9th Circuit upholds SF ordinance targeting false advertising by pregnancy centers

First Resort, Inc.
v. Herrera, 2017 WL 2766094, — F.3d –, No. 15-15434 (9th Cir. Jun. 27, 2017)
First Resort, a
nonprofit providing free pregnancy-related services, challenged San Francisco’s
Pregnancy Information Disclosure and Protection Ordinance, which targeted false
or misleading advertising by limited services pregnancy centers (LSPCs). The
court of appeals affirmed the district court’s ruling that the Ordinance was
constitutional and not preempted by state law.
First Resort’s
target clients are “women who are unsure how to proceed with unplanned
pregnancies, including women considering abortion.” It bought keywords such as
“abortion” and “emergency contraception”; its advertising competes with abortion
providers for viewers’ attention. 
Online, it advertised itself “as an unbiased and neutral organization
that provided ‘abortion information, resources, and compassionate support for
women’ with ‘unintended pregnancies’ who are ‘considering abortion,’” promised
to “equip [women] with the resources [they] need to make a well-informed
decision about [their] options,” and offered information about abortion
procedures and costs. “Notably, the website and advertising materials did not
mention First Resort’s anti-abortion stance or that it did not provide
referrals for abortions.”
Further background:
false and misleading advertising by pregnancy clinics is a well-documented
problem.  Some such clinics “frequently
fail to provide medically accurate information” and “the vast majority of
pregnancy centers” contacted during a federal investigation misrepresented the
medical consequences of abortion.  San
Francisco’s City Attorney sent First Resort a letter in 201 expressing his
“serious concerns” about First Resort’s misleading advertisements and asking
First Resort to “correct” its advertising “to clarify that the clinic does not
offer or make referrals for abortion services.”
The city’s ordinance
defined a “[p]regnancy services center” as “a facility, licenced or otherwise
… the primary purpose of which is to provide services to women who are or may
be pregnant, that either (1) offers obstetric ultrasounds, obstetric sonograms
or prenatal care to pregnant women, or (2) has the appearance of a medical
facility.” A limited services pregnancy center (LSPC) is a pregnancy services
center that doesn’t directly provide or provide referrals to clients for abortions
or emergency contraception.”
Under the ordinance,
(a) It is unlawful for any [LSPC], with intent directly or indirectly
to perform pregnancy-related services (professional or otherwise), to make or
disseminate or cause to be made or disseminated before the public …, in any
newspaper or other publication, or any advertising device or in any other
manner or means whatever, … any statement, concerning those services,
professional or otherwise, or concerning any circumstance or matter of fact
connected with the proposed performance or disposition thereof, which is untrue
or misleading, whether by statement or omission, that the [LSPC] knows or which
by the exercise of reasonable care should know to be untrue or misleading.
(b) It is unlawful for any [LSPC], with intent directly or indirectly
to perform pregnancy-related services (professional or otherwise), to make or
disseminate or cause to be so made or disseminated any such statement
identified in subsection (a) as part of a plan or scheme with the intent not to
perform the services expressly or impliedly offered, as advertised.
Before filing an
action, the City Attorney must provide the LSPC with written notice of the
violation and indicate that the LSPC has ten days to cure the violation.  If it doesn’t, the City Attorney can sue,
with penalties from $50-500 per violation.
First, the court of
appeals found that the ordinance was facially valid; it had a constitutional
application and it was not unconstitutionally overbroad or vague, but regulated
only unprotected false or misleading commercial speech.  (I might have gone with “apparent
professional speech” to bolster the commercial speech analysis; whether or not
the centers provide medical services in the ordinary sense, they seem to be
offering medical advice—at least in the limited way targeted by the ordinance.  The professional speech consideration is at
least implicit in the discussion of the services and marketplace at issue.)
First Resort argued
that the Ordinance regulated all advertising, not only false or misleading
advertising, and also that it regulated only noncommercial speech. First, the
Ordinance clearly limited itself to false or misleading speech.  As for commercial speech, “[w]here the facts
present a close question, ‘strong support’ that the speech should be
characterized as commercial speech is found where the speech is an
advertisement, the speech refers to a particular product, and the speaker has
an economic motivation.” These factors are not individually necessary,
however.  In American Academy of Pain
Management v. Joseph, 353 F.3d 1099 (9th Cir. 2004), the court of appeals held
that advertisements for paid medical services constituted commercial speech, as
to a California state law prohibiting doctors from advertising they were “board
certified” in certain circumstances.  The
advertising at issue related to a specific product, medical services, and the
advertiser had an economic motive: to solicit a patient base.
Here, the
ordinance’s purpose was similarly to regulate advertising related to medical
services, and the LSPCs had  “at least
one similar economic motive for engaging in false advertising: to solicit a
patient base.”  However, in American Academy, the patients were
paying clients, and here they were not. The court of appeals declined to limit American Academy to “circumstances where
clients pay for services.”  In this case,
soliciting patients “directly relates to an LSPC’s ability to fundraise and, in
turn, to buy more advertisements.” The joint statement of undisputed facts
included: “First Resort’s employees are encouraged to share client stories because
they are useful in fundraising,” and “[a] majority of First Resort’s
fundraising communications reference the benefit of its services to clients and
often include client stories.” Furthermore, successful advertising directly
affects First Resort’s employees’ compensation, as “[m]embers of First Resort’s
senior management team are eligible to receive bonuses based on criteria which
may include … the number of new clients.” Thus, LSPCs had an economic
motivation for advertising their services.
Moreover, an
economic motive for speech is not absolutely required to make the speech
commercial. The court of appeals pointed to Fargo Women’s Health Org., Inc. v.
Larson, 381 N.W.2d 176 (N.D. 1986), which upheld a preliminary injunction
preventing a “pro-life” pregnancy clinic from engaging in “false and deceptive
advertising and related activity [that] misleads persons into believing that
abortions are conducted at the clinic with the intent of deceptively luring
those persons to the clinic to unwittingly receive anti-abortion propaganda.” Even
though clients didn’t pay for services, the court explained that, “[m]ore
importantly, the Help Clinic’s advertisements are placed in a commercial
context and are directed at the providing of services rather than toward an
exchange of ideas.”  
So too here: the
ordinance is limited to “the pregnancy-related services an LSPC offers in a marketplace
for those services.” Indeed, the record indicated that First Resort viewed
itself as “advertising and participating in a competitive marketplace for
commercially valuable services.” The undisputed facts included First Resort’s
admission that it “views its online advertising as competing with that of
abortion providers for the attention of online viewers,” and that “[t]he
medical services offered by First Resort, such as pregnancy testing,
ultrasounds, and nursing consultations have monetary value.”
Nor was the
Ordinance void for vagueness.  (If it had
been, how could general prohibitions on false or misleading ads have
survived?)  The Ordinance specified that
its purpose was to prevent false or misleading ads about the nature of the
counseling and services provided by LSPCs. A person of ordinary intelligence
could understand what’s prohibited.
For basically the
same reasons, the Ordinance was valid as applied to First Resort.  First Resort’s regulated speech wasn’t
inextricably intertwined with its fully protected speech. First Resort’s
commercial speech about the limited medical services it provides can easily be separated
from its fully protected speech, that containing truthful information about
pregnancy, on its website.  As the City
Attorney’s letter explained, the clinic’s website included “detailed
information about abortion procedures offered at outpatient medical clinics”
and “implie[d] on its ‘Abortion Procedures’ page that First Resort perform[ed]
pregnancy tests and ultrasounds as a prelude to offering abortion as an
outpatient procedure, or referring clients to a provider who performs
abortions.” The Ordinance regulated only misleading aspects of the website,
which could easily be separated from other portions of the website, such as:
“If you have missed at least one period, you may be pregnant …. The only sure
way to know is by having a pregnancy test or pelvic exam.”
Nor did the
Ordinance discriminate based on viewpoint. Whether the Ordinance applies
depends on the services offered, not on the particular views espoused or held
by a clinic. Even if an LSPC chooses not to offer abortions or abortion
referrals for reasons that have nothing to do with their views on abortion,
such as financial or logistical reasons, it’s covered.  Further, the Ordinance regulates LSPCs “because
they engage in false or misleading speech, irrespective of their viewpoints.”  Applying only to the service providers that
presented this “grave threat to women’s health” wasn’t viewpoint-based and
didn’t restrict them from expressing their views.  The motivation
for LSPCs’ false or misleading advertising might be anti-abortion views, but
the Ordinance didn’t target the motivation, only the threat to women’s
health.  Similarly, there was no equal
protection problem based on the Ordinance’s use of a classification based on
the speaker’s identity; rational basis review applied and was satisfied.
Separately, the
Ordinance wasn’t preempted by California’s FAL (a matter that one of the
judges, concurring, would have certified to the California Supreme Court).  “[A]bsent a clear indication of preemptive
intent from the Legislature,” California courts presume that a local law in an
area of traditional local concern “is not preempted by state statute.” However,
preemption applies “if the local law ‘duplicates, contradicts, or enters an
area fully occupied by general law, either expressly or by legislative
implication.’ ” “Local legislation is ‘duplicative’ of general law when it is
coextensive therewith.”  But California
courts have mostly confined duplication preemption to penal ordinances, because
when local and state offenses are duplicative, “a conviction under the [local]
ordinance will operate to bar prosecution under state law for the same
offense.”
The Ordinance here
was civil and created no double-jeopardy bar to a state criminal prosecution for
the same false advertising, and First Resort failed to show that the Ordinance
would interfere with the enforcement of state law.  At least, the lack of a penal component
weighed against finding preemption. 
Also, the laws didn’t bar “precisely the same acts.” The Ordinance,
which only applies to LSPCs and to statements about pregnancy-related services,
was narrower in scope than the FAL in both covered parties and topics.  But First Resort didn’t show that the FAL
covered all acts barred by the
Ordinance—the Ordinance barred untrue or misleading statements whether through
affirmative statements or by omission, while the FAL’s text didn’t mention
omissions.  The Ordinance also regulated
services “expressly or impliedly offered,” while the FAL didn’t mention implied
offers. In addition, the Ordinance barred LSPCs from makng untrue or misleading
statements about pregnancy-related services with the “intent not to perform”
those services “as advertised.” By contrast, the FAL barred untrue or
misleading statements about property or services with “the intent not to sell” them
as advertised. Thus, the Ordinance covered false advertising concerning the
performance of services, regardless of whether those services were  offered for sale.  The enforcement schemes were also entirely
different, with the Ordinance lacking a criminal component that the FAL has.
Judge Tashima’s
concurrence pointed out that many of the things the majority opinion said about
the FAL weren’t really true—for example, the FAL covers omissions where affirmative
statements become misleading because of the omission, which is pretty obviously
the situation targeted by the Ordinance.

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