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The U.S. Supreme Court on April 23 appeared ready to protect Nike Inc. from being sued by a private individual who claims that the company’s defense of its global labor practices amounts to false advertising. But after 70 minutes of oral argument in Nike v. Kasky, it was unclear that the Court’s ruling would go much beyond that, to give companies broad protection from being sued over their participation in political debates with commercial overtones. Several justices seemed to think that Nike’s statements could be legally vulnerable if California or the Federal Trade Commission � rather than consumer activist Marc Kasky � had taken legal action against Nike, or even if Kasky himself claimed that he had bought sneakers and had been harmed by Nike’s claims that it paid its overseas workers decent wages. Antiglobalization groups criticized Nike, among other large companies, in the late 1990s for what were described as sweatshop conditions in its factories worldwide. When Nike fought back with a public relations campaign � including letters to the editor, op-ed columns, and written reports � Kasky invoked state laws against commercial fraud in challenging Nike’s statements. Although the case did not go to trial, the California Supreme Court agreed with Kasky that the Nike statements were commercial speech. Corporate Free Speech Companies, media organizations, and the Bush administration joined Nike in challenging the California ruling. Some First Amendment advocates expressed hope that the case would be a vehicle for expanding corporate free speech rights. But during oral arguments, it appeared the Court was no closer than it had been in the past to expanding or even clearly defining the category of corporate, noncommercial speech, which deserves full First Amendment protection, as opposed to commercial speech or advertising, which gets less protection. Free-Floating Power Nike’s lawyer in the case, Harvard Law School professor Laurence Tribe, told the Court that the company’s statements “don’t come close” to commercial speech � even a letter sent by Nike to school athletic directors, who make purchasing decisions about athletic equipment. Tribe also asserted that Kasky “doesn’t have standing to sue for athletic directors.” California has given Kasky “free-floating power to correct speech,” Tribe said. Kasky’s unusual status under California law as a “private attorney general” seemed to work in Nike’s favor, and was underlined by Solicitor General Theodore Olson, who also argued on Nike’s behalf. Olson said that California consumer protection laws allow “unelected, unaccountable, private enforcers” to sue companies at random. He also said anyone with a whim or grievance against a company could become a “licensed censor.” But in answers to questions from the justices, Olson implied that if Kasky had actually claimed to have suffered “concrete harm” � for example, by buying Nike shoes in reliance on its statements about its labor practices � the suit would be on firmer constitutional ground. He also implied that California itself could have used Nike’s statements as the foundation for an enforcement action. Kasky’s lawyer, Paul Hoeber of San Francisco’s Bushnell, Caplan & Fielding, readily acknowledged to the Court that Kasky had never bought Nike sneakers “and never will.” As a result, Hoeber said, Kasky’s suit would not have met federal standards for a viable suit, but under California law it was permitted. Hoeber did not fare well during one portion of the oral argument, when Justice Stephen Breyer proclaimed that Nike’s campaign was a combination of both commercial and noncommercial speech. Nike was trying to “sell products” as well as to contribute to an important “public debate,” Breyer said. Hoeber started to respond that, to protect consumers, the Nike campaign should be regarded as commercial speech. Breyer, sounding skeptical, asked, “That trumps the First Amendment?” Justice Anthony Kennedy then intervened to ask whether the Court had ever upheld a statute that “chilled speech.” Hoeber replied, “Oh, yes,” but when Kennedy asked him to name an instance, Hoeber paused for a long time and finally said, “You caught me there.”

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