Commercial Speech

Commercial speech, for purposes of First Amendment law, has been defined by the U.S. Supreme Court as speech that does “no more than propose a commercial transaction” or, on occasion, as expression “solely motivated by the desire for profit.” Commercial speech receives less First Amendment protection than does speech on political or social issues of public importance because it has traditionally been perceived as having less value in a democratic society and because of the desire to protect consumers from fraudulent business practices.

Advertisements for products or services clearly are commercial speech, but communication materials, such as informational brochures and issue ads, are harder to classify. In 1983, the Supreme Court held that whether material, such as an informational pamphlet, is commercial speech depends on three factors: whether (1) it was meant to be an advertisement, (2) it referenced a particular product, and (3) its dissemination was economically motivated. These three factors would not be sufficient individually to turn the pamphlet into commercial speech, but the combination of all three supported a commercial finding, the Court said. The Court was concerned that holding otherwise would lead advertisers to combine false or misleading product information with social or political information to avoid government regulation. The Court has not addressed the issue since, although it rejected an opportunity to do so in the 2002 case of Nike v. Kasky.

Nike, the multinational athletic equipment manufacturer, became the subject of a public debate about the use of sweatshops overseas in the early 1990s. Activist Marc Kasky sued Nike in California under the state's false advertising statute, claiming that statements made by Nike in the course of its public relations campaign to restore its public image were false and misleading. Nike argued that the statements constituted political speech, not commercial speech, and were therefore protected by the First Amendment and not subject to the false advertising act. The trial court agreed, but the California Supreme Court held that the speech was indeed commercial speech because Nike is a corporate speaker, it hoped to reach consumers with its message, and it discussed its own business operations. The court said that Nike was free to discuss the issue of overseas labor in the abstract, but it could not discuss its own practices unless it was truthful and nonmisleading. The U.S. Supreme Court initially agreed to hear the case, but reversed itself, sending the case back to California for trial. Nike subsequently settled with Kasky, leaving the state's Supreme Court decision to stand.

In determining whether a government regulation on commercial speech is constitutional, courts apply a four-part test. Under what it is known as the Central Hudson (1980) test from the case in which it was first enunciated by the [Page 147]Supreme Court, courts must consider each of the following:

• Whether the commercial speech is worthy of First Amendment protection (in other words, it must be accurate and for a lawful product or service);
• Whether the government has a substantial interest for regulating the speech (courts usually consider the government to have a substantial interest in protecting the health, safety, welfare, and morals of the public);
• Whether the regulation in question directly advances the government's interest; and
• Whether the regulation is no broader than necessary to achieve the objective (it cannot restrict the speech entirely).

Although the Court applies the Central Hudson test to all commercial speech cases, it reaches different decisions depending on the kind of product or service advertised. For example, the Court has strongly supported the right of truthful, nonde-ceptive advertising—even of “vice” products and services, such as gambling, alcohol, and tobacco— to protection under the First Amendment. Yet, the Court has consistently limited the advertising of professionals, such as lawyers, accountants, and dentists. Professionals may advertise the price of standardized procedures, but not of more complex services. The Court has also restricted the means by which attorneys may communicate with consumers.

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