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Wednesday, March 6, 2019

Federal Court Limits Size of Required Warning Labels on Commercial Billboards

Government-required warning labels on billboards are a ubiquitous, and permissible, infringement on the First Amendment commercial speech rights of advertisers. However, the Ninth Circuit Court of Appeals recently found a local government’s ordinance went too far by requiring too much advertising space be dedicated to warnings against the harmful health effects of consuming drinks with added sugar. American Beverage Ass'n v. City and County of San Francisco (7th Cir. 1/31/19).

In 2015, the City and County of San Francisco adopted an ordinance requiring any advertisement for sugar sweetened beverages contain the following warning: 
WARNING:  Drinking beverages with added sugar(s) contributes to obesity, diabetes, and tooth decay. This is a message from the City and County of San Francisco. City & Cty. of S.F., Cal., Health Code art. 42, div. I, § 4203(a) (2015).
The ordinance required the warning occupy at least 20% of the advertisement and be set off with a rectangular border. A broad array of advertising companies and industry groups sued to prevent enforcement of the ordinance on the grounds it exceeded the government’s authority to  compel speech as set forth by the Supreme Court in in its decision Zauderer v. Office of Disciplinary Counsel of Supreme Court of Ohio.

In Zauderer, the U.S. Supreme Court found the government could require an advertiser to disclose certain information without violating the advertiser's First Amendment free speech rights as long as the disclosure requirements were reasonably related to the government’s interest in preventing the deception of consumers. However, in order to comply with Zauderer, the government’s regulation must not be more extensive than is necessary to serve that interest. 

In evaluating San Francisco's ordinance, the Ninth Circuit found the City’s own expert had cited studies showing warning signs half the size of those required by the ordinance would still accomplish the City’s stated goals. Because the difference was so significant, the court found the size requirement not justified and unduly burdensome. 

Post Authored by David Warner, Ancel Glink


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