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Resources Available as Nike v. Kasky heads to U.S. Supreme Court

Date: Sun, 12 Jan 2003 22:38:43 -0700
From: <>
Subject: Resources Available as Nike v. Kasky heads to U.S. Supreme Court

Special Update From

On Friday, January 10th, the U.S. Supreme Court announced that it will hear Nike's appeal of the decision by the California Supreme court to send the Nike v. Kasky case to trial. In May, the California Supreme Court rejected claims by Nike's lawyers that public statements about its labor practices were protected as First Amendment free speech and not subject to false advertising laws. The U.S. Supreme Court appeal is now called Nike v. Kasky, Docket 02-575. A resource list about the case appears below.

As many of you know, Nike v. Kasky has become an important test of corporate claims to First Amendment protections in order to avoid accountability under state consumer protection laws. We view the case as a key opportunity to educate people about the power behind corporate personhood. has a new section of our website dedicated to the case that presents extensive background information and arguments from both sides of the issue, plus a major section launched last year on Corporate Personhood.

We also have a campaign underway to urge the ACLU to stop supporting corporations like Nike in First Amendment and Bill of Rights cases. Individuals and organizations can sign-on to our letter to the ACLU, available from both the nike and personhood pages above.

We hope you'll find these resources helpful in writing about this case. Feel free to contact us for more information. Please consider linking to our /nike/ page if you publish about this case as we've worked hard to put it together.

Sincerely, Board Member
PO Box 532 Boulder, CO 80306

Resources for Nike v. Kasky -
Nike v. Kasky - Does Our Constitution Protect "Commercial Free Speech?"
Thom Hartmann:
Now Corporations Claim The "Right To Lie"
Supreme Court:
Docket for 02-575
Nikebiz :: The Inside Story

Regarding the latest news, an AP story and a Washington Post article announcing the U.S. Supreme Court appeal are attached below.

from New York Times online

Supreme Court to Hear Arguments in Nike Case
January 10, 2003
by The Associated Press

Filed at 7:34 p.m. ET (second version) WASHINGTON (AP) -- Sneaker maker Nike Inc. cleared the first hurdle in a Supreme Court battle over the scope of corporate free-speech protection.

The court said Friday it will consider when company executives can be sued for how they respond to accusations of things like running sweatshops or making dangerous products. The case involves what Nike says are unfounded allegations that workers who make Nike products in overseas plants were mistreated -- and that the company lied about it.

In commercial speech cases, there is no First Amendment protection if it can be proven that information was false or misleading. In other types of free-speech cases, people who file suit must prove either negligence or actual malice.

Nike and companies that back it contend they have full free-speech protection when responding to such allegations. Critics argue that companies that mislead the public while trying to sell products should not be shielded.

For more than two decades the Supreme Court has struggled to define commercial speech, which gets less protection than other types of speech like political expression. A coalition of companies, public relations executives and newspapers and television stations had urged the court to clarify the standard.

Some 30 news organizations, including ABC, CBS, NBC and top newspaper chains, sided with Nike and argued in court filings that reporters will not be able to get company executives to talk freely about the safety of products, racial discrimination or environmental concerns about their industry, because of the fear of the lawsuits.

The result will be "inhibiting the media's ability to compare both viewpoints in order to ferret out the truth," the groups said in court filings.

New York First Amendment lawyer Floyd Abrams said a lower court watered down the free-speech protection businesses have in the Nike case and if the decision is not overturned by the Supreme Court "corporations will speak less because they will be warned by lawyers and business people to shut up, lest they be sued."

The case arises from a campaign by Nike to defend wages, treatment of workers and health and safety conditions at Asian plants, run by subcontractors, where workers make tennis shoes and athletic wear with the distinctive Nike swoosh logo.

The company was sued by San Francisco activist Marc Kasky, who contends the company lied about how much the employees earned and how they were treated.

Alan M. Caplan, one of the lawyers for Kasky, said Friday that companies need to be held accountable for what they say when trying to sell products. If they aren't, he said they could falsely claim that their products were made in the United States or that workers were treated well.

Caplan said Nike put false statements about its labor practices in a pamphlet distributed to reporters, in press releases, on the Internet, in letters to organizations, and in a letter to the editor -- all efforts to sell products. "The public wants to be told the truth," he said.

A sharply split California Supreme Court ruled Nike could be sued under a state consumer protection law and that the defense campaign was commercial speech.

The case has not gone to trial. The high court will decide before July if it will, and if others like it can follow.

Oregon-based Nike hired a high-powered team of lawyers in its Supreme Court appeal, including Harvard professor Laurence H. Tribe and former U.S. Solicitor General Walter Dellinger.

Tribe said that under the California decision, companies cannot respond to critics.

"There is a Draconian scheme in which one side is virtually unfettered in what it can say that is critical of the business, and the other side is shackled," Tribe said. "The ultimate loser is the public."

The case is Nike Inc. v. Kasky, 02-575.

Nike Speech Case Goes to High Court
Justices to Rule on Artistic Vs. `Commercial' Expression
By Charles Lane, Washington Post Staff Writer
Saturday, January 11, 2003; Page E01

The Supreme Court announced yesterday that it will hear an appeal by athletic apparel maker Nike Inc. of a California court decision that Nike says forces corporate America to disarm in its war of words with anti-globalization activists.

At issue is a May ruling by the California Supreme Court upholding the right of corporate critic Marc Kasky to sue Nike for false advertising, asserting that the company misled the public when it denied that its subcontractors mistreated workers in Southeast Asian shoe factories.

The court ruled 4 to 3 that Nike's statements were "commercial speech" intended to help it sell merchandise and therefore not entitled to the same First Amendment protection that other forms of expression enjoy.

Almost from the day it was issued, however, the ruling -- which has national impact because so many companies seek to do business in California -- has been under attack not only from Nike, but also from several corporations, public relations executives and media companies.

Nike and its supporters say the ruling could apply to almost any public statement a company might issue regarding its corporate practices, including a remark to the media, thus deterring corporations from communicating even on matters of genuine public interest.

"No company should feel impeded from engaging in the marketplace of ideas just because they operate in the marketplace of goods," Nike attorney Walter Dellinger said in a prepared statement yesterday.

A brief signed by 32 media firms and professional organizations told the court, "The California Supreme Court's decision poses a serious and immediate threat to the media's ability to report on important issues regarding corporate America." The Washington Post Co. was among the signatories.

The Web site of Reclaim Democracy, a Colorado-based anti-corporate group, said that the California ruling merely recognized that there is no constitutional "corporate right to lie." [Ed Note: comments on the inaccurate "anti-corporate" label can be found on our website at ]

"The lawsuit specifically describes numerous factual misrepresentations Nike made to the public about the labor practices in the factories that manufacture its shoes," Kasky's attorney, Alan Caplan, said in a statement. "These misrepresentations were not part of any political debate, but were made by Nike to encourage customers to buy a pair of its shoes."

Kasky's brief also noted that the California Supreme Court merely permitted the case to go to trial, where Nike would have a chance to defend its claims.

The case sets the stage for one of the court's most important rulings on commercial speech in recent years. In past rulings, the court has tried to distinguish between company claims aimed at potential buyers, which may be tightly regulated or in some cases banned, and political or artistic expression, which is entitled to constitutional protection.

But as the boundaries separating advertising, art and politics have blurred, scholars and judges, including members of the court, have come to question that dichotomy.

Supreme Court Justice Clarence Thomas wrote in a 1996 case that he does "not see a philosophical or historical basis for asserting that 'commercial' speech is of `lower value' than `noncommercial' speech."

And a dissenting justice on the California Supreme Court, Janice Brown, wrote in the Nike case, "I believe the high court must reassess the commercial speech doctrine and develop a more nuanced inquiry that accounts for the realities of today's commercial world."

The case is Nike v. Kasky, No. 02-575. Oral arguments are scheduled for April, and a decision is due by the end of June.

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