Appendix — R. J. Reynolds Tobacco Co. v. Shewry

The Court extended this fundamental principle of

freedom of expression to situations “involving expression

by groups which include persons who object to the speech,

but who, nevertheless, must remain members of the group

by law or necessity.” United Foods, 533 U.S. at 413. The

first such case, Abood v. Detroit Board of Education, 431

U.S. 209, 52 L. Ed. 2d 261, 97 S. Ct. 1782 (1977), involved

a challenge by public school teachers to a collective

bargaining agreement. The agreement required non-

union members who were represented by the teachers

union to pay a service fee equal to union dues. Some

portions of this service fee were then used to pay “for

political and ideological purposes unrelated to collective

bargaining.” /d. at 232. The Court held that this program

violated the principle that “the freedom of an individual

to associate for the purpose of advancing beliefs and

ideas” is protected by the First Amendment. Jd. at 233.

Although the union could compel objectors to provide

funds for purposes that were “germane” to “its duties as

|a] collective-bargaining representative,” it would violate

basic principles of freedom of association to compel the

financial support of objectors for ideological purposes

unrelated to collective bargaining. Jd. at 235. The Court

revisited similar issues in Keller v. State Bar of

California, 496 U.S. 1, 110 L. Ed. 2d 1, 110 S. Ct. 2228

(1990), in which it invalidated a program in which

mandatory dues to the California State Bar were used,

over member's objections, to advance political and

ideological causes to which some bar members did not

subscribe. The Court held that the state bar could use

compulsory membership dues to finance activities

“germane” to the purposes for which the “compelled

association and integrated bar |were] justified . . . the

State’s interest in regulating the iegal profession and

improving the quality of legal services.” /d. at 13. It could

not, however, order compulsory dues to be used to “fund

activities of an ideological nature which fell outside of

those areas of activity.” Jd. at 14. Abood and Keller set

lla

forth the principles that were later applied—with

differing results—-in Glickman v. Wileman Bros. & Elliott,

521 U.S. 457, 138 L. Ed. 2d 585, 117 S. Ct. 2130 (1997),

and in United Foods to programs in which the

government compels agricultural producers to contribute

to joint marketing programs. In Glickman, the Court

rejected a First Amendment challenge to a regulatory

program that required tree fruit growers to fund

marketing campaigns as part of a broader regulation of

the industry. The crucial distinction between Glickman

and United Foods is that the mandatory assessment in |

Glickman was “ancillary to a more comprehensive

program restricting market autonomy.” United Foods, 533

U.S. at 411. We have explained the distinction between

the two cases as follows: “If the generic advertising

assessment is part of a ‘comprehensive program’ that

‘displaces many aspects of independent business activity,’

exempts the firms within its scope from the antitrust

laws, and makes them ‘part of a broader collective

enterprise, the assessment does not violate the First

Amendment.” Delano Farms v. Cal. Table Grape Comm’n,

318 F.3d 895, 898-99 (9th Cir. 2003). The program in

United Foods, on the other hand, raised a constitutional

problem because “if the program is, in the main, simply

an assessment of independent and competing firms to pay

for generic advertising, it does violate the First

Amendment.” Jd. at 899. The United Foods rule protects

against “making one entrepreneur finance advertising for

the benefit of his competitors” when there is no broader

regulatory interest at stake. 533 U.S. at 418 (Stevens, J.,

concurring).

Seen in this perspective, United Foods is a logical

extension of a long line of cases that have protected both

freedom of expression and freedom of association. See

United States v. Frame, 885 F.2d 1119, 1132 (3d Cir.

1989) (describing the “underlying rationale of the right to

be free from compelled speech or association” as guiding

the Abood line of cases).

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Under Wooley and Barnette, the First Amendment

does not permit the government to force citizens to

express beliefs that are not their own. As an extension of

this principle, under Abvod, Keller and United Foods, the

First Amendment also does not permit the government to

force citizens to contribute to a private association when

the funds are used primarily to support expression from a

certain viewpoint.® The First Amendment may, however,

under Abood and Glickman, permit the government to

compel contributions to an association’s expression when

that expression is germane to a broader regulatory

scheme that compelled the association in the first place.®

* Read in this context, it is clear that United Foods relied on

harm to expressive and associational freedoms in order to

support its conclusion. See 533 U.S. at 413 (“It is true that the

party who protests the assessment here is required simply to

support speech by others, not to utter the speech itself. We

conclude, however, that the mandated support is contrary to

the First Amendment principles set forth in cases involving

expression by groups which include persons who object to the

speech, but who, nevertheless, must remain members of the

group by law or necessity.”) (emphasis added). The Court

emphasized that contributions to the Mushroom Council forced

certain private parties to pay for the speech of other private

parties—a violation of both expressive and associative freedom.

Id. at 416 (noting “the mandatory assessments imposed to

require one group of private persons to pay for speech by

others”).

6 Because United Foods is easily reconciled with previous

Supreme Court precedent,-we-do-not see a basis in United

Foods for our dissenting colleague’s view that, in distinguishing

Glickman, the Court intended to untether the compelled speech

doctrine from its expressive and associational moorings and

create a new constitutional right to challenge all forms of

targeted taxation. Nor does United Foods suggest that we

should apply principles governing government suppression of

private commercial speech, see Central Hudson Gas & Elec.

Corp. v. Pub. Serv. Comm'n, 447 U.S. 557, 564, 65 L. Ed. 2d

341, 100 S. Ct. 2343 (1980), to this case—in which the

(...continued)

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Nothing in United Foods suggests that the compelled

speech doctrine applies to situations where the

government imposes an excise tax on private citizens and

then uses the money to speak in the name of the

government itself. No court has held otherwise. See

NAACP vy. Hunt, 891 F.2d 1555, 1566 (11th Cir. 1990)

(“Abood has never been applied to the government,

however; if it were, taxation would become impossible.”).

An otherwise valid tax for an otherwise valid purpose

ordinarily must bind even those who object to the

government’s objective. In Board of Regents of the

University of Wisconsin System v. Southworth, 529 U.S.

217, 229, 146 L. Ed. 2d 193, 120 S. Ct. 1346 (2000), the

Court explained that:

It is inevitable that government will adopt

and pursue programs and policies within its

constitutional powers but which

nevertheless are contrary to the profound

beliefs and sincere convictions of some of its

citizens. The government, as a general rule,

may support valid programs and policies by

taxes or other exactions binding on

protesting parties. Within this broader

principle it seems inevitable that funds

raised by the government will be spent for

speech and other expression to advocate

and defend its own policies.

Put simply, the rationale of the Abvod and Keller line

of cases—protecting freedom of expression and

association—does not apply to government speech when

the government acts as both a taxing authority and as a

government has neither suppressed nor compelled speech, but

has merely used an excise tax to fund a governmental message.

Surely if the Court in United Foods had intended to create such

broadly sweeping principles, it would have said so.

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speaker. Paying a tax, even an excise tax, does not create

a compelled form of association. When the government

acts as a speaker it may espouse views that directly

contradict those of taxpayers without interfering with

taxpayers’ freedom of expression. In a democracy based

on majority rule, such a conclusion is inescapable.

“Government officials are expected as a part of the

democratic process to represent and to espouse the views

of a majority of their constituents. .. . If every citizen

were to have a right to insist that no one paid by public

funds express a view with which he disagreed, debate

over issues of great concern to the public would be limited

to those in the private sector, and the process of

government as we know it radically transformed.” Keller,

496 U.S. at 12-13. As we have said before, “simply

because the government opens its mouth to speak does

not give every outside individual or group a First

Amendment right to play ventriloquist.” Downs v. Los

Angeles Unified School Dist., 228 F.3d 1003, 1013 (9th

Cir. 2000).

B. > 2e California Regulation and Compelled Speech

The companies claim that their situation is unique

because the DHS pays for its anti-industry ads

exclusively from revenues raised ultimately through the

surtax, which in turn is derived exclusively from sales of

cigarette packages. They argue that imposing an excise

tax on a particular industry and then earmarking the use

of the tax funds for advertisements that criticize that

industry suffices to make the companies similarly

situated to the plaintiffs in the compelled speech cases.

There is a fundamental difference between the excise

tax/spending regime at issue here and the compelled

contributions to private associations that were at issue in

Abvod, Keller and United Foods. When a union, a state

bar association or even a mushroom growers’ association

speaks, it represents only the interests of that particular

entity. When California uses funds from the tobacco

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surtax to produce advertisements, it does so in the name

of all of California’s citizens. As the district court

observed, “|The tobacco companies] are not seeking to

prevent coerced participation in private association;

rather, they are attempting to exercise a taxpayer's veto

over speech by the government itself.” Bonta, 272 F.

Supp. 2d at 1100. That California has chosen to fund a

valid public health message through a targeted excise tax

does not mean that it is no longer speaking as the State of

California.

The key issue is not the targeted nature of the tax but

the degree of governmental control over the message. See

Livestock Mktg. Ass’n v. USDA, 335 F.3d 711, 723 (8th

Cir. 2003) (noting that “the greater the government’s

responsibility for, and control over, the speech in

question, the greater the government’s interest therein”).

In the compelled speech cases cited by the companies,

control over the content of the message produced had

been delegated to an association “representative only of

one segment of the population, with certain common

interests.” Abood, 431 U.S. at 259 n.13 (Powell, J.,

concurring). The problem with the government forcing

private citizens to contribute funds in those cases was

that the funds were being used to support the speech of

such segmented, specific interests. Here there can be no

doubt that the tobacco companies’ funds are being used to

speak on behalf of the people of California as a whole. Any

coercion—that is, the collection of funds used to produce a

particular message—is performed not in the name of a

segment of the public, but of the state.

Indeed, a wide range of First Amendment cases

differentiate between the government controlling the

expenditure of its own revenue and the government

sharing control with private or quasi-private parties. See,

v.g., Rust v. Sullivan, 500 U.S. 173, 197, 114 L. Ed. 2d

233, 111 S. Ct. 1759 (1991) (distinguishing situations

where the government imposes a direct constraint on the

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use of its own money from situations “in which the

Government has placed a condition on the recipient of the

subsidy rather than on a particular program or service,

thus effectively prohibiting the recipient from engaging in

the protected conduct outside the scope of the federally

funded program”); FCC v. League of Women Voters of Cal.,

468 U.S. 364, 399-400, 82 L. Ed. 2d 278, 104 S. Ct. 3106

(1984) (same); Widmar v. Vincent, 454 U.S. 263, 268, 70

L. Ed. 2d 440, 102 S. Ct. 269 (1981) (establishing limited

public forum doctrine and explaining that the First

Amendment “forbids a State to enforce certain exclusions

from a forum generally open to the public, even if it was

not required to create the forum in the first place”).

This is not to say that a state may avoid the limits of

the First Amendment simply by labeling a compelled

contribution a contribution to the government’s own

speech. As the Supreme Court has noted, a state law

“determination that [an entity] is a ‘government agency,’

and therefore entit’ed to the treatment accorded a

governor, a mayor, or a state tax commission, for

instance, is not binding on us when such a determination

is essential to the decision of a federal question.” Keller,

496 U.S. at 11. The analysis may differ when the

government nominally controls the production of

advertisements, but as a practical matter has delegated

control over the speech to a particular group that

represents only one segment of the population. See

Frame, 885 F.2d at 1133-34 (describing compelled

contributions to a nominally government controlled

“Cattleman’s Board,” where the persons with actual

control over the disbursement of funds were private

individuals “whose primary or overriding purpose is to

promote the welfare of the cattle producers” (quoting 7

U.S.C. § 2905(b)(4))); see also Mich. Pork Producers Ass'n

v. Veneman, 348 F.3d 157, 161 (6th Cir. 2003) (“We

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conclude that the pork industry’s extensive control over

the Pork Act’s promotional activities prevents their

attribution to the government.”).’ But that situation is

not present here. As the district court put it, “while in

some cases the distinction between government speech

and compelled allegiance may present ‘difficult issues,’

the analysis here is straightforward.” Bonta, 272 F. Supp.

2d at 1100 (quoting United Foods, 533 U.S. at 417).

In their complaint, the tobacco companies themselves

allege that the director of the DHS, a government agency,

is “ultimately responsible for the advertising challenged

in this action.” The DHS is acting expressly according to

California law, which directs the DHS to implement a

media campaign emphasizing “both preventing the

initiation of tobacco use and quitting smoking . . . based

on professional market research and surveys necessary to

determine the most effective method of diminishing

tobacco use among specified target populations.” Cal.

* Thus, the dissent’s claim that there is an “untenable

distinction” between situations in which the government speaks

for itself and situations where the government has effectively

licensed control over speech to a private organization is

misplaced. In similar cases, courts can (and often have)

examined whether or not the government has delegated

authority to a private body, such that a compelled subsidy is

being used to support a private interest instead of a

governmental one. See, e.g., Cochran v. Veneman, 359 F.3d 263,

278 (3d. Cir. 2003) (finding First Amendment concerns where

an agricultural act “seemed to really be special interest

legislation on behalf of the industry's interest more . . . than the

government's”). Indeed, this was what was at issue in the

language the dissent quotes from the Third Circuit’s decision in

Frame; that court identified an improper “coerced nexus

between the individual and . . . specific expressive activity” in a

case where “the Cattlemen’s Board seems to be an entity

‘representative of one segment of the population, with certain

common interests. “ Frame, 885 F.2d at 1132, 1133 (citing

Abood, 431 U.S. at 259 n.13 (Powell, J., concurring)).

18a

Health & Safety Code § 104375(e)(1). The advertisements

are also clearly identified as coming from the government

itself and not from the tobacco companies, the tobacco

industry or any other private party or group. Cf. Frame,

885 F.2d at 1133 n.11 (describing advertisements

“without mention of the Secretary or the Department of

Agriculture, thus failing to communicate that the

advertisements are funded through a_ government

program”). As _ noted above, all the contested

advertisements expressly state that they are sponsored by

the DHS. Plainly, in imposing the surtax and in

producing the contested advertisements, California is

acting on behalf of all of its citizens.*

8’ As a point of comparison, it is worth citing those

aspects of the organization of the State Bar of California

upon which the Supreme Court relied to hold that its

speech should not be classified as coming from the

government itself:

The State Bar of California is a good deal different

from most other entities that would be regarded in

common parlance as “governmental agencies.” Its

principal funding comes, not from appropriations

made to it by the legislature, but from dues levied on

its members by the board of governors. Only lawyers

admitted to practice in the State of California are

members of the State Bar, and all 122,000 lawyers

admitted to practice in the State must be members.

[The State Bar] undoubtedly performs important and

valuable services for the State by way of governance of

the profession, but those services are essentially

advisory in nature. The State Bar does not admit

anyone to the practice of law, it does not finally disbar

or suspend anyone, and it does not ultimately

establish ethical codes of conduct. All of those

functions are reserved by California law to the State

(...continued)

19a

C. Excise Taxation, Government Speech ard the First

Amendment

In short, by being required to contribute to the DHS’s

advertisements, the tobacco companies have not been

deprived of their freedom of expression or their freedom of

association, which are the harms that the compelled

speech cases protect against. The tobacco companies’

claim goes to another kind of harm—the harm caused by

paying an excise tax used to fund government speech of

which they understandably disapprove.

The tobacco companies concede that the state would

not have violated the First Amendment had it imposed

the same surtax on cigarette packs, commingled the

proceeds of the surtax with the state’s general fund and

then used the general fund to produce precisely the same

Supreme Court. ... The State Bar of California was

created, not to participate in the general government

of the State, but to provide specialized professional

advice to those with the ultimate responsibility of

governing the legal profession. Its members and

officers are such not because they are citizens or

voters, but because they are lawyers. We think that

these differences between the State Bar, on the one

hand, and traditional government agencies and

officials, on the other hand, render unavailing |the

State Bar’s| argument that it is not subject to the

same constitutional rule with respect to the use of

compulsory dues as are labor unions representing

public and private employees.

Keller, 496 U.S. at 11, 13 (footnotes and citations

omitted). Here, by contrast, the contested advertisements

are unquestionably part of the “general government of the

state.”

20a

advertisements. Thus, the tobacco companies object only

to the nexus between the excise tax and_ the

advertisements. Federal courts have traditionally given

great deference to a state’s control over its financial

affairs when faced with constitutional challenges. See,

e.g., San Antonio Independent Sch. Dist. v. Rodriguez, 411

U.S. 1, 40, 36 L. Ed. 2d 16, 93 S. Ct. 1278 (1973) (noting,

in a challenge under the Equal Protection Clause, that

“this Court has often admonished against such

interferences with the State’s fiscal policies”); see also

Welsch v. Likins, 550 F.2d 1122, 1131-32 (8th Cir. 1977)

(“No right of a state is entitled to greater respect by the

federal courts than the state’s right to determine how

revenues should be raised and how and for what purposes

public funds should be expended.”). The Supreme Court

has repeatedly emphasized that deference not warranted

in other regulatory areas is warranted when it comes to

the tax system. Regan v. Taxation With Representation of

Wash., 461 U.S. 540, 547-548, 76 L. Ed. 2d 129, 103 S. Ct.

1997 (1983) (“Legislatures have especially broad latitude

in creating classifications and distinctions in tax statutes.

‘In taxation, even more than in other fields,

legislatures possess the greatest freedom in

classification.” (quoting Madden v. Kentucky, 309 U.S. 83,

87-88, 84 L. Ed. 590, 60 S. Ct. 406 (1940))). The tobacco

companies can point to no case in which, when the state

has the right both to impose the relevant tax and to

promulgate the relevant speech, the First Amendment

mandates that a state arrange its budgetary categories so

as to make the link between a tax and speech less direct.

The implication of the tobacco companies’ argument

is that industries subject to an excise tax are entitled to a

special veto over government speech funded by the tax.

Such a right, in turn, would suggest that excise taxes,

especially those that earmark funds for particular

purposes, are so unusual or improper that they should

allow payors of those taxes to avoid the political process

and use the courts to control government speech. This

Pia

suggestion fundamentally misunderstands the history of

taxation in the United States, because excise taxation

targeted at particular goods or industries is not only

common but predates the income tax. See U.S. CONST.

art. I, § 8, cl. 1 (“The Congress shall have Power To lay

and collect Taxes, Duties, Imposts and _ Excises”)

(emphasis added); THE FEDERALIST NO. 12 (Alexander

Hamilton) (“In America, far the greatest part of the

national revenue is derived from taxes of the indirect

kind, from imposts, and from excises.”). One of the

earliest Supreme Court cases upheld a uniform national

excise tax on carriages. Hylton v. United States, 3 U.S. (3

Dall.) 171, 1 L. Ed. 556, 3 Dall. 171 (1796). And excise

taxes are hardly unusual today. According to the Office of

Management and Budget, the federal government

collected approximately 67 billion dollars in excise taxes

in 2002. See Office of Management and Budget, Budget

for Fiscal Year 2004, Summary’ Tables, _ at

http:/ /www.whitehouse.gov /omb/ budget / fy2004 / summa

rytables.html (last visited Aug. 23, 2004).

Nor is it a novel feature of American government to

levy an excise tax on a particular industry and then use

the proceeds of that tax in ways that regulate that

industry. The nineteenth century Supreme Court upheld

(albeit not against a First Amendment challenge) a

federal tax statute that required distillers of alcohol to -

both pay an ercise tax and pay the salaries of federal

officers supervising the production of alcohol. United

States v. Singer, 82 U.S. (15 Wall.) 111, 118-19, 122, 21 L.

Ed. 49 (1872) (upholding an act requiring distillers to

“reimburse to the United States the expenses and salary

of all storekeepers or other officers in charge of. . .

warehouses”). Excise taxes levied in the name of public

health have long been held constitutionally permissible,

even when such taxation has put severe burdens on

particular industries. See McCray v. United States, 195

U.S. 27, 63, 49 L. Ed. 78, 24 S. Ct. 769, Treas. Dec. Int.

Rev. 795 (1904) (upholding, as an exercise of Congress's

22a

ability to protect public health, the constitutionality of an

excise tax on artificially colored oleomargarine “although

it be true that the effect of the tax in question is to

repress the manufacture of artificially colored

oleomargarine”); Patton v. Brady, 184 U.S. 608, 623, 46 L.

Ed. 713, 22 S. Ct. 493 (1902) (upholding an excise tax on

tobacco and noting that “it is no part of the function of a

court to inquire into the reasonableness of the excise

either as respects the amount or the property upon which

it is imposed”).

Today, a tax on heavy trucks and trailers is dedicated

to a fund intended to improve highways. See 26 U.S.C.

§ 9503 (establishing a “Highway Trust Fund”); 26 U.S.C.

§ 4051 (imposing a retail tax on heavy trucks and trailers

dedicated to the Highway Trust Fund). A tax on fishing

equipment is dedicated to government action to preserve

fisheries. See 26 U.S.C. § 9504(a) (establishing an

“Aquatic Resources Trust Fund”); 26 U.S.C. § 4161

(imposing an excise tax on sport fishing equipment

dedicated to the Aquatic Resources Trust Fund). Yet we

would not conclude that the manufacturers of large trucks

have a First Amendment right to veto government speech

on highway safety, or that the makers of sonar fish

finders have a First Amendment right to direct

government speech on fishery management.

There is thus a long history of excise taxation

directed at particular industries in the name of public

health and welfare. Despite this history, not one court has

upheld a right of an industry to block otherwise

legitimate government activity simply because the

industry pays an excise tax. The tobacco companies offer

no reason why they should be entitled to such unique

treatment here.

Significantly, the tobacco companies have not offered

any principle that could limit the consequences of

sustaining their objectica. Although the companies claim

that they object only to the denigratory advertisements at

23a

issue here, they offer no principled basis for limiting their

“nexus” theory to such advertisements alone. For

example, the tobacco companies do not explain why, if

their First Amendment rights have been violated solely

because of a nexus between the surtax and the challenged

advertisements, they would not also have a right to

challenge the use of surtax funds for anti-tobacco

education in the public schools to the extent that they

disagreed with the state’s educational message.

Thus, if the tobacco companies were permitted to

object to government speech simply because they pay an

excise tax used to fund speech contrary to their interests,

the result could be not only to reduce government’s ability

to disseminate ideas but also an explosion of litigation

that could allow private interests to contro! public

messages. There are numerous taxpayers who contribute

disproportionately through excise taxes to government

speech with which they disagree. If each were to have a

similar right to challenge what it may deem government

“propaganda,” the government’s ability to perform crucial

educational and public health activities in the interests of

all citizens would be hampered. Cf. Downs, 228 F.3d at

1015 (noting that if a First Amendment violation applied

to government speech, “[the plaintiff] would be able to do

to the government what the government could not do to

[the plaintiff]: compel it to embrace a viewpoint.”)

D. Other Limitations on Government Speech and the

Power to Tax

At the risk of repetition, we emphasize that the

tobacco companies do not argue that the government’s

speech itself is constitutionally impermissible; nor do they

argue that the government has burdened their First

Amendment rights through the exercise of its power to

tax. Were the tobacco companies challenging a California

restriction on their ability to express their views, our

analysis would be different. As the district court noted,

there are already several recognized instances of

24a

constitutional limitations on government speech and

“government is no more free to disregard constitutional

and other legal norms when it speaks than when it acts.”

Bonta, 272 F. Supp. 2d at 1110. For example, there may

be instances in which the government speaks in such a

way as to make private speech difficult or impossible. or

to interfere with some other constitutional right, which

could raise First Amendment concerns. See Warner Cable

Communications, Inc. v. City of Niceville, 911 F.2d 634,

638 (11th Cir. 1990) (“The government may not speak so

loudly as to make it impossible for other speakers to be

heard by their audience. The government would then be

preventing the speakers’ access to that audience, and first

amendment concerns would arise.”).

Another limitation or government speech is found in

the Establishment Clause. See Bd. of Educ. of Westside

Cmty. Schs. v. Mergens, 496 U.S. 226, 250, 110 L. Ed. 2d

191, 110 S. Ct. 2356 (1990) (“There is a crucial difference

between government speech endorsing religion, which the

Establishment Clause forbids, and private speech

endorsing religion, which the Free Speech and Free

Exercise Clauses protect.”) (emphasis in original). The

dissent, quoting a passage often used by the’ tobacco

companies in this litigation, invokes Thomas Jefferson’s

pronouncement that “to compel a man to furnish

contributions of money for the propagation of opinions

which he disbelieves, is sinful and tyrannical.” P. Kurland

& R. Lerner, eds., 5 THE FOUNDERS’ CONSTITUTION

77 (1987). As the district court carefully explained,

The quoted statement is taken from

Jefferson’s Virginia Bill for Fstablishing

Religious Freedom, a landmark anti-

establishment measure declaring that ‘no

man shall be compelled to frequent or

support any religious worship, place, or

ministry whatsoever.’ /d. It is perhaps

significant that the statement arose in this

25a

context, since ‘the Establishment Clause is

a specific prohibition on forms of state

intervention in religious affairs with no

precise counterpart in the = speech

provisions.” Lee v. Weisman, 505 U.S. 577,

120 L. Ed. 2d 467, 112 S. Ct. 2649 (1992).

Bonta, 272 F. Supp. 2d at 1107 n.25. Jefferson’s comment

was directed to a situation in which the government

speech itself was improper, not to valid taxation used to

fund valid governmental speech.

There are also strict limits on the government’s

ability to impose taxes that are “general law(s] singling

out a disfavored group on the basis of speech content.”

Rust, 500 U.S. at 194; see also Arkansas Writers’ Project,

Inc., 481 U.S. at 228-29.9 A government tax designed to

suppress the speech of a targeted group would raise

serious First Amendment concerns.

But these are issues not before us. On this record, we

need not determine the metes and bounds of

constitutionally permissible government speech; nor need

* Concerns about forced expression, repression of speech,

improper taxation and interference with other constitutional

rights could arise, for example, under the facts of Summit

Medical Center v. Riley, 284 F. Supp. 2d 1350, 1353-54 (M.D.

Ala. 2003), a case cited to us by the tobacco companies. In

Summit Medical, it appears that the state of Alabama designed

a program to suppress abortion clinics’ ability to disseminate

independent information, requiring the clinics to purchase from

the state and then display information intended to dissuade

women from obtaining abortions. The plaintiffs in Summit

Medical chalienged the burden this mandatory purchase-and-

display program imposed upon their own expression, as well as

its compulsory and discriminatory nature. Jd. at 1354. We take

no position on the correctness of the district court’s decision in

Summit Medical, but note that it confronted a factual situation

very different from the one we consider here

26a

we articulate abstract limits on the state’s power to tax.

We share our dissenting colleague’s concern that the

government not use its taxation power to suppress the

free expression of disfavored groups, but the tobacco

companies claim no suppression of ideas. The nexus

between excise taxation and government speech is the

only First Amendment argument they raise, and we limit

ourselves to that issue alone. For the reasons set out

above, we reject the companies’ argument.

II. Seventh Amendment and Due Process Claims

The tobacco companies also raise a novel claim under

the Seventh Amendment. They note that they face

litigation in state and federal courts. They argue that

because the advertisements publicly disparage the

reputation and character of the tobacco industry, their

right to receive a jury trial under the Seventh

Amendment has been infringed because potential future

jurors in potential future trials could be biased by the

advertising. They do not, however, allege that any actual

trial in which they have participated was rendered

unconstitutionally unfair by the challenged

advertisements.

There are a number of problems with this argument.

The companies cite only to cases involving a criminal

defendant's Sixth Amendment right to jury trial in

criminal cases or to interpretations of the procedural

rules governing the federal courts, and not to any case

suggesting that they have an independent Seventh or

Fourteenth Amendment right to be free of disparaging

state speech before a civil trial. Moreover, as the district

court noted, the Seventh Amendment’s guarantee of the

right to a civil trial by jury does not apply to the states

and was not incorporated into the Fourteenth

Amendment. See Dohany v. Rogers, 281 U.S. 362, 369. 74

L. Ed. 904, 50 S. Ct. 299 (1930); Walker v. Sauvinet, 92

U.S. 90, 92, 23 L. Ed. 678 (1875). Therefore, whether

parties may raise claims against state officials under 42

27a

U.S.C. § 1983 for Seventh Amendment violations is

questionable.

We need not consider these issues, however. Even

assuming that the tobacco companies may properly allege

a violation of Seventh or Fourteenth Amendment rights

due to juror bias created by these advertisements, the

proper context for raising such issues is an actual jury

trial where a court could consider whether real jurors

actually have been biased. Allegations of juror bias are

traditionally resolved by the court conducting the trial,

not courts considering hypothetical future proceedings.

See Smith v. Phillips, 455 U.S. 209, 217, 71 L. Ed. 2d 78,

102 S. Ct. 940 (1982) (“Due process means a jury capable

and willing to decide the case solely on the evidence

before it, and a trial judge ever watchful to prevent

prejudicial occurrences and to determine the effect of such

occurrences when they happen. Such determinations may

properly be made at a hearing |conducted by the trial

court|.”). None of the cases cited by the companies

supports their asserted right to be free from negative

publicity because potential jurors may be prejudiced in

potential cases, and we are aware of no case that supports

their claim that this court should enjoin certain speech in

order to protect the alleged injury occurring in another

court.

The tobacco companies do not allege the elements of

stigmatization that would violate their due process rights.

Cf. Wisconsin v. Constantineau, 400 U.S. 433, 436, 27 L.

Ed. 2d 515, 91 S. Ct. 507 (1971) (establishing that stigma

can change a _ person’s legal status and_ therefore

constitute a violation of due process). The companies

cannot meet the requirements of the “stigma-plus” test

established in Paul v. Davis, where the Supreme Court

explained that in addition to reputational harm, a due

process stigma claim must assert that a recognized liberty

or property right, as secured by the due process clauses,

has been violated. 424 U.S. 693, 701, 47 L. Ed. 2d 405, 96

28a

S. Ct. 1155 (1976); see also WMX Techs., Inc. v. Miller,

197 F.3d 367, 374 (9th Cir. 1999) (“Reputation, without

more, is not a protected constitutional interest.”). The

companies assert that the alleged deprivation of their

right to a fair jury trial is sufficient to meet the stigma-

plus test. In essence, the companies are trying to

bootstrap two arguments about reputational harm to

create a single claim—arguing that the reputational harm

creates juror bias, and that the juror bias combined with

reputational harm creates a constitutionally improper

stigma. We reject such an attempt at bootstrapping. See

Paul, 424 U.S. at 712 (“Petitioners’ defamatory

publications, however seriously they may have harmed

respondent's reputation, did not deprive him of any

‘liberty’ or ‘property’ interests protected by the Due

Process Clause.”).

CONCLUSION

For the reasons set forth above, we affirm the

judgment of the district court.

AFFIRMED.

POSTSCRIPT

After we filed our opinion, the Supreme Court decided

Johanns v. Livestock Marketing Ass'n, 161 L. Ed. 2d 896,

125 S. Ct. 2055 (2005), helding that the Beef Promotion

and Research Act of 3985 did not violate the First

Amendment by impesing an assessment on all sales and

importation of cattle te fumd beef promotional campaigns

with which many of the assessed parties disagreed. The

Court reasoned, as we do here, that the Act was not

susceptible to a First Amendment compelled-subsidy

challenge because the assessments funded government

speech. Although the Johanns opinion affirms our

reasoning, Judge Trott remains in dissent. He would now

remand to the district court pursuant to the Court’s

29a

statement in -/ohanns that an as-applied challenge might

lie “if it were established . . . that individual beef

advertisements were attributed to respondents.” Jd. at

2065.

Appellants have never, before us or the district court,

claimed that the ads at issue in this litigation could be or

were attributed to them; nor does the record reveal a

material question of fact on the issue. A reasonable

viewer coulda not believe that these anti-industry ads,

expressly identified as “Sponsored by the California

Department of Health Services,” were created, produced

or approved by the appellants. The ad singled out by the

dissent as “putting [words] directly into the mouth of the

tobacco industry,” for example, is unmistakable satire. In

that ad, children play in a schoolyard while cigarettes fall

like rain from the sky and a voiceover states “we have to

sell cigarettes to your kids. We need half a million new

smokers a year . . . so we advertise near schools, at candy

counters.” No reasonable viewer could overlook the

satirical tenor of this ad and attribute the voiceover text

to actual tobacco executives.

We also find inapposite the dissent’s analogy to our

recent order in Charter v. United States Department of

Agriculture, 412 F.3d 1017 (9th Cir. 2005). We remanded

on the question of attribution in that case because the

record indicated that the National Cattlemen's Beef

Association “routinely, before Congress, and in other

public ways and in press announcements, states that it is

the trade organization and marketing organization of

America’s one million cattle producers.” Jd. at 1019. The

record in this case contains no evidence that the state

ever attributed its ads to the appellants or that a

reasonable viewer could have done so; accordingly, we

reject the analogy to Charter and decline Judge Trott’s

invitation to remand.

AFFIRMED.

30a

DISSENT:

TROTT, Circuit Judge, Dissenting:

To compel a man to furnish contributions of

money for the propagation of opinions

which he_ disbelieves is_ sinful and

tyrannical.!°

Thomas Jefferson

The atmospheric challenge in this case, which is one

we often face, is to focus not on the overwhelming

demerits of the underlying subject matter—smoking—but

on the primary constitutional principle at issue: whether

consistent with the First Amendment’s right against

government abridgement of freedom of speech—which

includes “the right to refrain from speaking at all”!'—a

state can compel reluctant individuals and private

entities directly and exclusively to pay for and to support

a public interest message with which the entities disagree

and which subjects them public scorn, obloquy, and even

hatred. It would be a mistake in this principled context to

become overly distracted by the medical, physical,

personal, financial, and addictive havoc knowingly

inflicted for profit upon the public by the tobacco industry;

or to be influenced by the hundreds of thousands of

premature, preventable, and horrible smoking deaths

caused by cancer, emphysema, heart and lung disease,

and stroke. There is little doubt that government, in its

role as steward of the public’s general welfare, can mount

a vigorous public campaign against smoking and the

tobacco industry, and that it can do so with general tax

0 See, e.g., Abood v. Detroit Bd. of Education, 431 U.S. 209, 235

n. 31, 52 L. Ed. 2d 261, 97 S. Ct. 1782 (1977).

'\! Wooley v. Maynard, 430 U.S. 705, 714, 51 L. Ed. 2d 752, 97S.

Ct. 1428 (1977).

3la

revenues and by way of “government speech;” but can

government do so using this particular compulsory

funding mechanism? Today the target of government

dislike is smoking, but tomorrow it will be something else,

such as Alabama’s imposition, in its the Woman’s Right to

Know Act, of a fee applied to abortion providers for the

production by the state of pro-childbirth materials which

the providers did not wish to endorse, much less

purchase. See Ala. Code §§ 26-23A-1 to 13; Summit

Medical Center of Alabama, Inc. v. Riley, 284 F. Supp. 2d

1350 (M.D. Alabama 2003). Who knows whose disfavored

ox or whose industry or business or lifestyle will be the

next to be fatally gored in this manner by a well-

intentioned government.

Moreover, hanging over this controversy like a

blinking yellow light in the constitutional sky is Chief

Justice Marshall's timeless admonition in McCulloch v.

Maryland, 17 U.S. 316, 4 Wheat. 316, 4 L. Ed. 579 (1819),

that “the power to tax is the power to destroy.” This

warning is not only memorable, but it reminds us that

might, especially in the hands of government, does not

always make right.

There appears no doubt that California’s goal is to

destroy the industry singled out for this targeted and

exclusive tax. Although an earnest deputy attorney

general denied this lethal purpose during oral argument,

claiming that the Act’s only purpose was to inform the

public, her boss, the Attorney General of California

William Lockyer, forthrightly said differently after the

hearing. Attorney General Lockyer, who took the unusual

step of attending the argument himself, is quoted by the

Los Angeles Daily Journal as calling the tobacco

companies “merchants of death” and agreed that the ad

campaign aimed to put them out of business. He added

that “the democratic process will provide a check on the

use of taxes to fund such messages. Elected officials are

responsible for appropriating the money .. . . If voters

32a

don't like the message, they can oust the messenger.”!?

Query.

So this is the issue: can government, consistent with

the First Amendment’s right against the abridgment of

free speech, create a public information program against

an industry funded by a targeted excise tax imposed

solely upon that industry and which is segregated in a

special state health education account? Not surprisingly,

in our system which values not just good goals but also

the right process, the question here is not ends, but

means. '

DISCUSSION

First Amendment Claim

1. Government and Compelled Speech

The First Amendment provides that “Congress shall

make n® law .. . abridging the freedom of speech... .”

U.S. Const. amend. I. It is axiomatic that “just as the

First Amendment may prevent the yovernment from

prohibiting speech, the Amendment may prevent the

government from compelling individuals to express

certain views .. . or from compelling certain individuals to

pay subsidies for speech to which they object.”'* United

2 Los Angeles Daily Journal, Tuesday, May 11, 2004,

“Court revisits anti-smoking ad campaign.”

8 W. Va. State Bd. of Educ. v. Barrette, 31. U.S. 624, 87

L. Ed. 1628, 63 S. Ct. 1178 (1943) provides an often

quoted passage regarding the extension of free speech

protections to those who wish not to speak: If there is

any fixed star in our constitutional constellatien, it is that

no official, high or petty, can prescribe what shall be

orthodox in politics, nationalism, religion, or other

matiers of opinion or force citizens to confess by word or

act their faith therein.” /d. at 642.

(...continued)

33a

States v. United Foods, 533 U.S. 405, 410, 150 L. Ed. 2d

438, 121 S. Ct. 2334 (2003). In United Foods, the latest in

a series of compelled assessments cases, the Supreme

Court held that government's forced assessments of

mushroom producers, which funded advertisements

promoting mushroom sales, violated the First

Amendment. Relying primarily upon United Foods,

appellants assert that California’s targeted tax, which

funds anti-industry advertisements, violates their right

against compelled financing of speech.

By labeling the anti-tobacco advertisements

“government speech,” the majority concludes that the

targeted tax is clear of First Amendment concerns. I

respectfully disagree. Though the Supreme Court has

embraced the existence of a “government speech” doctrine

in this general context, United Foods, 533 U.S. at 417, the

Court has not provided a clear explanation of the reach or

proper application of the doctrine. The appellants assert

that the central question is the source of the funding for

the particular speech, contending that a targeted tax on a

particular group to fund speech opposed to by that group

constitutes unconstitutional compelled speech.

Ultimately, the State’s argument that the First

Amendment’s protections against compelled speech can be

avoided by finding that the speech is spoken by the

government is at odds with the force and logic of

controlling authority.

2. Government Speech

Focusing on the Supreme Court's brief reference to

the government speech inquiry in United Foods, and the

Court's discussion of government speech in other contexts,

see, e.g., Lebron v. National Railroad Passenger Corp., 513

U.S. 374, 1380 L. Ed. 2d 902, 115 S. Ct. 961 (1995), the

34a

State asserts that the government is free from First

Amendment concerns “when the state is the speaker.”

Rosenberger v. Rector & Visitors of the Univ. of Virginia,

515 U.S. 819, 833, 132 L. Ed. 2d 700, 115 S. Ct. 2510

(1995).'4 Specifically, the State asserts that because the

speech at issue is not explicitly attributed to appellants,

the free speech concerns of traditional compelled speech

cases, see, e.g., Wooley, 430 U.S. 705, 51 L. Ed. 2d 752, 97

S. Ct. 1428, are absent. Moreover, the state asserts that

the source of the State’s funding for its speech is

irrelevant to the question of the constitutionality of the

particular speech.

The State’s arguments, however, are not consistent

with the trajectory and force of the Supreme Court's

recent compelled speech jurisprudence. Specifically, the

State’s framework ignores the central lesson of United

Foods: in that case, the Supreme Court reigned in its

previous pronouncements in Glickman v. Wileman Bros.

& Elliott, 521 U.S. 457, 476, 138 L. Ed. 2d 585, 117 S. Ct.

2130 (1997) that coerced government speech is akin to

economic regulation and not entitled to First Amendment

protection. See Glickman, 521 U.S. at 476. Instead, the

United Foods Court propounded a broad constitutional

'1 IT note that the State also supports its position with genera!

pronouncements made by the Court in its compelled

assessments of speech cases indicating that the proper

functioning of government requires the government to heve

control over the nature and content of its speech. See, «.g.,

Keller v. State Bar of California, 496 U.S. 1, 12-13, 110 L. Ed.

2d 1, 110 S. Ct. 2228 (1990) (“Government officials are expected

as part of the democratic process to represent and espouse the

views of a majority of their constituents. .. . If every citizen

were to have a right to insist that no one paid by public funds to

express a view with which he disagreed, debate over issues of

great concern to the public would be limited to those in the

private sector, and the process of government as we know it

would be radically transformed.)

35a

protection against compelled contributions for commercial

speech. See United Foods, 533 U.S. at 414. Indeed,

applying United Foods, one court has held that the issue

of government speech, which generally involves the

state’s power to control the content of its speech, is

fundamentally different from the “government’s authority

to compel [plaintiffs] to support speech with which they

personally disagree; such compulsion is a form of

‘government interference with private speech.’ “ Livestock

Marketing Ass’n v. USDA, 335 F.3d 711, 720 (8th Cir.

2003) (holding compelled contributions in beef promotion

violated First Amendment) (certiorari granted in part by

Veneman v. Livestock Marketing Ass'n, 541 U.S. 1062, 158

L. Ed. 2d 962, 124 S. Ct. 2389 (U.S. May 24, 2004) and

Nebraska Cattlemen, Inc. v. Livestock Marketing Ass'n,

541 U.S. 1062, 158 L. Ed. 2d 962, 124 S. Ct. 2390 (U.S.

May 24, 2004). As Justice Thomas stressed in

concurrence, “any regulation that compels the funding of

advertising must be subjected to the most stringent First

Amendment scrutiny.” United Foods, 533 U.S. at 419

(Thomas, J., concurring). Finally, the State’s argument

necessarily relies on an untenable distinction between

government speech activities paid directly from the

government treasury, or coordinated by traditional

government agencies, and those that are coordinated by

more complex regulatory organizations and schemes, even

when such schemes are funded and run by the

government. As one commentator has noted, “government

speech cannot logically be made a function of the office of

the person making the allocation decision. That approach

would elevate form over substance and would enable the

government to dictate the First Amendment result simply

by manipulating the agency in the decision-making

process.” Randall P. Bezanson & William G. Buss, The

Many Faces of Government Speech, 86 lowa L. Rev. 1377,

1430 (2001).

Accordingly, recognizing the principle expressed in

United Foods, the appellants clearly have a First

36a

Amendment interest at stake that is not erased by

pigeonholing the ads as “government speech.” The

question remains, however, whether the compelled speech

does indeed violate appellants’ free speech rights, an

analysis that is governed by the Supreme Court’s

compelled speech line of cases, including Abood, Keller,

Glickman, and United Foods.

3. Compelled Speech

Appellants rely on the string of cases, beginning with

Abood, concerning compelled contributions to speech, and

assert that there exists the fundamental principle that,

under the First Amendment, a discrete group should not

be specifically taxed to fund speech with which they

disagree. Indeed, this proffered principle provides a

coherent picture of the puzzle with which courts have

been struggling. See, e.g., Summit Medical Ctr. of Ala. v.

Riley, 284 F. Supp. 2d 1350, 1360 (holding that state’s

imposition of “a direct fee assessment on a limited class of

citizens—abortion providers—and using the revenue to

advance speech in support of the State’s favored policy

position on abortion” intruded on abortion provider's free

speech rights) (emphasis added); United States v. Frame,

885 F.2d 1119 (3d Cir. 1989) (“Where the government

requires a publicly identifiable group to contribute to a

fund earmarked for the dissemination of a particular

message associated with that group, the government has

directly focused its coercive power for expressive

purposes.”) (citation omitted) (emphasis added). The

United Foods Court announced that the “question is

whether the government may underwrite and sponsor

speech with a certain viewpoint using special subsidies

exacted from a designated class of person, some of whom

object to the idea being advanced.” United Foods, 533 U.S.

at 410. And in United Foods, the Court answered: No. Id.

at 411.

In answering the question, however, the Court was

forced to distinguish another recent compelled speech

37a

case, Glickman, which was factually similar to United

Foods, but where the Court had found that no First

Amendment issues were raised by the forced subsidies.

521 U.S. at 460. In Glickman, the Court determined that

“criticisms of generic advertising provide o basis for

concluding that factually accurate advertising constitutes

an abridgement of anybody’s right to speak freely.” Jd. at

474. The United Foods Court distinguished Glickman by

asserting that the program in Glickman “mandated

assessments for speech [which] were ancillary to a more

comprehensive program restricting marketing autonomy.”

United Foods, 533 U.S. at 411-12.

Thus, after distinguishing Glickman, and finding that

First Amendment interests were at stake, the Court

proceeded to apply the tenets established in Abood and

Keller, which established the “germaneness test.” United

Foods, 533 U.S. 405, 150 L. Ed. 2d 438, 121 S. Ct. 2334.

That test requires any coerced subsidized speech be

germane to the larger purpose of the association at issue.

Abood, 431 U.S. at 235 (holding that union can only

finance speech not germane to collective bargaining with

non-objecting mernbers’ funds); Keller, 496 U.S. at 13-14

(holding that state bar association can only compel

payment for activities related to bar’s purposes).'®

'> [| note that the district court’s decision relied on the question

of association and stressed the non-associational nature of the

tobacco industry being taxed, thereby distinguishing the Abood

line of cases. Those cases stressed that there exists “a First

Amendment interest in not being compelled to contribute to an

organization whose expressive activities conflict with one’s

‘freedom of belief. “ Glickman, 521 U.S. at 471 (quoting Abood,

431 U.S. at 235). The district court found that because the

appellants subject to the surtax were not members of a

particular association, their free speech rights were not

undermined by any compelled financing of speech made on

behalf of that association. This finding is also supported by

some of the Court’s language in United Foods, where it noted

(...comuienmed )

38a

Guided by Glickman and United Foods, and looking

at the statutory schenie provided in the Act, it is clear

that the tobacco companies are not similarly situated to

the tree growers in Glickman, as they are not “bound

together and required by statute to market their products

according to cooperative rules” for purposes other than

advertising or speech. United Foods, 533 U.S. at 412. Nor

is the statutory scheme directly congruous with that in

United Foods, as the ads in this case are a part of a larger

regulatory scheme, and thus not clearly “a program where

the principal object is speech itself.” Jd. at 415. Thus, the

Act is different from both the statute analyzed in United

Foods and the statute in Glickman. Moreover, the fact

that the speech at issue involves, not the promotion of the

relevant group’s product, but the disparagement of the

entire industry, only increases the difficulty of resolving

this case.

Given the unique nature of the question presented,

proper review of the Act must acknowledge United

Foods’s obvious retreat from Glickman, and the Court’s

that there is “a threshold inquiry . . . whether there ts some

state imposed obligation which makes group membership less

than voluntary; for it is only the overriding associational

purpose which allows any compelled subsidy for speech in the

first place.” United Foods, 533 U.S. at 413. However, hinging

the right to be free from compelled commercial speech on

whether there is an associational interest at stake ignores the

obvious fact of what the Court actually did in United Foods.

Indeed, the Court not only found that the compelled subsidies

constituted an unconstitutional infringement on the dissenting

mushroom grower’s speech rights, but it did so after expressly

distinguishing Glickman on the grounds that there was no

“regime of cooperation” as presented in Glickman. Id. at 415.

Therefore, though the Court saves some of its associational

rights rhetoric, the practical effect of its decision in United

Foods is to unhinge its compelled speech analysis from the

previously-pronounced requirement that there be = an

involuntary group membership.

39a

pronouncement of broadened protection against compelled

speech. In this regard, as the appellants assert, United

Foods and the Court’s previous compelled speech case law

can be reconciled and understood by applying what

United Foods explicitly stated: the First Amendment

forbids certain compelled assessments from “a particular

citizen, or a discrete grovp of citizens, to pay special

subsidies for speech.” 533 U.S. at 411.

As the Third Circuit recently explained, however,

though a case may be properly characterized as a

compelled speech case, “the Supreme Court .. . has left

unresolved the standard for determining the validity of

laws compelling commercial speech ... .” Cochran v.

Venemian, 359 F.3d 263, 277 (3rd Cir. 2004). In Cochran,

the court also explained that there are several standards

available which the courts may try to apply: 1) the lenient

standard derived from commercial speech cases, see, ¢.g.,

Central Hudson Gas & Elec. Corp. v. Pub. Serv. Comm'n,

447 U.S. 557, 564, 65 L. Ed. 2d 341, 100 S. Ct. 2343

(1980), or some adaptation of that commercial speech

standard, see, e.g., Livestock Marketing, 335 F.3d at 722-

23; 2) the “germaneness test” of traditional compelled

speech cases, see, e.g., Abood, 431 U.S. at 235-36, and 3)

the stringent standard of associational cases, see, e.g.,

United States v. Frame, 885 F.2d 1119 (3rd Cir. 1989).

The speech and the funding mechanism in this case is

questionable under whatever standard one uses. In

tentral Hudson, the Court held that commercial speech is

to be evaluated using intermediate scrutiny. That is, 1)

the state must “assert a substantial government interest;”

2) “the regulatory technique must be in proportion to that

interest;” and 3) the incursion on commercial speech

“must be designed carefully to achieve the State’s goal.”

447 U.S. at 564. Under this standard, though never before

40a

applied to compelled commercial speech cases,'® the

speech regulation at issue, and the targeted tax placed on

appellants, constitutes a disproportional and _ overly

burdensome regulatory technique, thereby failing the

second and third prongs of the Central Hudson test.

Indeed, the speech in this case is exceptional in its

difference from what the Court has _ previously

encountered in its compelled commercial speech cases.

Whereas previous cases generally involve promotional

activity, see, e.g., Glickman, 521 U.S. at 474; United

Foods, 533 U.S. at 413-14, here, California is specifically

targeting one discrete and largely disfavored group,

forcing that group to meet the State’s regulatory goals by

directly financing speech designed to undermine that

group's status and reputation. Though the State’s goals

may be strong and laudatory, the methods used seriously

undermine the particular group’s speech rights and seem

disproportional to the goals to be achieved. Accordingly,

the Act cannot survive Central Hudson’s intermediate

scrutiny.

Moreover, as did the Sixth Circuit in Michigan Pork

Producers Ass’n, Inc. v. Veneman, 348 F.3d 157 (6th Cir.

2003), I “find inapplicable to this case the relaxed

scrutiny of commercial speech analysis... .” Id. at 163

(citing Glickman, 521 U.S. at 474 n.18 (questioning

whether “the Central Hudson test, which involved

commercial speech should govern a case involving the

compelled funding of speech”). The speech in this case is

i6 | note, in this regard, that the Supreme Court in United

Foods refused to apply the Central Hudson test because the

“Government itself [did] not rely upon Central Hudson to

challenge the Court of Appeals’ decision.” 533 U.S. at 410.

Accordingly, other courts have recognized that the Central

Hudson test has never been applied by the Supreme Court to

compelled assessment of commercial speech cases. See Cochran,

359 F.3d at 277.

4la

materially different from the speech issuing from the

private sector that we normally label as commercial.

Applying the “germaneness test” derived from Abood

and its progeny, the compelled speech here would also

fail. The Supreme Court expressly applied this test in

United Foods, and found that “the expression respondent

[was] required to support [was] not germane to a purpose

related to an association independent from the speech

itself.” United Foods, 533 U.S. at 415-16. Of course, as

previously explained, there is no relevant association of

tobacco companies for purposes of this analysis. As the

Court stressed in United Foods, the question is not

whether the State necessarily has a larger regulatory

purpose justifying the speech, but whether there is a

“cooperative marketing structure ... to sustain an

ancillary assessment” for speech. /d. Here, as in United

Foods, there is no collective association to which the

compelled assessments for speech is germane.

Finally, as in Frame, a pre-Glickman and pre-United

Foods case, the Third Circuit applied the stringent

associational rights standard of Abood, but upheld the

constitutionality of the beef regulatory statute in question

because of the compelling state interest involved. Frame,

885 F.2d at 1134. In refusing to extend Frame’s reach

after United Foods, however, the same court held in.

Cochran that United Foods established that “promotional

programs... seem really to be special interest legislation

on behalf of the industry's interests more so than the

government’s|,|” and therefore constitute unconstitutional

compelled speech for those dissenting from the

promotions. 359 F.3d at 279.

What has survived from Frame is the principle that

in the review of a compelled financing statute’s intrusion

into free speech rights, “it is relevant to consider ‘the

coerced nexus between the individual and the specific

expressive activity.” Summit, 284 F. Supp. 2d at 1360

(quoting Frame, 885 F.2d at 1119). Here, the nexus is

42a

vital: unlike a situation in which money is allocated from

the general treasury fund, individuals who have

specifically been targeted by the speech are forced to pay

for the speech. See id.

4. Conclusion

In sum, review under any of the available standards

reveals that the compelled assessments in this case

constitute an exceptional case of government intrusion on

the right not to be compelled to finance speech. Indeed,

the Act is designed to force one particularly disfavored

group to fund speech directly undermining that group’s

reputation. Such state action offends the very essence of

the First Amendment. See e.g., Sons of Confederate

Veterans v. Comm’r of the Va. Dept. of Motor Vehicles, 305

F.3d 241, 242 (4th Cir. 2002) (“The First Amendment was

not written for the vast majority. . . . It belongs to the

minority of one.”) (Wilkinson, C.J., concurring in denial of

rehearing en banc).

Moreover, the State can provide no limiting principle,

no logical reason why, if the government is free to tax and

speak in this manner against this group, it cannot do so

against any other disfavored group or individual. See

Summit Medical Ctr. of Alabama, 284 F. Supp. 2d. at

1361 (refusing to apply the district court’s analysis in this

case, and finding that Alabama’s statute forcing abortion

providers to pay for the state’s informational materials

infringes plaintiffs’ First Amendment rights). Contrary to

the Attorney General’s claim that the democratic process

will provide a check on the use of taxes to fund such

messages, by removing the burden of the cost of this

program from every taxpayer except the ones targeted,

this tax becomes the ultimate cheap shet, one not fully

subject to the considerations that normally attend the

decision to reguire the public at large to pay for

something. See Board of Regents v. Southworth, 529 U.S.

217, 229, 146 L. Ed. 2d 193, 120 S. Ct. 1346 (2000)

(traditional political controls ensure _ responsible

43a

government).'’ Furthermore, the approach I take does

not hinder or unduly burden the State’s right or power to

speak, and it does not interfere with the imposition of

excise or other taxes. It simply requires the government

when doing so to stay within normal channels and to

avoid First Amendment violations. Under the reasoning

and force of the Supreme Court’s compelled speech cases,

particularly the Court’s recent pronouncements in United

Foods, I respectfully believe the majority's argument,

although well presented and articulated in their opinion,

is without merit.

POSTSCRIPT

Shortly after I circulated this dissent, the Supreme

Court decided Johanns v. Livestock Marketing Ass’n, 161

L. Ed. 2d 896,544 U.S. , 1255S. Ct. 2055 (2005). For the

majority of the Court, Justice Scalia wrote:

The compelled-subsidy analysis is

altogether unaffected by whether the funds

for the promotions are raised by general

taxes or through a targeted assessment.

Citizens may challenge compelled support

of private speech, but have no First

17 In Michigan Pork Producers Ass'n v. Veneman, 348

F.3d 157 (6th Cir. 2003), one significant factor in the

court’s determination that the speech involved was not

government speech was that the funding did not come

from general tax revenues. Jd. at 162. See also Livestock

Marketing Ass’n, 335 F.3d at 720 (the flaw in the

government speech argument is that the plaintiffs funds

were identifiable as the funds used to finance the speech

to which they objected).

44a

Amendment right not to fund government

speech. And that is no less true when the

funding is achieved through targeted

assessments devoted exclusively to the

program to which the assessed citizens

object. The First Amendment does not

confer a right to pay one’s taxes into the

general fund, because the injury of

compelled funding (as opposed to the injury

of compellec speech) does not stem from the

Government’s mode of accounting.

161 L. Ed. 2d 896 (second emphasis added) (citations

omitted).

Not surprisingly, California’s Attorney General

suggests that this ruling “eliminates all possible doubt

about the correctness” of the majority’s decision. I do not.

agree.

The Johanns Court suggests, while “expressing no

view on the point,” that if it were to be shown that the

challenged speech would “convince a_ reasonable

factfinder” that “all . . . producers[{| would be tarred with

the content of each trademarked ad,” an “as applied” First

Amendment challenge might lie. 161 L. Ed. 2d 896.

(emphasis added).

Writing separately, Justice Thomas advanced the

same suggestion:

Still, if the advertisements associated their

generic pro-beef message with either the

individual or organization respondents,

then respondents would have a valid as-

applied First Amendment challenge. The

government may not, consistent with the

- First Amendment, associate individuals or

organizations involuntarily with speech by

attributing an unwanted message to them,

whether or not those individuals fund the

/

45a

speech, and whether or not the message is

under the government’s control. This

principle follows not only from our cases

establishing that the government may not

compel individuals to convey messages with

which they disagree, . . . but also from our

expressive-associate cases, which prohibit

the government from coercively associating

individuals or groups with unwanted

messages.

161 L. Ed. 2d 896. (emphasis added) ‘citations omitted).

Here, one challenged government television ad—

described by my colleagues as “particularly striking”—

uses a voice-over technique to speak to the public on

behalf of the tobacco industry. The words put directly into

the mouths of the tobacco industry disparagingly

associate the appellants ,and the industry with the

unwanted message about which they now complain:

We have to sell cigarettes to your kids. We

need half a million new smokers a year just

to stay in business so we advertise near

schools, at candy counters. We lower our

prices. We have to. It’s nothing personal.

You understand.

The “we” is the appellants.

If this language, albeit couched in a literary device,

does not “tar all in the industry” required to pay for the

ad, and if this language does not “coercively associate”

and intentionally smear the appeliants—all of them—

with an “unwanted message” to which they object, it is

hard to know what does. | respectfully disagree with the

district court’s preemption of this issue as a matter of law.

The facts are such as to survive summary judgment and

should be submitted—as suggested by the Supreme

Court—to a factfinder.

46a

At the very least, we should take our |.ad from our

recent decision in Charter v. United States Department of

Agriculture, 412 F.3d 1017 (9th Cir. 2005), recognizing

the difference between that case and Johanns with

respect to a possible attribution/association “as applied”

challenge:

In light of the Supreme Court’s recognition |in

Johanns| (without expressing a view on the issue) that an

attribution claim might form the basis for an as-applied

First Amendment challenge tc the Act, the district court’s

decision must be vacated and the case remanded for

further proceedings to determine, among other things,

whether speech was attributed to appellants and, if so,

whether such attribution can and does support a claim

that the Act is unconstitutional as applied. /d.; see also id.

at *9 n.* (Thomas, J., concurring) (noting that, pursuant

io Federal Rule of Civil Procedure 15, “on remand

respondents may be able to amend their complaint to

assert an attribution claim”).

There is a world of difference between what was at

issue and at stake in Johanns and what is on our docket

here. In Johanns, the question was whether, consistent

with the First Amendment, the government could compel

beef producers to fund by way of mandatory assessments

a generic advertising program promoting the sale of beef.

7 U.S.C. § 2901(b). In our case, however, the purpose of

the coerced speech is deliberately destructive of those

forced to pay for it—not so in Johanns. Does this

difference matter here? I believe it does. The difference is

not just one of degree, but of material kind. It is one thing

to promote the sale of an agricultural product; it is

altogether another to attempt to destroy an entire legal

industry.

I see this case as distinguishable from Johanns, and |

continue respectfully to dissent. In my view, we should

remand to the district court for reconsideration on the “as

applied” issue as newly articulated in Johanns itself.

47a

No. 03-16535

R.J. REYNOLDS TOBACCO COMPANY; LORILLARD

TOBACCO COMPANY; R. J. REYNOLDS SMOKE

SHOP, INC., Plaintiffs-Appellants,

V.

SANDRA SHEWRY, Director of the California

Department of Health Services; DILEEP G. BAL, Acting

Chief of the Tobacco Control Section of the California

Department of Health Services; STATE OF

CALIFORNIA, Defendants-Appellees.

UNITED STATES COURT OF APPEALS

FOR THE NINTH CIRCUIT

May 10, 2004, Argued and Submitted,

San Francisco, California

September 28, 2004, Filed

Before: Betty Binns Fletcher, Stephen Trott and Raymond

_ C. Fisher, Circuit Judges.

FISHER, Circuit Judge:!

* ok *

TROTT, Circuit Judge, Dissenting:?

*K K of:

| Judge Fisher’s opinion is reprinted supra, pp. la-30a, not

including the postscript at pp. 30a-3 La.

2 Judge Trott’s dissent is reprinted supra, pp. 32a-45a, not

including the postscript at supra, pp. 45a-48a.

48a

NO. CIV. S-03-659 LKK/GGH

UNITED STATES DISTRICT COURT FOR THE

EASTERN DISTRICT OF CALIFORNIA

R.J. REYNOLDS TOBACCO COMPANY; R.J.

REYNOLDS SMOKE SHOP, INC.; and LORILLARD

TOBACCO COMPANY, Plaintiffs,

V.

DIANA M. BONTA, Director of the California

Department of Health Services; and DILEEP G. BAL,

Acting Chief of the Tobacco Control Section of the

California Department of Health Services, Defencants.

July 22, 2003, Decided

ORDER

Two tobacco companies bring suit against officials of

California’s Department of Health Services. They

challenge the state’s anti-tobacco advertisements, which

are funded through a special surtax on wholesale tobacco

sales. The tobacco companies claim that the surtax forces

them to fund ads with which they disagree, and that this

violates their right to free speech under the First

Amendment. They also complain that the ads interfere

with their right to trial by jury under the Seventh

Amendment and unfairly stigmatize them in violation of

the Due Process Clause of the Fourteenth Amendment.

The tobacco companies have moved for a preliminary ©

injunction and the state has moved to dismiss the

complaint. I decide the matter on the basis of the papers

and pleadings filed herein, and after oral argument.

1 In addition to unusually extensive and competent

briefing by the parties, the court has also had the benefit

of briefing by the amici American Cancer Society,

(...continued) ;

49a

I.

BACKGROUND?

A. PROPOSITION 99: THE TOBACCO TAX AND

HEALTH PROTECTION ACT

In 1988, the voters of California approved Proposition

99, a statewide ballot initiative also known as the

“Tobacco Tax and Health Protection Act of 1988” (“the

Act”). Cal. Rev. & Tax Code §§ 30121-30130. The Act

imposes a $ 0.25 per-pack surtax on all wholesale

American Heart Association and American Lung

Association.

* Because this case is before the court on defendants’

motion to dismiss, the factual surmmary assumes the

truth of all of the allegations set forth in plaintiffs’ First

Amended Complaint. I do not here consider the factual

showing required for obtaining injunctive relief, since “the

irreducible minimum” for such relief is “a fair chance of

success on the merits.” Benda v. Grand Lodge of Int'l

Machinists, 584 F.2d 308, 314 (9th Cir. 1978). Thus, if the

motion to dismiss prevails, the court will have no occasion

to consider the plaintiffs’ motion. I have, however, on

occasion considered the contents of affidavits filed in

support of plaintiffs’ motion, where they tender details

concerning the facts alleged in the complaint.

* See generally Michael P. Traynor and Stanton A. Glantz,

California’s Tobacco Tax Initiative: The Development and

Passage of Proposition 99, 21 J. Health Pol’y & L. 543

(1996); Edith D. Balbach, et al., The Implementation of

California’s Tobacco Tax Initiative: The Critical Role of

Outsider Strategies in Protecting Proposition 99, 25 J.

Health Pol'y & L. 689 (2000). The history of Proposition

99 has been one of intense legislative and legal conflict.

See, ¢.g., American Lung Assn, 51 Cal.App.4th 743 (Cal.

Ct. App. 1996); Kennedy Wholesale, Inc. v. State Bd. of

Equalization, 53 Cal.3d 245, 279 Cal. Rptr. 325, 806 P.2d

1360 (Cal. 1991).

50a

cigarette sales in California known as the Cigarette and

Tobacco Products Surtax (“the Surtax”).

1. The Cigarette and Tobacco Products Surtax

The revenue collected by the Surtax is placed in the

“Cigarette and Tobacco Products Surtax Fund” and may

be appropriated only for the following purposes: (1)

tobacco-related school and community health education

programs; (2) tobacco-related disease research; (3)

medical care for patients who cannot afford to pay and

who lack health insurance; and (4) programs for fire

prevention and environmental conservation. /d.,

§ 30122(a). In accordance with these purposes, taxes

deposited into the Surtax Fund are allocated, according to

specified percentages, among six separate accounts:

Health Education (20%), Hospital Services (35%),

Physician Services (10%), Research (5%), Public

Resources (5%), and an Unallocated Account (25%), which

may be made available for any of the four purposes

specified above. /d., § 30124(b\(1). The tobacco advertising

program at issue in this case is funded through a portion

of the Health Education Account, which “shall only be

available for the prevention and reduction of tobacco use,

primarily among children, through school and community

health programs.” Jd., § 30122(b)(1).

2. The Tobacco Control Program

In 1999, the Legislature adopted implementing

legislation. Cal. Health & Safety Code §§ 104350-104485.

In conjunction therewith, the Legislature made findings

that smoking is detrimental to the health of Californians,

that it results in huge costs to the state, and that

prevention is the best means of addressing these

concerns.’ The Legislature also determined that tobacco

4 The legislature specifically found that:

(...continued)

5la

use prevention and cessation is “the highest priority in

disease prevention for the State of California” and made a

commitment to “play a leading role in promoting a smoke-

free society by the year 2000... .” Id., § 104350(aX(9),

(10).°

The Legislature directed the Department of Health

Services to establish “a program on tobacco use and

health to reduce tobacco use in California by conducting

Smoking is the single most important source of

preventable disease and premature death in

California.

Tobacco-related disease places a tremendous

financial burden upon persons with the disease,

their families, the health care delivery system, and

society as a whole. California spends five billion six

hundred méllion dollars ($ 5,600,000,000) a year in

direct and indirect costs on smoking-related

illnesses.

The elimination of smoking is the number one

weapon against four of the five leading causes of

death in California.

Id. § 104350(a1), (7) & (8).

5 While California is certainly not “smoke-free,” there is

substantial evidence, including published medical studies,

indicating that the Proposition 99 programs, and the media

campaign in particular, have been successful in achieving their

goals. See C. Fichtenberg and S. Glantz, Association of the

California Tobacco Control Program with Declines in Cigarette

Consumption and Mortality from Heart Disease, New England

Journal of Medicine 34° 24, 1772-1777 (2000); M. Siegel, Mass

Media Antismoking «a» .uigns: A Powerful Tool for Health

Promotion, Annals of » zrnal Medicine, 129:2, 128-132 (1998):

J.P. Pierce, et al, He. he California Tobacco Control Program

reduced smoking?, Journal of the American Medical Ass'n,

280:10, 893-899.

52a

health education interventions and behavior change

programs at the state level, in the community, and other

nonschool settings.” Jd., § 104375(a). Pursuant to this

program, known as the Tobacco Control Program, the

Department is required, inter alia, to develop a media

campaign directed to raising public awareness of the

deleterious effects of smoking and to effect a reduction in

tebacco use. /d., §§ 104375(b), (c), (eX 1) & (j); 104385(a);

104406.

Approximately two-thirds of the funds in the Health

Education Account are allocated to the Department of

Health Services for tobacco control activities. Plaintiffs

allege that the state spends approximately $ 25 million

annually on the challenged advertisements. Complaint at

P22.

B. THE CHALLENGED ADVERTISEMENTS

California’s anti-tobacco media campaign consists of

radio, television, billboard and print advertising.

Complaint at P14. According to plaintiffs, the ads

consistently portray smoking as dangerous’ and

undesirable and the tobacco industry and its executives

as deceptive. Jd. at PP17, 19. In several of the television

ads, actors playing tobacco executives are shown

discussing how to lure more people into smoking or are

portrayed as being elusive about smoking’s health effects.

See Declaration of Todd Thompson (“Thompson Decl.”),

Exh. L. These ads do not contain disclaimers explaining

that the people shown are actors rather than actual

- tobacco compuny employees. Complaint at P18.

A recent round of television commercials features an

actor playing a public relations executive for the fictional

cigarette brand “Hampton,” detailing for viewers his

unseemly methods for getting people to start smoking.

Thompson Decl., Exh. L. The ads end with the tagline,

“Do You Smell Smoke?,” id., implicitly referencing both

cigarette smoke and a smoke-and-mirrors marketing

53a

strategy. Another ad _ portrays tobacco executives

discussing how to replace a customer base that is dying at

the rate of 1,100 users a day. Jd. Some of the ads end

with images of mock warning labels such as: “WARNING:

The tobacco industry is not your friend.”; or “WARNING:

Some people will say anything to sell cigarettes.” Id.

Several spots suggest that tobacco companies

aggressively market to children. Jd. In one particularly

striking television ad entitled “Rain,” children in a

schoolyard are shown looking up while cigarettes rain

down on them from the sky. Complaint at P19. A voice-

over states “We have to sell cigarettes tu your kids. We

need half a million new smokers a year just to stay in

business. So we advertise near schools, at candy

counters. We lower our prices. We have to. It’s nothing

personal. You understand.” Thompson Decl., Exhibit L. At

the conclusion, the narrator says, “The tobacco industry:

how low will they go to make a profit?” Jd.

Each of the challenged advertisements is identified as

“Sponsored by the California Department of Health

Services.” Id.

C. THE PARTIES

Plaintiffs are R.J. Reynolds Tobacco Company, its

subsidiary, R.J. Reynolds Smoke Shop, Inc., and Lorillard

Tobacco Company. Both R.J. Reynolds and Lorillard

manufacture and sell cigarettes in California. All three

corporations have their principal place of business in

North Carolina and are incorporated in Delaware.

Lorillard and R.J. Reynolds allege that their business

in California requires them to ,;uy the Cigarette and

Tobacco Products Surtax; R.J. Reynolds does not pay the

Surtax directly but pays it through the Smoke Shop

subsidiary. Because the Surtax is imposed on

“distributors” of cigarettes, most Surtax payments are not

made by the cigarette manufacturers themselves, but by

cigarette wholesalers. Because plaintiffs also sell or

54a

provide small quantities of-cigarettes directly to smokers

in California, nowever, they claim that they have and will

in the future be required to pay the Surtax. See

Declaration of Steven F. Gentry (“Gentry Decl.”) PP2, 4.

Plaintiffs state that their combined payments of the

Tobacco Products Surtax in 2002 were in excess of

$ 14,000. Gentry Decl. P4. Thus, plaintiffs allege that

they collectively contributed approximately $ 2,800 of the

$ 25 million spent on the’challenged ads.

The defendants are Diana M. Bonta, Director of the

California Department of Health-Services, and Dileep G.

Bal, Acting Chief of the Tobacco Contro! Section of DHS.

The Complaint alleges that “Bonta is the highest-ranking

official of DHS and, accordingiy, is ultimately responsible

for the advertising challenged in this action.” Complaint

at 2, P4. Defendant “Bal is directly responsible for the

design, approval and distribution of the advertising

challenged in this action.” Jd. at 2, P5.

D. PLAINTIFFS’ ALLEGATIONS

Plaintiffs bring five causes of action. First, they allege

that the use of the Surtax for funding anti-industry ads

violates the right of free speech secured to them by the

First Amendment. Second, they allege an identical claim

under the free speech clause of Article I, section 2 of the

California Constitution. Third, plaintiffs allege that the

“anti-industry” ads stigmatize them, publicly disparage

their reputation and character, and prejudice potential

jurors with respect to the facts that underlie the sort of

civil lawsuits that are frequently brought against thern in

California. They allege that the distribution of the

advertisements thus constitutes a denial of due process,

in that the state has publicly stigmatized them and

denied them the right to a fair and impartial jury in

California, in violation of both the Fourteenth and

Seventh Amendments. Fourth, plaintiffs allege that the

distribution of the program’s anti-industry ads constitutes

a denial of their right to a fair and impartial jury under

5da

the Seventh Amendment. Fifth, plaintiffs bring a claim

for declaratory relief, seeking a judicial declaration that

the distribution of the anti-industry ads violates their

constitutional rights because it (1) constitutes compelled

speech with which they disagree; (2) constitutes

disparaging speech which was published without

affording them prior notice and hearing; and (3) has the

potential to prejudice current and future California jurors

with respect to matters at issue in pending litigation.

Plaintiffs also seek an injunction barring defendants from

using funds raised by the Surtax to distribute any

advertising that “attacks, ridicules, vilifies, or otherwise

criticizes or comments negatively upon the conduct or

speech of the ‘tobacco industry, or of Plaintiffs.”

Complaint at 14 1.

Il. STANDARDS UNDER FED. R. CIV. P. 12(b) (6)

On a motion to dismiss, the allegations of the

complaint must be accepted as true. See Cruz v. Beto, 405

U.S. 319, 322, 31 L. Ed. 2d 263, 92 S. Ct. 1079 (1972). The

court is bound to give the plaintiff the benefit of every

reasonable inference to be drawn from the “well-pleaded”

allegations of the complaint. See Retail Clerks Intern.

Ass’n, Local 1625, AFL-CIO v. Schermerhorn, 373 U.S.

746, 753 n. 6, 10 L. Ed. 2d 678, 83 S. Ct. 1461 (1963).

Thus, the plaintiff need not necessarily piead a particular

fact if that fact is a reasonable inference from facts

properly alleged. See id.; see also Wheeldin v. Wheeler,

373 U.S. 647, 648, 10 L. Ed. 2d 605, 83 S. Ct. 1441 (1963)

(inferring fact from allegations of complaint).

In general, the complaint is construed favorably to

the pleader. See Scheuer v. Rhodes, 416 U.S. 232, 236, 40

L. Ed. 2d 90, 94 S. Ct. 1683 (1974). So construed, the

court may not dismiss the complaint for failure to state a

claim unless it appears beyond doubt that the plaintiff

can prove no set of facts in support of the claim which

would entitle him or her to relief. See Hishon v. King &

Spalding, 467 U.S. 69, 73, 81 L. Ed 2d 59, 104 S. Ct. 2229

56a

(1984) (citing Conley v. Gibson, 355 U.S. 41, 45-46, 2 L.

Ed. 2d 80, 78 S. Ct. 99 (1957)). In spite of the deference

the court is bound to pay to the plaintiffs allegations,

however, it is not proper for the court to assume that “the

[plaintiff] can prove facts which |he or she] has not

alleged, or that the defendants have violated the . . . laws

in ways that have not been alleged.” Associated General

Contractors of California, Inc. v. California State Council

of Carpenters, 459 U.S. 519, 526, 74 L. Ed. 2d 723, 103 S.

Ct. 897 (1983).

Ill. STANDING

The defendants’ first defense is that the plaintiffs

lack standing. As I now explain, plaintiffs’ constitutional

claims are such that this suit comes close to being “in the

class of those cases where standing and the merits are

inextricably intertwined.” City of Revere v. Massachusetts

General Hospital, 463 U.S. 239, 243 n.5, 77 L. Ed. 2d 605,

103 S. Ct. 2979 (1983).

“To satisfy Article III’s standing requirements, a

plaintiff must show (1) it has suffered an ‘injury in fact’

that is (a) concrete and particularized and (b) actual or

imminent, not conjectural or hypothetical; (2) the injury is

fairly traceable to the challenged action of the defendant;

and (3) it is likely, as opposed to merely speculative, ti. it

the injury will be redressed by a favorable decision.”

Friends of Earth, Inc. v. Laidlaw Environmental Services,

528 U.S. 167, 180-181, 145 L. Ed. 2d 610, 120 S. Ct. 693

(2000). These requirements together constitute the

“irreducible constitutional minimum” of standing. Lujan

v. Defenders of Wildlife, 504 U.S. 555, 560, 119 L. Ed. 2d

351, 112 S. Ct. 2130, (1992). The party invoking federal

jurisdiction bears the burden of establishing these

elements. See FW/PBS, Inc. v. Dallas, 493 U.S. 215, 231,

107 L. Ed. 2d 603, 110 S. Ct. 596 (1990). “At the pleading

stage, general factual allegations of injury resulting from

the defendant’s conduct may suffice, for on a motion to

dismiss we presume that general allegations embrace

57a

those specific facts that are necessary to support the

claim.” Lujan, 504 U.S. at 561 (internal citations and

quotation marks omitted).

E. INJURY-IN-FACT

Plaintiffs claim they are injured because they are

compelled to fund speech with whic. ‘hey disagree and

because the airing of the challenged advertisements

injures their reputation. Defendants ccntend that

plaintiffs lack the requisite injury because their stake as

taxpayers is too generalized and indirect to confer

standing and because the compelled-speech claim fails as

a matter of law. Defendants also argue that plaintiffs

cannot premise standing on alleged reputational injury

because any such injury is not sufficiently individualized.

Generally, suits premised solely on state or federal

taxpayer status are not cognizable in the federal courts

because a taxpayer's “interest in the moneys of the

Treasury .. . is shared with millions of others, is

comparatively minute and indeterminable; and the effect

upon future taxation, of any payments out of the funds,

so remote, fluctuating and uncertain, that no basis is

afforded for [judicial intervention.|” ASARCO, Inc. v.

Kadish, 490 U.S. 605, 613, 104 L. Ed. 2d 696, 109 S. Ct.

2037 (1989) (quoting Massachusetts v. Mellon, 262 U.S.

447, 487, 67 L. Ed. 1078, 43 S. Ct. 597 (1923)). The

Supreme Court, however, has indicated that standing

may exist where the “peculiar relation” of the taxpayer

and the taxing entity or program makes the taxpayer's

interest in the application of revenues “direct and

immediate.” /d.

In the matter-at-bar, it appears that plaintiffs have

such a “direct and immediate” interest. The Surtax in

question is levied only on tobacco wholesalers and

manufacturers, for purposes directly related to their

business, so that the interest at issue is not “shared with

millions of others.” Both the Supreme Court and the

58a

Ninth Circuit have indicated that standing is proper

where, as here, a tax is challenged by members of a small,

discrete group on whom the tax is imposed. See Bacchus

Imports v. Dias, 468 U.S. 263, 267, 82 L. Ed. 2d 200, 104

S. Ct. 3049 (1984) (liquor wholesalers had standing to

challenge constitutionality of liquor excise tax); United

States v. Butler, 297 U.S. 1, 61, 80 L. Ed. 477, 56 S. Ct.

312 (1963) (farmers had _ standing to _ challenge

agricultural processing taxes); ACF Indus., Inc. v.

California State Bd. of Equalization, 42 F.3d 1286, 1291

(9th Cir. 1994) (holding that where a state “directly

assesses [plaintiffs] with the challenged tax . .. the

standing issue is not complex.”).®

The plaintiffs, however, are not challenging the tax

itself but the government’s use of tax dollars. The

question is whether the distinction makes a difference; |

conclude that it does not. Standing in the present context

turns on whether the plaintiffs are members of a small,

discrete group on whom the tax is imposed and whether

the tax is put to uses directly affecting the plaintiffs.

Under this standard, there appears to be no meaningful

distinction between attacking the lav. fulness of collecting

the tax, as contrasted with the lawfulness of the use to

which the tax is put. As I now explain, the issue here is

similar to taxpayer standing in another First Amendment

context.

In Establishment Clause cases, rather than requiring

a “direct injury,” courts require a plaintiff to demonstrate

6 The Tax Injunction Act, 28 U.S.C. § 1343, which creates a

jurisdictional bar to cases in federal court that seek to enjoin or

restrain the collection of taxes under state law, is inapplicable

here because plaintiffs seek only to enjoin anti-tobacco

advertising funded by the tobacco Surtax, not the collection of

the Surtax itself. See Hoohuli v. Arivoshi, 741 F.2d 1169, 1177

(9th Cir. 1984).

59a

a logical link between his taxpayer status and the

challenged legislative enactment, and a nexus between

his taxpayer status and the precise nature of the alleged

constitutional infringement. Flast v. Cohen, 392 U.S. 83,

102-03, 20 L. Ed. 2d 947, 88 S. Ct. 1942 (1968); see also

Doe v. Madison Sch. Dist., 177 F.3d 789 (9th Cir. 1999) (to

challenge the constitutionality of a state statute on the

basis of the Establishment Clause, a party must show

that “tax revenues are expended on the disputed

practice.”). In Flast, the decision rested in part on the fact

that the Establishment Clause is a_ specific limit on the

power of Congress to tax and spend. 392 U.S. at 104.’ If

plaintiffs’ theory on the merits of their First Amendment

claim is correct - i.e. that the Abood line of compelled

expressive association cases may be extended to cover tax-

funded government speech - then it would appear to_

follow that the Free Speech Clause would also satisfy

Flast, since in that limited context the Free Speech

Clause would also operate as a limit on the state’s power

to tax and spend.

Similarly, plaintiffs alleged reputational injuries, on

which their Seventh Amendment and Due Process claims

depend, are not as generalized as defendants contend. In

arguing to the contrary, defendants rely on Allen v.

Wright, 468 U.S. 737, 82 L. Ed. 2d 556, 104 S. Ct. 3315

(1984), a case in which the Supreme Court held that the

alleged harm of racial stigmatization was not sufficiently

individualized to confer standing on parents of black

children attending public schools who challenged IRS

policies regarding the tax-exempt status of racially-

discriminatory private schools. The Court explained that

7 The Court has never declared that the Establishment Clause

is the only constitutional provision that_satisfies the Flast test

for taxpayer standing; it has, however, never found any other

constitutional provision that satisfies the test.

60a

“if the abstract stigmatic injury were cognizable, standing

would extend nationwide to all members of the particular

racial groups against which the Government was alleged

to be discriminating by its grant of a tax exemption to a

racially discriminatory school, regardless of the location of

that school.” Jd. at 755-56 (internal citations and

quotation marks omitted). Whatever the strength of

Allen’s logic,*® the situation here is entirely different. The

stigma and reputational harm allegedly caused by the

challenged advertisements affects only tobacco

wholesalers and a handful of large tobacco manufacturers

that sell their cigarettes to Californians. Thus, plaintiffs

have sufficiently alleged injury.

F. CAUSATION

In arguing that plaintiffs have failed to demonstrate

the requisite causation, defendants again raise arguments

that are more properly directed to the merits. Defendants’

causation argument is particularly directed to the merits

of plaintiffs’ Seventh Amendment claim; they claim that

any impact on jury trials caused by the challenged

program is entirely speculative. For purposes of the

standing inquiry, at least on a motion to dismiss,

plaintiffs would appear to have satisfactorily alleged that

California’s advertising campaign, which has the purpose

of changing people’s attitudes about tobacco use and

maligning the character of the tobacco industry, actually

has that effect. These allegations are sufficient to show

* I note in passing that the observation is less than perfectly

persuasive. African-Americans are a distinct group, and if

indeed the government is discriminating against the members

of the group in its use of taxes, it is not clear why any member

of the group should not have standing. See generally Gene R.

Nichol, Abusing Standing: A Comment on Allen v. Wright, 133

U. Pa. L. Rev. 635, 641-49 (1985).

6la

that the rep ional harm alleged flows from the

advertisement:

G. REDRESSABILITY

Finally, defendants argue that plaintiffs’ claims, even

if sustained, would not be redressable. As defendants

correctly point out, the ordinary remedy in compelled

funding for speech cases is a refund of the money used to

fund the objected-to speech. Here, however, plaintiffs do

not seek a refund or an order enjoining the state from

collecting the Surtax and, in any event, such a remedy

would be barred by the Tax Injunction Act, 28 U.S.C.

§ 1343. The remedy that plaintiffs do seek, however, an

injunction prohibiting the defendants from airing the

objectionable advertisements, is not barred by statute and

has in fact been adopted by at least one court in a

compelled speech case. See Pelts & Skins LLC v. Jenkins,

259 F. Supp. 2d 482, No. 02-384, 2003 WL 1984368 (M.D.

La. Apr. 24, 2003) (enjoining use of funds in the Louisiana-

Fur and Alligator Public Education Marketing Fund for

the purpose of generic alligator marketing). Whether or

not the relevant law dictates such a remedy is a separate

matter. Because there appears to be‘no bar to the remedy

plaintiffs seek, they have alleged redressability for

_ purposes of standing.

Given all the above, the court concludes that

plaintiffs’ allegations satisfy Article [III's “case -or

controversy” requirement. I now turn to the merits.

IV. THE FIRST AMENDMENT

The tobacco companies argue that California’s use of

the Proposition 99 Surtax to fund the challenged

advertising effectively compelstthem to fund speech with

which they disagree. They assert that such compulsion

62a

violates their rights under the First Amendment.’ They

do not question the states’s right to convey information to

its citizens about the health risks of smoking. Rather,

they object to advertising that assails the character,

motives and practices of the tobacco industry and seek to

enjoin the state from airing ads fitting that description.

Defendants and amici contend that the advertising is

speech by the government on a matter of urgent

importance to the public health of its citizens, and as with

any other speech by the government, the advertising is

necessarily funded by tax revenues. Under the

“government speech” doctrine, they argue, taxpayers do

not have a right to object to such activity under the First

Amendment. Before turning to the government speech

doctrine, I begin by addressing the compelled speech cases

on which plaintiffs rely.

B. WHETHER THE DHS ADVERTISEMENTS ARE

IMPERMISSIBLE COMPELLED SPEECH

Cases involving “compelled speech” fall into two

distinct categories. The first line of authority, involving

situations where the government directly compels citizens

to engage in speech activity, is plainly inapplicable here.

The challenged program does not, for instance, require

the tobacco companies to repeat an objectionable message

out of their own mouths, see West Virginia Bd. of Ed. v.

Barnette, 319 U.S. 624, 632, 87 L. Ed. 1628, 63S. Ct. 1178

(1943) (government may not compel children, contrary to

their conscience, to salute the American flag), or force

* While there is no doubt that corporations enjoy the protection

of the First Amendment, Hague v. CIO, 307 U.S. 496, 83 L. Ed.

1423, 59 S. Ct. 954 T1939), the Court has not “decided whether

the First Amendment’s protection of corporate speech is

coextensive with the protection it affords to individuals.”

Mcintyre v. Ohio Elections Commission, 514 U.S. 334, 353, 131

L. Ed. 2d 426, 115 S. Ct. 1511 (1995).

them to use their own property to convey an antagonistic

ideological message, see Wooley v. Maynard, 430 U.S. 705,

51 L. Ed. 2d 752, 97 S. Ct. 1428 (1977) (government may

not compel motorists, contrary to their conscience, to

display license plates bearing the motto “Live Free or

Die”).!°

Instead, plaintiffs rely on a second line of cases in

which the Supreme Court has scrutinized programs that

compel people to join and contribute to groups or

associations whose speech they find objectionable. See

Abood v. Detroit Bd. of Educ., 431 U.S. 209, 52 L. Ed. 2d

261, 97 S. Ct. 1782 (1977); Keller v. State Bar of

California, 496 U.S. 1, 110 L. Ed. 2d 1, 110 S. Ct. 2228

(1990); Glickman v. Wileman Brothers, 521 U.S. 457, 138

L. Ed. 2d 585, 117 S. Ct. 2130 (1997); United States v.

United Foods, 533 U.S. 405, 413, 150 L. Ed. 2d 438, 121 S.

Ct. 2334 (2001) (“The mandated support is contrary to the

First Amendment principles set forth in cases involving

expression by groups which include persons who object to

the speech, but who, nevertheless, must remain members

of the group by law or necessity.”).!!

As | explain below, plaintiffs’ reliance on these cases

is unwarranted. Neither the holdings nor the reasoning in

these cases suggest that government’s decision to levy a

targeted tax used to fund its own speech runs afoul of the

'” While the plaintiffs object to the use of “their” tax money to

fund the advertisements, they do not contend (nor could they,

given the undisputed propriety of imposing the tax), that funds

so raised are not the State’s at the time the funds are expended.

'| [ have previously described this line of cases as articulating a

“doctrine of unwilling allegiance.” Prescott v. County of El

Dorado, 915 F. Supp. 1080. 1085 (E.D. Cal. 1996). I have also

noted my sense that this line of cases does not fit easily within

the conventional pattern of First Amendment issues. Jd. at

1085 n. 5.

64a

First Amendment; moreover, so far as this court can

determine, no lInwer court, state or federal, has found

otherwise. This is not surprising. Cf; NAACP v. Hunt, 891

F.2d 1555, 1556 (11th Cir. 1990) (*Abood has never been

applied to the government, however; if it were, taxation

would become impossible.”). Put directly, the courts have

consistently drawn a line between the compelled payment

of funds to support private expressive association, which

may be unconstitutional “compelled speech,” and the

compelled payment of taxes and other exactions to fund

speech by the government itself. Questions arising under

the latter scenario must be considered under the

government speech doctrine. The Supreme Court cases on

which plaintiffs principally rely serve to illustrate this

distinction.

1. Abood and Keller

Chronologically, the first such case is Abood.'* There,

public school teachers in Detroit challenged the “agency

shop” provisions of their collective bargaining agreement,

which required every teacher represented by the teachers’

union, regardless of whether the teacher was a member,

to pay a service fee equal to union dues. 431 U.S. at 210.

The Court held that although being required to help

12 In their opening brief, plaintiffs propose that “the compelled

speech doctrine was first applied in International Ass'n of

Machinists v. Street, 367 U.S. 740, 768-69, 6 L. Ed. 2d 1141, 81

S. Ct. 1784 (1961), in which the Court held that when

employees are required by law to pay dues to a labor union. the

union cannot use those dues to support political activities the

employees oppose.” Pl’s MPA in Supp. of Prelim. Inj. at 13.

While this statement of the holding in Street is accurate, that

holding was dictated by the Court’s interpretation of the

Railway Labor Act, not by a conclusion that the challenged

policy violated the First Amendment. 367 U.S. at 768. In any

event, Abood made clear that the First Amendment dictates the

same result.

65a

finance the union “might well be thought . . . to interfere

in some way with an employee's freedom to associate for

the advancement of ideas, or to refrain from doing so,”

any such interference was constitutionally justified by the

important contribution of agency shops to the system of

labor relations established by Congress. Id. at 222-232.

When it came to the union’s use of service fees for

political activities unrelated to collective bargaining,

however, the Court reached a different conclusion; using

the fees for such purposes, the Court held, constituted

impermissible compelled speech.

This holding was dictated by two well-established

principles: first, that “the freedom of an individual to

associate for the purposes of advancing beliefs and ideas

is protected” by the First ... Amendment, id. at 233, and

second, that “a government may not require an individual

to relinquish rights guaranteed to him by the First

Amendment as a condition of public employment.” Jd. at

234. It followed, the Court held, that the First

Amendment prohibited the union and the school board

from requiring any teacher, as a condition of empleyment,

to contribute to the advancement of ideological causes

with which the teacher disagreed and which were not

“germane” to the union’s duties as a collective-bargaining

representative. /d. at 235-35. The Court carefully limited

the prohibition to activity unrelated to the union’s core

associational purposes, distinguishing between collective

bargaining activities, for which otherwise impermissible

compelled association was justified, and other purposes,

for which no such justification existed.

In a concurring opinion, Justice Powell emphasized

that the obligation of citizens to contribute taxes to the

government, whether or net they agree with how the

money is spent, is not an obligation that may be excused

by the freedom of speech or association. In doing so, he

highlighted the critical distinction between expressive

association and government speech:

66a

Compelled support of a private association

is fundamentally different from compelled

support of government. Clearly, a_ !ocal

school board does not need to demonstrate a

compelling state interest every time it

spends a taxpayer's money in ways the

taxpayer finds abhorrent. But the reason

for permitting the government to compel

the payment of taxes and to spend money

on controversial projects is that the

government is representative of the people.

The same cannot be said of a union, which

is representative only of one segment of the

population, with certain common interests.

The withholding of financial support is fully

protected as speech in this context.

Id. at 259 n.13 (Powell, J., concurring).

In Keller, the Court expanded on Abood’s compelled

speech analysis and, more importantly for our purposes,

on the distinction in Justice Powell’s footnote. The Keller

Court held that compelling objecting attorneys to pay

dues to the California State Bar, to the extent that- such

dues were used to finance political or ideological activities

not germane to the state bar’s function, was invalid. The

California Supreme Court decision under review, relying

on the government speech doctrine, had rejected the

attorneys’ First Amendment challenge because it

Jetermined that the Bar was a government agency. In

ruling against the Bar, the U.S. Supreme Court did not

reject the state court’s rationale. On the contrary, the

Court embraced the distinctioh between government

speech and compelled speech and merely rejected the

premise that the State Bar was speaking on behalf of the

67a

government.'? Indeed, the Court quoted the California

court’s broad articulation of the doctrine, along with

Justice ‘Powell’s Abood concurrence, apparently with

approval:

If the bar is considered a government

agency, then the d tinction between

revenue derived from mandatory dues and

revenue from other sources is immaterial. A

government agency may use unrestricted

revenue, whether derived from taxes, dues,

fees, tolls, tuition, donation, or other

sources, for any purposes within its

authority.

Keller, 496 U.S. at 10 (quoting Keller v. State Bar, 47

Cal.3d 1152, 1167, 255 Cal. Rptr. 542, 767 P.2d 1020

(1989)) (emphasis added).

The High Court, however, concluded that the Bar’s

primary purpose was the representation of its members;

and thus it was functionally equivalent to the union in

Abood and “a good deal different from most other entities

that would be regarded in common parlance as

‘government agencies.” 496 U.S. at 11. The Court clearly

articulated the difference between the compelled speech

at issue there and government speech, holding that “the

very specialized characteristics” of the Bar distinguished

its role from that of government officials, wuo “are

expected as part of the democratic process to represent

‘8 The Court acknowledged that “the Supreme Court of

California is the final authority on the ‘governmental status’ of

the State Bar of California for purposes of state law” but held

that the state court’s “determination that the respondent is a

‘government agency ... is not binding on us when such a

determination is essential to the decision of a federal question.”

496 U.S. at 10. But see McMilitan v. Monrve County, Alabama,

520 U.S. 781, 786, 138 L. Ed. 2d 1, 117 S. Ct. 1734 (1997).

68a

and espouse the views of a majority of their constituents.”

Id.

As in Abood, the Court found that compelled

association with the Bar was permissible to the extent

that it furthered the Bar’s core purposes. Just as the

“agency shop” arrangement was designed to prevent free-

riders (people who benefit from collective bargaining but

don’t pay dues), it was appropriate that “the lawyers who

derive benefit” from the Bar’s activities, “should be called

upon to pay a fair share of the cost of professional

involvement in this effort.” Jd. at 11. Again, as in Abood,

to the extent that the political and ideological activities

funded were not germane to that purpose, compelled

association could not be justified.

2. Glickman and United Foods

Plaintiffs place greater emphasis on a pair of more

recent Supreme Court decisions, Glickman and United

Foods, both of which discussed the application of Abood

and Keller to programs that compel agricultural

producers to contribute to trade groups for the purposes of

generic industry advertising. Neither of these cases,

however, upset the Court's distinction between

government speech and impermissible compelled speech.

In Glickman, the Court rejected a challenge by

growers and processors of California tree fruits, who were

required by marketing orders promulgated by the

Secretary of Agriculture (pursuant to the Agricultural

Marketing Agreement Act) to pay assessments to a

Nectarine Administrative Committee and _ Peach

Commodity Committee. Those committees, in turn, used

the money to pay for generic industry advertising.

The Court began its inquiry by stating that “Abood,

and the cases that follow it, did not announce a broad

First Amendment right not to be compelled to provide

financial support for any organization that conducts

expressive activities. Rather, Abood merely recognized a

69a

First Amendment interest in not being compelled to

contribute to an organization whose expressive activities

conflict with one’s freedom of belief.” 521 U.S. at 471. The

Glickman Court held that the assessments at issue did

not violate the First Amendment because “(1) the generic

advertising of California peaches and nectarines is

unquestionably germane to the purposes of the marketing

orders and, (2) in any event, the assessments are not used

to fund ideological activities.” Jd. at 473. Thus, as in

Abood and Keller, the Court adhered to its germaneness

test, holding that speech that is germane to broader,

legitimate purposes of association will be upheld. As

Justice Souter noted, the Court was not required to

discuss the government speech doctrine because the

Secretary of Agriculture expressly waived the argument

that the advertisements at issue constituted government

speech. Jd. at 483 n.2 (Souter, J., dissenting).

Only four years later, in United Foods, the Court

invalidated a _ similar federal assessment program

imposed on mushroom growers. The Court distinguished

the fruit-tree program upheld in Glickman by explaining

that “in Glickman, the mandated assessments for speech

were ancillary to a more comprehensive program

restricting marketing autonomy. Here, for all practical

purposes, the advertising itself, far from being ancillary,

is the principal object of the regulatory scheme.” United

Foods, 533 U.S. at 415."

4 Based on this distinction, defendants contend that, even if

the speech at issue here were not government speech, the use of

Tobacco Products Surtax funds for advertising would

nevertheless survive constitutional scrutiny because the ads are

just one part of a comprehensive regulatory scheme aimed at

reducing the harmful effects of tobacco use. Because the vast

majority of the funds raised by the Surtax are used to fund

activities other than speech, such as health care, research and

other programs, they maintain that this case would be closer to

(...continued )

70a

Notably, the Court again did not reach the question of

government speech. Because the issue had not been

addressed in the courts below, the Court declined to

consider the argument. The Court suggested, however,

that the government would have to establish that it

exercised more than pro forma control over the speech for

it “to be labeled, and sustained, as government speech.”!®

Glickman than United Foods. Assuming government speech

were not involved, defendants’ argument has considerable

weight, since speech appears not to be “the principal object of

the regulatory scheme.” United Foods, 533 U.S. at 415; see

Delano Farms Co. v. California Table Grape Comm'n, 318 F.3d

895, 898 (2003) (applying Glickman-United Foods distinction to

grape advertising program; explaining that the distinction

turns on the comprehensiveness of the regulatory scheme).

Since the speech involved here is government speech, neither

Glickman nor United Foods control and there is therefore no

need to further address the issue.

‘5 The Court explained:

The Government’s failure to raise its argument in

the Court of Appeals deprived respondent of the

ability to address significant matters that might

have been difficult points for the government. For

example, although the Government asserts that

the advertising is subject to approval by the

Secretary of Agriculture, respondent claims that

the approval is pre forma. This and other difficult

issues would have to be addressed were the

program to be labeled, and _ sustained, as

government speech.

533 U.S. at 417.

71a

Unlike the mushroom’ assessment program

invalidated in United Foods, there is no question that the

DHS officials named as the defendants here exercise

much more than pro forma authority over the challenged

advertising, and plaintiffs do not suggest otherwise. The

parties do not dispute that the defendants are actually

responsible for the speech conveyed. Thus, there are no

“difficult issues [that] would have to be addressed [before]

the program [is] labeled, and sustained, as government

speech.” 533 U.S. at 417.

In Board of Regents of the Univ. of Wisconsin v.

Southworth, 529 U.S. 217, 146 L. Ed. 2d 193, 120 S. Ct.

1346 (2000), as in United Foods, the Court made clear

that when the question of whether government speech is

involved is properly raised, that question presents a

threshold issue in a compelled speech challenge under the

Abood line of cases. Only after first concluding that “the

case we decide here . . . does not raise the issue of the

government's right, or to be more specific, the state-

controlled University’s right, to use its own funds to

advance a particular message,” 120 S. Ct. at 1354, did the

Court move on to the compelled speech inquiry, id. (“the

Abood and Keller cases, then, provide the beginning point

of our analysis.”).!®

16 The Ninth Circuit authority on which plaintiffs rely

does not suggest another mode of analysis. Plaintiffs rely

on Cai-Almond, Inc. v. USDA, 14 F.3d 429 (9th Cir. 1993)

(“Cal-Almond I”), and go so far as to suggest that the case

“controls” the outcome here. See, e.g., Pl’s Reply Br. at 8-

10. But as Cal-Almond’s procedural history makes clear,

and as the Ninth Circuit has explained, that decision’s

compelled speech analysis is no longer good law. See Cal-

Almond v. USDA, 192 F.3d 1272, 1277 (1999) (“Cal

Almond IV”) (“In light of the Supreme Court’s remand in

Cal-Almond IT and our subsequent remand for dismissal

(...continued)

72a

In the wake of United Foods, federal courts

addressing challenges of mandatory assessments for

generic agricultural advertising programs have uniformly

addressed government speech as a threshold issue before

turning to the compelled speech inquiry. See, e.g., Pelts &

Skins, LLC v. Jenkins, No. Civ.A.02-CV 384, 259 F.

Supp.2d 482, 2003 WL 1984368, at *6 (M.D. La. Apr. 24,

2003) (challenge of mandatory assessments used to fund

generic advertising of alligator products; reasoning that

“because the generic advertising here involved is not

government speech, plaintiff is free to challenge such

advertising on First Amendment grounds”); Jn re

Washington State Apple Comm’n, 257 F. Supp. 2d 1290,

1305 (challenge of mandatory assessments used to fund

generic advertising of apples; reaching compelled speech

issue only after holding that “the Commission’s activities

are not protected by the government speech doctrine”);

Michigan Pork Producers v. Campaign for Family Farms,

229 F. Supp.2d 772, 785-89 (W.D. Mich. 2002) (challenge

of mandatory assessments for generic advertising of pork

products; reasoning that “though the Secretary is

integrally involved with the workings of the Pork Board,

this involvement does not translate the advertising and

marketing in question into ‘government speech”);

in Cal-Almond III, Cal-Almond I has been implicitly

overruled.”). The decision’s holdings on other issues,

however, retain precedential value. See, e.g., NRDC v.

Evans, 316 F.3d 904, 906, 911-12 (9th Cir. 2003) (relying

on Cal-Almond I for an administrative law issue; “The

outcome here follows Ca/l-Almond.”).

Nor does the Ninth Circuit’s recent decision in Delano Farms

help plaintiffs. Delano Farms simply offers a straightforward

application of United Foods to a grape advertising program

similar to the mushroom program considered by the Supreme

Court.

73a

Livestock Mktg. Ass’n v. United States Dep’t of Agric.,

2002 DSD 18, 207 F. Supp.2d 992 (D.S.D. 2002) (“The

generic advertising program funded by the beef checkoff

is not government speech and is therefore not excepted

from First Amendment challenge”); Charter v. USDA, 230

F. Supp.2d 1121 (D. Mont. 2002) (rejecting challenge to a

program of mandatory assessments for beef industry

advertising on the grounds that the advertising at issue

was government speech and that United Foods, therefore,

did not control).

A recent decision by the Eighth Circuit offers a

concise explanation of the difference between compelled

speech and government speech:

Unlike |a case] where plaintiffs challenge [|

a decision concerning the content of

government speech, appellees in the

present case are chailenging the

government’s authority to compel them to

support speech with which they personally

disagree; such compulsion is a form of

government interference with private

speech. The two categories of First

Amendment cases - government speech

cases and compelled speech cases - are

fundamentally different.

Livestock Mktg. Ass'n v. USDA, 2003 U.S. App. LEXIS

13630, Nos. 02-2769/283, F.3d , 2003 WL 21523837

(July 8, 2003) at *8. (emphasis added). Put simply, while

the cases on which plaintiffs rely fall in the compelled

speech line, this case involves government speech.

Plaintiffs are not seeking to prevent coerced participation

in private expressive association; rather, they are

attempting to exercise a taxpayer's veto over speech by

the government itself. As I explain below, that attempt

founders on the shoals of the “government speech”

doctrine.

74a

C. WHETHER THE DHS ADVERTISEMENTS ARE

GOVERNMENT SPEECH

The determination as to whether speech is properly

characterized as government speech or private speech

turns entirely on “who is responsible for the speech.”

Downs v. Los. Angeles Unified Sch. Dist., 228 F.3d 1003,

1011-12 (9th Cir. 2000), cert. denied, 532 U.S. 994, 149 L-

Ed. 2d 636, 121 S. Ct. 1653 (2001). In other words, the

inquiry rests on the level of control and authority that the

government exercises over the message conveyed. See id.

at 1009-1012 (content of public school bulletin boards was

government speech because boards were used to express

school policy, access was limited to faculty and staff, and

postings were subject to the oversight of school

principals); see also Knights of the Ku Klux Klan v.

Curators of the Univ. of Mo., 203 F.3d 1085, (8th Cir.),

cert. denied, 531 U.S. 814, 148 L. Ed. 2d 18, 121 S. Ct. 49

(2000) (underwriting acknowledgments by _ state

university-run radio station constituted government

speech because, inter alia, radio station’s staff members

composed, edited and reviewed acknowledgment scripts

prior to broadcast and because the university was

ultimately responsible for all broadcast materiz’

While in some cases the distinction between

government speech and compelled allegiance may present

“difficult issues,” United Foods, 533 U.S. at 417, the

analysis here is straightforward. The advertisements at

issue here are controlled by government officials, who are

ultimately responsible for their content.'? See Complaint

‘7 In contrast, the “speakers” ii: the compelled allegiance ¢ «ses

cited by the plaintiffs were the Mushroom Council (Un.ted

Foods), the Nectarine Administrative Committee and Peach

Commodity Committee (Glickman), the State Bar of California

(Keller), the Detroit Federation of Teachers (Abood), the

California Table Grape Commission (De/ano Farms), California

Almond Board (Ca/-Almond 1), and the Cattleman’s Beef

(...continued)

at 2, P4 (alleging that defendant Bonta “is ultimately

responsible for the advertising challenged in this action”);

id. at 2, P5 (alleging that defendant Bal “is directly

responsible for the design, approval and distribution of

the advertising challenged in this action.”). Indeed, the

Department of Health Services is specifically directed by

statute to produce and implement a “media campaign...

stressing the importance of both preventing the initiation

of tobacco use and quitting smoking .. . based on

professional market-research and st'*veys necessary to

determine the most effective meti:cd of diminishing

tobacco use among specific target populations.” Cal.

Health & Saf. Code § 104375(e)(1).!5

If the determination turned on the attribution of the

speech rather than control of the message, the result here

would be the same. Unlike the Glickman-United Foods

line of cases where a discrete group is compelled to fund

the “dissemination of a particular message identified with

that group,” Cal-Almond I, 14 F.3d at 435 (emphasis

added), the tobacco advertisements are clearly identified

as coming from the California Department of Health

Services, i.e. the state government. Compare Thompson

=

Promotion and Research Board (United States v. Frame, 885

F.2d 1119 (3rd Cir. 1989)).

's The same statute also provides that “no media campaign

funded pursuant to this article shall feature in any manner the

image or voice of any elected public official or candidate for

elected office, or directly represent the views of any elected

public official or candidate for elected office.” Cal. Health &

Safety Code § 104875(e2). This provision in no way

undermines the fact the government is directly responsible for

the ads: on the contrary, it ensures that the position being

advanced is that of the government itself, not of political

candidates. The provision is clearly designed to ensure that tax

money is not used to fund partisan political speech or

,

.

electioneering.

Decl., Exhibit L (challenged advertisements are all clearly

identified as “Sponsored by the California Department of

Health Services”) with Frame, 885 F.2d at 1133 n.11 (beef

checkoff advertising contains “no mention of the Secretary

or the Department of Agriculture, thus failing to convey

that the advertisements are funded through a

government program.”).!9 Even if the ads were not so

clearly identified, no one could possibly confuse them for

the tobacco companies’ own speech. This fact of

_ attribution, together with the actual responsibility of

government officials for the ads, demonstrates that the

speech at issue here is government speech.

D. THE GOVERNMENT SPEECH DOCTRINE

In discussing the latitude afforded to the government

under the “government speech” doctrine, courts have

generally spoken in terms that are remarkably open-

ended. Given the purposes of the doctrine, a_ broad

opportunity for government speech is~ not entirely

inappropriate. I cannot acknowledge the doctrine,

'’ With near unanimity, courts that have squarely addressed

the issue have found that generic agricultural assessment

programs, which fund speech by non-governmental or quasi-

governmental industry groups for the collective benefit of

contributing producers, are not governmental speech. The “Beef

Checkoff program appears to be the only such program on

which courts have been somewhat divided. Compare Livestock

Marketing, 2003 U.S. App. LEXIS 13630, 2003 WL 21523837

(holding that beef program is not government speech; striking

down program as “in all material respects, identical to the

* mushroom checkoff program at issue in United Foods”); Goetz v.

Glickman, 149 F.3d 1131, 1138-39 (10th Cir. 1998), cert. denied,

525 U.S. 1102, 142 L. Ed. 2d 769, 119 S. Ct. 867 (1999)

(upholding beef program under Glickman), United States v.

Frame, 885 F.3d 1119 (3d Cir. 1989) (holding beef program is

not government speech and passes muster under Central

Hudson) with Charter (beef checkoff is government speech and

thus United Foods does not control).

ry

‘

~]

a

—

however, without also expressing my serious reservations

about its undefined and open-ended nature. I begin by

explaining why the government speech doctrine compels

the conclusion that the challenged program must be

upheld. I then turn to the potential! limits on the doctrine

in order .to underscore that government speech, like

government action, is not without constitutional limits.

Nonetheless, I conclude that none of the present

limitations on government speech support plaintiffs’

claims.

I begin this portion of the analysis by noting that the

government does not enjoy protection for its speech under

the First Amendment. See Columbia Broad. Sys., Inc. v.

Democratic Nat'l Comm., 412 U.S. 94, 139, 36 L. Ed. 2d

772, 93 S. Ct. 2080 (1973) (Stewart, J., concurring) (“The

First Amendment protects the press from government

interference; it confers no analogous protection on the

government”); id. at 139, n.7 (“The purpose of the First

Amendment is to protect private expression and nothing

in the guarantee precludes the government from

controlling its own expression or that of its agents.”

(quoting T. Emerson, The System of Freedom of

Expression 700 (1970)).

Nonetheless, “the government speech doctrine has

firm roots in our system of jurisprudence.” Livestock

Marketing, 2003 U.S. App. LEXIS 13630, 2003 WL

21523837, at *8. The Supreme Court has said, in dicta,

that “when the government appropriates public funds to

promote a particular policy of its own it is entitled to say

what it wishes.” Rosenberger v. Rector and Visitors of the

Univ. of Va., 515 U.S. at 833 (1995); see Columbia Broad.

Sys., 412 U.S. at 139 & n.7 (Stewart, J., concurring)

(“Government is not restrained by the First Amendment

from controlling its own expression.”). In equally broad

language, the Ninth Circuit has said that when the

government is the speaker, “its control of its own speech

is not subject to the constraints of constitutional

78a

safeguaids and forum analysis, but instead is measured

by practical considerations applicable to any individuals’

choice of how to convey oneself: among other things,

content, timing and purpose.” Downs, 228 F.3d at 1013.°°

It has been said that the government speech doctrine

is a necessary implication of our system of government:

Government officials are expected as a part

of the democratic process to represent and

to espouse the views of a majority of their

constituents. With countless advocates

outside of the government seeking to

influence its policy, it would be ironic if

those charged with making governmental

decisions were not free to speak for

themselves in the process. If every citizen

were to have a right to insist that no one

paid by public funds express a view with

which he disagreed, debate over issues of

great concern to the public would be limited

to those in the private sector, and the

process of government as we know it

radically transformed.

“” Implicit in the government speech cases is a suggestion that

government is just one more participant in the marketplace of

ideas. Such a notion appears to this court to be naive. It ignores

the force of government, as compared to private speech, and,

even more importantly, the access that government speech has

to free media, much less the paid media at issue here.

79a

Keller, 496 U.S. at 12-13.2! While plaintiffs’ reaction to

California’s advertisements is quite understandable, the

government speech doctrine teaches that the remedy for

their assertion of harm is “political rather than judicial.”

Griffin v. Secretary of Veteran Affairs, 288 F.3d 1309,

1324-25 (Fed. Cir. 2002). “When government speaks, for

instance to promote its own policies or to advance a

particular idea, it is, in the end, accountable to the

electorate and the political process for its advocacy. If the

citizenry objects, newly elected officials later could

espouse some different or contrary position.” Southworth,

529 U.S. at 235; see Downs, 228 F.3d at 1011-14 (“In order

for the speaker to have the opportunity to speak as the

government, the speaker must gain favor with the

populace and survive the electoral process.”).**

2! Such broad statements appear to this court to miss the

nuances that should inform the question. It is one thing to

recognize that the government in a democracy must make

policy choices about those issues that are properly before it, and

must be able to inform the public about why those choices were

made. This case appears to present quite a different question.

Here, the legislature has not made a decision about banning or

even regulating the sale of tobacco products to adults, but

rather seeks to persuade adults not to use tobacco products. In

a sense, the path taken by Proposition 99 turns the democratic

process on its head. Rather than citizens trying to persuade the

government as to a proper course of its conduct, the government

tries to dissuade the public from engaging in conduct it

apparently does not have the political will to either regulate or

ban. While these observations may well address questions of

political philosophy rather than purely legal issues, they

nonetheless appear appropriate, given that the entire

government speech doctrine derives from political philosophy

rather than a specific constitutional power.

“2 The assumption that a particular piece of government speech

would suffice in the mind of the voting public to justify

obtaining “newly elected officials” seems not just unrealistic,

but also ignores the difficulty and vast costs of election

campaigns in a state such as California. See, e.g., California

(...continued)

80a

Here, some may think that the issue is not as

problematic as government’s efforts to persuade the

public might be in another context. They would take

comfort from the fact that the advertisements in question

derive not just from some government official’s choice, but

are instead the result of an initiative. In a sense, then,

the program represents the direct decision of the majority

of those voting to attempt to convince smokers to forego

that vice. In this court’s view, however, those facts

provide cold consolation. The issue is not whether the

majority of voters approve of the program, but whether in

a system of limited government, such approval should be

translated into a government sponsored propaganda

effort. Indeed, as I have previously noted, the fact that a

statute was adopted by the initiative process “provides no

special insulation from review for asserted constitutional

infirmity.” Service Employees Int'l Union v. Fair Political

Practices Com., 747 F. Supp. 580, 583 (E.D. Cal. 1990)

(citing Citizens Against Rent Control v. Berkeley, 454 U.S.

290, 295, 70 L. Ed. 2d 492, 102 S. Ct. 434 (1981)). Again,

notwithstanding this court’s scruples, the present state of

the government speech doctrine appears to provide no

basis for limiting the advertisements in issue.

Certainly, the fact that the advertisements at issue

are tax-supported provides no support for plaintiffs’

claims. The government’s speech is necessarily paid for by

citizens, some of whom - like plaintiffs here - will disagree

with its message. See Southworth, 529 U.S. at 229 (“It is

inevitable that government will adopt and pursue

programs and policies within its constitutional powers but

which nevertheless are contrary to the profound beliefs

and sincere convictions of some of its citizens.”). The

ProLife Council v. Scully, 989 F. Supp. 1282 (E.D. Cal. 1998).

To say that the answer to abuse by government speech is

political, frequently will simply mean that there is no answer.

Sla

High Court has consistently taught that such

disagreement is simply the cost of living in a democracy

and provides no basis under the First Amendment to

silence the government or to excuse objecting citizens

from having to share the costs of its speech. See Lathrop

v. Donohue, 367 U.S. 820, 857, 6 L. Ed. 2d 1191, 81 S. Ct.

1826 (1961) (Harlan, J., concurring) (“A federal taxpayer

obtains no refund if he is offended by what is put out by

the United States Information Agency.”); United States v.

Lee, 455 U.S. 252, 260, 71 L. Ed. 2d 127, 102 S. Ct. 1051

(1982) (“The tax system could not function if

denominations were allowed to challenge the tax system

because tax payments were spent in a manner that

violates their religious belief.”).

The tobacco companies argue that a crucial difference

between this case and others in which the courts have

applied the government speech doctrine is that, here, the

state is using taxes paid by a specific industry to finance

advertising that condemns that very industry. Again, one

may understand the plaintiffs’ discomfort, but the

Supreme Court has never suggested that the government

speech doctrine applies only to speech funded with

general tax revenues. On the contrary, it seems clear that

speech by the government is government speech, however

funded. That is, given that the tax is lawfully imposed,

the money collected becomes the government’s to expend

as it sees fit, so long as those expenditures fall within

legal limits. If this were not so, the Supreme Court’s

discussion of and reference to the government speech

doctrine in Abood, 431 U.S. at 259 n. 13, Keller, 496 U.S.

at 12-13, Glickman, 521 U.S. at 483, and United Foods,

533 U.S. at 417, would have been irrelevant surplusage.

Indeed, the Court has recently declared that “the

government, as general rule, may support valid

programs and policies by taxes or other exactions binding

on protesting parties. Within this broader principle it

seems inevitable that funds raised by the government will

be spent for speech and other expression to advocate and

82a

defend its own policies.” Southworth, 529 U.S. at 229

(emphasis added);?* see also United Foods, 533 U.S. at

425-26 (Breyer, J., dissenting) (arguing that if contested

>

assessments on industry constituted “a targeted tax,’

government could fund advertising with such a tax,

which, under Southworth, would be “binding on

protesting parties.”); cf. Regan v. Taxation With

Representation of Wash., 461 U.S. 540, 547, 76 L. Ed. 2d

129, 103 S. Ct. 1997 (1983) (“Legislatures have especially

broad latitude in creating classifications and distinctions

in tax statutes”); Laurence H. Tribe, American

Constitutional Law, § 12-4 at 807 n. 14 (2d ed. 1988)

(observing that while a taxpayer might have standing to

challenge “an earmarked tax” used to fund government

speech on a political or ideological issue, “it has been

assumed that the taxpayer would lose any such challenge

on the merits.”).

Nor does the content or subject matter of the speech

at issue alter the applicability of the government speech

doctrine, as it might if the speech were religious,

politically partisan, defamatory or in some other way

subject to legal constraints. While the precise scope of the

government speech doctrine has hardly been considered,

23 In Southworth, which concerned the constitutionality of a

student activity fee that was used in part to fund student

organizations engaging in political or ideological speech, the

Court noted that because “the University had disclaimed that

the speech was its own,” the case did not present the question

whether the challenge could be sustained “under the principle

that the government can speak for itself.” Jd. at 234-35. The

Court went on to observe that, “if the challenged speech here

were financed by tuition dollars and the University anc its

officials were responsible for the content, the case might be

evaluated on the premise that the government itself is the

speaker.” Jd. Thus, the Court recognized the applicability of the

government speech doctrine to speech funded not from general

tax revenues, but from tuition dollars.

83a

there is no doubt that modern government is called upon

to deal with “innumerable subjects” on which government

may be required to take a position and then explain its

reasons for doing so. National Endowment for the Arts v.

Finley, 524 U.S. 569, 598, 141 L. Ed. 2d 500, 118 S. Ct.

2168 (1998) (Scalia, J., concurring).

As the Supreme Court has recently observed, “tobacco

use, particularly among children and adolescents, poses

perhaps the single most significant threat to public health

in the United States.” Lorillard Tobacco v. Reilly, 533

U.S. 525, 570, 150 L. Ed. 2d 532, 121 S. Ct. 2404 (2001)

(quoting FDA v. Brown & Williamson, 529 U.S. 120, 161,

146 L. Ed. 2d 121, 120 S. Ct. 1291 (2000)); cf. id. at 528

(“The governmental interest in preventing underage

tobacco use is substantial, and even compelling.”); Brown

& Williamson, 529 U.S. at 162 (Breyer, J., dissenting)

(“Unregulated tobacco use causes more than 400,000

people to die each year from tobacco-related illnesses,

such as cancer, respiratory illnesses, and heart disease.

Indeed, tobacco products kill more people in this country

every year than .. . AIDS, car accidents, alcohol,

homicides, illegal drugs, suicides, and fires, combined.”

(citations and internal quotation marks omitted)). It

seems clear that the dangers of tobacco use, with its

concomitant effects on public health, are matters properly

to be considered by the government and, upon adopting

laws or regulations concerning such use, are proper

subjects for government speech.

I have noted above my discomfort as to the propriety

of the government’s speech where the state has not

sought to directly regulate the conduct that its speech

condemns. Candor requires me to recognize that many

others find no such discomfort. Indeed, government

advertising to combat the public health problems caused

by smoking is often cited as a paradigmatic instance of

permissible government speech. See, e.g., Finley, 524 U.S.

at 610-11 (Souter. J., dissenting) (stating that in its role

84a

as speaker, “the government is of course entitled to

engage in viewpoint discrimination: if the Food and Drug

Administration launches an advertising campaign on the

subject of smoking, it may condemn the habit without also

having to show a cowboy taking a puff on the opposite

page.”); Randall Bezanson and William Buss, The Many

Faces of Government Speech, 86 lowa L. Rev. 1377, 1384

(2001) (“The simplest and clearest example of government

advancing a point of view is provided when a ‘law’

specifically adopts a program of promoting a _ specific

message. For example, a law might create a program to

assist smokers to stop smoking.”).

Put directly, while I believe that government speech

doctrine raises profound questions concerning the

appropriate role of government in a liberal society, the

fact that the activity being condemned - the sale,

purchase and use of tobacco by adults - is a legal activity

does not, under present doctrine, appear to preclude

government from actively discouraging that activity. On

the contrary, the Ninth Circuit, by which I am bound, has

recently indicated that the government speech would be

unrestricted even if the sale of cigarettes were not only

legal, but constitutionally-protected:

We agree with the host of other circuits

that recognize that public officials may

criticize practices that they would have no

constitutional ability to regulate, so long as

there is no actual or threatened imposition

of government power or sanction.

American Family Ass’n, Inc. v. San Francisco, 277 F.3d

1114, 1125 (9th Cir. 2002).24 California’s decision to

*4 One pair of commentators have asserted that:

Speech is but one means that government must

have at its disposal to conduct its affairs and to

(...continued)

85a

combat the problem through a strategy of education and

counter-advertising, as opposed to outright prohibition, is,

under present doctrine, a political and practical judgment

accomplish its ends. Restricting the use of

tobacco, for example, might be accomplished by

regulatory action that makes it sale or purchase

or possession illegal. It might be accomplished

by taxing the disfavored behavior or production.

But the restriction might also be accomplished

through the provision of information so that the

consumer's choice will be knowing, or by direct

persuasion in the form of government

advertisements or by educational programs or

even by subsidies for groups or organizations

that speak out against tobacco use. These

expressive forms of action are no less necessary

or proper means, nor less practical, efficient, or

effective

Randall Bezanson and William Buss, The Many Faces of

Government Speech, 86 lowa L. Rev. 1377, 1380 (2001).

Another commentator has explained that “there are

several ways of understanding government’s contribution as

speaker . .. Government speech can serve as an avenue for the

representation of citizens’ higher-minded desires even when as

consumers they act with perhaps lower-minded motives (the

smoker who supports Surgeon General’s warnings against

smoking, the careless litterer who supports environmental

warning campaigns, etc.) . . . Government can use its speech

powers to alter social norms that might be difficult for people to

change through private action.” Abner S. Greene, Government

Speech on Unsettled Issues, 69 Fordham L. Rev. 1667, 1683-84

(2001).

While my own views suggest that a more restricted role for

government speech is both appropriate and more consistent

with the role of government in a democracy, these comments

demonstrate that others are more sanguine about the exercise

of the government’s enormous power to persuade.

86a

that the state is free to make. See Lorillard Tobacco, 533

U.S. at 587 (“The State’s assessment of the urgency of the

problem posed by tobacco is a policy judgment, and it is

not this Court’s place to second-guess it.”); id. at 571 (“To

the extent that federal law and the First Amendment do

not prohibit state action, States and localities remain free

to combat the problem of underage tobacco use by

appropriate means.”). In sum, the challenged program

passes constitutional muster.

D. POTENTIAL LIMITATIONS ON GOVERNMENT

SPEECH

Courts, including the Supreme Court and the Ninth

Circuit, have framed the government speech doctrine in

especially broad terms and have generally done so

without discussing ways in which the Constitution,

including constitutional provisions other than the First

Amendment, may place substantive limits on the

government’s power to speak. Nonetheless, “the

‘government speech’ doctrine is still in its formative

stages, and, as yet, it is neither extensively nor finely

developed.” Sons of Confederate Veterans, Inc. v.

Commissioner of Virginia Dept. of Motor Vehicles, 305

F.3d 241, 245 (4th Cir. 2002) (Luttig, J., respecting denial

of rehearing en banc). As the contours of the doctrine

develop more fully, it is to be hoped that the courts will

recognize that limitations, both constitutional and

otherwise derived, constrain the government’s power to

speak on controversial issues. See Livestock Marketing,

2003 U.S. App. LEXIS 13630, 2003 WL 21523837, at *8

(“The government speech doctrine clearly does not provide

immunity for all types of First Amendment claims.”)

(citing Santa Fe Sch. Dist v. Doe, 530 U.S. 290, 147 L. Ed.

2d 295, 120 S. Ct. 2266 (2000) (prayers at public school

football games)). Although these issues have not been

raised by the parties and indeed, do not alter resolution of

the case at bar, I pause briefly to address some of the

important limitations on government speech in order to

87a

emphasize that my conclusion regarding plaintiffs’ free

speech ciaim does not imply that the “government speech”

doctrine offers a blank check for abuse.

First, and most obviously, the Establishment Clause

prohibits government from using its speech to endorse

religion. See Board of Ed. of Westside Community Schools

(Dist. 66) v. Mergens, 496 U.S. 226, 250, 110 L. Ed. 2d

191, 110 S. Ct. 2356 (1990) (O’Connor, J., concurring)

(“There is a crucial difference between government speech

endorsing religion, which the Establishment Clause

forbids, and private speech endorsing religion, which the

Free Speech and Free Exercise Clauses protect.”). As the

Court explained in Lee v. Weisman, 505 U.S. 577, 591, 120

L. Ed. 2d 467, 112 S. Ct. 2649 (1992), “the First

Amendment protects speech and religion by quite

different mechanisms. Speech is protected by ensuring its

full expression even when the government participates,

for the very object of some of our most important speech is

to persuade the government to adopt an idea as its own.

The method for protecting freedom of worship and

freedom of conscience in religious matters is quite the

reverse. In religious debate or expression the government

is not a prime participant, for the Framers deemed

religious establishment antithetical to the freedom of all.”

(citations omitted ).?9

“> Plaintiffs open their brief by invoking Thomas Jefferson's

pronouncement that “to compel a man to furnish contributions

of money for the propagation of opinions which he disbelieves,

is sinful and tyrannical.” P. Kurland & R. Lerner, eds, The

Founders’ Constitution, vol. 5 (1987) at 77. The quoted

statement is taken from Jefferson’s Virginia Bill for

Establishing Religious Freedom, a landmark _$anti-

establishment measure declaring that “no man _ shall be

compelled to frequent or support any religious worship, place,

or ministry whatsoever.” Id. It is perhaps significant that the

statement arose in this context, since “the Establishment

Clause is a specific prohibition on forms of state intervention in

(...continued)

88a

Second, the First Amendment may place other

substantive limits on the government’s use of speech. For

instance, government speech that “drowns out” private

speech may violate the First Amendment. See NAACP v.

Hunt, 891 F.2d 1555, 1556 (llth Cir. 1990) (“The

government may not monopolize the ‘marketplace of

ideas, thus drowning out private sources of speech .. .

For example, the government may not confer radio

frequency monopolies on broadcasters it prefers.”)

Warner Cable Communications v. City of Niceville, 911

F.2d 634, 638 (11th Cir. 1990) (“The government may not

speak so loudly as to make it impossible for other

speakers to be heard by their audience. The government

would then be preventing the speakers’ access to that

audience, and first amendment concerns would arise.”).76

For this reason, it is particularly important for courts to

carefully distinguish between situations in which the

government speaks for itself and situations in which the

government creates a public forum for private speech. As”

Judge Luttig recently observed, it may even be that these

_ categories will not always be mutually exclusive. See

Sons of Confederate Veterans, 305 F.3d at 245 (Luttig, J.,

respecting denial of rehearing en banc).

religious affairs with no precise counterpart in the speech

provisions.” Lee v. Weisman, 505 U.S. 577, 591, 120 L. Ed. 2d

467, 112 S. Ct. 2649 (1992).

26 Here, of course, the “drown out” concern appears

inapplicable. The tobacco industry spends much more than

California does on advertising within the state itself, even

excluding national advertising expenditures that have an

impact in California. In 1999/2000, the tobacco industry spent

an estimated $ 823 Million advertising and promoting tobacco

use in California, an amount that translates into $ 34.01 for

every man, woman and child in the state. In contrast, the

state’s tobacco control budget for 1999/2000 was $ 3.42 per

capita. See DHS, California Tobacco Control Update (Nov.

2002).

89a

Third, the Constitution would appear to contain a

core structural principle, perhaps embodied in the

Republican Form of Government Clause, that would limit

the use of tax dollars to fund overtly partisan activity.*’

See NEA v. Finley, 524 U.S. 569, 598, 141 L. Ed. 2d 500,

118 S. Ct. 2168 (1998) (Scalia, J., concurring) (“It would

be unconstitutional for the government to give money to

an organization devoted to the promotion of candidates

nominated by the Republican Party - but it would be just

as unconstitutional for the government itself to promote

candidates nominated by the Republican Party, and | do

not think that that unconstitutionality has anything to do

with the First Amendment.”); Lathrop v. DonOhue, 367

U.S. 820, 853, 6 L. Ed. 2d 1191, 81 S. Ct. 1826 (1961)

(Harlan, J., concurring in the judgment) (stating that a

legislature could not constitutionally “create a fund to be

used in helping certain political parties or groups favored’

by it ‘to elect their candidates or promote their

27 Article IV, § 4 of the Constitution, which provides that “the

United States shall guarantee to every State in this Union a

Republican Form of Government,” is generally treated as

judicially unenforceable, based on a series of decisions thought

to have established a per se rule of nonjusticiability. See

Colegrove v. Green, 328 U.S. 549, 556, 90 L. Ed. 1432, 66 S. Ct.

1198 (1946) (“Violation of the great guaranty of a republican

form of government in States cannot be challenged in the

courts.”). In recent years, however, a growing chorus of

academic critics has urged the Court to abandon the per se

nonjusticiability rule in Guarantee Clause cases. See Erwin

Chemerinsky, Cases Under the Guarantee Clause Should Be

Justiciable, 65 U. Colo. L. Rev. 849, 850 n.4 (1994). Recently,

the Court has shown some signs of receptiveness to these

arguments, and “has suggested that perhaps not all claims

under the Guarantee Clause present nonjusticiable political

questions.” New York v. United States, 505 U.S. 144, 185, 120 L.

Ed. 2d 120, 112 S. Ct. 2408 (1992) (O'Connor, J.) (declining to

decide the issue); see Reynolds v. Sims, 377 U.S. 533, 582, 12 L.

Ed. 2d 506, 84 S. Ct. 13862 (1964) (“some questions raised under

the Guarantee Clause are nonjusticiable”).

90a

controversial causes” (quoting /nternational Ass’n of

Machinists v. Street, 367 U.S. 740, 788, 6 L. Ed. 2d 1141,

81 S. Ct. 1784 (1961) (Black, J., dissenting)). One recent

commentator has argued for an even broader “political

anti-establishment” principle, which would prohibit a

range of speech activity by the government in the sphere

of election activities in a manner analogous to the

Establishment Clause. See generally Brian P. Marron,

Doubting America’s Sacred Duopoly: Disestablishment

Theory and the Two-Party System, 6 Tex. F. on C.L. &

C.R. 303 (2002).25 Such a principle might be thought to

flow from Justice Jackson’s eloquent statement, which

remains perhaps the best encapsulation of the First

Amendment’s core values: “If there is any fixed star in our

constitutional constellation, it is that no official, high or

petty, can prescribe what shall be orthodox in politics,

nationalism, religion, or other matters of opinion or force

citizens to confess by word or act their faith therein.” West

Virginia Bd. of Educ. v. Barnette, 319 U.S. 624, 642, 87 L.

Ed. 1628, 63 S. Ct. 1178 (1943). But see American Family

Ass'n v., 277 F.3d 1114, 1124 (9th Cir. 2002) (holding that

for the orthodoxy-of-belief prohibition to apply, there

must be more than mere speech by the government;

rather, there must be “actual or threatened imposition of

government power or sanction.”). Whatever its source, it

seems clear that the Constitution places some structural

2s This article is a recent revival of an argument advanced in

the earlier work of two scholars, both of whom argued for broad

limitations on government speech. See Mark G. Yudof, When

Government Speaks (1983); Robert D. Kamenshine, The First

Amendment's Implied Political Establishment Clause, 67 Cal. L.

Rev. 1104 (1979). These broad arguments have gained few

adherents among commentators, however, and even its chief

proponents appear to have recognized that the theory is out of

step with current jurisprudence. See Robert D. Kamenshine,

Reflections on Coerced Expression, 34 Land & Water L. Rev. 101

(1999).

9la

limits, as yet undefined, on the ability of government

officials to divert public funds for partisan speech.

Fourth, it is possible that the Due Process Clause and

the Equal Protection Clause may provide substantive

limitations on government speech programs where the

legislative classifications do not bear a- rational

relationship to a legitimate state interest. See Richardson

v. City & County of Honolulu, 124 F.3d 1150, 1162 (9th

Cir. 2000).2° Imagine a situation in which a state

legislature, under the influence of a powerful dairy

industry, decides to tax the margarine industry and use

the money for baseless ads attacking the industry. Such a

scheme, it seems, would not hold up to constitutional

scrutiny. “Protecting a discrete interest group from

economic competition is not a legitimate governmental

purpose.” See Craigmiles v. Giles, 312 F.3d 220 (6th Cir.

2003) (rejecting proffered health and safety justifications

and holding that a state’s prohibition on the sale of

caskets by anyone not licensed as a funeral director

violated due process and equal protection clauses); see

2? Some have also suggested that government speech with

discriminatory content would be barred by equal protection or

anti-endorsement principles. See, e.g., James Forman, Note,

Driving Dixie Down: Removing the Confederate Flag from the

Southern State Capitols, 101 Yale. L.J. 505 (1991) (arguing that

the Southern states’ flying of the Confederate Flag “constitutes

government endorsement of discrimination by private parties”

and is therefore unconstitutional); cf. American Family Ass'n,

277 F.3d at 1127 (Noonan, J., dissenting) (“Suppose a city

council today, in the year 2002, adopted a_ resolution

condemning Islam because its teachings embraced the concept

of a holy war and so, the resolution said, were ‘directly

correlated’ with the bombing of the World Trade Center.

Plausibly the purpose might be to discourage terror bombings.

Would any reasonable, informed observer doubt that the

primary effect of such an action by a city could be the

expression of official hostility to the religion practiced by a

billion people?”).

92a

City of Philadelphia v. New Jersey, 437 U.S. 617, 624, 57

L. Ed. 2d 475, 98 S. Ct. 2531 (1978) (holding, in dormant

commerce clause context, that “where simple economic

protectionism is effected by state legislation, a virtually

per se rule of invalidity has been erected.”).

Finally, the Constitution places substantial limits on

the government’s ability to use its speech to interfere with

or punish constitutionally-protected activity. As a general

rule, of course, the Supreme Court’s “unconstitutional

conditions” jurisprudence has said that the state may

exercise its power to spend in order to discourage

protected activity. See, e.g., Maher v. Roe, 432 U.S. 464,

53 L. Ed. 2d 484, 97 S. Ct. 2376 (1977) (holding that the

government “may make a value judgment favoring

childbirth over abortion, and .. . implement that

judgment by the allocation of public funds.”). Perhaps the

most extreme (and extremely controversia!) application of

this principle was Rust v. Suliivan, 500 U.S. 173, 192-93,

114 L. Ed. 2d 233, 111 S. Ct. 1759 (1991), which sustained

a prohibition on abortion-related advice by recipients of

federal funds designated for family-planning counseling.*®

But even there, the Court was careful to emphasize the

difference between discouragement and coercion:

4” While “Rust did not place explicit reliance on the [government

speech rationale], when interpreting the holding in later cases

[the Court has] explained Rust on this understanding.” Legal

Servs. Corp. v. Velazquez, 531 U.S. 533, 540, 149 L. Ed. 2d 63,

121 S. Ct. 1043 (2001). This explanation of Rust’s holding,

however, may be dicta. See Brown v. California Dep't of

Transp., 321 F.3d 1217, 1225 (9th Cir. 2003) (“Rust addresses

only the government’s ability to exclude from a government-

funded program speech is incompatible with the program’s

objectives.”); Velazquez, 531 U.S. at 554 (Scalia, J., dissenting)

(stating that if the speech “at issue in Rust constituted

‘government speech,’ it is hard to imagine what subsidized

speech would not be government speech”).

93a

A refusal to fund protected activity, without

more, cannot be equated with the

imposition of a ‘penalty’ on that activity.

There is a basic difference between direct

state interference with a protected activity

and state encouragement of alternative

activity consonant wit

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