Courthouse Steps Decision: NRA v. Vullo

Chayila Kleist: Hello and welcome to this FedSoc Forum webinar call. Today, June 5th, 2024, we're delighted to host a Courthouse Steps Decision on NRA v. Vullo. My name is Chayila Kleist and I'm an Associate Director of Practice Groups here at the Federalist Society. As always, please note that all expressions of opinion are those of the experts on today's program as the Federalist Society takes no position on particular legal or public policy issues. In the interest of time, we'll keep the introduction of our guests today brief, but if you'd like to know more about any of our speakers, you can access their impressive full bios at fedsoc.org. Today we are fortunate to have with us as our moderator Casey Mattox, who is Vice President for Legal Strategy at Stand Together and the Senior Advisor at Americans for Prosperity.

In these roles, he advocates for and creates strategies and partnerships working to ensure a constitutionally limited government that protects the civil liberties of all Americans. Prior to joining Stand Together and AFP, Mr. Mattox's legal career focused on defending the First Amendment rights of students, faculty, healthcare workers, and religious organizations. I'll leave it to him to introduce our panel. One note and then I'll get off your screens. If you have any questions, please submit them via the Q&A feature found at the bottom of your Zoom screen so they'll be accessible when we get to that portion of today's webinar. With that, thank you all for joining us today. Mr. Mattox, the floor is yours.

Casey Mattox: Thank you, Chayila. I very much appreciate it and thanks to the Federalist Society for hosting this conversation and thanks to our panelists. This is - for those who don't know how these things come together - the Supreme Court issued a decision, we did not have this planned before that, this has come together pretty quickly. Some of the folks here have just met each other online in the last few minutes and I think it speaks both to the case and the importance of this case and the interest that there is around this decision, but also just their willingness to, on a pretty short notice, make their time available to be able to talk about this. So very appreciative for that and FedSoc for making these sorts of forums available. I'm going to move very quickly because we've got a lot to talk about and some impressive folks to hear from about this case, so I'm going to try to really quickly give their bios here and just kick off the conversation.

Vera Eidelman is a staff attorney with the ACLU's Speech Privacy and Technology Project. She works on the rights to free speech and privacy in the digital age. She focuses on free speech rights of protestors and young people, online speech, and genetic privacy. She was previously the Brennan Fellow with the ACLU and is a graduate of Stanford University and Yale Law School. Before joining the ACLU, she served as a law clerk to the Honorable Beth Labson Freeman of the US District Court for the Northern District of California. Bob Corn-Revere is with FIRE. He joined FIRE from the law firm of Davis Wright Tremaine LLP, where he was a partner for 20 years specializing in freedom of expression and communications law. He is a prominent writer, thinker, advocate on free expression issues and has written many books and is well known to anyone in the freedom of speech space.

He's regularly listed as one of the leading First Amendment media law practitioners by the Best Lawyers, Super Lawyers, Chambers USA, et cetera, et cetera. He was Washington DC's - Best Lawyers named him Washington DC's best lawyer or Lawyer of the Year in 2017 in the areas of First Amendment law and litigation. Tommy Berry is research fellow in the Cato Institute's Robert Levy Center for Constitutional Studies, Managing Editor of the Cato Supreme Court Review. Before joining Cato, he was an attorney at the Pacific Legal Foundation and clerked for Judge E. Grady Jolly of the US Court of Appeals for the Fifth Circuit. He has a JD from Stanford Law School where he was the Senior Editor of the Stanford Law and Policy Review, and graduated with a BA in Liberal Arts from St. John's College in Santa Fe.

John Vecchione is the senior litigation counsel at the New Civil Liberties Alliance. Prior to that, he was President and CEO of the Cause of Action Institute. He's Counsel of Record for most of the individual respondents or the plaintiffs in this case and in Murthy v. Missouri, the case that was argued the same day and it's obviously closely connected to this one - we'll talk about that as we go on - and for the petitioners in Relentless v. Department of Commerce, which is also presently pending before the Supreme Court as well. So John has a busy spring. With that, I wanted to jump right into the conversation here and I would like to be able to go to Ms. Eidelman for just sort of the basic background on what this case was about, the fact pattern behind this case, and what the court did and then we will kind of go from there and let everyone else give their views and we'll ask a few questions. And then I would encourage all of you if you have questions as they arise, please drop them in the chat because we will definitely get to your questions and I expect there'll be very good questions. So please drop them in the chat and we will, we'll take them from there. But Ms. Eidelman?

Vera Eidelman: Thanks for the introduction and for holding this event in general. I just want to also mention that you may be wondering why I'm here with these other luminaries and the reason is that I was one of the attorneys representing the NRA in this case before the Supreme Court. That's also why I am going to explain to you the background facts of the case. So in this case, our client, the NRA, sued Superintendent Vullo, she was when she took the actions at issue in the case, the Superintendent of the Department of Financial Services in New York, which is an incredibly powerful financial regulator in New York. And she, our client alleged, took a variety of actions targeted at financial entities, insurance actors that the NRA worked with specifically to provide affinity insurance products to its members and for other reasons because they worked with the NRA and she asked them to cut ties with the NRA because she did not like its gun promotion advocacy.

Essentially, the allegations in the complaint that the Supreme Court really focused on had to do with a variety of interactions that she had with regulated entities. One of them had to do with talking to representatives of Lloyd's in a backdoor meeting, essentially telling them, "We know people break our regulations all the time. We know that you guys do that all the time and we know that you've done it with respect to gun promotion advocacy groups like the NRA and others. If you stop working with gun promotion advocacy organizations, specifically the NRA, we will continue to look at your violations with respect to them, but we will turn a blind eye to any violations with other entities." And that complaint also alleges that Lloyd's reacted by basically saying, "Okay, great, we will stop working with the NRA and please just limit any enforcement action to the violations related to them."

Around the same time, Superintendent Vullo sent out guidance letters to all of her regulated entities that spends the first five or six paragraphs describing all of the problems she sees with the ways that the NRA has affected public safety in the world, all of the ways in which gun violence is a real problem, not talking about their insurance infractions and then any violations of insurance law in New York. And then in the last paragraph basically says, "Given all of this, we really urge you to reconsider your work with the NRA and we suggest that you follow the lead of other organizations and regulated entities that have already cut ties with the NRA." And also in the background here is the fact that as alleged she is investigating all of the regulated entities that have decided to cut ties with the NRA, resulting ultimately in consent decrees that have some serious limitations including not allowing the regulated entities to continue offering lawful insurance products with the NRA anywhere going forward for some of the entities, and also multimillion-dollar fines.

So taking all of these allegations as true as they had to at this stage because this was at the motion to dismiss, the Supreme Court issued a nine-zero opinion basically saying that reaffirming the rule from Bantam Books Inc. v. Sullivan, which is a Supreme Court case that's sort of in the background of this entire litigation saying that the government can't do indirectly what it couldn't do directly. And when it comes to targeting the associates or entities that speakers depend on in order to suppress the speaker's disfavored speech, the government can't coerce them, can't threaten them, can't try to coercively stop them from working with that speaker because they don't like the message of the speaker. And that rule is really important. 

That is in essence the ultimate rule, when a reasonable recipient of the communications from the government understands this as an attempt to coerce and it ends up being a rule that really depends on the facts. The court basically says - courts typically have looked at four factors below. Here are those four factors: tone, content of communications, and things like the authority of the communicator and the recipient's reactions. But those aren't exhaustive. And ultimately what matters is was this an attempt to coerce. And I think this case is really important because unusually for the Supreme Court, I actually think the way that it applies that rule to the facts is what should help litigants going forward. Bantam Books was the one Supreme Court case we had before that explained what the "You can't coerce but you can persuade" rule means and now we have another set of factual scenarios that should help explain exactly where the line is.

Casey Mattox: That's very helpful and thank you. I failed to mention at the outset as you heard her say, the ACLU actually represented the NRA at the Supreme Court in this case. And so it's very nice when you have a Supreme Court decision on free speech that really does completely cut across all of the preconceptions that I think that people would often bring to free speech cases where you try to put people into partisan boxes in this case, first of all because it's unanimous, second of all the ACLU is representing the NRA. For free speech advocates, this is, it's a nice sort of exploding the narratives opportunity with this case. I wanted to turn next to Mr. Corn-Revere and get your thoughts. Bob, what are your first thoughts about the opinion?

Robert Corn-Revere: Well, thanks, Casey. And first I want to follow up on what you were just saying about the ACLU and its team arguing this case. They stepped in at the Supreme Court level and did a brilliant job of advocacy. David Cole was terrific in the oral argument and all around just a first-rate job and that's reflected in this unanimous decision and also terrifically, as you noted, to illustrate that the First Amendment is not a partisan policy document. Its neutrality is one of its central strengths and this is just a good example of that where you can put politics aside and argue a matter of pure principle. This is one of a series of blockbuster cases that the Supreme Court is facing this term and so far we're seeing pretty good results. This one was really terrific and most of them focused by the way, most of the important cases, on how to deal with online speech, whether it's state regulation or moderation policies directly or indirect pressure being put on social media platforms in the Murthy case or the case that is already decided on public officials that use of their personal social media accounts for public business.

And so the court has a lot of really weighty issues before it and this is an excellent precursor of how it will handle some of the informal regulation cases. I think this is important not only because it's a unanimous decision by the court in a very important year, but I think it's important in several dimensions. First, of course, is the result of reversing the Second Circuit. And what's interesting here is that the Second Circuit actually articulated the correct test for how to evaluate this kind of informal government regulation and it identified the four factors that Vera had mentioned but then simply misapplied them. It really got the application of the correct test wrong, which was sort of remarkable since other cases like in the Fifth Circuit like Murthy v. Missouri - or at the time Missouri v. Biden - used the same test and reached the opposite result when it came to allegations that the Biden administration was pressuring social media platforms to alter their moderation policies.

The second important thing is the court now unanimously has endorsed this non-exclusive test of four factors to look at. And this is important because it's the first time the Supreme Court since 1963 has revisited Bantam Books and Bantam Books set the basic rule that you can't informally restrict speech using government pressure, but it didn't lay out what the factors were other than looking at the facts of Bantam Books and trying to figure that out. And so lower courts over the years had come together and at least articulated a constellation of factors and they've settled on these four. And now the Supreme Court has adopted that as sort of the basic general test, though not an exclusive test for looking at what constitutes governmental coercion. But in addition to the specific holding here, I think there are a number of analytical building blocks that contributed to the final decision that I think are really important and will be from the perspective of this case, part of a gift that keeps on giving in First Amendment law, one of which is to reject the government's argument here that it wasn't regulating speech, it was just regulating business practices.

And this is something that we're seeing in state legislation across the board, arguments being made across the board where governments are increasingly trying to evade First Amendment review by saying they're not regulating speech, "There's nothing to see here, we're just regulating business practices or the right to contract or transparency or whatever." And Justice Sotomayor made pretty quick work of that argument saying, "No, what you're doing is using regulation of business practices to restrict speech and that's what you can't do." So ultimately that objective was identified for what it was. Second, the court reinforced the notion that restrictions on speech intermediaries, those who transmit the speech of others or who make that speech possible, create a First Amendment problem in their own right. In Bantam Books it was a bookstore distributing other people's books, in the social media cases, you think of social media platforms as the intermediary spreading the speech and the court here made clear that what we're talking about is if you put pressure on a third party that can then affect the speech of the disfavored speaker, then that too violates the First Amendment.

That's a very important principle that we're going to see come up in other cases. And then one other final point that's sort of a pet peeve of mine and that is what constitutes government speech? Here you have the government speaking through its regulators to various regulated entities and quite often in decisions you'll see the loose use of language talking about government officials having their own First Amendment rights, they're simply exerting their own rights to do this or that. And a point we've tried to make at FIRE over and over again is that governments don't have rights, governments have powers. Rights are what individuals have. Now, public officials may have rights in certain contexts - if you're a public employee may be exerting your individual right to speak or if you're a political candidate you may be a government official but you're running it as a candidate in your personal capacity or there are various ways in which that comes up here where you're dealing with government speech that is an exercise in government power and justice Sotomayor's decision really drives that point home. And then finally, and this is just sort of a personal thing, I was personally gratified to see the court endorse the decision in Backpage.com, LLC v. Dart and that became sort of a prominent part of the analysis, and having argued that case, it did my heart good.

Casey Mattox: Excellent. Well thank you and I share your bugaboo about, I mean even just in sort of the colloquial conversation about this case as it was coming up there, people kept talking about it as that, "Well there are two people with free speech rights at stake here. There's the individuals and then there's the government" and it's like, the government has powers, it doesn't have rights period, end of sentence. And that's an important point and I think there are some key lines there. I expect that sort of like as with hate speech, there's a hate speech exception to the First Amendment that it'll be a sort of bugaboo that doesn't matter how many nine-zero decisions you get from the Supreme Court saying "No there's not", people will still keep saying it, but I think that it is an important point to have that when those issues, those things get sort of pointed out that way very clearly in the decision. John, coming to you next, we've talked a little bit about Murthy, you can decide whether you want to talk about that now and what the implications are going to be.

John J. Vecchione: I'll just touch on it. I'll do a little bit, but I do want to point out certain things about this case and I won't be repetitive. I agree with everything the prior panelists have said on this. I want to point out some different things about this case though before we do Murthy. I will point out one thing that I'm very happy about for Murthy. The only thing I will repeat is that the ACLU is a storied organization and this really added another story, and I have to - in order not to be drummed out of the Georgetown Alumni Association - point out that the advocates on both sides were David Cole and Neal Katyal, both of Georgetown. So I did want to point that out to this wonderful audience. But in any event when you look at this case, I've said - it's Sotomayor, but she's a big Yankee fan, and this is a Soto opinion. It's home runs all over the place.

And I think that to add to what went on here, I just have highlighted certain pieces of this that are going to be useful to the practitioner going down the line. First, we put in - NCLA put in an amicus brief - where we pointed out that this Constitution says you can't abridge speech, which means "lessen". It doesn't mean you have to get rid of a hundred percent of it. And she does quote the abridgement language very strongly in Section A right at the start of it. And so I was very happy about that. I could have done with a little more use of it, but that was good. And then I thought she used the word "suppress" on page nine. She's talking about the government's ability in support of its powers to speak and she says, but "In doing so, she can rely on the merits and force of her ideas, the strength of her convictions and her ability to inspire others. What she cannot do, however, is use the power of the state to punish or suppress disfavored expression."

So once again there's a delta that is not a hundred percent. I think that can be used as a diminishment, any kind of diminishment of speech - of somebody else's speech. I think one of the differences with Murthy is that this is a motion to dismiss. I was so disappointed when the Second Circuit upheld a motion to dismiss these allegations as not First Amendment - I have great respect for the Second Circuit. I'm a New York attorney. I was really shocked actually when it came out and I got a little feeling up my spine of fear when I saw that was affirmed because it just seemed so out of character. So I'm very happy with that. But I do think that the fact that compared to what we have, a preliminary injunction, this is a motion to dismiss. It's a much lower standard. So I do think that that matters.

The other thing about this I do like very much is that Vullo admitted that the insurance policies violated New York law. I think you're not allowed to ensure certain things because they don't want to encourage certain behaviors and they admitted that they violated it, but that didn't matter to the case. The fact that there was a reason to do something to the NRA for a violation did not mean that their speech could be suppressed. That I think is a big point that practitioners can use in the future. And I loved that they pointed out that Vullo conceded - not the NRA, Vullo conceded - that a threat by the government does not have to be explicit. This is a huge, "And we mean it" added onto Bantam Books, right? Sixty years later, they're going "And we mean it."

And I think that's excellent, but also that the threats don't have to be explicit and some of these have already been stated, so I'm skipping over 'em. But the other thing, I love Footnote Six, I love Footnote Six of this opinion because in Footnote Six it says that Vullo's boss, then-Governor Cuomo, the appointing power for all these people, also urged businesses to disassociate with the NRA to put the organization into financial jeopardy and shut them down. 

And the reason that's important is because in a lot of these cases, the governor or the President of the United States in Murthy, is going to be hammering home the regulator's message and apparently it matters, according to this opinion. So that's all good news and I know we may get to the qualified immunity issue. Footnote Seven is not good news, but there you have it.

I'll just mention briefly the concurrences of Gorsuch and Jackson because Gorsuch says he doesn't like these four-part tests, he fully agrees that these are the factors, but then I just thought it was funny that he says he quotes what the test is, "Ultimately the critical question is whether the plaintiff has plausibly alleged conduct that viewed in context could be reasonably understood to convey a threat of adverse government action in order to punish or suppress the plaintiff's speech." Well, that's kind of the four-part test, just not with numbers in front of it. So I don't really know what his difference is there, but he doesn't like four-part tests and he's going to say so every time. And then finally there's Jackson, and Jackson really was pointing out that you can have - that if they would do something anyway, maybe it's not a First Amendment violation. I suspect, given her view of that "It's really bad to stop the government from doing things", which I think the First Amendment's maybe supposed to do, that she and Gorsuch are maybe signaling here that they're going to be on opposite sides of Murthy. And so anyway, those are my takeaways that haven't already been expressed and as I said, home run case, a "We mean it" for the Supreme Court, and a home run for the ACLU.

Casey Mattox: Excellent, thank you, John. And then I'll go last to Mr. Berry.

Thomas Berry: All right, what an illustrious panel. Just sort of some scattered thoughts that others haven't said. I'll echo that it's really important that this was a nine-zero decision. I think it is also really interesting and maybe important that it was authored by Sotomayor. You have a drumbeat of people saying, "Oh, you can tell which way the justices are going to vote based on what party's on which side of the V." And I think we've had multiple decisions this year that are kind of showing that that's not true, particularly notably by who is chosen as the author. So you have Sotomayor here, authoring an opinion in which the NRA wins. We had Justice Thomas earlier this term authoring an opinion in which the Consumer Finance Protection Bureau won - not typically seen as a darling of conservatives, or you might think the conservative justices - I think perhaps there's some intention behind this on the court, kind of showing that it's not about the political outcomes or about what the name of the party is in terms of which way the justices are going to go.

I think I'll echo that this is an important - not just reaffirmation of Bantam Books, but really an extension of it in kind of a novel scenario. Bantam Books was a case about a project of censorship. It basically said you couldn't do this directly because it was attempting to censor or ban obscenity in a way that didn't have the needed constitutional protections. This claim is kind of analogous to a First Amendment concept known as sort of retaliation, the notion that even if someone has legitimately broken the law, you can't selectively enforce laws against them for a bad reason, specifically because you didn't like something they said. And likewise, you can't threaten, you can't sort of say, "We will enforce this law against you unless you stop speaking." That's sort of the flip side of the coin and what this opinion is saying is that's true, even if it's one step removed.

So instead of "We will prosecute the NRA unless you stop speaking or as punishment for your speaking", it's equally true that you can't punish the banks that are helping the NRA or that are working with the NRA because of the NRA's speech. So no matter how many chains removed, it's still effectively kind of like a retaliation or a threat type case. And so I think that is relevant for another case that I don't think has been mentioned yet this term in Gonzalez v. Trevino, which could be an important precedent on First Amendment retaliation where you had a law that may well have been broken but had not been enforced for the past 20 years and suddenly was enforced against a reporter where there was a lot of evidence that the local government did not like her and did not like what she was writing. So that's an important First Amendment value.

One thing I'll raise about why are we having more cases like this - jawboning, government coercion, why is the government so often effective at chilling speech, Cato and the Goldwater Institute filed an amicus brief in this case and we pointed out that a lot of that can be traced back to just the ubiquity of the regulatory state and the permission state. The fact that there are so many businesses and so many industries where you have an all-powerful agency that you have to be in their good graces or you can't really operate a business, and in New York in particular, this agency had so much concentrated power within this industry that they knew that if you got on the bad side of Ms. Vullo that could be the end of your business. So yes, it's great that the Supreme Court stepped in here and that the right to not be coerced may well be vindicated if their claims are proven, but it's more of a problem that you even have this concentrated power such that it is threatening and it is coercive for nothing but words from one particular bureaucrat to have this level of effect.

So if people - one way to fight back against this besides in the courts would be to have less concentrated power, especially in just one or two specific people. Along those lines, I'll highlight my favorite sentence from the opinion Justice Sotomayor was discussing that officials do have the ability, they are allowed to speak out loud on issues and they can be voted out if people don't like what they're saying, but then she writes "Whereas here, a government official makes coercive threats in a private meeting behind closed doors, the ballot box is an especially poor check on that official's authority."

So that's justifying both the judicial engagement that we have here and also I think making a case for more transparency. So I want to highlight and commend a Cato Institute publication by two attorneys, Andrew Grossman and Kristen Shapiro, in which they make a really intriguing proposal for essentially a federal statute requiring transparency for every time a government official contacts any sort of platform and makes a request that they take down speech or that they alter their speech and essentially it's saying, "Let's put this out in the open." If they have the courage of their convictions, they can still do it. It may not be that every single one of these violates the First Amendment, but at least let the people be able to judge and be aware of how ubiquitous this is and at least see if that pressure did indeed lead to something being taken down. And then potentially you will have the ability to punish officials at the ballot box if you don't like what they're doing.

Whereas here, litigation is kind of the only recourse if these issues are happening in private. And also I'll just sort of say as a preview for the qualified immunity issue, I think that there's been a lot of interesting writings, especially in the Fifth Circuit, about whether it should make a difference that a plan of action was taken after a lot of deliberation, which is what we had here. So contrasting sort of a split second police officer's decision to shoot versus a months long plan, and it could be if this case continues and if the qualified immunity issue becomes a big issue that we could get an important precedent on that as well because this is a scenario, this is kind of right in that wheelhouse of this was not a split second decision by Ms. Vullo, this was a very intentional plan done over many several steps and well thought out. And I think that the case for giving the benefit of the doubt to government officials is much, much weaker in that scenario versus split-second decisions.

Casey Mattox: Let's go ahead and turn to that question. I think that's the other question coming out of this decision. For those who don't know, the Second Circuit had, it basically posited two reasons why it was dismissing the complaint. One was failure to state a claim, the other was qualified immunity for Vullo, and the argument for those who don't know, qualified immunity is typically you think of it in the sort of policing context, but it's not limited to the policing context. There was an IJ report recently that said that qualified immunity coming up in the free speech context is actually the second most common type of case where qualified immunity arises. This has been, I've litigated against a lot of universities and it's a frequent issue in the university litigation space. So as this case goes back down, the NRA is - that's going to be a live question - whether the case nevertheless is dismissed on qualified immunity grounds and I'm curious for folk's take on that, at least folks that feel like they can talk about that. I will leave that to your judgment or how you want to talk about that, but maybe Bob, if you have something I'll go to you first.

Robert Corn-Revere: Sure, thanks, Casey. And in this case, I don't really see qualified immunity as being much of a problem going forward. As you mentioned, the Second Circuit had dealt with qualified immunity and that was one of the issues presented to the Supreme Court for decision but not accepted for review. The state of New York had tried to argue that means the court doesn't have jurisdiction because they didn't take the qualified immunity part, something the court slapped down early in the opinion, but the reason I feel optimistic is as this goes back to the lower courts, if qualified immunity comes up again, the court made clear that this is the prevailing rule that has existed since 1963 and went out of its way to say, "We break no new ground here." There is no argument that the law was not clearly established, and so I think really no argument for qualified immunity when this goes to the lower courts.

Casey Mattox: That is noteworthy. You get on Page 18, "The court does not break new ground in deciding this case", even at the very beginning of the decision, the decision begins by saying "Six decades ago, we decided Bantam Books." So it does seem like despite the fact that the lower court had decided qualified immunity before, it seems to set up the argument that well, how can it possibly be not clearly established? The Supreme Court is saying, "We've decided nothing new. This has been the law for six decades."

 John J. Vecchione: I agree with all that, but my concern is the four-part test, I think they're going to claim that because the facts are different and the facts have to be fit into the four-part test, they couldn't have really known so they still have qualified immunity. I think that's going to be the argument, but I agree there is not a change in the law, not a millimeter.

Thomas Berry: And I'll just add that clearly established law is not just at the Supreme Court but also in whatever Circuit it's occurring in. So even though we haven't had a Supreme Court jawboning case in Bantam Books, I think we've had others in the Second Circuit and any of those, if that four-part test had been set out by the Second Circuit, you would say that officials were on notice for that.

Robert Corn-Revere: And most of the background law comes from the Second Circuit, and that's something that the court in this case in the Second Circuit acknowledged and then it applied the four-part test that was derived from those earlier cases. So I don't think there's really any argument to say that the law isn't well established here. I'd like to pick up on an earlier point that Tom made because I think it sort of ties into what we're going to see in these issues going forward. I agree with his point that one of the reasons we see cases like this in jawboning cases is because of the rise of the administrative state, but there's another contributor that we identified in our brief to the court in the case and that is these efforts to evade First Amendment review by informal means or whatever are really a byproduct of the fact that we have a very strong First Amendment jurisprudence and you can sort of trace a straight line from the cases beginning in the late forties and then into the fifties in establishing high First Amendment standards and new areas of obscenity and then harm to minors where you see then that led directly to efforts like Bantam Books where you set up these informal committees to try and regulate without regulation, where you try and evade the law.

And so whenever you have the development of this kind of strong protection, then you will see governments who still have an interest in regulating speech or censoring or whatever, look for ways to evade that. This case, like Bantam Books before it, draws a strong line against those kinds of end-runs around the First Amendment. And the next phase that we will see and are already seeing in a number of cases are these points that the court addressed in this case too, and that is trying to call your regulations something else, whether it's a privacy regulation that is masquerading, that's really a free speech regulation like the California's Age Appropriate Design Code Act or some kind of other regulation that you call a business regulation - in Ohio where they call the regulation of social media for minors a contracting regulation. And here where they said it was simply the regulation of business practices, all of these are various ways governments are trying to evade the rule of law established by the First Amendment.

Casey Mattox: No, there's a long history, there was a piece when the 303 Creative case was coming up, you have on one hand you've got Colorado saying, "But this isn't speech, it's discrimination" and then in the Texas cases, "But this isn't speech, it's censorship." And so it's basically just trying to come up with, "Well we can't say we regulate on the basis of speech, we've got to call it something else in order to do this." So I think what this raises then is the cases that are still pending and the implications for those cases - so I'll let people take them however they want to or whichever cases they want to talk about them. We've got the Murthy case, you've also got the NetChoice case out there that this could certainly have some implications for. So who wants to go first on that question?

John J. Vecchione: I'll tell you what, I'll go first on Murthy. I'll leave NetChoice alone. We didn't put in anything on NetChoice on either side. I think some of our friends were for the law and some of our friends were against the law and we were with our friends. In any event, I think that on Murthy that this is a very good sign and I'll just tell you where it - Vullo used much more temperate language than the Murthy case and they really went out of their way to say, "She was very nice to them. She didn't say anything to them." I think as far as the points that have been made by Tom and Robert here, that bankers are not known for their great moral strength in the face of regulators. I mean if you talk about long tailed cats in a rocking chair store, that's the bankers.

And so I am sitting there going, oh my God, she barely had to say anything to them. You've met these bankers and they know what can happen to them. So in any event, I do think the temperate language is an important distinction for Murthy that helps Murthy. I think that the "no direct threat" is also very good because we did, we had closer to a direct threat, certainly from the White House. So that was good I thought. And then the one that's on the bubble there is we have a whole-of-government approach. Our argument was that the administration, the whole government first under Trump, but then even more under Biden, were trying to stop certain messages. I think that the negative side of this opinion is that they really focused on the direct regulators, not everybody else, but they also focused on the president. That would be the White House, particularly this court's view of the unitary executive.I think that's going to be even more powerful than it was here in footnote six. So I think that's good for Murthy.

The one thing that really bothered me about this opinion is the dog that didn't bark, which is Blum v. Yaretsky, that in Blum - the statement that we put in our amicus in this case they said that, this court held, it required proof that the government had exercised coercive power and this case was all about coercive power or has provided such significant encouragement either overt or covert that the choice must in law be deemed to be that of the state. And that's really the Murthy case. I mean they really had a significant encouragement entanglement, all those things and nobody said anything. And the person who didn't say anything that bothers me the most is Justice Kagan. She's quiet as a mouse in this thing. So I do - I will look forward to what she has to say, but I also thought that there should be a little more, I'd be more comfortable if there was more talk of abridging, more talk of significant entanglement. Everybody's kept their powder dry on this, so we'll see. But I thought this was very encouraging for Murthy. I thought on NetChoice, if I had to guess the AGs are not happy with this, that would be my thought.

Robert Corn-Revere: Well, no, the AGs wouldn't be happy with this because the AGs regularly engage in the kind of jawboning that this is.

 John J. Vecchione: Oh, but they came out, they were all for this case.

Robert Corn-Revere: Well yeah, there were a lot of strange alliances all over the place, including the AGs in the Murthy case who were steadfast in protecting the First Amendment. Also filing in the NetChoice cases arguing that we should be able to have direct regulation of moderation practices. It makes for a very strange First Amendment theory. If you can be on both sides of that question. I think with respect to the point you just made about whether or not the court should have addressed Blum v. Yaretsky and excessive cooperation, I really don't think that was an issue in this case. It is the issue in Murthy - or one of the two issues in Murthy - and so I think we'll see the court saying more about it in that case.

And the question I think, and one of the reasons why we didn't see opinions in both cases issued on the same day, even though they were argued on the same day and had related issues, is because the factual records in the two cases are so vastly different. Here you had a straightforward and confined set of facts focused on the government communication designed in a way to restrict an advocacy organization's speech. In Murthy you have this far-reaching record and as you know from the oral argument, the court's struggling to look for - to connect the dots between the government speech and particular examples of censorship. Now we filed them in support of upholding the Fifth Circuit with our amicus brief, but you have to acknowledge that it's a much more complicated record.

 John J. Vecchione: And they have a preliminary injunction issue to deal with.

 Robert Corn-Revere: That's right, that's right.

Thomas Berry: I'll address the NetChoice cases. Just for viewers who aren't familiar, these are two laws passed in Florida and Texas that essentially regulate the moderation decisions of social media companies and probably potentially beyond. That's one unanswered question, a wide range of websites. The stated purpose was to make them sort of viewpoint neutral, so not biased towards conservatives or liberals. One way this may be relevant is that there's a lot of discussion in the opinion using quotes from politicians from Vullo and from Cuomo kind of showing what their intent behind this was. And one of the claims, especially in the Florida NetChoice case, is that there are statements from both the governor Florida and legislators that show that there was a specific viewpoint-based intent behind passing this law and that they didn't like specific decisions - moderation decisions - made by the social media companies that they thought were biased towards the left, decisions like deplatforming then-President Trump or blocking a story about Hunter Biden's laptop. And so there's tons of quotes saying "We're fighting back against big tech liberal bias" and things like that. And one of the claims is that there's a form of retaliation here that the laws are both tinged with a bias tinged with a particular purpose to influence the discourse. And you could also argue that they were essentially punishing the social media sites taking away some of their liberty because Florida legislators and I think Texas also didn't like the choices that they were previously making. So to the extent that this case decision here in Vullo was partially a retaliation case or a threats case, I think it supports that retaliation claim in NetChoice as well.

Vera Eidelman: I have very little to add, but I think the one other thing I would just say is it's also possible it won't have any effect at all. I think it's interesting, there are so many - we as First Amendment litigators and thinkers have recognized the themes that are percolating - and of course the justices will be thinking about that too. They're really focused on these cases, thinking about how they impact one another. But I will say that listening to the arguments both in NetChoice and in Murthy, there are many other ways that those cases could go and it's fully possible that the things, the sort of hints that are sprinkled throughout this opinion don't make their way into those either. Not to disagree with anything that anyone has said. That's just another possibility.

Robert Corn-Revere: Definitely. That's a very good point. One thing I'd like to follow up on is just this distinction between informal pressure and regulation as in this case and the concept of retaliation. I would disagree slightly that this can be framed as a retaliation case and I think that has had a lot to do with what I saw as Justice Jackson's confusion over the issue. She said this really should have been taken as a retaliation case. And that's unfortunately for the NRA, they argued both. I think if you view this as retaliation, you sort of frame every First Amendment as a retaliation case in that if the government, if a speaker doesn't do what the government wants them to do, whatever measure they adopt to suppress their speech is retaliation. And I don't think it really works that way. Here we're talking about using various informal means as a form of pressure to change the public debate and change what speech is available.

Retaliation is somewhat different and the classic retaliation case is like a public employee case where you have someone who says something on the job or off the job and then they lose their job or lose a position because of that speech. The speaker is the one who's being retaliated against. Here, where you have intermediaries, it's really the government pressure on those intermediaries to change the public debate. And if you frame it as a retaliation case, you take on a higher burden of proof as a plaintiff to demonstrate what the government's motive was. And so I think it's important to keep those different doctrines separate. I think retaliation, while you can kind of see it in this case, I really don't think this is a retaliation case. This is a pure Bantam Books case, even if you're not putting the pressure on bookstores.

Casey Mattox: 'm going to start to turn to some other questions here. I know Sarah Reese had asked, and I feel like we haven't covered this before. Part of the argument from Ms. Vullo was basically that these insurers needed to be concerned about the reputational risk that was posed. Vera or someone else. If you can explain that, what is the reputational risk? What was going on there?

Vera Eidelman: It is a thorny concept and it's a really good question and I think one reason that it is relevant - arguably could be relevant in the financial space is that this idea that at some point the reputation of an entity becomes so bad that it actually impacts their financial status, their ability to actually do the financial work that they want to do, bring the returns that they claim they'll be able to do. I think here it really had, I would argue no teeth, there's no actual support at least at this stage, certainly at the motion to dismiss stage, to suggest it's actually arguably improper to suggest that there is a factual difference in why Vullo took these actions and whether she was had a legitimate basis as a financial regulator to look at reputational risk. I think Justice Sotomayor gets at that by basically saying we just have to credit the allegations as written. Maybe discovery will show something else down the line. Certainly possible. And I do think the financial space is an interesting one where reputational risk may be maybe at some point a legitimate basis for regulation. It does appear in a lot of financial regulatory discussions, but I think it's quite thorny because I think there's also serious potential for a heckler's veto to be available through that.

Casey Mattox: Yeah, I think that's the challenge here, right, is basically like, "Hey, I just want to make sure, in this very public letter, that I will blast everywhere and issue a press release to talk about that you're very aware of the reputational risk posed by the people that you're insuring." It sure looks like you're trying to create a reputational risk while warning of it, right?

John J. Vecchione: And I'll just add on that just like in certain cases, whenever the government wants to do something, they'll say national security is involved even though it's not really national security, it's some other thing they're doing. I think reputational risk is sort of taking on some of the aspects of those cases where they just assert national security when there's none. I always think of the alpaca wool. They have a subsidy for alpaca wool because we needed it in Korean bomber jackets back in the fifties and they still have the subsidy now, "Oh, it's national security." Well come on. The same thing here with reputational risk, the flavor of the case to me is it's sort of expanding to take over anything they don't like

Casey Mattox: Looking through questions here, Cindy Crawford, who's actually at Americans for Prosperity Foundation, she noted that the language from the opinion where Sotomayor says, "Whether analyzed as a threat or as an inducement, the conclusion is the same." And that does seem important, that the court seems to be pointing to the idea that look, just because that basically you could have a First Amendment violation either because the government or a government official is sort of making a veiled threat or an express threat, but also if they're offering an inducement. And what's your thought there and potentially how that could affect some of the other cases?

 Robert Corn-Revere: Well, this was the part of the opinion that I thought did a little bit of foreshadowing toward the Murthy case. And that is, the context was slightly different here where you were talking about in meetings where Vullo alternately suggested, “Well, we're going to investigate you or perhaps regulate you if you continue doing business with the NRA.” But she also said, "We will go easy on you for other things if you go ahead and sever your ties." And so it was both a carrot and a stick and so the opinion was talking about the inducement is every bit as much as a coercion as a direct threat, and it hints at what the Murthy court will need to address in terms of excessive cooperation or inducement to moderate.

 John J. Vecchione: Or maybe significant encouragement.

Robert Corn-Revere: Right. That's what I was getting at, getting to the significant encouragement point. It seems like a cousin to what we're talking about here in terms of whether it's an inducement or a threat.

Casey Mattox: Well, we are coming up on time, so I wanted to, we can kind of go down the line. Any other last comments before we turn it back over to Chayila? John?

John J. Vecchione: The thing I'm going to be looking for, just what's going to be, we're in June, what's going to be the delta between when this case came out and when Murthy comes out and if NetChoice is going to come out first and if NetChoice comes out at first, we're going to have a few more tea leaves beforehand. I thought because they put Murthy and Vullo together, they'd come out sometime near each other. But I'm getting the feeling in the pit of my stomach that it'll be NetChoice first and Murthy last. So that's my pseudo-prediction and I want to thank the Federalist Society and everyone here for being on this panel. It's been a lot of fun.

Casey Mattox: Well, we may know as early as tomorrow. So any others with last comments?

Robert Corn-Revere: Well, I'll just say that, and I've said this in other forums as well, this is the most consequential term for First Amendment decisions perhaps since I've been practicing law. And if the court addresses directly all of the questions that it has taken up this term, it could set the pattern for free speech and particularly for online free speech for years or decades to come. All I can say about the decisions that have been issued so far is "So far so good", both in terms of the outcomes and in terms of the court seeing the need to be unanimous in these decisions. And so I'm hopeful for the rest of the term, but we don't have that long to wait to see what's going to happen.

Thomas Berry: I'll just say quickly on the entanglement issue. Cato filed a brief supporting neither side in Murthy. We joined NetChoice and a few other groups and we pointed out, be careful talking about private platforms becoming entangled with the government and becoming state actors because then you start to justify more regulation of platforms that I don't think should be justified. You start to justify the laws at issue in NetChoice in Florida and Texas that I think are further restricting the free speech rights of private parties. So from our point of view, if you're the victim of jawboning, that doesn't make you the government, that just makes you a victim and the government is the proper defendant. I'll just say also, it may well be that Murthy will come out differently. I think that's a harder case. But I think the holding of this decision is important because even if Murthy comes out differently, it's because the Supreme Court thought the facts were different. But this case has really set out a principle and I think no matter what, setting out the principle is the most important thing. But people may disagree on the principle's application to different facts.

Vera Eidelman: And I agree with Tommy, but I would say I think here, because the principle is essentially you can't based on the totality of the facts coerce but you can persuade, the application to the facts really matters. And so if the court does reach the merits in Murthy, I think that would be great because then we'd have three opinions that explain what this rule actually means in practice. So fingers crossed. John?

John J. Vecchione:I think so. And I will just say I do think we'll get over standing because none of the six Republican appointees asked a question on it except Alito to say "If one person has it, then we get to the merits!" So I'm very confident. Well, I'm very hopeful that it'll get to the merits. 

Robert Corn-Revere: And Casey, if I could just beg your indulgence for 20 or 30 seconds for one last point to react to what Tom said, I agree with the point that social media platforms do not become state actors in this situation. And something that we pointed out in our brief to the court is that that was not the issue below. There was never a question of whether or not the platforms should be converted into state actors because they cooperated with the White House or other federal agencies. The question was whether or not there was excessive encouragement or coercion in forcing them to restrict their speech, which is a classic First Amendment problem and not the kind of state action thing that the government misleadingly identified as the issue in its cert petition in the Murthy case.

Casey Mattox: Well, thank you very much and again, thanks to the Federalist Society for hosting this and making this possible. And Chayila, we'll turn it back over to you.

Chayila Kleist: Really appreciate it. Thanks to you all for joining us today and sharing your expertise and insight. Really appreciate you carving out this portion of your afternoons. Thank you also to our audience for joining and participating. We welcome listener feedback by email at [email protected]. And as always, keep an eye on our website and your emails for announcements about other upcoming virtual events. With that, thank you all for joining us today. We are adjourned.