Brand Restrictions—The Right Not to Speak and the Right to Listen

Published: December 15, 2021

Paul Kilmer

Paul Kilmer Holland & Knight LLP Washington, D.C., USA Chair, Emerging Issues Committee

The United States has the rare distinction of being a jurisdiction in which a court has struck down brand restrictions. Applying the U.S. Constitution’s First Amendment right to free speech as extended to corporate commercial messages, the majority in R.J. Reynolds Tobacco Co. v. U.S. Food and Drug Administration, 696 F.3d 1205 (D.C. Cir. 2012) held in August 2012 that certain tobacco labeling requirements (for example, graphic images purportedly associated with the adverse effects of smoking; a “1-800-QUIT NOW” legend) were unconstitutional as they abridged the right of the plaintiff, R.J. Reynolds, to refuse to carry government-mandated messages on cigarette packaging.

In deciding that the U.S. Food and Drug Administration had gone beyond permissible bounds in requiring certain labeling statements and disturbing graphics on cigarette packaging, the court relied upon the “intermediate” scrutiny test laid out in Central Hudson (Central Hudson Gas & Elec. Corp. v. Public Service Commission, 447 U.S. 557 (1980). That case set forth a multipart test that balances the rights of the speaker (in this case, R. J. Reynolds) to control its message against the challenged motivations, intentions, and legal requirements adopted by the government to regulate commercial speech.

Central Hudson does not protect commercial speech if the activity at issue is unlawful or if the speech is misleading or fraudulent. Assuming the speech is otherwise permissible, the government must then demonstrate a substantial interest in regulating the commercial message at issue. The regulation under consideration must “directly” advance “the governmental interest asserted” and not be “more extensive than is necessary to serve that interest,” (but it might not necessarily be the least drastic alternative imaginable). 447 U.S. at 566.

The courts in Central Hudson and R.J. Reynolds focused on whether companies can refuse to deliver a government-compelled message (the right not to speak). In other words, under the constraints on the government set forth in Central Hudson, a corporate “speaker” may both have the right to deliver the message it wishes to convey and, concomitantly, refrain from delivering certain messages required by the government.


What the courts in Central Hudson and R.J. Reynolds arguably overlooked is the right of the listener, viewer, and consumer to receive information, which is at the heart of most trademark infringement and unfair competition actions.

What the courts in Central Hudson and R.J. Reynolds arguably overlooked is the right of the listener, viewer, and consumer to receive information, which is at the heart of most trademark infringement and unfair competition actions. However, an early commercial speech case decided by the U.S. Supreme Court put the rights of listeners, viewers, and consumers firmly into the balance and, arguably, found those rights at least as important as the rights of the “speaker.”

In Virginia State Board of Pharmacy v. Virginia Citizens Consumer Council, Inc., 425 U.S. 748 (1976) (Virginia Pharmacy), the Supreme Court struck down a ban on price advertising for ethical (prescription) drugs on First Amendment grounds, in large measure based upon the rights of consumers and listeners to receiving accurate information regarding the price of pharmaceuticals. The Virginia Pharmacy decision raises the issue of whether, in the realm of regulating corporate speech, courts should balance the rights of the speaker along with the interests of the listener, viewer, or consumer.

The right to free speech does not simply protect the ability of the speaker to go into the forest and shout her opinions at the trees. Free speech naturally subsumes the right to deliver a message to others and the right of listeners, viewers, and consumers to receive messages. However, the right of free speech is not absolute, and the government may have a legitimate interest in protecting listeners, viewers, and consumers from receiving certain types of messages, just as the government may have an interest in compelling corporations to deliver certain government-mandated messages.

In this regard, in the trademark field, infringement is founded upon what a relevant reasonable consumer (listener/viewer) would think when presented with similarly branded products from producer X and producer Y. Ultimately, the issue is whether the two brands would confuse the consumer (listener/viewer) into believing that those unrelated products come from the same producer/source. Thus, the two parties must present arguments about what a reasonable consumer (listener/viewer) will think when confronted with their products in the marketplace (the actual marketplace—which includes the “marketplace of ideas”). If consumer (listener/viewer) confusion is likely to result, then one of the parties may be enjoined from continuing to deliver its message—that is, from using the brand it has adopted.

Therefore, the marketplaces for goods and of ideas overlap. The marketplace of ideas tries to sell people on a point of view, whereas the marketplace for trademarked goods relies on the image brands project. Both marketplaces impart information and ideas—some factual, some emotional.

Of course, trademarks are also used to sell services in addition to products. Those services include the sale of information (for example, news organizations sell information and therefore trademarks (service marks) are protected for designations such as The New York Times and Fox News).


The right to free speech does not simply protect the ability of the speaker to go into the forest and shout her opinions at the trees.

The overlap of the marketplaces for services and ideas brings free speech and concomitant rights of the listener/viewer even more to the forefront.

Closely related to trademark law is the law of unfair competition. Unfair competition law is used, among other things, to assess whether goods or services are being offered by reference to a false designation of origin, or false, misleading, or deceptive advertising. Although there are state law corollaries, at the federal level, private parties generally pursue these torts under the provisions of 15 U.S.C. Section 1143(a), which reads, in pertinent part:

(a) Civil action

(1) Any person who, on or in connection with any goods or services, or any container for goods, uses in commerce any word, term, name, symbol, or device, or any combination thereof, or any false designation of origin, false or misleading description of fact, or false or misleading representation of fact, which—

  • is likely to cause confusion, or to cause mistake, or to deceive as to the affiliation, connection, or association of such person with another person, or as to the origin, sponsorship, or approval of his or her goods, services, or commercial activities by another person, or
  • in commercial advertising or promotion, misrepresents the nature, characteristics, qualities, or geographic origin of his or her or another person’s goods, services, or commercial activities,

shall be liable in a civil action by any person who believes that he or she is or is likely to be damaged by such act.

Consumers (listeners/recipients of commercial messages) have been denied standing to bring actions under this provision, even if the acts of a seller damage them personally (see generally, “Troubleshooting Legal Malfunction: Lexmark and Consumer Standing Under the Lanham Act,” 48 J. Marshall L. Rev. 453 (2015) Jeremy Rovinsk). Therefore, competitors argue before the courts over whether one of them (or sometimes both of them) have sold products or services:

  • Using a false designation of origin;
  • Made a false or misleading description of fact; or
  • Issued a false or misleading representation of fact in the course of hawking their goods or services.

Again, consumer perception of the competitors’ messages (the perception of the listener/viewer) often determines whether a violation of Section1125(a) (often referred to as “Section 43(a)”) has occurred.

Could this same approach be applied to First Amendment jurisprudence where corporations are the speakers? That is, when a corporation brings a First Amendment challenge against a statute or regulation, should the interests of the listeners or viewers be a factor that the parties must address, and the courts must assess and apply in their decisions?

The standard applied in R.J. Reynolds (following Central Hudson) therefore seems under inclusive since it ignores the rights of listeners, viewers, and consumers, and thus some of the teachings of Virginia Pharmacy.


Ultimately, the issue is whether two brands would confuse the consumer (listener/viewer) into believing that those unrelated products come from the same producer/source.

Without going deeper into case law and scholarly literature, perhaps the “listener” interest might be used to modulate the Central Hudson test (and perhaps all “corporate speech” cases), along the following lines:

  1. The statute or regulation at issue must be sufficiently clear that a corporation can reasonably discern how compliance can be affected;
  2. The corporate speech or activity at issue must be lawful;
  3. The corporate speech at issue may not be misleading, deceptive, false, or fraudulent from the perspective of relevant listeners or viewers;
  4. The corporate speech as issue may not be detrimental to the interests of relevant listeners or viewers;
  5. The government and relevant listeners/viewers must have a real and substantial (reasonable and rational) interest in regulating the commercial message at issue;
  6. The statute or regulation under consideration must demonstrably and directly advance the governmental and listener/viewer interests asserted (the evidence presented by the government in this regard must be more than mere conjecture or speculation);
  7. The statute or regulation must be narrowly tailored (although not the least restrictive alternative) so that it protects the interests of listeners/viewers without unduly preventing listeners/viewers from obtaining information that they have an interest in receiving;
  8. Greater scrutiny must be employed when a statute or regulation is content-based rather than a restriction on time, place, and manner that is content-neutral;
  9. Where the restriction on commercial speech at issue is not content-based, lesser scrutiny (no greater than the modified Central Hudson approach suggested above) should be employed where the corporate actor had a reasonable opportunity to provide input into the political process by which the law or regulation was formulated and intervention by a court would unreasonably distort or upend a prior vigorous public debate which led to enactment of the law or regulation at issue (see generally in this regard, “Beyond First Amendment Lochnerism: A Political Process Approach,” Tim Wu, Knight First Amendment Institute, Aug. 21, 2019, at Beyond First Amendment Lochnerism: A Political Process Approach | Knight First Amendment Institute (knightcolumbia.org); and
  10. Courts should employ greater scrutiny where the organization or person whose speech is being regulated is a member of the media (e.g., The New York Times; Fox News) or regularly promotes the rights of others (e.g., the ACLU, NAACP, Heritage Foundation, Federalist Society), rather than having as its central purpose the sale of products or services for commercial purposes (e.g., those organizations that “engage in association for the advancement of beliefs and ideas” have broader First Amendment rights per NAACP v. Alabama, 357 U. S. 449, 460 (1958); see also, NAACP v. Button, 371 U.S. 415 (1963)).

This article only intends to make an initial foray into potential modification of the Central Hudson test and related corporate-speech issues. The true intention of the First Amendment is not simply the ability of individuals to holler in the hollow but to balance the rights of listeners, viewers, and consumers into the free speech equation.

Editor’s Note

Brand restrictions is a policy priority issue for INTA. In November 2019, INTA’s Board of Directors adopted a resolution on brand restrictions that builds upon the Association’s 2015 resolution and affirms that “trademarks are intangible personal private property rights (positive rights) … and should be protected to the same extent and degree as all other forms of personal private property, both by law and treaty.” At the beginning of the 2020–2021 Committee Term, INTA created a dedicated Brand Restrictions Committee in order to raise awareness among membership of this growing trend and to reinforce its advocacy efforts before governments and multilateral organizations. Further, in June 2021, INTA published its Brand Restrictions Study: A View from Gen Zers and Millennials. This study explores the value that Gen Zers and millennials place on brands, the role branded packaging plays in their lives, their perceptions of brand restriction legislation, and how such legislation would impact them.

Although every effort has been made to verify the accuracy of this article, readers are urged to check independently on matters of specific concern or interest.

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