In 1973, when an oil embargo caused fuel shortages, the New York Public Service Commission issued a regulation prohibiting electric companies from advertising to promote electricity use. Central Hudson Gas & Electric, a public utility company, challenged the regulation, arguing that its advertisements were commercial speech protected by the First Amendment.
Before the 1970s, commercial speech was viewed as outside the scope of First Amendment protection. By the mid-1970s, however, the Supreme Court began recognizing some degree of protection for commercial speech, striking down advertising restrictions in Bigelow and Virginia State Board of Pharmacy.
In Central Hudson, the U.S. Supreme Court ruled that the ban on advertisements for electricity violated the First Amendment. In doing so, the Court established a four-part test, balancing government and commercial-speech interests to determine when commercial- speech regulations infringe on free-speech rights. Under this ‘‘intermediate scrutiny’’ test, if the commercial speech is truthful and relates to lawful activity, the regulation must directly advance a substantial government interest and be no more extensive than necessary to serve that interest.
In Central Hudson, the Court held that although energy conservation represented a substantial government interest, and the restriction on advertising directly advanced that interest, the restriction was more extensive than necessary, as it banned even advertisements for products and services that use energy efficiently.
Since 1980, the Central Hudson test has endured as the standard governing regulation of commercial speech, despite being frequently criticized as too malleable, both by those favoring greater protection for commercial speech and by those favoring more government control over commercial speech. The most vocal critic of the Central Hudson test has been U.S. Supreme Court Justice Clarence Thomas, who would deem per se illegitimate any asserted government interest in withholding information from the public to manipulate their choices in the marketplace.
IRENE SEGAL AYERS
References and Further Reading
Cases and Statutes Cited
See also Balancing Approach to Free Speech; Balancing Test; Commercial Speech; First Amendment Balancing; 44 Liquormart v. Rhode Island, 517 U.S. 484 (1996); Freedom of Speech Extended to Corporations; Intermediate Scrutiny Test in Free Speech Cases; Thomas, Clarence; Virginia State Board of Pharmacy v. Virginia Citizens Consumer Council, Inc., 425 U.S. 748 (1976)