Are Commercial Speech Limitations Down the Drain?

By: Rachel Ann Stephens, Staff Writer

I. Introduction

Going to the bathroom has never been more perilous, for sewer systems. Systems already under pressure from growing populations, aging infrastructure, and climate change have a new villain in the form of “flushable” wipes. Places including New York, London, San Francisco, and Toronto have been feeling the effects of wipe use. In an effort to protect its sewers, Washington D.C. sought to enact the Nonwoven Disposable Products Act. The Act would have limited the sale of flushable wipes and put in place labeling requirements. However, before the law took effect on January 1, 2017, Kimberly-Clark, the producer of such products, brought an action against the city to prevent the Act’s enforcement. In finding for Kimberly-Clark, the DC District Court held the law imposed an unconstitutional limit on free speech under the First Amendment. The ruling in Kimberly-Clark v. DC is an example of the two ways courts show deference to commercial speech rights: (1) application of a higher standard of review and (2) a minimization of government interests.

II. Case Summary

The provision at issue prohibited the sale of “nonwoven disposable products” that were labeled safe to flush unless they passed the flushable definition contained in the statute. It also required that products that were not safe for flushing be “conspicuously” labeled. At the outset, both parties agreed that the labeling dispute qualified as commercial speech under Central Hudson. In evaluating the regulation, Kimberly-Clark advocated for an application of the four-part Central Hudson test, while the District championed an application of Zauderer that evaluated disclosure requirements.

Zauderer holds “the First Amendment interests implicated by disclosure requirements are substantially weaker than those at stake when speech is actually suppressed.” The court reasoned that when regarding “purely factual and uncontroversial information” the speaker’s interest in disclosures is “minimal”. As such, the court has determined the rights of the speaker are protected so long as “disclosure requirements are reasonably related to the State’s interest in preventing deception of customers.” Compared to Central Hudson, this is a “relaxed standard of review. The court began with the caveat “[n]obody knows exactly” what falls under this designation, but stated that there must be “no dispute of factual accuracy” and is controversial if it is “inflammatory.”

Here, the district court found the categorization of nonwoven products as unflushable were not “uncontroversial” and thus foreclosed the application of Zauderer and its relaxed standard. In making this decision the court cited that Kimberly-Clark themselves vehemently disagree with the conclusion that the wipes are not flushable, and thus cuts against a finding of no controversy. The court pointed to competing definitions of “flushable” by industry organizations such as, the Association of the Nonwoven Fabrics Industry (INDA) and National Association for Clean Water Agency (NACWA), to support Kimberly-Clark’s claim. The court also discusses how other federal circuits have found disclosure requirements that “promote policies or views that are . . . expressly contrary to the corporation’s views” to be invalid. The court applied intermediate scrutiny and the Central Hudson test to the regulation.

Under Central Hudson, the government must show: “1) a substantial interest that 2) its restriction directly and material advances and 3) that the regulation is not ‘more extensive than is necessary to serve that interest.’” The court had no difficulty ruling against the government on all three parts. First, the court concluded the $500,000 estimated damage did not reach the “substantial interest requirement” when compared to the overall $535.8 million budget. Second, it concluded that DC failed to factually support the assertion that a limitation on wipes would save the sewer systems. Finally, the court found that no matter the conclusions to the first two Central Hudson prongs, the regulation itself was not narrowly tailored. The court criticized the process of the District in creating the regulation in that they “gave little thought to whether it needed that disclosure requirement in the first place”. Taken together, the court found the regulation failed the Central Hudson test and therefore was unconstitutional under intermediate scrutiny.

III. Implications

This case serves as a prime example of increased deference to commercial speech protections, both in reluctance to apply a more relaxed standard and a discounting of government interests. Commercial speech doctrine has been criticized for being vague and undefinable, and its squishy nature has led to differing application by courts. Here, the court elevated the standard of review based on the finding that the regulation was not “purely factual and noncontroversial” pointing to the controversy of the plaintiff itself. This creates a self-defeating rationale, a relaxed standard will be used if there is no controversy, but controversy can be found if there is a plaintiff that “vehemently” disagrees.

Further, under the heightened standard, the court found the District lacked evidence to support the claim the wipes contributed to the damage. The court found it easy to discount arguments that in other context have merited sufficient weight in other states. For example, cases in New York and Minnesota where there was sufficient evidence of this damage in pleadings to continue with a claim. In its evaluation of Central Hudson,the court also easily discounted the regulation because it found that the District of Columbia council did not “give thought” to whether the regulation was needed in the first place. Despite stating in the case that “ordinarily, the ‘preferred remedy’ for potentially misleading speech is ‘more disclosure, rather than less,’” and government need not choose the least restrictive means, but only the “reasonable fit” the court finds the disclosure requirement for wipes abhorrent.

This case illustrates how the DC Court has used the mystifying standard of commercial speech to heighten protections for commercial speakers, and in this case, continue the tirade of sewer clogs caused by flushable wipes.