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SPOTLIGHT on Beer Labels Case 5.3 Bad Frog Brewery, Inc. v. New York State Liquor Authority United States Court of Appeals, Second Circuit, 134 F.3d 87 (1998). BACKGROUND AND FACTS Bad Frog Brewery, Inc., makes and sells alcoholic beverages. Some of the beverages feature labels that display a drawing of a frog making the gesture generally known as "giving the finger." Bad Frog's authorized New York distributor, Renaissance Beer Company, applied to the New York State Liquor Authority (NYSLA) for brand label approval, as required by state law before the bee could be sold in New York. The NYSLA denied the application, in part, because "the label could appear in grocery and conve nience stores, with obvious exposure on the shelf to children of tender age." Bad Frog filed a suit in a federal district court against the NYSLA, asking for, among other things, an injunction against the denial of the application. The court granted summary judgment in favor of the NYSLA. Bad Frog appealed to the U.S. Court of Appeals for the Second Circuit. IN THE LANGUAGE OF THE COURT Jon O. NEWMAN, Circuit Judge: * * * * * * * To support its asserted power to ban Bad Frog's labels [NYSLA advances] * * * the State interest in "protecting children from vulgar and profane advertising" * * * CASE 5.3 CONTINUED This interest is] substantial * * * . States have a compelling interest in protecting the physical and psychological wellbeing of minors * * * . [Emphasis added.] * * * * * * * NYSLA endeavors to advance the state interest in preventing exposure of children to vulgar displays by taking only the limited step of barring such displays from the labels of alcoholic beverages. In view of the wide currency of vulgar displays throughout contemporary society, including comic books targeted directly at children, barring such displays from labels for alcoholic bev- erages cannot realistically be expected to reduce children's exposure to such displays to any significant degree. [Emphasis added.] * * * If New York decides to make a substantial effort to insulate children from vulgar displays in some significant sphere of activity, at least with respect to materials likely to be seen by children, NYSLA's label prohibition might well be found to make a justifiable contri- bution to the material advancement of such an effort, but its currently isolated response to the perceived problem, applicable only to labels on a product that children cannot purchase, does not suffice. * * * A state must demonstrate that its commercial speech limitation is part of a substantial effort to advance a valid state interest, not merely the removal of a few grains of offensive sand from a beach of vulgarity. * * * * * * * Even if we were to assume that the state materially advances its asserted interest by shielding children from viewing the Bad Frog labels, it is plainly excessive to prohibit the labels from all use, including placement on bottles displayed in bars and taverns where parental supervision of children is to be expected. Moreover, to whatever extent NYSLA is concerned that children will be harmfully exposed to the Bad Frog labels when wandering without parental supervision around grocery and convenience stores where beer is sold, that concern could be less intrusively dealt with by placing restrictions on the permissible loca- tions where the appellant's products may be displayed within such stores. DECISION AND REMEDY The U.S. Court of Appeals for the Second Circuit reversed the judgment of the district court and remanded the case for the entry of a judgment in favor of Bad Frog. The NYSLA's ban on the use of the labels lacked a "reasonable fit" with the state's interest in shielding minors from vulgarity. In addition, the NYSLA had not adequately considered alternatives to the ban. WHAT IF THE FACTS WERE DIFFERENT? If Bad Frog had sought to use the offensive label to market toys instead of beer, would the court's ruling likely have been the same? Why or why not? THE LEGAL ENVIRONMENT DIMENSION Whose interests are advanced by the banning of certain types of advertising?. Dallas v. Stanglin (s. ct., 1989) Cases Was Procedural Due Process met? Which Constitutional Clause (s) EP and DP Constitutional Analysis City Ordinance Prohibits adults (over 18) to attend club on "Teen Night" (14-18) Kelo v. City of New London (2005) -to ensure that state actor used a fair method in depriving rights (must give notice and hearing) applies and why? What are the facts? city condemns homes in a 90-acre blue-collar residential neighborhood. gives land to a developer for $1 99-year lease, to build hotel, offices, nicer housing. 1) NOTICE 2. What rule/law/action is being reviewed for constitutionality? A. Due Process for a fundamental right. 3. Does the Constitution even apply in this case? State law banning vulgar label on beer is too broad why -inform person of the where, what, when, & TEST ANSWER SHEET B. Due Process for a non-fundamental right. 4. What court has jurisdiction and why? 4. Federal Government ) HEARING What does law/rule/action regulate or impact? Requires all businesses with govt. contracts to perform drug testing and electronic -provide opportunity to be heard, confront, C. Amendment that lists a specific right. (what type of rights for DP type of class for EP) . Voting Inserts (inserts, donations allowsd with minor limits for general corp. fund) object explain 6. Which Constitutional Clause apples and why? Prohibition against voting inserts in Paycheck envelopes Formality of both depends on ual Protection for suspect class 7. What STANDARD OF REVIEW applies? Why? . violent video games 1) Importance of right 2) D E. Equal Protection for Quasi suspect class. What Level of govt. OBJECTIVE needed to justify law/rule?why? St louis prohibits selling to minors without adults consent ee and risk right is infringed 9. What is the required (FIT) of the rule/law to accomplishment of objective? . Dress Code irlines has weight restrictions and dress code (enforce it on women, less on men) 3) Potential harm to person F. EP for non-suspect class. 10. Is the law Constitutional? Does it meet the needed Objective and FIT? B. Food Safety and Inspection Service (FSIS), the USDA's enforcement arm Benefits of Due Process (added value): (means - end test) e meat in pepperoni pizza will 1) Fairness 11. Business Recommendation to make rule/law legal? ant and plan games before it hits the grocery store: at slaughterhouse, packing Goodwill and relationships 12. What are the requirements for procedural du . "closely regulated" industry privacy (OSHA comes in demanding docu 3) Creates some certainty in area our industries (liquor sales, firearms dealing, mining, and auto junkyard, havi 5) L Courts honor and defer to organization history of government oversight that no reasonable expectation of privacy Less likely to be challenged 72 86 90 Is there a constitutional question and why? Does the Constitution even come into play? What court has subject matter jurisdiction and why? Equal Protection 14th Amendment - "No state shall deny to any A. Federal system exclusively because a federal statute. person... the equal protection of the laws" What STANDARD OF REVIEW applies? Why? Held to apply to federal sovt. by 5th Am. DP clause A. Yes, a government entity is a traditional state actor. A. Strict Scrutiny for B. Federal System exclusively because of diversity of citizenship Suspect Class (race, national, citiz strict scrutiny Tor B. Yes, the entity qualifies as a state actor by fulfilling a public C. State Jurisdiction exclusively because no federal question involved? B. Intermediate test for FUNDAMENTAL RIGHTS function traditionally done by government. sour faimess of application of law Quasi Suspect Class (gender, age, legit.) Legal protection (in Constitution land statutes) that prevents state actor (and maybe commercial speech) C. Yes, the entity is qualifies as a state actor because it is entangled D. State court concurrently because a federal question is involved. from treating certain classes of people unequally Intermediate test for . suspect class = race, national, citiz C. Rational Basis fo (maybe commercial speech) non-suspect classes (economic) D. No, the constitution does not apply to purely private entities. . What court has territorial jurisdiction and why? . quasi-suspect class = sex, age, legit . Based on the geographical contact of each party? non-suspect class = social or economic Rational basis test for other Prohibits discrimination by state actor or govt. law NONFUNDMANTAL RIGHTS UNLESS a valid reason for treating differently Validity of reason determined by reviewing law under one of three Civil rights protecti rutiny, intermediate, rational basis) 75 78 2 98 Which Constitutional What does law/rule/action regulate or impact? What Level of govt. OBJECTIVE needed to justify law/rule? (and why?) What is the required (FIT) of the rule/law to Clause(s) applies and why? (what type of rights for DP type of class for EP) A. compelling reason or objective for suspect class accomplishment of the objective? (race, national, citiz If Rule/Law/Act impacts a A. DUE PROCESS No person B. EQUAL PROTECTION B. RIGHT of any person, important reason or objective for quasi suspect class 1. Fundamental rights me, liberty, or property 1.Suspect class [not for DP] (gender, age, legit.) (and commercial speech) then the Due Process Clause applies. petition gov., travel, vote, privacy, (of race, nationality, citizor C. legitimate reason or objective for non-suspect class 2. Non-fundamental Rights social or economic rights like housing, welfare, employment, 2. Quasi-suspect class (of gender, age, legit.) REASON 3 alamy stock photo 14TH If Rule/Law/Act treats a certain education)? Ruled [for strict scrutiny] class of people different, 3. non-suspect class intrusive means to achieve ary to accomplishment of compelling goal (no less EQUAL . then Equal Protection Clause (all others, type of bus., etc.? D. compelling reason or objective for fundamental right 5. [for intermediate scrutiny] UNDER Applies Rule is substantially related to accomplishment of important objective E. legitimate reason or objective for non-fundamental right C. [for rational basis standard] Rule rationally related to accomplishment of legitimate objective 83 85 100 101 2