NIKE, INC., Defendant - Appellant, v. MARC KASKY, Plaintiff – Respondent
UNITED STATES SUPREME COURT
COUNSEL: Morgan Ross for Defendant – Appellant.
Josh Stillman for Plaintiff – Respondent
JUDGES: Before HANSON, CARLSON, and SCHISSLER
OPINION BY: CARLSON, SCHISSLER with HANSON
OPINION:
CARLSON and SCHISSLER, Justices.
The
speech in question in this case, made by Nike, Inc in response to allegations
of worker mistreatment, is commercial speech, and is therefore subject to
I. BACKGROUND
After a televised investigation by 48 Hours in 1996, the international labor practices of Nike, Inc. came under intense scrutiny. The company was accused of mistreating workers and violating labor laws. In an effort to address these accusations, Nike hired Andrew Young, a former United Nations ambassador, to investigate these claims. Young reported in 1997 that working conditions were acceptable and within the guidelines of international labor laws. The Nike Corporation then cited this commissioned report in an attempt to defend its labor practices. It sent letters to the editorial page of several newspapers, commissioned advertisements featuring the report, and sent letters to university athletic programs known to purchase Nike wares.
In 1998, Marc Kasky filed suit
against Nike alleging that statements in Young’s report were false. He sued under
II. COMMERCIAL SPEECH
This court finds that this
particular speech by Nike, Inc. does constitute commercial speech. It is therefore subject to
The court agrees with the Plaintiff – Respondent’s that “Nike’s statements are commercial because they comply with the three reasons for distinguishing commercial from non-commercial speech as outlined in Va. Pharmacy Bd. v. Va. Consumer Council (1976) 425 U.S. 748, 770, in that they are extremely verifiable, not likely to be chilled by proper regulation, and most importantly, carry with them great potential to inflict commercial harm” (Nike v. Kasky, Brief for Plaintiff – Respondent.)
It is quite clear in this case that Nike, Inc. had the ability to verify the accuracy of its claims. After all, the very claims certified by Andrew Young that Nike is defending in this case were made after an (expensive and time consuming) effort to verify the nature of Nike’s labor practices. Clearly, Nike’s comments were “extremely verifiable.”
The court also finds it extremely unlikely that classifying this speech as commercial will chill any further speech by Nike. The Nike Corporation’s very business model centers around spending extraordinary amounts on advertising in order to draw attention to its product and create and foster its product image. It is improbable that classifying Nike’s speech as commercial, and consequently holding the company to a higher standard of truth than the consumers to which it sells, will do anything to quell the continuation of either Nike’s business model or commercial success.
The
result will simply be that Nike must be truthful in the way that it represents
its business practices. As the plaintiff-respondent stated in their reply
brief, “classifying the statements at issue as commercial speech would no’t
silence Nike, but simply make them exercise more caution in issuing claims
about its business practices” (Nike v.
Kasky, Brief for Plaintiff – Respondent).
We find that commercial harm most certainly could affect a consumer who buys a product from a company whose labor practices that consumer finds unacceptable. Consumers have the right to truthful accounts of a manufacturer’s labor policies.
This court rejects the Defendant – Appellant’s definition of commercial speech. It is far too narrow in scope given past precedent.
In analysis of prior court decisions regarding what, exactly, comprises commercial speech, this court most heavily relies on the precedent set in Bolger v. Young’s Drug Products Corp. (1983) 463 U.S. 60, 64-65. The Plaintiff – Respondent’s brief notes that in Bolger, the “court found that (I) advertising format, (II) product references, and (III) commercial motivation were three relevant considerations (but not the only ones) that provided “strong support” for classifying speech as commercial, but that none of these factors must be present in every case” (Nike v. Kasky, Brief for Plaintiff – Respondent.)
(I) While Nike’s statements most surely did not follow in the footsteps of its (or its competitors) traditional advertising format, this is not grounds to grant Nike, Inc. freedom from the responsibility of truthful speech outright. The fact that Nike’s advertisements in regard to this matter did not feature Michael Jordan, photos of athletics, or even references to specific prices or models of shoes, does not convince this court that Nike’s paid advertisements in subscription newspapers qualify as protected speech.
(II) Nike’s speech is commercial because it made specific product references and also referenced production standards. Nike did not reference “shoes” as a general concept. They referred to specific models of their own product in an attempt to defend these products and their mode of production.
(III) Lastly, and MOST IMPORTANTLY, this court finds that Nike’s statements had demonstrable commercial intent. Nike was not simply defending its public image in order to maintain respect for its corporate image, philosophy, or management. While maintaining careful reservations regarding this matter because conjecture regarding intent is always legally nebulous, in this case, NIKE’S INTENT WAS UNDOUBTEDLY COMMERCIAL. Letters to the editor stated that "consumers are savvy and want to know they support companies with good products and practices" and that "during the shopping season, we encourage shoppers to remember that Nike is the industry's leader in improving factory conditions." Nike, Inc. was unquestionably attempting to use this speech to maintain sales and brand reputation – surely enough to categorize this speech as commercial. Moreover, by mailing statements to decision makers at university athletic programs known to be clients, Nike, Inc. was attempting to maintain a viable commercial relationship. These letters were not a free and public discussion about labor practices. Instead they were commercial speech specifically defending Nike’s labor practices and urging current clients to keep buying Nike products.
III. REASONS FOR REGULATION
The Federal
Constitution’s First Amendment guarantees freedom of speech, but this does not
mean it protects all speech. While the First Amendment assures that
non-commercial speech is protected generally from restrictions, commercial
speech is less protected particularly when it is false or misleading. In Va. Pharmacy Bd. v. Va. Consumer Council
(1976) 425 .
It is also undeniable that Nike’s statements held potential for commercial harm; labor conditions and business practices are factors that affect consumer choices. External from this, it is important to take into account the potential precedent setting implications of this case. To defend commercial speech as free of regulation is to give corporations carte blanche in their statements regarding their products. We are loath to do this, given the potential harm to be incurred from misrepresentations of safety and quality, to name two. There are numerous regulations requiring safe business practices, and it could be potentially devastating to weaken any of these existing statutes. Va. Pharmacy guaranteed that the government has jurisdiction to regulate false and misleading commercial speech, and this is because the government has an interest in making sure the stream of commercial information runs not only freely, but also cleanly. Furthermore, the First Amendment does not prohibit the State from doing this because “the elimination of false and deceptive claims” promotes “the flow of accurate and reliable information relevant to public and private decision making,” which is necessary for “the proper allocation of resources in a free enterprise system" and "the formation of intelligent opinions as to how that system ought to be regulated or altered."
Ultimately, Nike’s
statements were not opinions to be argued for or against, but simple statements
of fact. The veracity was clearly in dispute, but the statements regarded
information Nike should have known the worth of. What’s more, just because the
statements were made in response to public debate does not mean they should be
protected. National Commission on Egg
Nutrition v. Federal Trade Commission (7th Cir. 1977) 570 F.2d 157, 159,
cert. den. (1978) 439
This
court rules that Nike’s intent regarding the speech in question was clearly
commercial, receives no protection from the Federal Constitution’s First
Amendment and is therefore subject to the regulation of
the