Advertising – Page 5 – Socially Awkward

3rd Circuit Smacks NJ on Compelled Speech

August 12, 2014 Josh King

Another day, another compelled speech case – this one involving lawyer advertising.

I’ve discussed the Dwyer case before. Dwyer sued to challenge a New Jersey advertising guideline preventing lawyers from using words of praise from judges in advertisements – unless the advertisement included the entire text of the judicial opinion. As I mentioned at the time:

Quotes from judges are likely to carry a lot of weight with consumers, largely because of their scarcity value: consumers will assume that judges will dole out such praise sparingly, not realizing that these compliments are functions of the workaday business of ruling on fee applications, rather than some rarefied benediction. It’s easy to see why the use of such quotes in advertising would be, as the state of New Jersey argued, inherently misleading without some form of disclosure.

However, as the Third Circuit noted, in a decision remarkable for its clarity on this nuanced and under-appreciated area of speech regulation (and contrary to the more expansive interpretation the DC Circuit adopted just weeks ago), disclosure requirements must be “reasonably related to preventing consumer deception.” They also can’t be unduly burdensome.

The Court went on to find the New Jersey Guideline wanting on both counts. There was no indication that presenting the entire text of a decision would in any way lessen consumer deception, and the requirement was incredibly burdensome in that it effectively prevented ANY form of advertising including such judicial plaudits.

It’s a classic screw-up on New Jersey’s part. Using these statements in ads does lead to consumer deception. What the state should have done is consider the first amendment issues and craft a narrower regulation.[ref]The 3rd Circuit decision even offers a helpful suggestion of a disclaimer that would survive constitutional scrutiny: “This is an excerpt of a judicial opinion from a specific legal dispute. It is not an endorsement of my abilities.”[/ref] Instead, the New Jersey regulators just went with the ham-handed approach to attorney speech regulation and called it a day. It’s an approach, that despite a growing number of Circuit Court setbacks, remains distressingly common – despite the fact that consumers, attorneys and the bars alike all lose in the process.

DC Circuit is COOL with Compelled Speech

July 30, 2014July 31, 2014 Josh King

Earlier this year, I noted two DC Circuit decisions on compelled speech – disclaimer requirements around country of origin labeling (“COOL”) for meat and “conflict free” diamonds. In each case, the court struck down the labeling requirements, applying the “intermediate scrutiny” standard for commercial speech regulation.

In a notable decision this week the DC Circuit, sitting en banc, reversed the COOL case. And in so doing, it explicitly overruled language in the “conflict diamond” decision applying the intermediate scrutiny standard.

Why is this important? Because the court is saying that disclaimer and disclosure requirements are only subject to the lightest of constitutional burdens – the requirement that the compelled speech be “reasonably related” to the government’s interests and objectives. This is a very low bar (and to make matters worse, the court declined to even hold that the government’s interest must be substantial).

The critical case at play is one I’ve written about before: Zauderer v. Office of Disciplinary Counsel. Zauderer isn’t as clear as it could be on this point, but most courts (including the two panels of the DC Circuit that first heard the COOL and conflict-free cases) have read it to apply the lower bar of “reasonably related” only to those cases where the compelled disclosure is necessary to prevent deception.

The DC Circuit has now thrown the gates wide open, allowing virtual carte blanche forall manner of speech the government might want a business to disseminate. This bodes well for proponents of things like lawyer advertising disclaimers and GMO labeling requirements, but it is certainly a setback for free speech.

Here’s hoping our very free-speech-friendly Supreme Courts steps in and clarifies that compelled speech, just like prohibitions on speech, should be carefully circumscribed.

UPDATE: Jonathan Adler at the Volokh Conspiracy has a more in-depth look at the decision and the vexing issues it raises.

“Publicity Rights” and Censorship

July 18, 2014 Josh King2 Comments

Did you realize Manuel Noriega was still kicking? I thought sure the former Panamanian dictator was dead, but apparently he’s still around, albeit old, in prison, and apparently possessed of a litigious streak.

Eugene Volokh brings the news that Noriega has filed a publicity rights lawsuit against Activision, claiming that a character in a recent “Call of Duty” video game is based on Noriega. Volokh then goes on to show how the troubling state of publicity rights law creates all sorts of potential threats to culture. If people have broad control over how their “images” are used – even when those “images” are composites, or used for parody – there will be a massive chilling effect.

And this isn’t only a concern for culture and the arts. It also applies to news reporting and criticism. I’ve seen firsthand how people who don’t want to be talked about online try to use publicity rights claims to shut discussion down. Until and unless this increasingly-popular claim gets reined in – and the appropriate level is to limit it to commercial advertising – this danger is going to persist.

NC Attorney Goes 0-4 on Ad Claims

June 9, 2014August 14, 2017 Josh King

In a classic example of Eric Turkewitz’ famous aphorism, “outsource your marketing, outsource your ethics,” a North Carolina attorney has just been disciplined for a number of sloppily-worded claims on her website. The Grievance Committee of the North Carolina bar did not take kindly to attorney Stephanie Villaver’s “dog ate my homework” defense blaming her website designer. The fact that she may have tried to cover up her own inattention to the matter surely didn’t help things, either.

However, my interest is in the advertising claims that formed the basis of her discipline. On her website, Villaver stated that:

She is “Jacksonville’s best car accident claim attorney.”
She is the “Jacksonville, North Carolina’s personal injury specialist.”
Her team “specializes in traffic ticket matters.”
She can get a person “the settlement you deserve.”

The grievance committee found that each of these statements violated the Rules of Professional Conduct, to wit and in order:

A claim that cannot be factually substantiated.
Implication that an attorney is a certified specialist.
Ditto.
Guaranteeing results.

Again, it’s likely the case that the attorney’s evasive and non-responsive handling of this matter was the primary reason the Bar lowered the boom on her. Had she immediately corrected the website, there’s almost no chance she would have been disciplined.

But the phrases in question – should they really form the basis of discipline? The first and the fourth are not “claims that can be factually substantiated” or “promises of results;” they are nothing more than the same vacuous puffery that every business that has given up employing any creativity in marketing uses in a half-hearted attempt to reach new customers. These are anything but effective advertising messages. But that’s also why they shouldn’t be regulated by the bar: they aren’t going to cause any consumer confusion. Every consumer knows how empty of meaning these terms are.

As for the use of the dread “specialist” term, North Carolina has fallen for the trap of expanding its regulatory reach beyond its constitutional limitations. For although NC’s rule in this area (7.4) prohibits attorneys from indicating they have been certified as specialists in a given area unless they have such certification (a restriction the Supreme Court found lawful in the Peel case), the comments to the rules expand it to make ALL uses of the term “specialize” verboten – even when there is no implication that a third party has certified the attorney in that area.[ref]Yes, the comment to the rule states that “the use of the word “specialize” in any of its variant forms connotes to the public a particular expertise often subject to recognition by the state;” that, I daresay, is larding far too much significance onto a term synonymous only with focus and concentration in a particular subject.[/ref]

I don’t feel that badly for an attorney who didn’t pay attention to her marketing and then failed to quickly address the problem. But I do wish the states would devote their enforcement resources to those engaging in real, consumer impacting abuses – and not those who simply resort to hackneyed marketing cliches.

More Compelled Speech Knocked Down

April 22, 2014July 18, 2014 Josh King

I was traveling in Scotland when this opinion came out last week, and it warms the cockles of my Scots-Irish heart to see more comeuppance for the state trying to tell us what to do.

In Nat’l Assn. of Manufacturers v. SEC, the DC Circuit dispensed with the “conflict free” labeling requirement for diamonds. As the court rightly notes, the state only enjoys the easy-peasy “rational basis” standard of review when the compelled disclaimer is “reasonably related to the State’s interest in preventing deception of consumers.” Otherwise – like when it wants to send a political message or inform consumers about something or other – its requirement must meet intermediate or strict scrutiny.

Jordan Jams on Jewel

March 3, 2014July 18, 2014 Josh King

Back in the day, kids would have posters in their rooms of Michael Jordan, the photo taken through the transparent backboard, a tongue-lolling Jordan poised to deliver a monster jam over whatever hapless opponent happened to be in the way.

MJ is long-retired, but he’s still “postering” opponents – just in a different kind of court.

On the occasion of Jordan’s induction into the NBA Hall of Fame, Jewel Foods (a Chicagoland grocery chain) ran a congratulatory ad in a special edition of Sports Illustrated. Jordan took offense, and sued for $5M alleging publicity rights violations. While Jewel prevailed at the District Court level, the 7th Circuit reversed, finding the ad to be commercial speech. The opinion has a nice discussion of how the commercial speech doctrine works in edge cases like this.

When I read the case, I thought perhaps the court had gotten it wrong. After all, not all advertising is commercial speech. It’s got to have an economic motive, promote a specific product and be in an advertising format. And this was just a nice ad congratulating a local legend, right?

But then I saw the ad itself. Check, check, and check. Although Jordan’s suit does seem awfully mean-spirited and petty, it’s not hard to see why the 7th Circuit found it be “image advertising” subject to the commercial speech doctrine.

Jordan v. Jewel Food Stores (7th Cir. 2014)

Text Messaging Solicitation

December 23, 2013July 18, 2014 Josh King

Over at Real Lawyers Have Blogs, Kevin O’Keefe rails against the use of text messages by Ohio personal injury lawyers for solicitation of accident victims. A few observations:

Kevin’s right that use of text messages is tasteless and intrusive. And on a purely pragmatic level, it’s probably ineffective in most cases for the firms that use it, given the relatively non-commercial conventions of SMS usage.
However, this doesn’t mean that solicitation by text message should be outlawed by the Bar. It’s long been established that the state can’t regulate advertising based on taste or the “dignity of the profession.” Bans on specific forms of solicitation have only been found constitutional when they involved the coercive presence of a trained advocate, in circumstances calling for a yes/no answer on the question of representation. That’s not the case with SMS; it’s a simple matter to just hit “delete” and think no more about it.
Ohio requires that a disclaimer accompany all solicitations sent to accident victims within 30 days of an accident:

THE SUPREME COURT OF OHIO, WHICH GOVERNS THE CONDUCT OF LAWYERS IN THE STATE OF OHIO, NEITHER PROMOTES NOR PROHIBITS THE DIRECT SOLICITATION OF PERSONAL INJURY VICTIMS. THE COURT DOES REQUIRE THAT, IF SUCH A SOLICITATION IS MADE, IT MUST INCLUDE THE ABOVE DISCLOSURE.[ref]Ohio Rules of Professional Conduct 7.3(e).[/ref]

The Bar requires that this disclaimer be included within the body of text messages, even if it requires several messages to do so. This interpretation wouldn’t (or at least, shouldn’t) survive a constitutional challenge, as it pretty much eliminates the ability to use text messages to communicate with accident victims. The Bar has the burden to show that its mandatory disclaimer is necessary and minimally restrictive; they’re unlikely to be able to do so here, given the lack of flexibility.

Solicitation by text message is unseemly and distasteful, but taste can’t be regulated by the bar without offending the first amendment rights of lawyers to speak and consumers to have timely access to the information they need. Prohibition of speech is a blunt instrument. And while it’s easy to imagine scenarios where a text message would be unwelcome, it’s equally easy to imagine situations where consumers would be well-served by having timely information about their rights, even if these cases are few and far between. Ultimately, consumers are better served by relying on market and first amendment forces to discipline advertising tactics such as these.

Update 12/24/13: Scott Greenfield has tried to take me to task on this one, but he’s missing the point – or letting his distaste for lawyer marketing blind him.

I think that – absent unusual circumstances – solicitation by text is going to be sleazy. And ineffective. It’s just that, under existing law, the bar can’t prohibit it.[ref]Which is a good thing – see my point about speech prohibitions being blunt instruments.[/ref]

Look at the Primus case. Look at the Shapero case. Two Supreme Court cases on bar rules prohibiting forms of written solicitation. Two cases applying the intermediate scrutiny standard of review for commercial speech. And two decisions overturning such restrictions, noting the fundamental difference between written and in-person solicitation.

Do you think text messaging is “in person” or “real time?” You’d need to, in order to make the argument that Ohio could have arrived at any decision other than the one it did. Or you’d need to believe that Primus and Shapero need to be revisited.

(@Popehat also raises the specter of the TCPA. While the TCPA limits the ability to use robodialers to send these texts, it doesn’t apply to manually-placed calls or texts.)