Casino Advertising Cases Next Test of 44 Liquormart, Rubin
By P. Cameron DeVore
As of April 28, the three pending First Amendment challenges to the federal ban on broadcast advertising of "any lottery...or similar scheme" (18 U.S.C.§1304) took center stage among high profile commercial speech cases.
This followed the ruling by Judge Osteen in the Coyne Beahm tobacco advertising challenge in North Carolina, striking down the FDA's tobacco advertising rules strictly on jurisdictional grounds, and the April 28 denial of certiorari by the U.S. Supreme Court in the Baltimore billboard cases.
Thus, the challenges to restrictions on gambling advertising became the most significant pressure point in First Amendment litigation testing the reach of 44 Liquormart v. Rhode Island and Rubin v. Coors Brewing Co. In the latter ruling, the Court held that restrictions on advertising of so-called "vices" are to be accorded no special deference under the commercial speech doctrine.
In the vacuum left by substantial overruling of the 1986 Posadas decision by 44 Liquormart, the gambling cases will also test the scope of the Supreme Court's only other significant gambling speech decision, United States v. Edge Broadcasting. This 1993 ruling upheld the federal broadcast ban in the context of cross-border advertising of state lotteries. The three gambling cases are:
Valley Broadcast Co. v. United States. In Valley, the Ninth Circuit affirmed a district court ruling that the federal ban was unconstitutional as applied to legal casino advertising in Nevada.
The court--which had heard initial arguments in the case before either Rubin or 44 Liquormart was decided by the Supreme Court--held that the government's asserted interest in reducing the "threat of organized crime" and minimizing "harmful effects on the health, safety, and welfare of citizens" was substantial.
The circuit cited Posadas for that proposition, while acknowledging that Posadas's analysis of Central Hudson Parts 3 and 4 "is no longer compeling" after 44 Liquormart
Applying Rubin, the circuit panel held that the government failed Part 3 ("directly advancing") because:
To use the language of Coors Brewing, "[t]here is little chance that [the challenged regulation] can directly and materially advance its aim, while other provisions of the same act directly undermine and counteract its effects."
The court thus relied on the Swiss cheese exemptions to the Section 1304 ban, and particularly the exemption permitting advertising by commerical casinos operated by Indian tribes under the Indian Gaming Regulatory Act, holding that this "undermine[d] the government's purported interest in protecting non-casino states from the reach of casino advertisements on the airwaves."
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