Speech the Central Hudson Test

Speech

The Central Hudson Test

Origination

While commercial speech typically receives limited First Amendment protection, two types of commercial speech receive no protection at all. Commercial advertising received free speech protection in the 1970s based on the rationale that ads provide the public with information needed in order to be informed consumers, and thus only misleading and deceptive ads could be barred (Cohn, W. (2009). With the technological inventions that have occurred over the years it became necessary to look at this issue again and set down some standards in which to follow.

Four part test questions

The government may regulate advertising that is false, misleading or deceptive and they can regulate advertising that is for unlawful goods and services. Even truthful adverting for legal goods and services can be regulated, provided that the government can satisfy three different requirements. The first is that they must assert a substantial state interest in order to justify the regulation. Next, they have to demonstrate that the ban on advertising will directly advance the interest of the state. Finally, the state must show that there is a reasonable fit between the state interest being asserted and the government regulation (Pember & Calvert, 2005).

Evolution

Over the last several years the U.S. Supreme Court used Central Hudson Gas v. Public Service Commission (1980) to significantly expand the power of the government at all levels in order to regulate advertising. Because of this, first amendment protection for commercial speech has steadily diminished over the years (Boedecker, Morgan, Wright, 1995).

Central Hudson Cases

Summary of original case

A four-part analysis for commercial speech cases was crafted in Central Hudson Gas & Electric Corp. V. Public Service Commission (1980). The New York Public Service Commission had ordered the state electric utilities not to promote the use of electricity because of a concern that demand would exceed supply. In 1977, the Commission continued its ban but allowed institutional and informational advertising. The Court ruled that the Commission had failed to show that a more limited speech regulation would be ineffective and therefore overturned the advertising ban (Boedecker, Morgan, Wright, 1995).

Examples of other cases

There have been several cases which have shown how the Supreme Court applies the Central Hudson test. In 1995 the court struck down a federal rule that forbid brewers from listing the alcohol content on labels attached to bottles and cans of beer and malt liquor. The government's argument was that they sought to discourage young drinkers from buying certain alcohols. The court said that this was a good goal but that there was really no evidence that this rule was advancing that goal (Pember & Calvert, 2005).

In 1996 the Supreme Court ruled that a Rhode Island statute that barred liquor stores from advertising the price of distilled spirits ran afoul of the First Amendment. The state attempted to justify the law by arguing that the ban on advertising reduced competition in sale of liquor, which resulted in higher prices and reduced consumption. The court ruled that they were not going to restrict truthful speech about a legal product on something that they saw as speculation and conjecture (Pember & Calvert, 2005).

Central Hudson Test Effects

Unsolicited Advertising

From the beginning of federal attempts to restrict unsolicited phone calls, the government has asserted that its primary interest lies in protecting citizens from invasion of privacy. Three different federal appeals courts have upheld the TCPA and the TSR in four separate challenges. These courts have all shown judicial deference in their consideration of the third part of Central Hudson, relying upon legislative findings and "simple common sense" to support the government interest in shielding citizens from invasions of privacy by the telemarketer, saving them from the cost-shifting of unsolicited fax advertisements and mitigating the problem of potentially deceptive and abusive telemarketing calls (Erickson, 2006).

Restrictions on Free Speech

In Hudson, in order for commercial speech to be protected by the First Amendment it must concern lawful activity and not be misleading. It must be determined whether the declared