- The Washington Times - Monday, April 21, 2003

Supreme Court justices will decide this week whether a world-famous company's denial that its products are made in sweatshops constitutes "false advertising" or an exercise of its First Amendment rights.
The case was filed against Nike Inc. by a California resident, Marc Kasky, who sued to have California courts gag the company under the state's Unfair Competition Law, require it to surrender money earned in the state, retract the words and utter no more.
Although Mr. Kasky was not an injured party, as lawsuits typically require, he was able to file the lawsuit in the role of "private attorney general" to force the state to act.
"The First Amendment does not countenance that novel form of private action in light of its severe threat to freedom of speech," U.S. Solicitor General Theodore Olson said in an amicus brief asking to argue for Nike before the high court, a request granted April 7.
A key issue at Wednesday's hearing is whether a private citizen can assume a government role, squelch speech and seek damages when he is not personally injured by the comments. The justices will vote Wednesday afternoon in a closed-door conference, and the opinion announcing their decision is expected to be made public in late June.
The California Supreme Court ruled against Nike and ordered a trial of the case to proceed under laws governing "commercial speech," which the company's appeal said violates the First Amendment by gagging its efforts to convince lawmakers and to defend itself publicly in press releases and paid issue advertisements.
Opponents say Nike, a $9-billion-a-year company, seeks a license to lie so it can sell more shoes.
"Granting companies a right to lie is similar to allowing counterfeit money into circulation; it undermines confidence in the system," said Nathaniel Garrett, who is with the San Francisco branch of the Sierra Club, which filed one of 10 briefs supporting Mr. Kasky.
"These misrepresentations were not part of any political debate but were made by Nike to encourage consumers to buy a pair of its shoes," said San Francisco lawyer Alan M. Caplan, who represented Mr. Kasky in California, although Paul Hoeber is Supreme Court counsel of record.
"We are confident that the United States Supreme Court will affirm the ruling of the California Supreme Court and allow this case to go to trial," Mr. Caplan said.
Nike's all-star legal team is led by constitutional lawyer Laurence H. Tribe, who said the California decision "approves a legal regime that gravely threatens fully protected speech." Nike's speech addressed a political issue, and there is no claim that any shoe buyer relied on those political statements.
"It cannot be seriously doubted that the raging debate over labor conditions in Asia is more central to the First Amendment than is a supermarket flyer advertising shoes," Mr. Tribe said in his high court brief.
He said the lawsuit would impose a double standard, penalizing the company for trying to keep public good will while ignoring the fact that Mr. Kasky's statements are "calculated to discourage consumers from purchasing a particular manufacturer's products."
In an unusual alliance, the American Civil Liberties Union joined major corporations and the Bush administration to support Nike.
ACLU lawyer Mark J. Lopez filed a brief that described accusations that Nike's Southeast Asia factories make shoes and sports gear under "slave-labor conditions" as part of a larger organized campaign.
"In our system of government, courts are not arbitrators of truthfulness or probity, except in cases involving product advertising or where reputational interests are at stake," Mr. Lopez said in urging the court to reverse the California decision.
"These allegations against Nike are part of a broader public debate over the ethical responsibilities of multinational corporations in bringing products to the marketplace," Mr. Lopez said.

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