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Corporations Are Entitled to Freedom of Speech — Most of the Time
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Corporations Are Entitled to Freedom of Speech — Most of the Time

R.J. Reynolds Tobacco Company, et al. v. Food & Drug Administration, et al.

Under our system of law and taxation, corporations are considered individuals for some legal purposes. Corporations can own property. They can sue and be sued and enter into contracts. They also have limited rights to free speech.

The extent of corporations’ right to free speech has been addressed by many courts over the years. With each new case decided, we gain a better understanding of the limitations on corporate freedom of speech.

In one such case last year, a federal appellate court considered whether the government could legally force tobacco companies to include gruesome pictures of dying smokers on product labels. The requirement arose from the Family Smoking Prevention and Tobacco Control Act, Pub. L. No. 111-31, 123 Stat. 1776 (2009), which directed the Secretary of the U.S. Department of Health and Human Services to issue regulations requiring all cigarette packages manufactured or sold in the United States to bear one of nine new textual warnings, as well as color graphics depicting the negative health consequences of smoking.

The FDA ultimately selected nine images to accompany the statutorily prescribed warnings on tobacco packaging. Five tobacco companies challenged the rule, alleging that FDA’s proposed graphic warnings violated the companies’ First Amendment right to free speech.

The federal district court granted the companies’ motion for summary judgment. The FDA appealed and the appellate court affirmed the lower court’s decision.

In responding to the FDA’s appeal, the tobacco companies did not dispute Congress’s authority to require health warnings on cigarette packages, nor did they challenge the substance of any of the nine textual statements mandated by the Act.

The only question before the court was whether the FDA’s promulgation of the graphic warning labels—which incorporated the textual warnings, a corresponding graphic image, and the “1-800-QUIT-NOW” cessation hotline number—violated the tobacco companies’ First Amendment rights. The tobacco companies contended that, to the extent the graphic warnings went beyond the textual warnings to shame and repulse smokers and denigrate smoking as an antisocial act, the message was ideological and not informational.

The appellate court agreed with the lower court’s conclusions, as follows:

  1. The graphic warnings were not the type of purely factual and uncontroversial disclosures to warrant an exception to the rule barring compelled speech, and
  2. The FDA failed to satisfy its burden of demonstrating that the rule requiring the nine textual warnings and color graphics was narrowly tailored to achieve a compelling government interest.

In our next article, we will discuss the two primary exceptions when commercial speech can be compelled or restricted and the basis for each.

At Glass & Goldberg, we strive to stay abreast of changes in case law and the corporate regulatory environment that may affect our clients. Our attorneys provide high quality and cost-effective legal services and advice for clients in all aspects of commercial compliance, business litigation and transactional law. Call us at (818) 888-2220, send an email inquiry to info@glassgoldberg.com or visit us online at www.glassgoldberg.com to learn more about the firm and to sign up for future newsletters.

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