Nike Case Returned to Lower Court
The U.S. Supreme Court dismissed a case revolving around whether the First Amendment right of free speech covers statements made by corporations.
Beaverton, Ore.-based Nike had challenged in the high court a lower court ruling that statements made by the athletic apparel and footwear giant were strictly “commercial speech.”
To date, no court has evaluated the facts or concluded that Nike’s statements challenged in the case were false or misleading. The dismissal order means that the case, Nike v. Kasky, will return to the California courts to determine whether it should proceed to trial and, if so, with what legal safeguards, according to a Nike statement.
The case stems from nearly a decade ago when Nike found itself under attack by anti-sweatshop activists who accused the company of producing its product in low-wage Asian factories—where the frequency of inadequate labor conditions run high and go unnoticed unless monitored closely. The company hired a former U.S. Ambassador to evaluate several factories in Asia, who concluded that Nike’s producers were indeed working in adequate conditions. Nike used the information in its responses to letters to the editor and other such public responses. Shortly afterward, San Francisco activist Marc Kasky filed a lawsuit against Nike for false advertising under California consumer protection laws. Kasky alleged that Nike’s campaign misled consumers and potential customers about the working conditions at its factories. Nike argued that its statements concerned labor practices and should, therefore, be protected by the First Amendment.
Two lower courts agreed with Nike’s argument. But last April the California Supreme Court found that the company’s campaign was commercial speech and reversed the decision in a 4–3 vote.
“We believe that all consumers and other stakeholders should be able to make their own assessment of a company’s performance based on robust, credible and relevant information,” said Maria Eitel, Nike’s vice president and senior advisor, Corporate Responsibility. “Equally important, we also believe that all stakeholders should have the benefit of common performance criteria through company reports to make such assessments.” —Claudia Figueroa
