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Just Sue It

July 15th, 2003 · No Comments

I think I find myself in the unusual position of siding with arch-leftist Barry Deutsch of Ampersand against the always-eloquent Amy Phillips when it comes to the recent Nike commercial speech case.

First, let’s get a dumb red herring out of the way—the idea that there’s some terribly pressing issue about whether”corporations have the same rights as individuals.” As the people who seem to think this is a real issue are fond of pointing out, corporations are legal fictions. That means that they don’t actually do any “speaking” of their own. Actual individual people have to do all that. So the question is bogus: you can’t restrict (metaphorical) “corporate speech” without clamping down on the real live human beings who actually speak. One could also point out that plenty of political advocacy groups and fuzzy non-profits are also technically “corporations,” and you don’t get to run the “Nike’s not a real person” argument without applying the same line of reasoning to the NAACP… but this is already more space than a red herring deserves.

So the real issue is commercial speech. Normally I’m sympathetic to the observation that this commercial/non-commercial distinction is found nowhere in the First Amendment—is, rather, a pure judicial invention. But we do all actually accept differential treatment of at least some sorts of commercial speech. Lying in your personal life makes you a jerk; lying in commerce at least potentially makes you a fraud. You’re criminally liable for the second, but not the first.

Now, Nike is accused of lying about their labor practices, not about the performance of their shoes as such. But that shouldn’t be decisive in an era when so much of our consumption is symbolic to begin with. I’m willing to spend more (and so, I bet, is Amy) for shampoo or shaving cream from a company that doesn’t test its product on animals. I can’t show you some way I’m materially worse off if a company lies about this, but they’ve clearly taken my money under false pretenses if they do: I wouldn’t have bought the product if I’d known it was torturing some rabbit before it became the nice foamy lather on my scalp. And it’s hard to see how it would make a difference if the company left the false claims about its practices off the bottle and out of its regular commercials, but issued press releases and sent regular letters to the editors trumpeting its animal-friendly stance.

Now, as Amy notes, things get tricky here. What if (she muses) I happen to have a hard-on for family values, and pick up all the Britney Spears albums because I want to support a nice, chaste, virginal young artist? Is Britney guilty of “fraud” if she’s building up that persona while secretly gangbanging four or five complete boy-bands simultaneously? It’s a little less tricky for corporations—and here’s where the corporate/individual distinction does come in—because someone speaking on behalf of a corporation is presumably acting on a fiduciary duty to shareholders. In other words, if they’re not trying to directly or indirectly “move the product,” what do they think they’re wasting resources on?

That won’t give us a perfectly clean distinction, of course, since one perfectly valid answer is “trying to infuence a political climate that might lead to the imposition of burdensome regulation.” And as the Britney example makes clear, the line between commercial and non-commercial speech is increasingly blurred in a world of symbolic consumption.

This relates to a problem I’ve been considering in another contested area of speech: libel laws. Libertarians tend to accept that fraud should be criminal, but are typically much more skeptical of libel laws. Yet consider two cases: in one, I (or my hired accomplices) falsely claim that my product is much better than it is. In another case, I (or my accomplices) claim falsely that my competitors product is worse than it is, or that the competing firm engages in racist practices, or that its CEO is a child molester. Since purchase decisions are always made in a limited field of alternatives, these two forms of deception may be functionally equivalent.

In any event, this seems like a much dicier problem than partisans of either side seem willing to admit. On the one hand, consumers need to be able to make informed market choices that aren’t distorted by fraudulent information, either about products themselves or the practices of the companies that sell them. On the other, it’s clearly undesirable to make any form of lying—or even any lying with some plausible connection to commerce—a criminal offense. I have no idea how to sensibly draw this line; I’m just pointing out the difficulty.

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