting of the altered quotations on its website. The court wasn’t entirely sure what claims the altered quotation allegations were supposed to support, but settled on defamation based on the structure of Klayman’s complaint and briefing – Klayman argued that the alterations were defamatory because they harmed Klayman’s reputation as an effective advocate and litigator. The court pointed out that the altered statements couldn’t be defamatory because as altered they weren’t “of and concerning” Klayman. Perhaps Klayman could have alleged reverse passing off, but that seems difficult – reverse passing off of what? Even if Dastar didn’t exist, appropriating someone’s good review is not the same thing as appropriating that person’s services. Can there even be reverse passing off of services? Arguably, attributing someone else’s favorable review to yourself is false advertising (and perhaps Klayman is really a competitor, or potential competitor, in the market for conservative public interest donations). Even there, though, the altered quotations were apparently paraphrases of statements various publications had made about Klayman’s activities while he was running Judicial Watch, in which case Judicial Watch is just as entitled to the favorable press as Klayman, so there’s nothing materially false about the advertising.