Let’s talk disclaimer, disclosure, and labeling requirements.
Or rather, “compelled speech.” Because that’s what the government is doing when it imposes one of these requirements: it is compelling a business to express a particular message as a condition of operating.
As it turns out, the law contains a considerable amount of fuzziness around what standard to apply to speech-compelling regulations. On the one hand, the intermediate scrutiny standard for commercial speech seems like the right fit. A disclaimer requirement is a commercial speech regulation, right?
But on the OTHER hand, there’s the “Zauderer standard.”
You see, back in the mid-80’s the Supreme Court adopted (in a case involving lawyer regulation, of course) a more lenient standard for at least some disclaimers. In Zauderer v. Office of Disciplinary Counsel, the court found that disclaimer requirements must merely be “reasonably related” to the state’s interest in preventing consumer deception. 1 This means that if any reasonable argument can be made that the disclaimer will actually remove deception from advertising, it will pass constitutional muster. Easy, right?
The problem is, the Zauderer decision was a mess. It didn’t clearly delineate whether the more relaxed standard it expressed applied to ALL compelled speech, or just to certain forms. So naturally, many courts have interpreted the case as providing regulators with wide leeway to compel speech. 2
But Zauderer was, in fact, a narrower decision than that. It didn’t apply to ALL disclaimers and labeling requirements, but rather only to compelled speech that is:
- Not unduly burdensome
And in 2018, the Supreme Court, apparently feeling that they needed to put a finer point on this, stepped back in. In NIFLA v. Becerra 3, the Court reiterated that the Zauderer standard only applies to disclosure mandates related to “purely factual and uncontroversial information about the terms under which . . . services will be available.” What’s more, the Court went on to note that even basic factual disclosure requirements must be supported by some showing that the disclosure is necessary to remedy a “potentially real not purely hypothetical” harm.
We should expect that, following NIFLA, the lower courts will begin reining in the overuse of compelled speech. One of the first major cases to address the Supreme Court’s more direct guidance was a 2019 decision addressing San Francisco’s attempt at a “sugared beverages warning label.” In a unanimous en banc decision, the Ninth Circuit found the warning requirement unconstitutional, noting that the warning label rule failed the Zauderer test out of the gate by being unduly burdensome. 4
Unfortunately, the decision in American Beverage Association v. San Francisco didn’t bring as much clarity as one might have hoped. For starters, the opinion considered — and explicitly rejected — the argument, dating back to the concurrence in Zauderer of Justices Brennan and Marshall, that the relaxed standard only applies to situations where the compelled speech is necessary to prevent consumer deception. And then, despite being unanimous in the result, the en banc panel submitted a number of concurrences taking issue with the path the court chose to get there — indicating that even the distinguished jurists of the Ninth Circuit are profoundly not of one mind when it comes to how the Zauderer rule is to be applied.
Expect to see more developments in the years to come, as the Circuits grapple with Zauderer’s reach.
- 471 U.S. at 651. ↩
- See my “legal disclaimers” page for some examples of how courts have applied the “rational basis” Zauderer test to compelled attorney speech. ↩
- Which, coincidentally, also marked the first instance of the Court explicitly addressing whether there is a “professional speech” category for First Amendment purposes. ↩
- The rule required that the following statement take up at least 20% of the label space on sugared beverage labels and advertisements: “WARNING: Drinking beverages with added sugar(s) contributes to obesity, diabetes, and tooth decay. This is a message from the City and County of San Francisco.” ↩