Publisher Challenges Speech Restrictions in Author’s Settlement Agreement with Securities and Exchange Commission

The Cato Institute v. United States Securities and Exchange Commission, No. 1:19-cv-0047 (ABJ).  Complaint filed January 9, 2019.

The Cato Institute (CATO) wants to publish a manuscript detailing the Securities and Exchange Commission’s (SEC) litigation tactics.  The manuscript’s author entered into a settlement agreement prohibiting discussion of the case against the author in perpetuity. CATO asserts injury to its First Amendment interests.  

The SEC’s inclusion of post-settlement non-disclosure provisions in its settlement agreements is grounded in a regulation designed to inhibit agreement to claims solely for purposes of settlement.  Although the stated purpose of the regulation is to discourage admissions of wrongdoing where the party charged does not believe them to be true, this measure has been interpreted to allow the government to require that the party accused not discuss the case subsequent to settlement.

CATO was not a party to the author’s settlement with the SEC and the author is not a party to CATO’s suit.  CATO alleges injury in fact because the settlement agreement acts as an unconstitutional restraint of CATO’s speech and press freedoms.  The settlement agreement provisions are unconstitutional conditions requiring a party to forfeit a constitutionally guaranteed right in order to obtain settlement.  No government purpose is advanced by unending and overbroad speech restrictions, CATO submits.

CATO’s suit comes at a time when non-disclosure arrangements appear to be honored more in the breach than in the observance.  While there are many forms of such agreements, and much may depend on whether agreements are between private parties or with government entities, this challenge to the alleged heavy hand of federal regulatory power may prove interesting provided, however, that CATO, a stranger to the agreement with the SEC, is successful in establishing Article III standing.

Cato v. SEC Complaint D. D.C. Jan. 9, 2019


Ordinance Compelling AirBnB and HomeAway to Produce Business Records Each Month Preliminarily Enjoined as Violative of the Fourth Amendment, Southern District of New York Concludes

AirBnB, Inc. v. City of New York, No. 18-7712; HomeAway, Inc.  v. City of New York, No. 18-7742 (S.D.N.Y.) January 3, 2019.

The City of New York has enacted measures requiring online rental booking services to turn over their business records each month, a measure intended to limit the proliferation of short-term rentals.  The services have successfully sought preliminary injunctive relief on Fourth Amendment grounds.

No physical entry on the online booking providers’ premises is involved in the contemplated municipal demand for monthly records.  Nonetheless, the court found, the Fourth Amendment may be implicated without such a physical intrusion. Moreover, the federal court found, that the source of the intrusion lies within a municipal ordinance rather than an agent of the state does not remove the providers’ Fourth Amendment protections.  The critical issue is the intrusion upon the providers’ expectations of privacy.

The court declined to reach the booking services’ argument that the ordinance compelled speech in violation of the First Amendment, as the Fourth Amendment issue was perceived to be sufficient to support issuance of a preliminary injunction.

The case is one of a series of attempts to impose regulations sufficient to dissuade further proliferation of short-term rentals of properties through entities such as AirBnB and HomeAway.  Whether the plaintiffs will prevail in the long run remains to be seen For the moment, however, it is of note that the court was not hesitant in reading the Fourth Amendment generously and in keeping with emerging concepts of telecommunications and online privacy considerations, a position which may work to the betterment of privacy interests online for all.  

Equally of note is the notion of regulatory measures gathering business information as a substitute for zoning or other more traditional property rights enforcement devices.  Where physical boundaries are ceding their predominance to online invisible geography, such laws are worthy of attention, and to some, are cause for concern.

AirBnB v. City of New York (S.D,N,Y, 2019)

(Anti)-SLAPPed Around: Online Reviews Are Both Constitutionally Protected and Susceptible of Statutory Resolution, Oregon Appellate Court Observes

Neumann v. Liles, No. 601 A149982, 295 Or. App. 340 (December 12, 2018).

Neumann sued Liles for defamation following a critical online review of Neumann’s wedding venue. Several rounds of litigation up and down the trial and appellate court ladders resulted in the conclusion that the online posting of a review is constitutionally protected speech rather than actionable defamation, as a reasonable reader would not form the impression that the review poster was presenting objective facts. In the most recent decision, the appellate court concluded that online reviews do involve matters of public concern, and thus may be addressed through the summary procedures permitted under the state’s anti-SLAPP law.

Neumann v. Liles, 295 Or App 340 (Or. App., 2018)

Pass-Fail at the Electoral College: Massachusetts’ Winner-Take-All Electoral Vote Allocation Does Not Violate First Amendment Rights of Association, Federal District Court Concludes

Lyman v. Baker, No. 18-10327 (PBS) (D. Mass.) December 7, 2018.

Massachusetts’ electoral vote allocation process is grounded in a winner-take-all system that neither violates ‘one-man, one-vote’ principles nor does it create infringement upon First Amendment rights of association that partisan gerrymandering may invite. Those who lose electoral votes have simply lost. Without more, and in view of the court’s perception that it lacks power to redress even a cogent claim, the case has been dismissed.

Lyman v. Baker (D. Mass., 2018)


Thieves in the Temple: Estate of Prince Rogers Nelson Permitted Limited Expedited Discovery about Bootleggers

Paisley Park Enterprises, Inc. and Comerica Bank & Trust, N.A. as Personal Representatives of the Estate of Prince Rogers Nelson v. Ziani, et al, d/b/a Eye Records, Lovesigne, and House Quake. Case No. 18-cv-2556 (DSD/TNL) (D. Minn.) December 13, 2018.

The federal district court in Minnesota has entered an order permitting the estate of Prince Rogers Nelson to subpoena internet service providers to obtain information about the identities and addresses of members of an enterprise said to be circulating unauthorized recordings of the artist’s music. The estate was found to have satisfied some, but not all, the conditions for permitting pre-Rule 26(f) conference discovery: 1) prima facie evidence of an actionable claim has been shown, as investigation disclosed information about the infringing entity, including allowing plaintiffs to obtain bootlegged material on request; 2) plaintiffs sought specific and limited information about names and addresses of those participating in the bootlegging enterprise, but they have not as yet established that financial institutions and records need be disclosed; 3) plaintiffs have good cause to obtain the addresses of individuals involved in the enterprise, which information is needed for service of process; 4) notwithstanding that the court has reservations about the sufficiency of the Digital Millennium Copyright Act to address some of plaintiffs’ claims, the court has concluded that plaintiffs had not established that they have exhausted available alternatives to pre-conference discovery; 5) potential defendants’ expectations of privacy and to anonymous speech must yield where such speech and anonymity is exercised in furtherance of unlawful copyright infringement; moreover, information provided to an internet service provider enjoys little to no protectable expectation of privacy.

Paisley Park Enters., Inc. v. Ziani (D. Minn., 2018)

Are Funny Things Happening on the Way to Publicly Created Non-Public Forums? Judicial Reviews of Transit Advertising Policies Invite Further Consideration

Center for Investigative Reporting v. Southeastern Pennsylvania Transportation Authority, No. 18-1839 (E.D. Pa.), Final Judgment and Decree entered December 20th, 2018.  

Archdiocese of Washington v. Washington Metropolitan Transit Authority, No. 17-7171 (D.C. Cir.). Order entered December 21, 2018 denying petition for rehearing en banc.   

The United States District Court for the Eastern District of Pennsylvania recently entered a final judgment ordering the Southeastern Pennsylvania Transportation Authority (SEPTA) to revise its advertising guidelines to eliminate the “unfettered discretion” theretofore vested in SEPTA to make advertising decisions that the court found to be unconstitutionally overbroad in its November 28, 2018 Memorandum Opinion.           

Nonetheless the federal district court found SEPTA had acted reasonably in its application of its standards to the Center for investigative Reporting.  The court found SEPTA did not err in rejecting the advertisement proposed by the Center for Investigative Reporting, which sought to publicize its review of bias in housing lending

The court took it upon itself to revise SEPTA’s advertising policies to forbid political advertisements and all advertisements offering an “opinion, position, or viewpoint about “economic, political, religious, historical or social issues.” Upon rejecting an advertisement, SEPTA has been ordered to provide, on request, some form of conference with the entity proposing the advertisement deemed unsuitable.

The ability of government entities to regulate speech on transit vehicles simmers not only in the Pennsylvania district court case but also in the United States Court of Appeals for the District of Columbia Circuit, which recently rejected, with dissent, a petition for rehearing en banc of a July 31, 2018 per curiam judgment upholding rejection of a Catholic Christmas message.  

The elephant(s) in the rooms of forum analyses that undergird these decisions invite further review.  The government exclusively holds the power to regulate speech by defining places as non-public forums.  The power to regulate speech by defining the sort of forum in issue merits questioning. While this power may not be wholly unchecked, some may perceive it to be “pretty darn close.”

Less foundational but worrisome is the contemporary notion that the public must not be exposed to messages which may, in the views of government authorities, induce distress. Political or religious messages, the authorities have concluded, are exceptionally apt to cause riders to become disquieted.

As the decisions here demonstrate, speech regulation inhibiting sources of public discomfort has been endorsed by the courts.  At the same time, there exists and evolving advocacy for a ‘right’ to not meet with disfavored images: this is at the heart of litigation before the United States Supreme Court seeking to dismantle religious historic public monuments. The American Legion v. American Humanist Association, No. 17-1717, consolidated with Maryland-National Capital Parks and Planning Commission v. American Humanist Association, No. 18-18.  Oral argument scheduled for February 27, 2019.

The demand that colleges and universities shied students from exposure to unsettling ideas has been reported widely.  Lukianoff and Haidt, The Coddling of the American Mind (Penguin 2018)  When observed through the lens of current judicial consideration of the acceptability of speech restrictions, the apparent acceptability of government intrusion in determining which messages the public may see, and which they must be spared, may itself be disquieting.

2018 12 20 Center Investigative Reporting v SEPTA

2018 11 28 Ctr. for Investigative Reporting v. Se. Pa. Transp. Auth. (E.D. Pa., 2018)

2018 12 21 ADW v. WMATA denial rehearing en banc

2018 07 31 ADW v. WMATA Opinion

SCOTUSblog Case File American Legion v. American Humanist Association

SCOTUSblog Case Files Maryland-National Capital Parks and Planning v. American Humanist Association





Docket Peek-a-Boo Round Two: Reporters’ Committee for Freedom of the Press and Federal Government Submit Supplemental Briefs Addressing Disclosure of Reported Assange Indictment

In Re Application of  Reporters’ Committee for Freedom of the Press to Unseal Criminal Prosecution of Julian Assange,  No. 2:18-cv-00037 (LMB/JFA).

 Julian Assange, Wikileaks founder and ostensible figure of interest in investigations into interference with the 2016 presidential election, was disclosed, by reported inadvertence, as the subject of criminal processes in a November court filing.  The Reporters’ Committee for Freedom of the Press has moved the federal court in the Eastern District of Virginia to unseal the criminal records

At oral argument on November 27, 2018, the government resisted unsealing vociferously, arguing that there is no right to unsealing prior to arrest.  The Reporters’ Committee, by contrast, maintains that the ‘right’ is one of access, either under the constitution or common law, making it the government’s responsibility to demonstrate with specificity any reason requiring sealing court records.  

In recent post-argument supplemental memorandum, the Reporters’ Committee offers that the government’s position that there is a general “pre-arrest” exception to First Amendment and common law rights of access to the courts has no foundation in law or fact.  The government must demonstrate why any claimed exception to open proceedings is justified on an individualized basis. This has not and cannot be done in this case, where Assange has already been identified, where he is doubtlessly aware of the imminence of proceedings, and where, having sought sanctuary in the Ecuadorian embassy in London for years, his location is well known to United States’ authorities, and his opportunities for flight less than optimal.  

It is the type of record, not custodial status, that controls decisions to seal or to unseal, the Reporters’ Committee asserts.  The constitutional and common law presumption of access cannot be overcome by general assertions, particularly where no case exists supporting the ideas that rights of access either do not exist or ought not apply prior to custody.  The government’s July, 2018 disclosures of indictments against Russian intelligence officers, all prior to arrest, flatly contradicts the government’s current position.

Neither can the government’s desire to preserve the integrity of ongoing investigations be supported by generalities, the Reporters’ Committee submits:  the government must present specific information demonstrating that a particular investigation would be harmed by disclosures. Where interest in Assange and Wikileaks has been widely publicly known for some time, there can be no reason to withhold public records.  

Of central importance are the critical  is the First Amendment principles in issue in any government determination to prosecute Assange because of Wikileaks’ publications. A prosecution for publication will affect both the press and the public, making public proceedings all the more significant.

The government in response reiterates that no case can be found in which disclosures (or denials) of a charging instrument was ordered pre-arrest.  It is immaterial whether the document in question is a docket, a charging instrument, a warrant, or an indictment, for it cannot be argued that the rules permitting sealing by a magistrate judge,  promulgated by the United States Supreme Court, can be disregarded absent a determination of fundamental constitutional or Enabling Act error.

That some documents are unsealed before arrest does not mean all should be, the government asserts, particularly where deference is due the court which made the determination to withhold.  The determination to seal should be respected absent a showing of prejudice or harm to the public interest. There are cases that uphold the adequacy of rights to challenge sealing orders occurring after public disclosure of indictments or the execution of (definitionally) ex parte search warrants.  

Neither does the press’ surmise about who the subject of any court filing may be compel the government to confirm or deny the validity of the press’ guess. There is no government compulsion to disclose whether an individual is not charged or charged under seal.

It is not known how long the court will take to rule.   

Assange – Reporters’ Committee Supplemental Memo of Points and Authorities

Assange – Government’s Response to Reporters’ Committee Supplemental Memorandum


The Right to Petition Does Not Prohibit State Requirement that Unpaid Volunteer Activist Register as a Lobbyist, According to Eighth Circuit

Calzone v. Summers, No 17-2654 (8th Cir.) November 28, 2018.

Petitioner Calzone sought to meet with and to persuade legislators of the need to put “Missouri First,” which was the self-styled name of his organization. While noting that some of Calzone’s arguments may not have been properly raised or preserved, the Eighth Circuit has concluded that Calzone, although operating on his own as an unpaid volunteer, must comply with the state’s lobbyist registration requirements. A singular dissent expresses concerns that the majority’s ruling seems to read petitionary rights out of existence.

Calzone v. Summers (8th Cir., 2018)

Retroactively Reasonable Measures Not Dispositive of Violations of Prisoner’s Right to Unopened Legal Mail

Hairston v. Franklin County Sheriff’s Office, No. 2:17-cv-581 (S.D. Ohio) November 28, 2018.

Prison officials opened mail from the courts addressed to prisoner in the mistaken belief that doing so was permissible. The official in question was tutored about the extension of the prohibition on opening prisoner’s “legal mail” to court documents, but in at least one instance repeated the behavior.

Although the county insists that it had not erroneously instructed its employees and that it took action to correct any misperceptions, its post-offense measures will not defeat the prisoner’s claim that a policy or practice operated to breach his privacy rights in receiving legal mail. Moreover, once the county employee was instructed in the scope of legal mail protections, qualified immunity could not be asserted.

Hairston v. Franklin Cnty. Sheriff’s Office Ctr. Main Jail 1 (S.D. Ohio, 2018)

Offender’s Privacy and Worship Liberties Diminished During Post-Prison Supervision, Federal Court in Oregon Concludes

Ferry v. Doohan, No. 3:18-cv-01891-HZ (D. Or.) November 28, 2018.

Petitioner cannot succeed in either his claim objecting to release to the state of mental health treatment records, as his rights of privacy are diminished in the post-prison supervision context, nor can he succeed in his demand to attend a particular church at a particular time, as the state’s failure to agree to that term does not materially impair any rights of worship he enjoys.

Ferry v. Doohan (D. Or., 2018)