Robert Cahaly v. Paul LaRosa, III

PUBLISHED

UNITED STATES COURT OF APPEALS

FOR THE FOURTH CIRCUIT

No. 14-1651

ROBERT C. CAHALY,

Plaintiff – Appellee,

v.

PAUL C. LAROSA, III; REGINALD I. LLOYD; SOUTH CAROLINA LAW

ENFORCEMENT DIVISION,

Defendants – Appellants.

No. 14-1680

ROBERT C. CAHALY,

Plaintiff – Appellant,

v.

PAUL C. LAROSA, III; REGINALD I. LLOYD; SOUTH CAROLINA LAW

ENFORCEMENT DIVISION,

Defendants – Appellees.

Appeals from the United States District Court for the District

of South Carolina, at Greenville. J. Michelle Childs, District

Judge. (6:13-cv-00775-JMC)

Argued: March 25, 2015 Decided: August 6, 2015

Before WYNN, DIAZ, and THACKER, Circuit Judges.

Affirmed in part, vacated in part, and remanded with

instructions by published opinion. Judge Diaz wrote the

opinion, in which Judge Wynn and Judge Thacker joined.

ARGUED: Kenneth Paul Woodington, DAVIDSON & LINDEMANN, P.A.,

Columbia, South Carolina, for Appellants/Cross-Appellees.

Samuel Darryl Harms, III, HARMS LAW FIRM, PA, Greenville, South

Carolina, for Appellee/Cross-Appellant. ON BRIEF: Robert D.

Cook, Solicitor General, OFFICE OF THE ATTORNEY GENERAL,

Columbia, South Carolina; William H. Davidson, II, DAVIDSON &

LINDEMANN, P.A., Columbia, South Carolina, for Appellants/Cross-

Appellees.

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DIAZ, Circuit Judge:

Robert C. Cahaly, a self-described Republican political

consultant, was arrested for alleged violations of South

Carolina’s anti-robocall statute. After the charges were

dismissed, Cahaly filed suit, challenging the statute on three

First Amendment grounds: as an unlawful regulation of speech, as

impermissibly compelling speech, and as unconstitutionally

vague. Cahaly also sought damages from the law enforcement

officials involved in his arrest (and the agency employing

them), advancing claims under 42 U.S.C. § 1983 and state law for

false imprisonment and malicious prosecution.

Under the content-neutrality framework set forth in Reed v.

Town of Gilbert, 135 S. Ct. 2218 (2015), we find that the anti-

robocall statute is a content-based regulation that does not

survive strict scrutiny. 1 We also hold that Cahaly lacks

standing to bring compelled-speech and vagueness challenges, and

that his other claims fail due to the presence of probable cause

to arrest him. As a result, we affirm the district court’s

judgment except for the compelled-speech claim, which we vacate

and remand with instructions to dismiss it.

1 We received supplemental briefs from the parties on the

import of Reed to the issues on appeal.

3

I.

A.

In 1991, the South Carolina General Assembly enacted a

statute regulating automated telephone calls that deliver

recorded messages, or “robocalls.” 2 This statute places

different restrictions on robocalls depending on whether they

are (1) unsolicited and (2) made for consumer, political, or

other purposes. By definition, it prohibits only those

robocalls that are “for the purpose of making an unsolicited

consumer telephone call” or are “of a political nature

including, but not limited to, calls relating to political

campaigns.” S.C. Code Ann. § 16-17-446(A).

All qualifying robocalls are banned with three exceptions,

based on the express or implied consent of the called party:

(1) in response to an express request of the person

called; (2) when primarily connected with an existing

debt or contract, payment or performance of which has

not been completed at the time of the call; (3) in

response to a person with whom the telephone solicitor

has an existing business relationship or has had a

previous business relationship.

Id. § 16-17-446(B). If an exception applies, the permitted

robocall must “disconnect immediately when the called party

hangs up”; must be made between 8:00 AM and 7:00 PM; and “may

2The statute refers to robocalls as “Adad calls,” which

stands for “automatically dialed announcing device.” S.C. Code

Ann. § 16-17-446 (2014).

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not ring at hospitals, police stations, fire departments,

nursing homes, hotels, or vacation rental units.” Id. § 16-17-

446(C)(2)-(4). Some permitted robocalls must also disclose

certain information to the called party: “(1) the identity of

the seller; (2) that the purpose of the call is to sell goods or

services; [and] (3) the nature of the goods or services.” Id.

§§ 16-17-445(B)(1)-(3), -446(C)(1).

Other statutory provisions contain rules for live

solicitors making unsolicited consumer telephone calls.

Solicitors must place their calls from 8:00 AM and 9:00 PM, make

certain disclosures, and maintain a do-not-call list. Id.

§§ 16-17-445(B)-(E).

A violation of the statute constitutes a misdemeanor

offense. Id. § 16-17-446(D) (cross-referencing § 16-17-445(F)).

A first or second conviction carries a maximum punishment of a

$200 fine or 30 days in prison while a third or later conviction

carries a fine of $200 to $500 or the same maximum 30 days’

imprisonment. Id.

B.

On September 23, 2010, Cahaly allegedly placed robocalls in

six South Carolina house legislative districts. With the name

changed to reflect the Democratic candidate in each district,

the calls’ prerecorded message said:

Please hold for a one-question survey.

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As you may have heard, Speaker of the House Nancy

Pelosi is coming to South Carolina.

Do you think incumbent Democrat Anne Peterson Hutto

should invite her fellow Democrat Nancy Pelosi to come

campaign for her?

Press 1 if you think incumbent Democrat Anne Peterson

Hutto should invite her fellow Democrat Nancy Pelosi

to come and campaign for her.

Press 2 if you think incumbent Democrat Anne Peterson

Hutto should not invite her fellow Democrat Nancy

Pelosi to come and campaign for her.

J.A. 219-20.

About one week before the calls were placed, an attorney

with the South Carolina Office of the Attorney General told

Cahaly that the anti-robocall statute did not cover “automated

telephone survey polls of a political nature.” J.A. 74. The

attorney encouraged him to ask a member of the state House of

Representatives to seek a written opinion to that effect. A

representative made that request, and the Attorney General

issued a letter, the day before Cahaly made the robocalls,

stating:

In the opinion of this office, organizations, such as

Survey USA, may routinely conduct automated survey

telephone calls for political purposes in this State

that require the recipient’s responses via a phone

key. The purpose of the ADAD law is to prohibit the

unwarranted invasion by automated dialing devices in

order to promote advocacy of a “product” including a

particular candidate. Thus, as long as these polling

calls, even if they are of a political nature, do not

advocate a particular political candidate but simply

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obtain a “snapshot” opinion of a voter, they may be

made.

J.A. 83.

The day after Cahaly placed the robocalls, an incumbent

seeking reelection in one of the targeted districts wrote to the

South Carolina Law Enforcement Division (“SLED”) reporting that

her constituents had received telephone calls that violated the

anti-robocall statute. Over the next three weeks, Democratic

candidates in the other five districts also reported to SLED

that their constituents had received the same calls using their

names.

On November 1, 2010, a state magistrate judge issued six

warrants--one for each targeted district--for Cahaly’s arrest.

The election was held November 2. That same day, SLED issued a

press release announcing the warrants. On November 3, Cahaly

turned himself in, was booked, and was released on his own

recognizance. The warrants were dismissed eighteen months

later.

C.

Cahaly filed a complaint in state court against SLED; Paul

C. LaRosa, III, a special agent with SLED who completed the

arrest warrant applications; and Reginald I. Lloyd, the director

of SLED at the time of Cahaly’s arrest (collectively, the

“Defendants”). Cahaly sought a declaration that the anti-

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robocall statute was unconstitutional and an injunction

prohibiting the Defendants from enforcing it. He also alleged a

damages claim under 42 U.S.C. § 1983 and state law claims for

false imprisonment and malicious prosecution.

The Defendants removed the case to federal court. Cahaly

moved for partial summary judgment on his claim for declaratory

and injunctive relief. The Defendants moved for summary

judgment on all claims.

The district court granted Cahaly’s motion, declared the

anti-robocall statute unconstitutional, and issued a permanent

injunction barring enforcement of the statute. The district

court concluded that the statute was a content-based restriction

on speech and applied strict scrutiny. Under that rubric, the

court found the statute unconstitutional due to “its

underinclusiveness and its singling out of commercial and

political speech” when the asserted government interest was to

eliminate nearly all robocalls to protect residential privacy.

Cahaly v. LaRosa, 25 F. Supp. 3d 817, 827 (D.S.C. 2014). The

court also determined that the statutory provision requiring

robocalls to disclose certain identifying information was

unconstitutional as compelled speech, but that Cahaly lacked

standing to bring his vagueness challenge.

The district court awarded summary judgment to the

Defendants on Cahaly’s other claims. The court held that LaRosa

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and Lloyd were entitled to qualified immunity on the § 1983

claim because the right at issue was not clearly established.

The court also held that the existence of probable cause to

arrest Cahaly defeated his false imprisonment and malicious

prosecution claims.

The Defendants appeal the district court’s judgment

granting declaratory and injunctive relief. Cahaly cross-

appeals the district court’s judgment on his damages claims. We

review de novo the district court’s order granting summary

judgment and its ruling that a party lacks standing. Brown v.

Town of Cary, 706 F.3d 294, 300 (4th Cir. 2013).

II.

We begin with Cahaly’s First Amendment claim. First, we

consider whether the anti-robocall statute is a content-neutral

restriction on speech subject to intermediate scrutiny or a

content-based restriction that must withstand strict scrutiny.

We then turn to whether the statute’s mandatory disclosure

provision constitutes compelled speech. Lastly, we reach

Cahaly’s vagueness challenge. As explained below, we hold that

the statute is content based and does not survive strict

scrutiny, and that Cahaly lacks standing to bring his compelled-

speech and vagueness challenges.

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A.

The Supreme Court recently clarified the content-neutrality

inquiry in the First Amendment context. In Reed, the Court

explained that “the crucial first step in the content-neutrality

analysis” is to “determin[e] whether the law is content neutral

on its face.” 135 S. Ct. at 2228. At the second step, a

facially content-neutral law will still be categorized as

content based if it “cannot be ‘“justified without reference to

the content of the regulated speech,”’ or . . . adopted by the

government ‘because of disagreement with the message [the

speech] conveys.’” Id. at 2227 (quoting Ward v. Rock Against

Racism, 491 U.S. 781, 791 (1989)).

This formulation conflicts with, and therefore abrogates,

our previous descriptions of content neutrality in cases such as

Brown v. Town of Cary. See 706 F.3d at 303 (“[I]f a regulation

is ‘justified without reference to the content of regulated

speech,’ [citation omitted] ‘we have not hesitated to deem

[that] regulation content neutral even if it facially

differentiates between types of speech.’”) (quoting Wag More

Dogs, Ltd. Liab. Corp. v. Cozart, 680 F.3d 359, 366 (4th Cir.

2012) (last alteration in original)). Our earlier cases held

that, when conducting the content-neutrality inquiry, “[t]he

government’s purpose is the controlling consideration.”

Clatterbuck v. City of Charlottesville, 708 F.3d 549, 555 (4th

10

Cir. 2013) (quoting Ward, 491 U.S. at 791). But Reed has made

clear that, at the first step, the government’s justification or

purpose in enacting the law is irrelevant. 135 S. Ct. at 2228-

29.

Applying Reed’s first step, we find that South Carolina’s

anti-robocall statute is content based because it makes content

distinctions on its face. Reed instructs that “[g]overnment

regulation of speech is content based if a law applies to

particular speech because of the topic discussed or the idea or

message expressed.” 135 S. Ct. at 2227. Here, the anti-

robocall statute applies to calls with a consumer or political

message but does not reach calls made for any other purpose.

Because of these facial content distinctions, we do not reach

the second step to consider the government’s regulatory purpose.

See id. at 2228 (“[A]n innocuous justification cannot transform

a facially content-based law into one that is content neutral.”)

As a content-based regulation of speech, the anti-robocall

statute is subject to strict scrutiny. Id. at 2231. Under this

standard, the government must prove “that the restriction

furthers a compelling interest and is narrowly tailored to

achieve that interest.” Id. (quoting Ariz. Free Enter. Club’s

Freedom Club PAC v. Bennett, 131 S. Ct. 2806, 2817 (2011)). “If

a less restrictive alternative would serve the [g]overnment’s

purpose, the legislature must use that alternative.” United

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States v. Playboy Entm’t Grp., Inc., 529 U.S. 803, 813 (2000).

Moreover, the restriction cannot be overinclusive by

“unnecessarily circumscrib[ing] protected expression,”

Republican Party of Minn. v. White, 536 U.S. 765, 775 (2002)

(quoting Brown v. Hartlage, 456 U.S. 45, 54 (1982)), or

underinclusive by “leav[ing] appreciable damage to [the

government’s] interest unprohibited,” Reed, 135 S. Ct. at 2232

(quoting White, 536 U.S. at 780).

The asserted government interest here is to protect

residential privacy and tranquility from unwanted and intrusive

robocalls. Assuming that interest is compelling, we hold that

the government has failed to prove that the anti-robocall

statute is narrowly tailored to serve it. Plausible less

restrictive alternatives include time-of-day limitations,

mandatory disclosure of the caller’s identity, or do-not-call

lists. See Maryland v. Universal Elections, Inc., 729 F.3d 370,

376 (4th Cir. 2013) (evaluating the federal Telephone Consumer

Protection Act’s identity disclosure requirement); Nat’l Fed’n

of the Blind v. F.T.C., 420 F.3d 331, 333-34 (4th Cir. 2005)

(examining a federal regulation that “requires callers to make

certain disclosures, refrain from making late-night, early-

morning, and ‘abandoned calls’ (calls followed by silence), and

comply with a . . . ‘do-not-call list’”); Van Bergen v.

Minnesota, 59 F.3d 1541, 1551 (8th Cir. 1995) (considering

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Minnesota’s ban on robocalls from 9 PM to 9 AM). The government

has offered no evidence showing that these alternatives would

not be effective in achieving its interest.

In addition, the record contains evidence that the anti-

robocall statute is overinclusive. The Defendants themselves

cite to a report from a U.S. House of Representatives committee

that concluded, “Complaint statistics show that unwanted

commercial calls are a far bigger problem than unsolicited calls

from political or charitable organizations.” H.R. Rep. 102-317,

at 16 (1991). Yet the statute also targets political calls.

At the same time, the statute suffers from

underinclusiveness because it restricts two types of robocalls--

political and consumer--but permits “unlimited proliferation” of

all other types. Reed, 135 S. Ct. at 2231; see id. (“The Town

cannot claim that placing strict limits on temporary directional

signs is necessary to beautify the Town while at the same time

allowing unlimited numbers of other types of signs that create

the same problem.”).

Because the statute does not pass muster under strict

scrutiny, we affirm the district court’s judgment declaring it

unconstitutional.

B.

Turning to Cahaly’s compelled-speech challenge, if

robocalls are permitted because they fall within one of the

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three exceptions listed in Section 16-17-446(B), then the

statute requires those calls to disclose “(1) the identity of

the seller; (2) that the purpose of the call is to sell goods or

services; [and] (3) the nature of the goods or services.” S.C.

Code Ann. § 16-17-446(C)(1) (cross-referencing § 16-17-

445(B)(1)-(3)). The district court ruled that these mandatory

disclosures unconstitutionally compel speech. The Defendants

contend this ruling is in error due to the absence of a case or

controversy, a jurisdictional prerequisite under Article III of

the U.S. Constitution. We agree.

One requirement of Article III standing is that the

plaintiff suffer an “injury in fact.” Susan B. Anthony List v.

Driehaus, 134 S. Ct. 2334, 2341 (2014) (quoting Lujan v.

Defenders of Wildlife, 504 U.S. 555, 560 (1992)). While “actual

arrest or prosecution” for violating a statute establishes an

injury in fact, Steffel v. Thompson, 415 U.S. 452, 459 (1974),

so too may a “credible threat of prosecution thereunder.”

Babbitt v. United Farm Workers Nat’l Union, 442 U.S. 289, 298

(1979).

As the Defendants note, Cahaly was not charged with

violating Section 16-17-446(C)(1), the disclosure provision,

despite the affidavits submitted to the magistrate judge

alleging that Cahaly’s robocalls “failed to promptly disclose in

a clear and conspicuous manner to the receiver of the call the

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identity of the originating party, endorsement of a candidate

and or [sic] the nature of the call.” J.A. 237-42. Rather, he

was charged solely with violating Sections 16-17-446(A)-(B),

which ban political robocalls outright. In addition, the

affidavits do not allege any facts about Cahaly’s relationship

to the called parties, but the called parties’ express or

implied consent to being called is a necessary condition for the

disclosure provision to apply. See S.C. Code Ann. § 16-17-

446(B)-(C). Thus, federal jurisdiction hinges on whether Cahaly

faces “sufficiently imminent” future arrest or prosecution.

Driehaus, 134 S. Ct. at 2342.

The record contains no evidence to support this

prerequisite to federal jurisdiction. In a declaration, Cahaly

explains his “desire to conduct telephone survey polls in the

future in the State of South Carolina of a political nature and

telephone calls related to political campaigns.” J.A. 73. But

never does he allege his intention to make robocalls permitted

by the statute, and therefore subject to the disclosure

provision, by falling within one of the Section 16-17-446(B)

exceptions.

As a result, Cahaly lacks standing to challenge the

disclosure provision as compelled speech. We therefore vacate

the district court’s judgment on this claim, and remand with

instructions to dismiss it.

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C.

Regarding Cahaly’s vagueness challenge, the district court

ruled that he lacked standing to press it. We agree.

“One to whose conduct a statute clearly applies may not

successfully challenge it for vagueness.” Parker v. Levy, 417

U.S. 733, 756 (1974). Cahaly argues that the anti-robocall

statute does not clearly apply to him because he made survey

calls. But he does not dispute that his robocalls were also “of

a political nature,” a category to which the statute expressly

applies. S.C. Code Ann. § 16-17-446(A). Because the statute

squarely covers Cahaly’s calls, we affirm the district court’s

judgment dismissing his vagueness challenge.

III.

We turn to Cahaly’s cross-appeal of his § 1983 and state

law claims. Because we find that probable cause supported his

arrest for violating the anti-robocall statute, we affirm the

district court’s grant of summary judgment to the Defendants.

A.

Cahaly alleges that LaRosa and Lloyd violated § 1983 by

arresting and prosecuting him in retaliation for his exercise of

free speech. He first argues that a genuine issue of material

fact exists as to whether LaRosa had probable cause to arrest

him. We disagree.

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A law enforcement officer who obtains an arrest warrant

loses the protection of qualified immunity “[o]nly where the

warrant application is so lacking in indicia of probable cause

as to render official belief in its existence unreasonable.”

Torchinsky v. Siwinski, 942 F.2d 257, 261 (4th Cir. 1991)

(alteration in original) (quoting Malley v. Briggs, 475 U.S.

335, 344-45 (1986)). “‘[P]robable cause’ to justify an arrest

means facts and circumstances within the officer’s knowledge

that are sufficient to warrant a prudent person, or one of

reasonable caution, in believing, in the circumstances shown,

that the suspect has committed . . . an offense.” Michigan v.

DeFillippo, 443 U.S. 31, 37 (1979). Although we agree with

Cahaly and the district court that the statute is

unconstitutional, at the time of Cahaly’s arrest, “there was no

controlling precedent that [the statute] was or was not

constitutional [and a] prudent officer [is not] required to

anticipate that a court would later hold the [statute]

unconstitutional.” Id. at 37-38. Thus, our earlier holding has

no bearing on whether LaRosa had probable cause when he arrested

Cahaly.

Before making the arrest, LaRosa had statements from six

witnesses describing the robocalls and a recording of one of the

calls. Some of the witnesses also provided the telephone number

of the caller, and a later investigation connected that number

17

to Cahaly as the president of the entity that paid for it.

Moreover, one witness reported that the call “was not a real

survey because pressing a button was not an option.” J.A. 128.

LaRosa was also aware of the Attorney General’s opinion

letter stating that “automated survey telephone calls for

political purposes” fell outside the anti-robocall statute.

J.A. 83. However, we think that a reasonable officer could have

determined that Cahaly’s robocalls differed from those

contemplated by the Attorney General based on the overtly

political nature of the calls and one witness’s view that the

survey aspect was a sham. Even if that determination was wrong

as a matter of law, officers may have probable cause to arrest

based on “reasonable mistakes of law.” Heien v. North Carolina,

135 S. Ct. 530, 536-37 (2014).

Cahaly contends that the arrest warrants are facially

invalid because they include disclosure requirements that appear

nowhere in the statute. The affidavits used to obtain the

warrants allege that Cahaly “failed to promptly disclose in a

clear and conspicuous manner to the receiver of the call the

identity of the originating party, endorsement of a candidate

and or [sic] the nature of the call.” J.A. 237-42. But Section

16-17-446(C) only requires some robocalls to disclose “(1) the

identity of the seller; (2) that the purpose of the call is to

18

sell goods or services; [and] (3) the nature of the goods or

service.” S.C. Code Ann. § 16-17-445(B)(1)-(3).

An arrest warrant is invalid only if the officer preparing

the affidavit included a false statement with reckless disregard

for its truth and, after that statement is redacted, “the

affidavit’s remaining content is insufficient to establish

probable cause.” Franks v. Delaware, 438 U.S. 154, 156 (1978).

Even assuming that the disclosure requirements in the affidavits

were false statements and that LaRosa acted with reckless

disregard for their truth by including them, we still find

probable cause based on the remaining content. The affidavits

allege that Cahaly made robocalls of a political nature, and

nothing more is required to violate the anti-robocall statute.

Consequently, we affirm the district court’s judgment that

LaRosa and Lloyd are entitled to qualified immunity. 3

3

Cahaly also argues that the arrest warrant affidavits fail

to include an essential element of the offense by not alleging

that his robocalls included a prize promotion. Section 16-17-

446(A) defines “‘Adad’ [to] mean[] an automatically dialed

announcing device which delivers a recorded message without

assistance by a live operator for the purpose of making an

unsolicited consumer telephone call as defined in Section 16-17-

445(A)(3).” The cross-reference takes readers to the definition

for a “prize promotion” at Section 16-17-445(A)(3) while the

definition for “unsolicited consumer telephone call” appears at

Section 16-17-445(A)(4). According to Cahaly, this cross-

reference should be interpreted literally, such that

“unsolicited consumer telephone call” means “prize promotion.”

(Continued)

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B.

From our conclusion that LaRosa had probable cause to

arrest Cahaly, we quickly dispense with Cahaly’s state law

claims. Under South Carolina law, a claim for false

imprisonment requires the plaintiff to demonstrate, in part,

that “the restraint was unlawful.” Law v. S.C. Dep’t of Corr.,

629 S.E.2d 642, 651 (S.C. 2006). “The fundamental issue in

determining the lawfulness of an arrest is whether there was

probable cause to make the arrest.” Id. To state a claim for

malicious prosecution, a South Carolina plaintiff must

establish, among other things, “lack of probable cause.” Id. at

648. Because Cahaly has not satisfied this element of the

claims, we affirm the district court’s judgment in favor of the

Defendants.

We find that construction nonsensical and obviously

contrary to legislative intent. The statute provides a

definition for “unsolicited consumer telephone call” in the very

next subsection. And as the Defendants point out, the

legislative history shows that the cross-reference to prize

promotion is a typographical error. As originally enacted, the

definition of “unsolicited consumer telephone call” appeared at

Section 16-17-445(A)(3). H.R. 3453, 107th Gen. Assemb. (S.C.

1988). The legislature later added a definition for “prize

promotion” and bumped the definition for “unsolicited consumer

telephone call” to the next subsection. In so doing, the

legislature simply neglected to update the cross-reference in

Section 16-17-446(A).

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IV.

For the foregoing reasons, we affirm in part and vacate in

part the district court’s judgment, and remand the case with

instructions to dismiss the compelled-speech claim.

AFFIRMED IN PART, VACATED IN PART,

AND REMANDED WITH INSTRUCTIONS

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