State governmental actions during the COVID-19 pandemic have inspired a vigorous debate over the balance between constitutional freedoms and public safety. One recent federal court decision confronted that balance in the context of a restriction on businesses’ speech and petition rights. The May 6 opinion in ACA International v. Healey is an important reminder that, even in emergency situations, government must fully and convincingly justify regulations that infringe First Amendment rights.


The Massachusetts Attorney General issued a rule under the state’s “Little FTC Act,” which prohibits unfair or deceptive acts and practices in commerce. For a 90-day period, the regulation defines any phone call or lawsuit initiated by a debt collector for the purpose of collecting a debt as an unfair or deceptive act. The rule exempts those who call or sue to collect mortgage debt, rent owed, and overdue phone, electricity, and gas bills.

ACA International, a trade association for the credit-and-collection industry, filed suit in the U.S. District Court for the District of Massachusetts, seeking a temporary restraining order and preliminary injunction. The complaint asserted state and federal constitutional violations.Ruling and Rational

Limiting its discussion to federal claims under the First Amendment, the court assessed the constitutionality of Massachusetts’ regulation of commercial speech under the so-called Central Hudson test. After finding that the debt-collectors’ speech was not unlawful, false, or inherently misleading, the court examined whether Massachusetts was advancing a substantial state interest.

The court was skeptical of Massachusetts’ stated policy interests. It chided the Commonwealth for “offer[ing] no empirical support” that consumers are more susceptible to the “undue influence exerted by debt collectors during a pandemic than would ordinarily be the case.” It reasoned that another policy interest—ensuring state residents’ wellbeing during the pandemic—”seems to have little to do with the prohibition of only one form of communication facilitating collection of payment on a debt.”

The court found that the Commonwealth’s final claimed interest—preserving domestic tranquility—stood “on somewhat firmer ground.” So Massachusetts passed that step of the Central Hudson test.

The emergency regulation, however, did not pass the test’s other two steps. The rule neither directly advances the state’s interest in insuring domestic tranquility nor does it pursue the state’s goal in a manner that restricts as little speech as possible. The court reasoned that the regulation’s numerous exceptions fatally undermines its ability to make consumers’ lives more tranquil. And in a nod to the realities of today’s phone technology, consumers can “simply not answer[] the phone or place[] it in silent mode.”

Finally, the court noted that the ban on phone calls needlessly restricted the plaintiffs’ speech because the Commonwealth, and its consumers, have a wide range of other consumer-protection devices at their disposal to punish unfair or deceptive debt collection.

In response to ACA International’s arguments that the regulation violated its speech rights, Massachusetts  asserted that such an intrusion should be tolerable because the ban would only be in effect for 90 days. The court retorted, “[C]onstitutional rights do not take a holiday simply because government authorities declare an emergency.”

The regulation’s ban on lawsuits—which prohibited litigation not only in Massachusetts state and federal courts, but also in the courts of other states—fared no better. The state once again argued that the regulation’s infringement on debt-collectors’ right to petition the government was temporary, a mere delay of a creditor’s day in court. Citing to U.S. Supreme Court precedent, the court reasoned that “the mere fact of an emergency does not increase constitutional power, nor diminish constitutional restrictions.”

Economic Liberty Preserved 

Debt collectors may not be the most sympathetic commercial speakers. And because of that, Massachusetts’ Attorney General perhaps felt secure in silencing their phone calls and lawsuits. After all, her constituents would appreciate the added bit of domestic tranquility. 

It’s for those very reasons, however, that District of Massachusetts Judge Richard G. Stearns deserves our (and your) appreciation for his dispassionate application of the First Amendment. Judge Stearns did not use the proverbial bad facts to make bad law. He didn’t take advantage of the Central Hudson test’s flexibility to reach a “popular” decision.

Perhaps ACA International v. Healey is an ephemeral ruling, one that will quickly fade into the background. But a contrary outcome may have encouraged officials in Massachusetts, and perhaps elsewhere, to curb other economic liberties at a time when the last thing businesses need is more regulation.

Also published by on WLF’s contributor page.