Courthouse Steps Decision: USAID v. Alliance for Open Society International, Inc.

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On Monday, the Supreme Court released its decision in United States Agency for International Development v. Alliance for Open Society International. By a vote of 5-3, the judgment of the U.S. Court of Appeals for the Second Circuit is reversed. The justices held that the enforcement of a law requiring foreign affiliates of domestic groups receiving funds to fight HIV/AIDS to have a policy opposing prostitution and sex trafficking does not violate the First Amendment. Justice Kavanaugh's majority opinion was joined by the Chief Justice and Justices Thomas, Alito, and Gorsuch. Justice Thomas also filed a concurring opinion.  Justice Breyer dissented, joined by Justices Ginsburg and Sotomayor. Justice Kagan took no part in the consideration or decision of the case. Our speakers will discuss the decision and its implications. 


Casey Mattox, Senior Fellow, Free Speech and Toleration, Charles Koch Institute

Krystal B. Swendsboe, Associate, Wiley Rein LLP


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Event Transcript



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Greg Walsh:  Welcome to The Federalist Society’s Teleforum conference call. This afternoon’s topic is titled “Courthouse Steps Decision: USAID v. Alliance for Open Society International, Inc.” My name is Greg Walsh, and I’m Assistant Director of Practice Groups at The Federalist Society.


As always, please note that all expressions of opinion are those of the experts on today’s call.


Today, we are fortunate to have with us Casey Mattox, the Senior Fellow of Free Speech and Toleration at the Charles Koch Institute, and Krystal B. Swendsboe, and Associate at Wiley Rein LLP. After our speakers give their opening remarks, we will go to audience Q&A. Thank you all for sharing with us today. Casey, the floor is yours.


Casey Mattox:  Thanks for joining us. As you said, my name is Casey Mattox. I am Senior Fellow for Free Speech at the Charles Koch Institute. And so I took a lot of interest in this case and published a piece at The Dispatch that you may have read or would welcome you to. It sort of lays out our thoughts on this case. And the short version is that, while I sympathize with many of the positions expressed in the majority opinion in yesterday’s decision, ultimately, I’m concerned about the free speech implications of the decision, as I think Krystal is as well. But we’ll get into more of that as we go. Krystal?


Krystal B. Swendsboe:  Thanks, Casey, and thank you all for tuning in again. This is our second opportunity to talk about this case. I am a commercial litigator and appellate lawyer at Wiley Rein. I’ll have to admit I’m a little bit of a divided mind on this opinion. The commercial litigator side of me is already plotting how I can cite the strong division between the corporate entities in a couple of briefs. But the constitutional appellate lawyer side of me is very concerned for these First Amendment implications here.


And to start, before we go into discussion about the majority and dissent opinions and then some of the consequences of this opinion, I want to give you just a brief case summary in case -- if you’re not quite as in the weeds on this case as we are. So this was billed and briefed as a compelled speech case, whether the government can dictate speech by conditioning grant funding on the adoption of the government’s anti-prostitution message. The speech requirement is part of the Leadership Act, which authorized over $80 billion to combat HIV/AIDS and requires that no funds may be used by an organization “that does not have a policy explicitly opposing prostitution.”


This is the second time the case has been before the Court. In 2013, the Court ruled that the funding requirement violated the First Amendment because it required respondents—same respondents in this case, domestic grant recipients—to pledge allegiance to the government’s policy. The same issue is presented here: whether the policy requirement was also unconstitutional because it applied to respondents and their speech through closely related foreign affiliates.


Based on the record, the foreign affiliates are virtually indistinguishable from the domestic entities. They share branding, message. They speak with one voice. Even Justice Breyer talked about that in the dissent.


Now, respondents before the Court argued that the 2013 decision resolved this issue. Dictating the speech of closely foreign affiliates is the same as dictating speech for the domestic entities, and the policy requirement should be ruled unconstitutional. Now, the government, in opposition, drew a very fine distinction based on corporate formalities of the domestic and foreign entities, in fact, argued that there are no constitutional barriers or limits to dictating speech because we’re dealing with foreign entities here. Casey, do you want to talk to us about the majority opinion?


Casey Mattox:  Sure. So first of all, this was a 5-4 decision, written by Justice Kavanaugh and decided essentially on what people would—at least before the last couple of weeks, if it’s still an accurate descriptor—would have thought of as kind of the conservative justices on one side and the more liberal justices on the other side. We’ve been disabused of the notion that that is a good way to divide up the Supreme Court justices for the last -- over the last two weeks, if not long before.


But Justice Kavanaugh had the opinion for the Court. And I’ll just kind of work through basically what he says. Now, granted this is a decision that came -- this was argued back in May, decided now. And, at least in my view, I think the analysis, for better or for worse, is rather simple in the opinion. That may reflect the fact that there’s a limited amount of time.


It’s also -- I thought at least Justice Kavanaugh’s majority opinion was a rather clear opinion. It attempted to set some sort of clear lines here. He begins first with “It is long settled as a matter of American constitutional law that foreign citizens outside U. S. territory do not possess rights under the U. S. Constitution. Plaintiffs do not dispute that fundamental principle.” The dissent does dispute the fundamental principle, and Krystal will talk about that in just a little bit, at least the breadth of the statement that he makes there.


But he states that as just a known fact that if you’re outside the U.S. -- foreign citizens outside the U.S., you don’t possess rights under the Constitution. Second, it’s a long-settled principle that “as a matter of American corporate law that separately incorporated organizations are separately legal units with distinct legal rights obligations.” So those are two very kind of bedrock principles, as he identifies them.


He says that “Those two bedrock principles of American constitutional law and American corporate law together lead to a simple conclusion: as foreign organizations operating abroad, plaintiffs’ foreign affiliates possess no rights under the First Amendment.” Now, keep in mind that there are no foreign organizations that are actually party to this case. The parties involved in this case are the domestic organization and USAID.


And the argument is that, for the domestic organization, requiring their closely identified foreign affiliate—so AOSI International as opposed to AOSI domestic, or AOS—that requiring them, the foreign affiliate, to adopt this statement of belief as their own -- that that actually interferes with the domestic organization’s free expression because the sort of misattribution of the message from the foreign organization to domestic. He goes on and says, “Congress can condition funding on a foreign organization’s ideological commitment”—this is a quote—“for example, pro-democracy, pro-women’s rights, antiterrorism, pro-religious freedom, anti-sex trafficking, or the like.”


Kavanaugh continues and says, “By contrast, plaintiffs’ approach is to throw a constitutional wrench into American foreign policy. Congress would be in the untenable position of either cutting off certain funding programs altogether or funding foreign organizations that may not align with U.S. values.” I have concerns with the way that is framed because I think, first of all, it significantly overstates the case.


Congress presently -- even with domestic organizations, they clearly have First Amendment rights. Where those have been affirmed under the prior decision, Congress can say, for example, that you can’t use appropriated funds in a program for purposes that would be contrary to the program. So for example, there’s another requirement for participating in this program that’s not even been challenged. And that’s that you can’t use the funds to actually promote prostitution.


So AOSI says, “Well, we have no intention of actually promoting prostitution.” So they’re not actually promoting prostitution in the program, and no one disputes that. The question is really, well, can you require them to adopt their own formal policy, make it their own personal statement of the organization’s own values as a consequence of being able to participate here?


Which raises the other question, what exactly is the harm-benefit calculus here? And that’s, frankly, a question that is unanswered through the entire opinion. There’s not much of a discussion about what exactly the federal government gains when it can already say that you can’t use these funds in ways that the federal government instructs you not to use them. What does it gain additionally by saying that the organizations must believe what the federal government says you must believe in order to receive the funds?


So requiring them to adopt their own personal policy that says that you reflect Congress’ values, what exactly is the benefit of that to the federal government and what is the harm of allowing an organization that’s not otherwise doing things in violation of what Congress wants done to participate in the program? The United States is not forcing plaintiffs to affiliate with foreign organizations. Plaintiffs are free to choose whether to affiliate with foreign organizations and are free to disclaim agreement with the affiliate’s required statement of policy.


So essentially, one of the arguments here is, look, to the extent that Congress is placing any burden on these foreign organizations, or to the extant there is a burden placed on foreign organizations -- or sorry, on the domestic organizations, it’s because the domestic organizations choose to affiliate with foreign organizations. So it’s basically an “It’s not our fault. We imposed this rule on the foreign organizations. If people are misattributing the statements made by foreign organizations to domestic organizations, that was your choice to choose to affiliate with them,” would be the argument there.


Plaintiffs emphasized that the Court could narrowly decide to protect the free speech rights of only those foreign organizations that are closely identified with American organizations, and yet, they didn’t do so. Again, the First Amendment cases involving speech misattribution arose when the state forced one speaker to host another speech. No compulsion is present here. Krystal will get into a little bit the dissent’s response to that, which I think needs to be taken pretty seriously.


The majority is glossing over ways that, in fact, the federal government can force that misattribution on parties and the sort of unfortunate -- the clarity of this opinion might actually gloss over some of those open questions still to come. And they conclude the plaintiffs’ closely held distinction would “enmesh the courts in difficult line-drawing exercises—how closely identified is close enough?—and leave courts without any principle basis for making those judgements.” My view is that this concern ended up driving a lot of the analysis here. And this was a pretty significant burden -- pretty significant problem, I guess, for AOSI.


It’s one thing to say that you want an exception for closely identified organizations where people would misattribute what the international organization is saying to the domestic organization. It’s another thing altogether to try to identify when is the affiliation close enough for that to really be a problem. And I think at least the majority of the Court had a difficult time figuring out exactly how they would draw that line.


It was much cleaner and easier to draw a line as Justice Kavanaugh did at the beginning of the opinion that says, if you are foreign -- if you’re a foreign organization, you do not have First Amendment rights, and you have separate corporate structures. Then, we can draw the line right there and not have to get into the difficult line-drawing exercise. Krystal, you want to walk through the dissent?


Krystal B. Swendsboe:  You bet. So one quick clarification, this is a 5-3 decision because Justice Kagan was recused.


Casey Mattox:  Sorry. That’s right.


Krystal B. Swendsboe:  So on the defense side, Justice Breyer wrote the opinion, and he was joined by Justices Ginsburg and Sotomayor. He very clearly states it at the beginning of the dissent. This is a case about First Amendment rights as American citizens, drawing a big distinction from the majority who really focused on the foreign entities.


The respondents in 2013 are the same as the respondents in this case, given one or two might have dropped out. But we’re talking about American citizens and American entities here. So the case in 2013 should have decided the matter. Justice Breyer then goes through a lengthy discussion of the record in the 2013 opinion, I would bet, to make up for the lack in Justice Kavanaugh’s opinion. This could very well be a fault that this opinion came at the end of the term.


But also I think it’s helpful to go through all of the facts, the record, the discussion in 2013, which really was given short shrift in the majority opinion. Specifically, Justice Breyer notes that the dual structure solution -- that is there’s a heavy distinction between a corporate -- or excuse me, a foreign and a domestic entity. This is proposed in 2013, and Justice Breyer points out it was rejected by the Court “because corporate formalities do nothing to ward off speech distortion where the government has required a speaker to espouse a specific belief as its own.”


So the dissent argues that respondents should have won this case for the same reasons they won in 2013. When respondents speak through legally separate but clearly identified affiliates -- in this case, the record shows that they speak with one voice -- in 2013, the Court held that speech is attributed to respondents for First Amendment purposes, exactly what the Court should have held here. And I tend to agree.


And then Justice Breyer has some excellent quotations. Audiences everywhere attribute speech based on whom they perceive to be speaking, not on corporate paperwork they will never see. The majority really relies on this idea of corporate formality and corporate distinction. Most people have no idea that these are separate entities at all.


I really appreciated this quotation from Justice Breyer that, in the First Amendment context, “the corporate veil is not an iron curtain.” In fact, it’s just the opposite because they “attribute speech across corporate lines all the time.” To kind of play off of something Casey had mentioned earlier, one of the few cases that the majority actually discusses in some detail is this Hurley case, which dealt with a parade throwers and a gay and lesbian message that was included in the parade.


So the dissent goes through and rebuts the majority’s claim that Hurley involved compulsion and is, therefore, very different from this case because AOSI does not -- there’s no compulsion. However, that case was really about a combined multi-series set of voices. You had multiple entities that were part of this parade, and it was simply adding one new voice to the mix. It’s not a compelled message that’s attributable to a single speaker.


The real difference is that, in Hurley, the parade throwers were required to host speech and something Justice Breyer points out the government requires in a number of different ways. However, they were not required to adopt a policy or profess a belief, which is, I believe, what the dissent were arguing. But I would argue the policy requirement here does.


So the consequence is, as far as Justice Breyer’s aware and, frankly, as far as my knowledge goes, the Court has never before held an American speaker forfeit First Amendment protection when it speaks to foreign affiliates to reach audiences overseas. And then, of course, Justice Breyer goes on to address these bedrock principles raised by the majority. And those two principles are that foreign citizens do not enjoy constitutional rights.


And then there’s a distinct separation between -- there’s a corporate separation that must be respected, with respect to the first kind of bedrock principle that foreign citizens don’t have constitutional rights. Justice Breyer calls this a sweeping assertion. It’s neither relevant nor correct.


This is a case about American citizens and the speech of U.S. entities. The statement and the fact that the statement that foreign citizens have never enjoyed constitutional protections is inaccurate. The Court has studiously avoided establishing this absolute rule. And in fact, there are certain circumstances where foreign individuals in the United States or other circumstances have been granted constitutional rights. There’s no need for the majority to make this statement because the respondent’s argument agreed that the foreign affiliates acting on their own do not have First Amendment rights.


Again, we’re only really talking about, from the respondent’s perspective, the U.S. based domestic entities. So this really -- I think the majority went beyond the question presented and potentially spoke on an issue that will raise concerns in the future. Second bedrock principle, that of corporate separation, again, Justice Breyer notes this gives way uncertain circumstances. This is not quite as bedrock as the majority might want it to be.


Obviously, there are doctrines for veil piercing or alter egos or nominally separate businesses that underlie a lot of corporate litigation. First Amendment precedence leave no doubt that corporate formalities have very little to say about the First Amendment issue before us. In fact, it’s kind of interesting in this point because, as Justice Breyer notes, this kind of corporate formality issue has never really played into the First Amendment before.


In fact, most recent cases that we’ve seen as functional analysis take place when we’re looking at speech. Who is the person perceived to be speaking? What is the perceived understanding of their words or the message? Here, it really -- the majority just kind of ignores that entirely and goes to this very kind of rote and formalistic approach that is really at odds with past precedent.


And then finally, Justice Breyer goes in and rebuts the distinction drawn by the majority between the present opinion and the 2013 case. He argues this is not a choice issue. Both U.S. and foreign governments often require respondents to work through foreign affiliates. Justice Kavanaugh doesn’t really address that and notes that, well, the respondents here have a choice whether they could speak through foreign entities. And that’s the end of it.


But the record does reflect that both U.S. and foreign governments sometimes require the respondents to act in a certain way, including to partner with local affiliates. And even if this was a voluntary or a choice that the respondents could make, we still have First Amendment problems. Justice Breyer points out Wooley v. Maynard. That was a case where we’re talking about speech on a license plate. No one in that case would have accepted the argument that there’s no First Amendment problem just because a driver could choose whether to have a car or not.


So we still have this First Amendment problem that goes largely unaddressed. As Casey noted earlier, the majority appears to be afraid of disrupting policy, which the government never really attempts to justify—indeed odd in a compelled speech case—and instead seems to shy away from writing a hard line-drawing opinion that would require some more factual analysis. And as Justice Breyer points out, the real party that suffers is the marketplace of ideas. So with that, Casey, what do you see some long-term consequences rising from this opinion?


Casey Mattox:  Yeah. So obviously, one of the first and maybe it’s not all that surprising given this week -- basically all constitutional doctrines have -- basically trying to decide what your view on any constitutional doctrine is ends up being tainted by the abortion question. And we’ve seen that play out for the last couple weeks at least now. But the Mexico City policy is, in some ways, I think one of the most central parts of this case. This is one of the things that people have been watching for. And I think, ultimately, the decision in this case means that the Mexico City policy will be protected.


Now, for those who don’t know, the Mexico City policy is basically the back and forth executive warning and executive orders that we’ve seen, basically, for every change in administration since the Reagan administration that basically restricts the use of federal funds by foreign organizations that would promote abortion or be used for abortions in other countries. And so Republican presidents will restrict that through the Mexico City policy, and the Democratic administrations will come back and remove that.


There were -- the Court could have decided this case -- in my view, the Court could have decided this case either way without the Mexico City policy being disrupted. The way it did decide the case to provide pretty broad power to the administration to say that foreign organizations have no First Amendment rights -- no constitutional rights at all -- is certainly very protective of policies like the Mexico City policy. One of the concerns that I would -- so a lot of folks on the right, I suspect, will be very pleased by that.


I think one of the concerns, though, as we see laid out in Justice Kavanaugh’s opinion -- he states directly in the opinion that -- sorry. I’m pulling up the language here. And this is a quote. “Congress may condition funding by foreign organization’s ideological commitments, for example, pro-democracy, pro-women’s rights, antiterrorism, pro-religious freedom, anti-sex trafficking, or the like.”


So while Mexico City seems to be on firm ground during a Republican administration, it’s also not at all difficult to see the consequences of this decision, just directly from that quote from Justice Kavanaugh, with a future administration. If you have a Democratic administration that decides that funds used by organizations that are fighting HIV/AIDS, for example, must also agree with the administration’s position on either abortion or whatever else and not just that you not spend the funds in ways that are contrary but that you must adopt an internal position that says, for example, that you support abortion rights, that that effectively means that Catholic organizations that are doing some of this work in other countries would be excluded. And Justice Kavanaugh’s opinion not only seems to permit that, it seems to affirmatively state that that will be the case.


So it’s a broad amount of power, I think, that is given to Congress here. So anyway, it will be protective of Mexico City, but it raises a lot of -- it should raise a lot of concerns about other ways that this will play out in other contexts.


Krystal B. Swendsboe:  Agreed. One thing I was really interested in, on the corporate form sheets is this. So Casey, you mentioned Hobby Lobby oddly does not show up in this opinion either in the majority or in the dissent. Hobby Lobby, obviously, might be a little bit different if you’re looking at it from a corporate form separation aspect. It’s odd that Breyer in the dissent didn’t kind of come back and say, “Well, what about speech that can be attributed -- you know, what about the type of religious speech that can be attributed?”


So it almost seems as if the dissent is not quite accepting Hobby Lobby, at least not enough to use it as, I guess, a sword against the majority. And also, when it comes to this idea of corporate form, the example that Justice Breyer gave are only a few of the ones where the corporate form can be kind of tossed aside, as it were. In oral argument, for example, there were a couple questions about campaign finance regulations and whether a ruling for the respondents would have a negative effect on campaign finance investigations.


So now what about a circumstance where -- I believe Casey and I were chatting about this earlier -- there are two separate U.S. entities who contribute to one campaign. The government prosecutes for campaign finance violation alleging that one entity is merely a shell of the other. How does the majority kind of bedrock principle of separate corporate status stand up in that circumstance? I think the real problem will be the corporate form, as the majority would like to see it, just doesn’t exist in the way that they’re stating. Although, I could -- again, as I mentioned earlier, the corporate litigators out there might enjoy this quite a bit.


Casey Mattox:  I think that’s right. It’s interesting when the majority just states some of these points that are bedrock principles that might seem like bedrock principles on first glance. But the more you think about them, the more you realize that there are certainly exceptions. But to your point about Hobby Lobby, I think, to some degree, everybody’s a hypocrite in this case.


As I read through both opinions, there are just several places where -- in particular maybe, I guess the Hobby Lobby point. CLS v. Martinez is another where, with the dissent, there were arguments that are on the table that they didn’t make. And I suspect that you may be right, Krystal, that part of the reason they don’t make those arguments is because they don’t like those precedents. And they’re recent enough cases that they don’t want to sort of wrap their arms around those.


Rust v. Sullivan, I suspect that the three in the dissent strongly disagree with the result there, but it’s an old enough case that, at this point, it’s settled. And you sort of point to it to help make your case. The Martinez point -- so I was one of the attorneys who litigated the Christian Legal Society v. Martinez case. And that case, frankly, in my bias view, has never made sense in sort of fitting into First Amendment doctrine. And it certainly didn’t after the original AOSI case.


It made very clear that, at least for domestic organizations, that the government can’t require a domestic organization to adopt an internal policy stating the government’s position in order to participate in even a funding program. And in CLS v. Martinez, it was the government requiring a domestic organization to adopt an internal position in order to participate in a speech forum. So it should have even been more problematic.


But Martinez, I think, is even in further question now because of the concern that the dissent has about hypocrisy where the dissent cast this as, look, everyone knows that this is not really true. If you’ve got a domestic organization that has one policy, an international organization that has another policy, the government is basically just forcing them to be hypocrites. Well, that certainly would seem to be the case in situations like university nondiscrimination rules applied to religious student groups where you have national organization, like the Christian Legal Society, and its local affiliates on a particular campus are required to adopt a policy—an internal policy, not just hold that there are certain rules that apply to you. But you must say these things in your constitution, or you will not be permitted to exist here—that all you’re actually accomplishing is just requiring these organizations to be contrary to one another, these closely identified organizations.


So I think that’s troubling. But just kind of more broadly, where was that concern for the closely identified organizations and their freedom of association rights and the misattribution of speech to the national organization in the Christian Legal Society case? Again, none of these cases come up. It’s always interesting to me which cases aren’t cited in this opinions, as much as the ones that are, because I suspect there’s a backstory for why they were not mentioned.


Krystal B. Swendsboe:  One of those things we’ll be looking at whenever the drafts are released to the public. So Casey, I’m curious. What do you think this -- what did you think of Justice Kavanaugh’s kind of compulsion point? We’ve touched on it briefly. But does it have any real merit here?


Casey Mattox:  Justice Kavanaugh’s opinion -- I think the biggest problem, I think, that the dissent has, or that AOSI had, is the difficulty of trying to identify the limits on a closely identified rule. So I think the great merit, essentially, in the majority’s opinion is in its clarity, in its simplicity, simply saying that foreign organizations don’t have First Amendment rights. But I think as you -- it’s not at all difficult -- and even the dissent walks through some of these scenarios where do we really mean that, for example, the U.S. government could violate what would otherwise be the free speech rights of CNN International, and CNN would have no standing to complain about that in the United States?


And that doesn’t seem like something that should be able to happen. But it’s difficult to sort of -- well, how would that not work? Why can’t they do this? Justice Breyer -- I think the majority would essentially say, “Well, but it’s not happening. Look around.” And Justice Breyer would say, “Well, it’s not happening because we -- everyone who saw that --


Krystal B. Swendsboe:  Because you can’t.


Casey Mattox:  “-- was not okay until now.” And then as of this, it would seem to open up a lot of opportunities for the federal government to basically impose things on foreign entities that are not in the United States. I think one of the points you were making earlier, Krystal, was how there’s just no conversation at all in the opinion about what exactly the government -- what is the benefit to the government out of this? And that’s one of the downsides of the way the case was decided. When you have no First Amendment rights as a foreign organization at all, there’s really no reason to have to assess, well, what is the burden being placed on those rights, obviously, but also, what is the government’s justification?


The government doesn’t need any justification at all if you have no First Amendment rights. But then the dissent also doesn’t really provide much of an analysis of that either. What exactly -- it doesn’t diminish at all what the government’s interest is, and it doesn’t really explain why whatever interest -- basically apply First Amendment analysis here and say the three in the dissent think that the First Amendment should have applied here is actually how the analysis should have played out. They don’t really do that.


Krystal B. Swendsboe:  Right. I was -- frankly, this has been billed as a compelled speech case. I think almost all of the amicus briefs address the issue in that sense. My firm wrote one of those briefs.


So it’s interesting to me that in a compelled speech case, where the burden on the government has to be the highest, that you really don’t get any -- that the question of the government’s motive really doesn’t have any play in the opinion. And it just strikes kind of an odd tone, aside from the legal analysis. The government’s never been told -- the government’s never had to answer for their actions here.


This case has been going on for a decade now. I know the respondents have been back and forth to court. They had an opinion in their favor, and they’ve been continuing to fight against the government in this because the government just won’t let it go. So this has been a long-fought battle for the respondents for what on the government side? Having kind of this “you must affirm this policy internally” -- I don’t know what the government gains from that, quite honestly.


Casey Mattox:  Yeah. It’s difficult to escape the idea that because the government already had this other provision that applies that’s never been challenged. It says you can’t use the funds in ways that would violate the government’s interest here. What else do they gain other than making sure that organizations that aren’t in, to quote Justice Kavanaugh -- that don’t share the government’s values -- that those organizations don’t participate. But that should be of at least some concern to First Amendment advocates, the idea that we’re just going to exclude organizations who don’t share our values as opposed to organizations who will do something inconsistent with those values in carrying out the program. That’s a different thing.


If you’re misusing the funds or if there are aspects of what you advocate for that will make you not the best candidate for a discretionary grant, that’s another thing. But if you are an organization that just believes wrong, the opinion makes very clear that that is a valid basis for the government excluding you from participating in a program, if you’re foreign. If you’re domestic, it’s a very light switch sort of analysis. If you’re a domestic organization, it’s right out. If you’re a foreign organization, it’s entirely permissible.


Greg Walsh:  Perfect. Well, let’s go to audience questions, unless you -- sorry.


Krystal B. Swendsboe:  No, I was saying I think every First Amendment advocate just shivered at Casey’s last statement, but questions are great.


Greg Walsh:  We will now go to the first question.


Bob Fitzpatrick:  Hi, this is Bob Fitzpatrick in D.C. I’m an employment lawyer, so I see the world through that lens. And hearing this, as you described it, simplicity evaluation of this case by Kavanaugh and, I gather, four others, no concurrents, I wonder downstream what effect that simplicity on separate corporate organizations might have, in your view, on franchisor or franchisee litigation, joint employer doctrine, integrated employer doctrine, etc. I’d be very interested in what in your views this might mean for those areas of controversy and employment law in the future. Thanks.


Krystal B. Swendsboe:  Well, I’m happy to start. Bob, thank you for your question, and I do have to make one correction that I didn’t state earlier. There is one concurrence here. Justice Thomas, and like in 2013, he came in with a concurrent saying that there was no compulsion. There was no compelled speech there so, therefore, no violation. I just want to correct that quickly.


But I really appreciate your question about the franchisee/franchisor relationship and the joint employer doctrine. The joint employer doctrine itself, especially kind of in the Fourth Circuit over the past four to five years, has really been fleshed out. And I’m curious how -- I would be -- my speculation might run rampant that there has been a lot of ink spilled laying out that analysis and what will happen now.


It seems to me that this corporate formality would, in theory, kind of undo some of the joint employer status -- joint employer cases we have in a variety of circuits. But I just don’t know because, again, Justice Kavanaugh laid out a bedrock principle. This is very clear cut. But as Justice Breyer pointed out, there are a lot of exceptions that he really doesn’t discuss in the majority opinion. And I think joint employer’s one where obviously from an employment law perspective it’s an important doctrine that might be undermined by a purportedly simplistic view.


Bob Fitzpatrick:  Thank you.


Casey Mattox:  Yeah. I think I would guess that you will probably see some back peddling from the clarity of some of these bedrock principles. As some of these easy-to-imagine circumstances end up coming up, the Court, and even lower courts, will say, “Well, surely they didn’t mean X, Y, or Z.” And that will generally be true.


But it certainly does provide an open door, I think, for people to litigate those questions now. I think people are going to be watching very closely for opportunities to take these very clear, simple principles of law -- we don’t get very many of those in the law. So when the Court announces them very broadly and in one sentence statements, black letter law, that’s a wonderful opportunity to see if that really means what it says.


Greg Walsh:  Krystal, you mentioned that there was one concurrence that was of particular note. Do you want to talk a little bit more about that?


Krystal B. Swendsboe:  Sure. And I apologize we didn’t hit it at the top. You can’t forget Justice Thomas, and I was clearly remiss in that. So Justice Thomas, it was a very short concurrence. He obviously sided with the majority that the policy requirement here was not a violation of the First Amendment. However, instead of diving into the clear distinction between foreign and domestic affiliates, Justice Thomas argued that the policy requirement itself is not a compelled speech requirement. And he had made a similar point during the 2013 opinion. There can’t be a violation for a number of reasons, not least of which there was no compelled speech to begin with in Justice Thomas’ view.


Casey Mattox:  Yeah. Justice Thomas would take the view on these First Amendment questions that, essentially, if the government is putting restrictions on government funding programs, if you can take or leave the government funding, then there just is no compulsion to speak. So that’s a principle that’s largely accepted by the other justices that sort of unconstitutional conditions doctrine that you can’t require people to accept an unconstitutional condition in order to receive a government benefit. Justice Thomas, as he often does, has a different read of some of these things, so maybe most notable that he’s concurring alone there. It would have been interesting if there would have been other votes picked up for that position. But it’s his concurrence.


Greg Walsh:  Keep an eye out for emails announcing upcoming Teleforum calls. You can also consult the full schedule of our upcoming telefora on The Federalist Society’s website. Also available there are podcasts of previously recorded Teleforum calls that you may have missed, as well as on iTunes, Spotify, and Google Play.


Casey, Krystal, it doesn’t look like we have another caller in the queue. Is there anything you want to say before we conclude?


Casey Maddox:  Nothing on my end. Thanks for the opportunity and certainly I think we both have -- we have a piece up on the FedSoc website. I have a piece with The Dispatch. And if you have any further questions, then feel free to reach out by email. I’m happy to talk.


Krystal B. Swendsboe:  Same here. Thank you so much for hosting us. And again, if anybody has any questions, this is an area we’re both very passionate about, and we hope to see the Court take up the case and maybe protect the First Amendment speech rights a little bit more in the future.


Greg Walsh:  On behalf of The Federalist Society, I want to thank our speakers for the benefit of their valuable time and expertise today. We welcome listener feedback by email at [email protected]. Thank you all for joining us. We are adjourned.




Dean Reuter:  Thank you for listening to this episode of Teleforum, a podcast of The Federalist Society’s practice groups. For more information about The Federalist Society, the practice groups, and to become a Federalist Society member, please visit our website at