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Supreme Court dismisses Nike commercial speech appeal

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Supreme Court dismisses Nike commercial speech appeal

  • On the last day of its term, the high court sent Nike’s case back to state court to be tried, sidestepping expectations that the Court would define the First Amendment rights of a company to speak out on issues of public importance.

June 26, 2003 — The U.S. Supreme Court today dismissed an appeal by Nike, Inc., saying the Court never should have granted review in the case, and refusing to address the sneaker company’s First Amendment defense to false advertising charges based on the “commercial speech” doctrine.

The case will go back to California state court for trial.

Nike was sued in 1998 by a private individual, Marc Kasky, over statements that Kasky felt misled the public regarding the company’s labor practices abroad.

In defense against the false advertising lawsuit, Nike claimed its statements — made in press releases, op-eds and Web postings in response to allegations of abuse in its factories — were a form of political speech deserving of full First Amendment protection. Kasky said Nike’s statements constituted “commercial speech,” which, under constitutional case law, enjoys fewer protections.

Kasky’s case was rejected by the trial court and a lower appellate court in California, but in May 2002, the state’s supreme court ruled that Nike’s statements could be characterized as commercial speech and sent the case to trial.

On Jan. 10, the Supreme Court agreed to review the case to determine the contours of the commercial speech doctrine.

The Court, which ends its current term today, issued a one-sentence, unsigned ruling, dismissing its grant of review as improperly granted. The ruling was accompanied by a concurring opinion written by Justice John Paul Stevens.

Justice Stephen Breyer, with Justice Sandra Day O’Connor, wrote a dissenting opinion, arguing that the Court should have resolved the First Amendment issue. Justice Anthony Kennedy also dissented.

In his concurrence, which was joined by Justice Ruth Bader Ginsburg and, in part, by Justice David Souter, Stevens said the appeal had procedural defects which precluded the Court from deciding it.

He said the Court could not rule on the case because the California Supreme Court had not issued a final ruling on the issue.

Stevens also said the parties in the case lacked standing to appeal the case to the Supreme Court.

Stevens said the First Amendment issues at stake in the appeal could reach the Court again after the technical issues are cured in the lower courts.

Breyer disagreed on the procedural issues and said that “given the importance of the First Amendment concerns at stake,” there was “no good reason for postponing a decision in this case.”

Breyer said that allowing the suit to go forward is likely to chill speech by corporate entities, who would be afraid to express themselves publicly without guidance from the Court.

A number of media organizations, including The Reporters Committee for Freedom of the Press, had filed a friend-of-the-court brief in the case, arguing that removing any protections from speech by companies engaged in public controversies will inhibit the news media’s ability to cover these topics.

(Nike, Inc. v. Kasky; Media amici counsel: Bruce E.H. Johnson, Davis Wright Tremaine LLP, Seattle) WT

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