Southern California Institute of Law v. Archie “Joe” Biggers et al.

, SACV 13-193 JVS (RNBx) Tentative Order re: Motion to Dismiss Defendants Archie “Joe” Biggers, James Bolton, J. Scott Bovitz, David Carrillo, Lisa Cummins, Patrick Dixon, Cometria Cooper, Richard Frankel, K. V. Kumar, Sean McCoy, John McNicholas, Sandra Mendoza, Martha PrudenHamiter, Steven Renick, Sandra Salazar, Larry Sheingold, James Vaughn, Jeanne Vanderhoff, Lee Wallach, Patricia White, Alan Yochelson, and George Leal (collectively, “Defendants”) are each current or former members of the State Bar of California’s Committee of Bar Examiners (“CBE”). They move in their individual and official capacities to dismiss Plaintiff Southern California Institute of Law’s (“SCIL”) Second Amended Complaint (“SAC,” Docket No. 26) pursuant to Fed. R. Civ. P. 12(b)(6). (Motion to Dismiss, Docket No. 30.) SCIL opposes. (Opposition, Docket No. 33.) Defendants replied. (Reply, Docket No. 34.) For the following reasons, the Court GRANTS the Motion. I. BACKGROUND

The Court detailed much of the background when it dismissed SCIL’s First Amended Complaint. (MTD Order, Docket No. 24.) The background consists of California law, factual allegations in the SAC, and documents attached to or incorporated by reference in the SAC. See New.Net., Inc. v. Lavasoft, 356 F. Supp. 2d. 1090, 1115–16 (C.D. Cal. 2004) (A court may “consider a document if it is ‘necessarily relied’ upon by the complaint” in ruling on a motion to dismiss.). The Court also may take judicial notice of matters of public record. See Fed. R. Evid. 201(b); C.B. v. Sonora Sch. Dist., 691 F. Supp. 2d 1123, 1138 (E.D. Cal. 2009). “When a written instrument or subject of judicial notice contradicts allegations in a complaint to which it is attached, the Court need not accept the allegations of the complaint as true.” Woods v. Asset Resources, No. CV 06-398 SMS, 2006 WL 3782704, at *2 (C.D. Cal. Dec. 21, 2006). The Court takes judicial notice of the following documents in Defendants’ Request for Judicial Notice (“RJN,” Docket No. 30-1):


RJN Ex. F RJN Ex. H RJN Exs. L, P, Q

Notice and Agenda for CBE’s June 29, 2012, Meeting CBE’s Request for Public Comment re: 2012 Revisions1 SCIL Webpages: (1) Accreditation, (2) Frequently Asked Questions, and (3) About Us (as visited on July 18, 2013)2


Factual Background

SCIL, a California Accredited Law School (“CALS”), was first accredited by CBE in 1996. (SAC ¶ 1.) This 42 U.S.C. §§ 1983 and 1988 action against members of CBE is based on their adoption of a rule requiring all CALS to make certain disclosures to the public, including current and prospective students. The State Bar of California is a constitutional entity established within the judicial branch of California. Cal. Const. art. VI, § 9. An administrative arm of the California Supreme Court, CBE “has the power to examine applicants for admission to practice law, [and] to administer the requirements for admission to practice.” Greene v. Zank, 158 Cal. App. 3d 497, 505 (1984); see Cal. Bus. & Prof. Code §§ 6060 et seq. CBE also is charged with the approval, regulation, and oversight of degree-granting law schools. Cal. Bus. & Prof. Code § 6060.7. CBE, “by setting standards for accreditation, can impose minimum standards on the quality of education at accredited schools.” Bib’le v. Comm. of Bar Examiners, 26 Cal. 3d 548, 555 (1980). CBE generally inspects CALS at least every five years
RJN Exs. F and H are judicially noticeable as official records of the State Bar and are authenticated by a State Bar employee. (Declaration of Gayle Murphy, Docket No. 30-1.) The Court specifically takes notice of the fact that CBE was amending the Guidelines for Accredited Law School Rules (“ALS Guidelines”). The Court also takes notice of the fact that CBE thought a change in ALS Guideline 2.3(D) was necessary because schools “no longer print and disseminate hardcopy ‘course catalogs’ or ‘school bulletins,’ and the nomenclature as to what constitutes the ‘principal page of a website has become increasingly vague and ambiguous.” (RJN Ex. F, at 5.) The Court does not take judicial notice of the latter fact for its truth or validity. See Lee v. City of L.A., 250 F.3d 668, 689–90 (9th Cir. 2001). The Court may take judicial notice of the webpages because the SAC details the “Accreditation” webpage, and SCIL’s website in general is referred to in the SAC. (E.g., SAC ¶¶ 4, 19, 21.) SCIL does not claim it has modified the website or that the accuracy of the webpage screenshots cannot be readily determined. See Fed. R. Evid. 201. 2
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for compliance with the then-current Accredited Law School Rules and ALS Guidelines, the latter of which CBE may amend. (MTD Order, at 4.) CBE may grant, deny, or terminate accreditation. (Id.) On January 1, 2013, CBE amended ALS Guideline 2.3(D), which is part of a section of the ALS Guidelines titled “Honesty in Communications.” (SAC ¶ 2; SAC Ex. A.) It requires CALS to create a “discrete page readily accessible to the public found on the law school’s website entitled ‘Accreditation.’” ALS Guideline 2.3(D). On that page, and in the course catalog or student handbook, CALS must state, inter alia, that “[s]tudy at, or graduation from, this law school may not qualify a student to take the bar examination or be admitted to practice law in jurisdictions other than California.” Id. The prior version explained this disclosure was “[t]o ensure that prospective students of, applicants to, and students of a law school’s J.D. degree program are fully informed about the requirements and possible limitations associated with attending and graduating from an accredited law school.” (Old ALS Guideline 2.3(D), SAC Ex. B.) SCIL does not challenge this part of the provision. The Guideline also requires that CALS publish “information relating to the pass rates of its graduates on the ten most recent administrations of the California Bar Examination” either (i) “[b]y means of posting an active link to the California Bar Examination ‘Statistics’ page of the State Bar’s website”; or, alternatively, (ii) by posting the pass rates of its graduates for the ten most recent administrations of the California Bar Examination.3 ALS Guideline 2.3(D). No specific language is mandated. SCIL challenges this part of the provision. It claims that CBE’s “premise is that without the regulation, there is a risk that students will be deceived.” (SAC ¶ 22.) D. SCIL’s Allegations

SCIL’s First Amendment claim rests on the following sentence on the “Accreditation” page of its website,

The prior version required a CALS to “advise potential students in its law school bulletin or other document that is always provided to prospective or incoming students, that information related to the school’s bar examination passing rates can be found at”; or, alternatively, the law school’s own website. 3


For more information relating to bar pass rates, on this school and other CBE-accredited law schools you may consult SCIL claims that this requires it “to publish a government message with which it disagrees” and “publicize CBE’s unsubstantiated views,” violating its free speech rights under the First and Fourteenth Amendments. (SAC ¶¶ 5, 17.) It seeks declaratory, injunctive, and monetary relief. (Id. ¶ 5.) Defendants are sued in their official and individual capacities. (Id. ¶ 12.) SCIL disagrees “with linking the quality of a law school’s education program to the performance of its graduates on a bar examination,” which CBE does by emphasizing bar exam passage rates on the “Accreditation” page. (Id. ¶ 4.) SCIL alleges that no current or prospective students or alumni have complained of a risk of deception related to the likelihood of passing the bar after attending a CALS. (Id. ¶ 22.) It also claims Defendants “made no reasoned response” to several CALS’s objections to the amendment and threatened SCIL with a Notice of Noncompliance if it did not make the disclosure. (Id. ¶ 19.) SCIL further claims that its website and publications are not intended solely for the purpose of proposing commercial transactions. (Id. ¶ 21.) The website details SCIL’s faculty and curriculum and provides tools and resources to existing students to support their education. (Id.) SCIL provides materials to prospective and current students to market the school and for informational and educational purposes. (Id.) SCIL’s website also advises students that a “legal education at SCIL alone” will not be “enough to pass the CA Bar Exam,” and that “passing the [bar examination] requires additional ‘test taking’ skills that are geared to the particular format, content, and structure” of the exam. (Id. ¶ 22.) II. LEGAL STANDARD

Under Federal Rule of Civil Procedure 12(b)(6), a defendant may move to dismiss for “failure to state a claim upon which relief can be granted.” A plaintiff must provide “enough facts to state a claim to relief that is plausible on its face.” Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570 (2007). A claim has “facial plausibility” if the plaintiff pleads facts that “allow[] the court to draw the reasonable inference that the defendant is liable for the misconduct alleged.”

Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009). In resolving a Rule 12(b)(6) motion under Twombly, the court must follow a two-pronged approach. First, the court must accept all well-pleaded factual allegations as true, but “[t]hreadbare recitals of the elements of a cause of action, supported by mere conclusory statements, do not suffice.” Iqbal, 556 U.S. at 678. Nor must the court “accept as true a legal conclusion couched as a factual allegation.” Id. (quoting Twombly, 550 U.S. at 555). Second, assuming the veracity of well-pleaded factual allegations, the court must “determine whether they plausibly give rise to an entitlement to relief.” Id. at 679. This determination is context-specific, requiring the court to draw on its experience and common sense, but there is no plausibility “where the well-pleaded facts do not permit the court to infer more than the mere possibility of misconduct.” Id. III. DISCUSSION

The case is about compelling speech under the First Amendment, not restricting speech. It is not a challenge to the entirety of ALS Guideline 2.3(D) or the ALS Rules and Guidelines in general, and it is not about arbitrary and capricious rule-making. Rather, SCIL focuses on ALS Guideline 2.3(D)(i)–(ii), which SCIL believes forces it to “reflect[] CBE’s unsubstantiated notion that the quality of legal education is linked to bar examination passage rates” and improperly ties bar passage rates to accreditation. (SAC ¶¶ 3–5.) Defendants move to dismiss the entire claim or, alternatively, to the extent it is brought for damages and in their individual capacity. First, they argue that ALS Guideline 2.3(D) regulates commercial speech. (Motion, at 9.) Second, they argue that SCIL must only make a neutral factual disclosure and is not prohibited from any speech of its own, so a rational basis can justify the rule. (Id. at 8–10.) Third, they contend the disclosure “is rationally related to CBE’s legitimate interest in making sure prospective students are not misled by the imprimatur of accreditation into believing that graduation from a given law school will necessarily result in the ability to pass the bar examination.” (Id. at 1–2, 10–12.) A. SCIL’s Speech and ALS Guideline 2.3(D)(i)–(ii)

Generally, “freedom of speech prohibits the government from telling people

what they must say.” Video Software Dealers Ass’n v. Schwarzenegger, 556 F.3d 950, 966 (9th Cir. 2006) (quoting Rumsfeld v. Forum for Academic & Inst. Rights, Inc., 547 U.S. 47, 61 (2006) [hereinafter FAIR]). Compelled statements of fact, like those of opinion, are subject to First Amendment scrutiny. FAIR, 547 U.S. at 62. The degree of protection depends on whether the speech sought to be regulated constitutes commercial or noncommercial speech. The parties dispute which standard of review governs: strict scrutiny, applied to noncommercial speech, Riley v. Nat’l Fed. of the Blind of N.C., Inc., 487 U.S. 781 (1988); or reasonableness review, as defined in Zauderer v. Office of Disciplinary Counsel, 471 U.S. 626, 651 (1985). To succeed in this facial challenge, SCIL must show that “no set of circumstances exists under which the [regulation] would be valid.” Reno v. Flores, 507 U.S. 292, 301 (1993) (citation omitted). 1. Commercial or Noncommercial Speech a. Legal Standard

Commercial speech is “expression related solely to the economic interests of the speaker and its audience,” Cent. Hudson Gas & Elec. Corp. v. Pub. Serv. Comm’n of N.Y., 447 U.S. 557, 561 (1980), or, at its core, “speech which does ‘no more than propose a commercial transaction,’” Dex Media West, Inc. v. City of Seattle, 696 F.3d 952, 957 (9th Cir. 2012) (quoting Bolger v. Youngs Drug Prods. Corp., 463 U.S. 60, 66 (1983)). A determination of whether speech is commercial should rest on “‘the commonsense’ distinction between speech proposing a commercial transaction . . . and other varieties of speech.” Bolger, 463 U.S. at 64. When analyzing mixed-content publications, the court must analyze “the nature of the speech taken as a whole” to determine the level of First Amendment protection. Dex Media West, 696 F.3d at 957 (quoting Riley, 487 U.S. at 796). First, the court must determine whether the publication as a whole constitutes commercial speech either (1) under the traditional test, because the speech “does no more than propose a commercial transaction” or (2) in “close question[s],” because the publication reflects other characteristics, such as the factors identified by the Supreme Court in Bolger. Id. at 957–58 (citing Hunt v. City of L.A., 638 F.3d 703, 715 (9th Cir. 2011)). Those factors are (1) the publication’s advertising format; (2) the publication’s reference to a specific product; and (3) the underlying economic motive of the speaker. Id. (citation omitted). These “factors are not

dispositive, but the ‘combination of all these characteristics . . . provides strong support for the . . . conclusion that the [publication at issue is] properly characterized as commercial speech.’” Id. (quoting Bolger, 463 U.S. at 67). “Second,” even if this threshold classification is met, the court “must determine whether the speech still receives full First Amendment protection, because the commercial aspects of the speech are ‘inextricably intertwined’ with otherwise fully protected speech, such that the publication sheds its commercial character and becomes fully protected speech.” Id. (citing Riley, 487 U.S. at 796). b. Application to SCIL’s Website

SCIL contends that the Court must apply noncommercial speech standards because ALS Guideline 2.3(D) “applies to law school websites as a whole” and its website contains extensive non-commercial information. (Opposition, at 18–20.) The Court rejects SCIL’s legal conclusion that ALS Guideline 2.3(D) regulates CALS’s websites “as a whole.” (Opposition, at 20.) The Guideline’s plain language directs the creation of an “Accreditation” webpage. It does not dictate or require the modification of any other content on a CALS’s website. Nor must a CALS publish the disclosure in its course catalog or handbook. This distinguishes the regulation from that in Dex Media West, where the court acknowledged that many of the advertisements in yellow pages directories fit within the “core notion of commercial speech” but concluded that the yellow pages were not commercial speech “as a threshold matter” because, inter alia, the ordinance at issue regulated the book “as a whole, not simply the individual advertisements contained therein.”4 696 F.3d at 957. Dex Media does not suggest that the Court must consider the publication “as a whole”—even unregulated aspects of it—to determine the character of the speech.

Dex Media is further distinguishable because the telephone directory and community listings in the yellow pages did not “refer to a specific product,” 696 F.3d at 959 (citation omitted); and there was “no clear link” between that information and the advertisements, unlike an “advertising leaflet put forth by an individual merchant to tout only its own products,” id. (quoting Ad World, Inc. v. Twp. of Doylestown, 672 F.3d 1136, 1140 (3d Cir. 1982)) (emphasis in original). The court also worried about undermining “[t]he full First Amendment protection” of publications like newspapers, magazines, and television programs. Id. at 963–65. 7


Nevertheless, it is not facially obvious that ALS Guideline 2.3(D) regulates commercial speech. Turning to the Bolger factors, the Court finds all three present in the speech regulated by ALS Guideline 2.3(D). First, SCIL publishes the disclosure in its “About Us” section and in the “Frequently Asked Questions by Prospective Students” section. (See RJN Exs. L, P.) These sections, albeit informational, clearly are a vehicle to advertise SCIL and its accreditation status to prospective students (consumers). Courts consistently hold that statements about accreditation status are commercial speech. See, e.g., Am. Acad. of Pain Mgmt. v. Joseph, 353 F.3d 1099, 1104, 1106 (9th Cir. 2004) (noting that board certification ‘designate[s] a certain level of qualification” and holding that statute regulated commercial speech because it regulated statements in advertising about such accreditation, advertising related to medical services, and economic motive for the speech was to “solicit a patient base”); Killian v. Pac. Educational Servs. Co., 486 F. Supp. 2d 1132, 1137–39 (D. Haw. 2006) (analyzing prohibition on statements about applications for accreditation and finding “no question that the statements regarding [the school’s] accreditation status fall into the category of commercial speech”). More broadly, SCIL’s website details its faculty, curriculum, and mission. (SAC ¶ 21.) Although this information may be useful to current students and is not equivalent to, for example, a car dealer’s website, it is designed to market SCIL. That it is not merely speech “on a commercial subject,” Va. State Bd. of Pharmacy v. Va. Citizens Consumer Council, Inc., 425 U.S. 748, 761–62 (1976), does not mean it is not commercial speech. See Am. Acad. of Pain Mgmt., 353 F.3d at 1106 (statute covered advertising about practitioner’s foreign language ability, education, publications authored, public health information, and other facts).5 Second, the regulated content relates to a specific product: the CALS and its educational services. Finally, it is evident that SCIL has an economic motive for this speech: soliciting students to build a student body.6 Therefore, the Court finds that ALS Guideline 2.3(D) regulates commercial speech.7
Although this fact is not material to the disposition, the Court notes that SCIL uses a “.com” (commercial) top-level domain, which more generally is used by commercial entities. Brookfield Comm’cns, Inc. v. W. Coast Entm’t Grp., 174 F.3d 1036, 1044 (9th Cir. 1999). The prior version of ALS Guideline 2.3(D) supports the conclusion that the object of CBE’s regulation is “advertising.” It emphasized that the bar examination passing rates information had to be provided to “potential students.” Old ALS Guideline 2.3(D). The Court is cautious not to swallow every statement by an educational institution in its publications under the umbrella of commercial speech. The line, admittedly, is blurry. But 8
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The Court further finds that ALS Guideline 2.3(D) regulates commercial speech that is not “inextricably intertwined” with noncommercial speech. In Bd. of Trs. of State Univ. of N.Y. v. Fox, 492 U.S. 469 (1989), the Court considered the character of a houseware sales party where attendees also discussed home economics. Id. at 472. The university invoked a regulation to prohibit the party. The Court found that the party was held merely to “propose a commercial transaction.” Id. at 473. It held that the commercial and noncommercial speech was not inextricably intertwined, because “[n]o law of man or nature ma[de] it impossible to sell housewares without teaching home economics, or to teach home economics without selling housewares.” Id. at 474. In Riley, the law required a fundraiser soliciting charitable contributions to disclose to potential donors the average percentage of gross receipts actually turned over to charities by the fundraiser within the previous twelve months. 487 U.S. at 804. The Court assumed the compelled statement was commercial speech and held that it was “inextricably intertwined” with the fully-protected solicitation of contributions, because the fundraiser could not fundraise without making the disclosure. Id. at 796. In Hunt, the Ninth Circuit found that the plaintiff boardwalk vendors clearly proposed a commercial transaction, because “the core of [their] speech was directed to their products and why a consumer should buy them.” 638 F.3d at 716. The court held that any noncommercial aspects were not “inextricably intertwined,” because the vendors “could easily sell their wares without reference to any religious, philosophical, and/or ideological element, and they could also express any noncommercial message without selling these wares.” Id. SCIL alleges that its website is not intended solely to recruit students, because it has information about the faculty and curriculum, teaching tools and resources for existing students, and more. (See SAC ¶ 21.) This allegation does not create any dispute of fact that precludes the Court from making a conclusion at the motion to dismiss stage that the noncommercial and commercial speech at issue is not “inextricably intertwined.” SCIL’s website has “About Us,”
“commonsense” suggests a significant difference between a disinterested presentation of resources to current students about courses or career resources, for example, and an institution’s desire to highlight what makes it unique and appealing to prospective students. See United States v. Wenger, 292 F. Supp. 2d 1296, 1302 (D. Utah 2003) (“Commonsense suggests that there is a significant difference between disinterested analysis of the nation’s stock markets and compensated promotion of particular stocks.”). 9

“Prospective Students,” “Academics,” “Staff,” and “Student & Alumni Services” sections. (See, e.g., RJN Ex. L.) The disclosures mandated by CBE appear in the “About Us”/”Accreditation” section. SCIL cannot evade the regulation simply because its website as a whole does more than evince an economic motive. SCIL’s entire website may not be only a vehicle to recruit students, but the aspects ALS Guideline 2.3(D) regulates are. Cf. Dex Media West, 696 F.3d at 963 (“[The phone book] was not created to serve merely as a vehicle for the delivery of ads. The telephone directory started as just that, a directory of telephone numbers. The commercial elements came later. . . .”); Am. Acad. of Pain Mgmt., 353 F.3d at 1106 (commercial speech covered by statute included extensive nonmisleading factual information). Therefore, the Court finds that unlike in Riley, CALS’s noncommercial speech can occur without the compelled disclosures. “No law of man or nature makes it impossible” to separate the commercial and noncommercial aspects: selling the school while also providing resources for current students. Fox, 492 U.S. at 474. Lastly, the Ninth Circuit has applied commercial speech standards to speech that does not fit within traditional definitions of commercial speech. See, e.g., Envtl. Def. Ctr., Inc. v. U.S. E.P.A., 344 F.3d 832, 849–51 & n.27 (9th Cir. 2003) (applying commercial speech standards to requirements to educate the public about the impacts of stormwater discharge on water bodies and to inform affected parties, including the public, about the hazards of improper waste disposal); CTIA–The Wireless Ass’n v. City & Cnty. of San Francisco, 827 F. Supp. 2d 1054, 1059–61 (N.D. Cal. 2011) (applying commercial speech standards to mandated disclosures by cell phone retailers about health risks of cell phones in light of presumption that government may require disclosures about public health risks), aff’d in part and vacated in part on other grounds, 494 F. App’x 752 (9th Cir. 2012). As the Court discusses more fully infra, the principles addressed in Environmental Defense Center further justify an analysis under the Supreme Court’s commercial speech precedents. Accordingly, the Court holds that the challenged regulation is a required disclosure in the commercial context and that SCIL’s regulated commercial speech is not “inextricably intertwined” with noncommercial speech.



Compelled Speech Under the First Amendment a. Legal Standard

Any attempt by the government to compel one to express certain opinions, viewpoints, or facts in fully-protected speech is subject to strict scrutiny. E.g., Dex Media West, 696 F.3d at 965; see Riley, 487 U.S. at 795–96 & n.9. The regulation must be “the least restrictive means available to further a compelling governmental interest.” Berger v. City of Seattle, 569 F.3d 1029, 1050 (9th Cir. 2009) (en banc). Commercial speech, on the other hand, generally receives less protection. Video Software Dealers, 556 F.3d at 966 (citing United States v. United Foods, Inc., 533 U.S. 405, 409 (2001)). Under Zauderer, the First Amendment permits compelled commercial speech that is “purely factual and uncontroversial.” 471 U.S. at 651 (upholding state’s requirement that attorney include in advertisements a disclosure that client may be responsible for litigation costs). The exact scope of this doctrine in the Ninth Circuit is somewhat unclear. In Video Software Dealers, the court stated that “[c]ompelled disclosures, justified by the need to ‘dissipate the possibility of consumer confusion or deception,’ are permissible if the ‘disclosure requirements are reasonably related to the State’s interest in preventing deception of consumers.’”8 556 F.3d at 966 (quoting Zauderer, 471 U.S. at 651); see also United States v. Schiff, 379 F.3d 621, 630–31 (9th Cir. 2004) (holding that because defendants were selling product that could, if used, expose customers to criminal liability for tax evasion, government could compel website to post factual information about potential liability). The focus was on misleading commercial speech. In Environmental Defense Center, meanwhile, the court addressed a regulation that does not fit within the “deception” framework. It upheld EPA rules under the Clean Water Act that required municipal storm sewer providers to educate the public about the impacts of stormwater discharge on water bodies and to inform affected parties, including the public, about the hazards of improper waste disposal. 344 F.3d at 849. Without comprehensively analyzing the nature of

The Zauderer Court also reasoned that the constitutionally protected interest in not providing the required factual information is “minimal.” 471 U.S. at 651. 11


the speech, the court looked to Zauderer and concluded that the rules did not raise the same concerns as in Wooley and Barnette.9 It noted that EPA had “not attempted to ‘prescribe what shall be orthodox in politics, nationalism, religion, or other matters of opinion or force citizens to confess by word or act their faith therein.’” Id. at 849 (quoting Barnette, 319 U.S. at 642). The court found that informing the public about safe toxic disposal involved “no ‘compelled recitation of a message’” or “‘affirmation of belief,’” did not prohibit the providers from stating their own views about the proper means for managing toxic materials or the rule itself, and did “not compel any specific speech.” Id. at 850. It concluded that the information requirement also “is consistent with the overall regulatory program of the Clean Water Act and the responsibilities of point source dischargers.” Id. at 851. The Ninth Circuit found support for its conclusion in Nat’l Elec. Mfrs. Ass’n v. Sorrell, 272 F.3d 104 (2d Cir. 2001), which upheld a statute requiring manufacturers to label products containing mercury to inform consumers how to dispose safely of the material. See 344 F.3d at 851 n.27 (noting Second Circuit’s holding that “mandated disclosure of accurate, factual, commercial information does not offend the core First Amendment values of promoting efficient exchange of information or protecting individual liberty interests”). It acknowledged that the EPA rules are “not an advertising or marketing regulation,” id. at 850 n.26, yet found that the policy considerations underlying commercial speech treatment of labeling requirements were equally applicable, id. at 851 n.27. Importantly for the present analysis, the Ninth Circuit emphasized that the Phase II Rule, of which the disclosure requirement was merely one part, “constitutes a ‘comprehensive program’ restricting the autonomy of MS4s in the relevant arena of controlling toxic charges to storm sewers that drain to U.S. waters.” Id. at 850 n.26.10
Wooley v. Maynard, 430 U.S. 705 (1997), invalidated a law requiring that drivers display the motto “Live Free or Die” on New Hampshire license plates. W. Va. State Bd. of Ed. v. Barnette, 319 U.S. 624 (1943), invalidated a requirement that public school students salute the flag, because the state may not impose on the individual “a ceremony so touching matters of opinion and political attitude.” The Ninth Circuit found the Phase II Rule more akin to Glickman v. Wileman Bros. & Elliot, Inc., 521 U.S. 457 (1997), which upheld a generic advertising assessment promulgated by the Department of Agriculture on behalf of California tree fruit growers that was ancillary to a more comprehensive program restricting market autonomy, than United Foods, 533 U.S. at 410–17, where the regulation compelled assessments for advertising that was antagonistic to the 12
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Accordingly, in the commercial speech context, governments may compel the disclosure of “purely factual and uncontroversial” information if it is (1) “reasonably related” to a governmental interest in (a) preventing a demonstrable, self-evident, or potentially real danger of consumer deception; or (b) in protecting public health and safety; or (2) as an ancillary part of a “more comprehensive program” restricting an actor’s autonomy. E.g., Video Software Dealers, 556 F.3d at 966; Envtl. Def. Ctr., 344 F.3d at 848–50; CTIA, 827 F. Supp. 2d at 1059; see also Pharm. Care Mgmt. Ass’n v. Rowe, 429 F.3d 294, 309–10 (1st Cir. 2005) (upholding rule that pharmaceutical distributors disclose information about finances and business practices to the state and not limiting Zauderer).11 But see R.J. Reynolds Tobacco Co. v. Food & Drug Admin., 696 F.3d 1205, 1214 (D.C. Cir. 2012) (analyzing Supreme Court precedent and adopting narrower rule that disclosure “is only appropriate if the government shows that, absent a warning, there is a self-evident—or at least ‘potentially real’—danger that an advertisement will mislead consumers”). Outside of this context, the compelled commercial disclosure of facts or opinions is subject to greater scrutiny. b. Application of Zauderer to ALS Guideline 2.3(D)

Applying the Zauderer standard because the protections in Riley are for speech entitled to full First Amendment protection, Wenger, 292 F. Supp. 2d at 1305, the Court finds that ALS Guideline 2.3(D)(i)–(ii)’s disclosure requirement is

plaintiff’s preferred advertising message and “was not part of a broader regulatory apparatus already constraining the plaintiff’s autonomy in the relevant area.” 344 F.3d at 850 n.26.

The concurrence in Pharm. Care Mgmt. Ass’n stated:

What is at stake here, by contrast, is simply routine disclosure of economically significant information designed to forward ordinary regulatory purposes—in this case, protecting covered entities from questionable . . . business practices. There are literally thousands of similar regulations on the books—such as product labeling laws, environmental spill reporting, accident reports by common carriers, SEC reporting as to corporate losses and (most obviously) the requirement to file tax returns to government units who use the information to the obvious disadvantage of the taxpayer. The idea that these thousands of routine regulations require an extensive First Amendment analysis is mistaken. 429 F.3d at 316 (Boudin, C.J. and Dyk, J., concurring). 13

reasonably related to CBE’s interest in preventing deception of consumers (prospective students) and otherwise is justifiable as ancillary to a broader regulatory scheme already constraining accredited law schools in California. See Envtl. Defense Ctr., 344 F.3d at 850–51 & n.26. To begin with, SCIL alleges that Defendants have no legitimate government interest because they came forward with no evidence of real or potential deception of prospective students, and it mitigates any potential issues by disclosing that legal education at SCIL alone will not be enough to pass the exam. (Opposition, at 12–14; SAC ¶ 22.) But SCIL does not seriously challenge that the purpose of ALS Guideline 2.3(D) as a whole is to “ensure that students do not make incorrect assumptions about the ability to pass the bar exam based on the fact that the CBE accredited a school.”12 (SAC ¶ 22; see Motion, at 10 (stating that asserted interest is “[t]o protect against inaccurate assumptions based on the fact that CBE has accredited a school”).) SCIL does not claim this interest is insubstantial, it does not protest as unconstitutional the first part of the Guideline, and it freely advises current and prospective students that a legal education at SCIL alone will not be enough to pass the examination. (SAC ¶ 22.) Regardless, Defendants did not have to come forward with empirical evidence before adopting ALS Guideline 2.3(D). See, e.g., Pickup v. Brown, No. 2:12-CV-02497-KJM-EFB, 2012 WL 6021465, at *25 (E.D. Cal. Dec. 4, 2012) (“A legislative choice such as this ‘is not subject to courtroom fact-finding and may be based on rational speculation unsupported by evidence or empirical data.” (quoting FCC v. Beach Comm’cns, Inc., 508 U.S. 307, 315 (1993))). In Zauderer, the Court upheld a regulation mandating that attorneys inform potential clients that they might be liable for significant litigation costs. 471 U.S. at 650. In doing so, the Court demanded no evidence that the existing advertisements actually were misleading, because “the possibility of deception” was “self-evident.” Id. at 652–53. In Milavetz, Gallop & Milavetz, P.A. v. United States, 559 U.S. 229, 1330, 1340 (2010), the Court upheld a law requiring debt relief agencies to clearly disclose they are debt relief agencies and help people file for bankruptcy under the Bankruptcy Code. The Court did not require the government to produce evidence that the advertisements were misleading because, based on experience and

ALS Guideline 2.3(D)(i)–(ii) is part and parcel of this broader purpose. There is no reason to analyze it in isolation. 14


common sense, the “likelihood of deception” was “hardly a speculative one.” Id. The D.C. Circuit cited these cases when it reasoned that the government need not produce additional evidence that it was deceitful and misleading that the most prominent price listed by an airline is anything other than the total, final price of travel. Spirit Airlines, Inc. v. U.S. Dep’t of Transp., 687 F.3d 403, 412–15 (D.C. Cir. 2012) (noting that disclosure requirements are not the limitations the Supreme Court refers to when invoking Central Hudson review). As in these cases, Defendants did not have to produce evidence that CALS’s publications are misleading or that a separate “Accreditation” webpage is necessary, because the “likelihood of deception” here is “hardly speculative” and arguably “self-evident.” Courts recognize the government’s interest in regulating the practice of professions in general, and statements about accreditation status in particular due to their potentially misleading nature. See Am. Acad. of Pain Mgmt., 353 F.3d at 1104–06; Killian, 486 F. Supp. 2d at 1137–39; Fla. Bar v. Went For It, Inc., 515 U.S. 618, 625 (1994) (“States . . . have the broad power to establish standards for licensing practitioners and regulating the practice of professions.” (citations omitted)). California’s interest is clear: it gives CBE the authority to approve, regulate, and oversee degree-granting law schools, and set “standards for accreditation.” Cal. Bus. & Prof. Code § 6060.7; Bib’le, 26 Cal. 3d at 555. California also now requires all private post-secondary schools to provide prospective students with a “School Performance Fact Sheet” disclosing, inter alia, completion rates and “[l]icense examination passage rates for programs leading to employment for which passage of a state licensing examination is required.” Cal. Educ. Code § 94910(a), (c). Having determined that Zauderer applies, the Court has no doubt that ALS Guideline 2.3(D)(i)–(ii), in concert with the whole provision, is “reasonably related to the [government’s] interest in preventing deception of consumers.” 471 U.S. at 651. By seeking to provide prospective students with comprehensive information, it aims to prevent any confusion about the effects of accreditation on the institution’s program and one’s preparedness for the bar examination. It directs CALS to provide or link to bar passage statistics. Contrary to SCIL’s assertion that the disclosure is not “a purely factual matter” because the statistics are “highly controversial” and reflect an “ideological belief that a law school should be judged by the passage rates of its graduates”

(Opposition, at 14–15), ALS Guideline 2.3(D)(i)–(ii) mandates no compelled recitation of any message about the validity of passage rates as a measure of institutional quality. Nothing in its language references ALS Guideline 12.1, which sets standards for CALS’ passage rates. SCIL does not claim such language is on the State Bar’s “Statistics” webpage, either. Thus, on its face, the information is factual and uncontroversial. Prospective students are free to draw their own conclusions about its relevance. That SCIL may not like those conclusions is irrelevant. See Zauderer, 471 U.S. at 651 (“[A]ppellant’s constitutionally protected interest in not providing any particular factual information in his advertising is minimal.”); N.Y.S. Rest. Ass’n v. N.Y.C. Bd. of Health, 556 F.3d 114, 134 (2d Cir. 2009) (“NYSRA does not contend that disclosure of calorie information is not ‘factual’; it only claims that its member restaurants do not want to communicate to their customers that calorie amounts should be prioritized among other nutrient amounts . . . . However, the First Amendment does not bar the City from compelling such ‘under-inclusive’ factual disclosures” where “the City’s decision to focus its attention on calorie amounts is rational.”). Moreover, the regulation does not restrict speech. Nothing prohibits CALS from supplementing the disclosure or arguing that passage rates should be irrelevant to students’ choices, as SCIL does. Thus, even though the regulation mandates some “specific speech,” it does not mandate a “specific message,” Envtl. Defense Ctr., 344 F.3d at 849, or “prescribe what shall be orthodox in politics, nationalism, religion, or other matters of opinion or force citizens to confess by word or act their faith therein,” Zauderer, 471 U.S. at 651. The burden on SCIL’s speech is de minimis and plainly permitted by the First Amendment. c. Application of Environmental Defense Center and Glickman to ALS Guideline 2.3(D)(i)–(ii)

Even if the disclosure requirement were not designed to remedy misleading commercial speech, the Court would uphold it pursuant to the principles in Environmental Defense Center. There, the compelled publication was part of a “comprehensive program restricting the autonomy of [providers] in the relevant arena of controlling toxic discharges to storm sewers that drain to U.S. waters,” 344 F.3d at 849 n.26. As Defendants argue, ALS Guideline 2.3(D) “requires CALS as a condition of accreditation to inform students where they can get” bar passage rate information. (Motion, at 10 (emphasis in original).) SCIL never had

to obtain accreditation. With SCIL having availed itself of the benefits of such status, the First Amendment also allows SCIL to be subject to certain burdens. SCIL concedes that “[a]ccreditation is an arduous process” and that “[i]n the unlikely event of a deceptive practice by a CALS, CBE can remedy the conduct under the ALS Rules and Guidelines.” (Opposition, at 13, 16 (emphasis added).) That is what CBE inarguably seeks to accomplish with ALS Guideline 2.3(D), and SCIL does not challenge the foundations of the accreditation system in California as unconstitutional. The Court cannot ignore this context, see United Foods, 533 U.S. at 411–12 (noting that “the entire regulatory program must be considered in resolving the case”), and finds that the mandated disclosure in ALS Guideline 2.3(D) is consistent with and “part of a broader regulatory apparatus already constraining [SCIL’s] autonomy in the relevant area,” Envtl. Defense Ctr., 344 F.3d at 850 n.26 (citing United Foods, 533 U.S. at 410–17). Furthermore, unlike in the aforementioned cases, compliance with the ALS Guidelines is a prerequisite to being or continuing to be accredited. There are a wealth of federal and state regulatory programs requiring the disclosure of product or other commercial information as a prerequisite to receive or maintain a status that are significantly more intrusive than ALS Guideline 2.3(D)(i)–(ii) and do not offend the First Amendment. SCIL consents to being told what type of content it must teach, when it must teach it, and what other disclosures it must make. The idea that each disclosure and content-based requirement in the ALS Guidelines would require a First Amendment analysis (the logical endpoint of SCIL’s position) is mistaken. See Pharm. Care Mgmt. Ass’n, 429 F.3d at 316. Finally, that the Guideline compels some “specific speech” 344 F.3d at 849, does not make it unconstitutional. The point is that it does not restrain SCIL from communicating its own message or compel it to express political or ideological views or views it disfavors. Glickman, 521 U.S. at 469–70; see also Strickland v. City of Seattle, 394 F. App’x 407, 409 (9th Cir. 2010) (unpublished disposition) (not mentioning “specific speech” language and finding that city’s requirement that marina owner distribute to tenants a “Best Management Practices Plan” in order to obtain a permit to modify the marina’s structure did not convey a “specific message” because “it simply sets forth requirements that marina tenants are advised to follow in order to keep the marina free of pollutants”).


Therefore, the Court finds that requiring a CALS to create an “Accreditation” webpage that includes the CALS’s bar passage rates or an active link to the State Bar’s “Statistics” webpage is reasonably related to CBE’s interest in protecting prospective students and a reasonable, ancillary part of a broader regulatory scheme. For both reasons, ALS Guideline 2.3(D)(i)–(ii) is constitutional under the First Amendment. B. Defendants’ Immunity

Because the Court dismisses the First Amendment claim in its entirety, it does not address whether Defendants have immunity from damages in their official capacities and legislative immunity in their individual capacities. IV. CONCLUSION

For the foregoing reasons, the Court GRANTS Defendants’ Motion to Dismiss. Because the Court finds that amendment of the First Amendment claim would be futile, the dismissal is with prejudice. IT IS SO ORDERED.


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