On the Circuit

Feds Searching for New First Amendment Rationale in Greater New Orleans Case
By P. Cameron DeVore, Esq.

On Oct. 7, 1996, the Supreme Court vacated and remanded yet another circuit court commercial speech decision for reconsideration in light of 44 Liquormart. In Greater New Orleans Broadcasting Association, Inc. v. United States, the Fifth Circuit had affirmed a district court decision that the federal ban on broadcast advertising of "any lottery...or similar scheme, offering prizes dependent in whole or in part upon lot or chance..." was constitutionally applied to ban broadcast advertising of legal casino advertising in the New Orleans area.
In a 2-1 opinion, the circuit panel had cited Posadas as its primary authority, both for the substantiality of the federal interest in regulating gambling, and for the proposition that Central Hudson parts three and four could be met with little or no evidentiary showing. In effect, the panel had deferred to the federal regulation in spite of the Supreme Court's renunciation in Rubin v. Coors Brewing Company of any special "vice" category, the advertising of which might be subject to greater governmental restrictions.
44 Liquormart's eradication of Posadas as a legitimate authority for the Fifth Circuit's initial result left the federal government in search of a new rationale to support the ban. Responding to the circuit's order for additional analysis, both the broadcasters and the government filed briefs on Nov. 27, 1996.

44 Liquormart, Inc. v. Rhode Island, 116 S. Ct. 1495 (1996).
Greater New Orleans Broadcasting Ass'n, Inc. v. United States, 69 F.3d 849 (5th Cir. 1995), cert. granted, vacated, and remanded (GVR'd) at _S. Ct._.
Other remanded cases: Pennsylvania State Police v. Hospitality Investments, 650 A.2d 854 (Pa. 1994), _U.S._ (No. 94-1247) to the Supreme Court of Pennsylvania; also Anheuser-Busch, Inc. v. Schmoke and Penn. Advertising v. Schmoke, to the Fourth Circuit (see story).
Posadas de Puerto Rico Assocs. v. Tourism Co. 478 U.S. 328 (1986).
Central Hudson Gas & Elec. Corp. v. Public Serv. Comm'n of N.Y., 447 U.S. 557 (1980)
Rubin v. Coors Brewing Co., 115 S. Ct. 1585 (1995).
Cincinnati v. Discovery Network, Inc 507 U.S. 410 (1993).

This author also joined in an amicus brief that same day, supporting the broadcasters, on behalf of the National Association of Broadcasters, American Association of Advertising Agencies, and Association of National Advertisers, Inc.
The government's brief was obviously scrambling to define a new rationale to dodge the First Amendment burden of proof reiterated in 44 Liquormart. Consistent with its arguments to the Fourth Circuit in the Anheuser-Busch and Penn Advertising cases on remand, the government made a three-pronged argument:
(1) It denied that 44 Liquormart stood for anything much, and touted the "lowest common denominator" interpretation of 44 Liquormart adopted by the Fourth Circuit in Anheuser-Busch II. (The Fourth Circuit did, in fact, "readopt" its highly deferential 1995 opinions.)
(2) It argued that Central Hudson part three ("directly and materially advancing") could be met by a presumption -- namely, that advertising can be presumed to increase consumption, and a ban on advertising will ipso facto reduce consumption; ergo part three can be met without the troublesome task of producing any actual evidence showing that the ban does anything at all in the real world to advance the asserted interest.
(3) It discerned a brand-new federal interest in discouraging "compulsive gambling," citing a gaggle of articles and "studies," on that general subject. In effect, it asked the circuit court to take judicial notice of this untested "evidence," instead of simply concluding that the government had failed to meet its post-44 Liquormart burden of proof, previously well established in such cases as Discovery Network, Edenfield, Ibanez, and Rubin.
The government's position was also akin to its arguments in other commercial speech cases, including Glickman v. Wileman Bros. & Elliott, Inc., and its brief opposing summary judgment in Coyne Beahm, Inc. v. United States, the tobacco/advertising industry challenge to the FDA's draconian tobacco restrictions in the Middle District of North Carolina.

Edenfield v. Fane, 507 U.S. 761 (1993).
Ibanez v. Florida Dept. of Business. and Professional Regulation, Bd. of Accountancy, 512 U.S._(1994).
Glickman v. Wileman Bros. & Elliott, Inc., 58 F. 3d 1367 (9th Cir. 1995), _U.S._ (No. 95-1184).
Coyne Beahm, Inc. v. United States, #2: 95CV00591 (M.D.N.C. 1997).

On Dec. 6, 1996, the plaintiff/appellant broadcasters filed a pungent reply brief, reminding the court of the government's burden to provide actual evidence of "direct and material advancement" of its asserted interest in preventing and treating compulsive gambling -- a difficult task, given the vast amount of gambling permitted by the "swiss cheese" nature of the federal regulatory scheme. The brief characterized as "preposterous" the government's claim that its untested materials on compulsive gambling demonstrated "narrow tailoring."
Bottom line: Whatever the Fifth Circuit does (or may have done by the time this article appears), the central issue in the commercial speech cases in both the Fourth and Fifth circuits is clear. Will the Supreme Court's clear holdings requiring government to step up to the evidentiary plate, in an adversary proceeding in court, to demonstrate that it has met its First Amendment burdens of proof, be followed by lower federal courts?
The results in Anheuser-Busch and Penn Advertising to the contrary notwithstanding, it is hard to see how the government's "smoke and mirrors" approach in the Fifth Circuit can meet that burden.
P. Cameron DeVore, a partner in the Seattle office of Davis Wright Tremaine, is Chair of the firm's Communications and Media Law Department. He regularly represents the media and national advertisers in major First Amendment cases in the U.S. Supreme Court, and federal and state trial and appellate courts.