Guest Commentary

Bryce L. Friedman, Simpson Thacher & Bartlett LLP

The U.S. Court of Appeals for the Fourth Circuit recently upheld a Virginia regulation restricting alcohol-related ads in college publications. The ruling, Educational Media Company at Virginia Tech, Inc. v. Susan R. Swecker, overturned a District Court injunction against the enforcement of a Virginia Alcoholic Beverage Control Board rule.

After the Swecker District Court decision, I authored a Legal Opinion Letter for WLF where I wrote that the trial court “confirm[ed] that the government bears a significant burden in regulating alcohol advertising, particularly if the purpose of that regulation is purportedly to curb underage drinking.” The circuit court’s April 19, 2010 Swecker opinion certainly didn’t agree with my assessment of the government’s burden in a commercial speech case. It also seems directly at odds with a Third Circuit decision authored by then-Third Circuit Judge Samuel Alito, The Pitt News v. Pappert. There, Judge Alito found the government didn’t meet its burden of proof, and thus struck down a state statute prohibiting all paid alcohol advertising in educational institution publications. That ruling was also the subject of a WLF publication, available here.

The Swecker case arose from two Virginia Alcoholic Beverage Control Board provisions, 3 VAC 5-20-40(A) (“Provision 40(A)”) and 3 VAC 5-20-40(B) (“Provision 40(B)”). Provision 40(A) was enacted shortly after the end of Prohibition. It allowed media advertisements to reference beer or wine, but allowed “reference[s] to mixed beverages only if the following words are used: ‘Mixed Drinks,’ ‘Exotic Drinks,’ ‘Polynesian Drinks,’ ‘Cocktails,’ ‘Cocktail Lounges,’ ‘Liquor’ or ‘Spirits.’ Provision 40(A) further forbid the use of the term “Happy Hour.” Provision 40(B) was enacted after Virginia’s drinking age was raised to 21 and applied only to “college student publications.” It prohibited advertisements about “beer, wine and mixed beverages unless in reference to a dining establishment.”

The District Court issued an injunction against the enforcement of these two provisions because they violate the First Amendment. The Fourth Circuit’s review focused primarily on a facial challenge to Provision 40(B). The majority opinion, written by Circuit Judge Shedd, reversed and remanded the case. District Judge Moon, sitting by designation, wrote the dissent.

The regulation at issue was only targeted to publications “distributed or intended to be distributed primarily to persons under 21 years of age.” More than half of the students and most faculty are over 21 at Virginia Tech. Rather than simply prohibit the enforcement of the regulations against these newspapers, the majority found a “credible threat of prosecution” (one that the Court could have disposed of in a few words) and went on to analyze constitutionality under the four-part test set forth by the Supreme Court in Central Hudson Gas & Electric Corp. v. Public Service Commission of New York, 447 U.S. 557, 566 (1980). This test requires the court to consider whether the commercial speech is protected by the First Amendment, whether the governmental interest is substantial enough to justify its regulation, whether the regulation directly advances the government’s interest, and finally whether the regulation is not “more extensive than is necessary to serve that interest.”

The majority summarily found that alcohol advertising was protected by the First Amendment and that the governmental interest in curbing underage and abusive drinking was substantial. In applying the third prong of the Central Hudson test, the majority stressed that the relationship between the State’s interests and the advertising ban “need not be proven by empirical evidence,” but could instead be supported by “history, consensus, and simple common sense.” Based on its “common sense,” the majority found that the regulations decreased demand for alcohol among college students. The majority believed that college newspapers attract more attention among college students than other forms of mass media, and that it would be illogical to think that alcohol ads do not increase demand based on the sheer amount of money spent on advertising. The majority shifted the burden to the appellees to “provide evidence to specifically contradict this link,” which they failed to do. The dissent pointed out the inaccuracy of the majority’s conclusions based on the trial record. Using its own “common sense” the dissent noted that the regulations had been in place since the repeal of Prohibition and that underage drinking has increased during that time. The dissent essentially agreed with the Third Circuit’s decision in Pitt News, which invalidated a similar Pennsylvania statute based on similar evidence.

There was also disagreement on the court about the application of the “reasonable fit”/fourth prong of the Central Hudson test. The regulation allows use of words “beer,” “wine” and “mixed beverages” in connection with advertisements of dining establishments. To the majority, this was evidence of “narrow tailoring.” To the dissent, permitting these words but not advertisements for “keg delivery,” “mojito night,” or “Blacksburg Wine Festival” was inconsistent, evidence of a lack of a reasonable fit, and demonstrated that the ban was out of proportion to the interest served.

This is undoubtedly not the last word on efforts to restrict advertising for alcohol and other lawful, but so-called “sin” products.