The commercial difference.

Author:Wu, Felix T.
Position:Between corporate and commercial speech
 
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ABSTRACT

When it comes to the First Amendment, commercially does, and should, matter. This Article develops the view that the key distinguishing characteristic of corporate or commercial speech is that the interest at stake is "derivative," in the sense that we care about the speech interest for reasons other than caring about the rights of the entity directly asserting a claim under the First Amendment. To say that the interest is derivative is not to say that it is unimportant, and one could find corporate and commercial speech interests to be both derivative and strong enough to apply heightened scrutiny to the restrictions that are the usual subject of debate, namely, restrictions on commercial advertising and restrictions on corporate campaigning.

Distinguishing between derivative and intrinsic speech interests, however, helps to uncover three types of situations in which lesser or no scrutiny may be appropriate. The first is in the context of compelled speech. If the entity being compelled is not one with intrinsic speech rights, this undermines the rationale for subjecting speech compulsions to heightened scrutiny under the First Amendment. The second is in the context of speech among commercial entities. In these cases, the transaction may be among entities none of which merit intrinsic First Amendment concern. The third is in the context of unwanted marketing. It makes no sense to protect listeners' access to information they do not want to receive.

Highlighting the difference that commerciality makes helps to better explain certain exceptions, or apparent exceptions, that existing case law already makes to heightened scrutiny. It also provides insight into a number of current controversies, such as those over cigarette and product labeling. It has particularly important implications for consumer privacy regulation, suggesting that regulation of both the consumer data trade and commercial data collection merit significantly less scrutiny than might be applied to restrictions on the privacy-invasive practices of ordinary individuals.

Table of Contents Introduction I. Derivative Speech Interests A. Corporate Speech B. Commercial Speech C. Derivative Interests in Traditional Settings II. Implications for Compelled Speech A. The Misfit Between Listener Interests and Scrutiny of Compelled Speech B. The Zauderer Standard C. Limitations on Compelled Corporate or Commercial Speech 1. Distinctions Among Corporate Speakers 2. Compulsions Conditioned on Speech 3. Deception About the Source of Speech III. Implications for Speech Among Commercial Entities A. Transactions Among Commercial Entities B. Privacy Invasions by Commercial Entities C. Indirect Regulation of Noncommercial Transactions IV. Implications for Commercial Speech Directed at Unwilling Listeners Conclusion INTRODUCTION

Courts and commentators have struggled for some time to determine what, if anything, is different about "commercial speech" or "corporate speech," as compared to "fully protected speech." Many share an intuition that either commercial speech, corporate speech, or both are in some way lesser forms of speech, less deserving of the protections of the First Amendment and more readily subject to government regulation. (1) Others say there is no principled way to distinguish corporate and commercial speech from types of speech that the court fully protects, and thus see doctrines that treat commercial speech or corporate speech as their own First Amendment categories as unwarranted and unprincipled encroachments upon free expression. (2)

This Article develops the view that corporate and commercial speech are different, but that whether the difference matters varies with the context in which the question arises. The key distinguishing characteristic of corporate or commercial speech is that the speech interest at stake in these contexts is "derivative," in the sense that we care about the speech interest for reasons other than caring about the rights of the entity directly asserting a claim under the First Amendment. (3) We assign such speech rights to the entity asserting them for instrumental purposes, to vindicate what are really the speech rights of others. In some cases, we may mean to vindicate the rights of others as listeners; in other cases, the rights of others as speakers. (4) To be sure, those third-party interests are potentially implicated in every dispute over speech. What makes corporate and commercial speech different is that those third-party interests are the only interests that matter.

The fact that a speech interest is derivative need not undermine its strength or importance. The key Supreme Court opinions on corporate and commercial speech have thus far arisen largely in the context of restrictions on commercial advertising (5) and restrictions on corporate campaigning. (6) In these contexts, the derivative nature of the speech interests at stake is entirely consistent with an argument that commercial speech and corporate speech should receive full protection under the First Amendment. Even if third-party interests are the ones that really matter, one could view those interests as being equally harmed whether the speech being restricted is commercial or noncommercial, corporate or noncorporate. For example, one could take the view that in all cases speech restrictions undermine the autonomy of willing listeners.

Distinguishing between derivative and intrinsic speech interests, however, helps to uncover three types of situations in which the regulation of corporate or commercial speech does not deserve the same First Amendment scrutiny as an equivalent regulation of noncommercial, noncorporate speech. The first is when the regulation compels speech rather than restricts it. (7) Speech compulsions are problematic primarily because of their effects on the person being compelled. If the compulsion is directed not to a person, but to an artificial entity with no intrinsic rights to "freedom of mind," then the rationale for heightened scrutiny of speech compulsions dissolves. The same can and should be said about compulsions directed to individuals who are acting in a commercial, rather than personal, capacity.

A second context in which the derivative nature of speech interests matters is that of speech that occurs among commercial entities. (8) The paradigmatic commercial speech case envisions an advertiser communicating with a consumer. (9) The paradigmatic corporate speech case is usually one in which corporations are speaking to voters. (10) If heightened scrutiny of corporate or commercial speech is justified primarily by the interests of the noncommercial listener, then such scrutiny may no longer be justified when the listener is equally commercial. In that case, none of the parties to the transaction may have an intrinsic First Amendment interest, and thus, there is no third-party interest to protect by giving the speaker a derivative claim.

The third situation in which recognizing derivative interests matters is in the context of unwanted marketing. (11) The problem of unwanted speech has often been conceptualized as a conflict between the speaker's right to speak and the listener's desire to avoid that speech. (12) When the speech is commercial, however, there are no longer two sides in conflict. If the commercial speaker's protection is derivative of the listener's interests, then only the listener really matters. And if listeners' access to information is the value being protected, then listeners who are trying to reject that information neither need nor want such protection.

Highlighting the derivative nature of corporate and commercial speech interests helps to better explain certain exceptions, or apparent exceptions, that existing case law already makes to heightened scrutiny. For example, antitrust laws have long prohibited price collusion among competitors, without worrying about any First Amendment limits on the government's ability to stop one company from conveying price information to another. (13)

Within the framework developed here, this result is easily understood as a natural consequence of the information being passed solely from one commercial entity to another. Similarly, the Fair Credit Reporting Act's restrictions on disseminating consumer reports make perfect sense under a similar analysis. (14)

Understanding the "commercial difference" also has important implications for current controversies, ranging from cigarette and other product labeling to privacy regulation. In prior work, I examined the constitutionality of consumer privacy regulation, concluding that most such regulation should be subject to minimal First Amendment scrutiny as either a form of commercial compelled speech or a regulation of speech among commercial entities. (15) This Article provides the general theoretical framework for the conclusions of that earlier work and broadens the application of the framework beyond the examples explored there.

This Article draws upon a broad literature that so far has generally addressed the relevant issues in isolation, with respect to commercial speech, corporate speech, compelled speech, or the interface between privacy law and freedom of expression. (16) Bringing the disparate theories together within a single framework exposes the discontinuities among them and reveals why protection for commercial speech and compelled speech separately need not lead to the conclusion that commercial compelled speech should be equally protected or why skepticism about some types of privacy laws on free expression grounds need not suggest skepticism for all privacy laws on such grounds.

In what follows, Part I explains the theory of derivative speech interests and shows how a wide variety of conceptions of corporate or commercial speech fit the model. Part I.C describes why this framing does not necessarily change the results of the existing jurisprudence around corporate campaigning or...

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