Corporate Free Speech Case Lands at High Court

January 13, 2003 ( - A case now before the US Supreme Court should decide whether corporate executives responding to public allegations of wrongdoing are cloaked by First Amendment protection or not.

The case before the high court involves sneaker-maker Nike Inc. and what the company says are unfounded allegations that workers who make Nike products in overseas plants were mistreated and that the company lied about it, according to an Associated Press report.

The case arises from Nike’s campaign to defend wages, treatment of workers and health and safety conditions at Asian plants, run by subcontractors, where workers make tennis shoes and athletic wear. San Francisco activist Marc Kasky sued Nike, alleging that the company lied about how much the employees earned and how they were treated.

Nike and companies that back it contend they have full free speech protection when responding to such allegations. Critics argue that companies that mislead the public while trying to sell products should not be protected.

Oregon-based Nike hired a high-powered legal team for the Supreme Court case including Harvard professor Laurence Tribe and former US Solicitor General Walter Dellinger. Tribe said that under the California decision, companies cannot respond to critics.

“There is a Draconian scheme in which one side is virtually unfettered in what it can say that is critical of the business, and the other side is shackled,” Tribe told the AP. “The ultimate loser is the public.”

Nike Opponents: Hold Companies Accountable

Alan Caplan, one of Kasky’s lawyer, told the AP that companies need to be held accountable for what they say when trying to sell products. If they aren’t, he said they could falsely claim that their products were made in the United States or that workers were treated well.

Caplan said Nike put false statements about its labor practices in a pamphlet distributed to reporters, in press releases, on the Internet, in letters to organizations, and in a letter to the editor — all efforts to sell products. “The public wants to be told the truth,” he said

For more than two decades the Supreme Court has struggled to define commercial speech, which gets less protection than other types of speech like political expression. A coalition of companies, public relations executives and newspapers and television stations had urged the court to clarify the standard.

In fact, s ome 30 news organizations, including ABC, CBS, NBC and top newspaper chains, have sided with Nike and argued in court filings that reporters will not be able to get company executives to talk freely about the safety of products, racial discrimination or environmental concerns about their industry, because of the fear of the lawsuits, the AP story said.

The result will be “inhibiting the media’s ability to compare both viewpoints in order to ferret out the truth,” the groups said in Court filings.

In commercial speech cases, there is no First Amendment protection if it can be proven that information was false or misleading. In other types of free speech cases, people who file suit must prove either negligence or actual malice.

The case is Nike Inc. v. Kasky, 02-575.