Sorrell v. IMS Health Inc.
2011 U.S. LEXIS 4794, 564 U.S. 552, 180 L. Ed. 2d 544 (2011)
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Rule of Law:
A state law that restricts the sale, disclosure, and use of lawfully obtained information based on the content of the speech and the identity of the speaker is a content-based regulation of speech that is subject to heightened judicial scrutiny under the First Amendment.
Facts:
- Pharmaceutical manufacturers market their drugs to doctors through a process called 'detailing,' where sales representatives visit doctors to persuade them to prescribe specific drugs.
- To make detailing more effective, manufacturers use 'prescriber-identifying information,' which reveals the prescribing practices of individual physicians.
- Pharmacies collect this prescriber-identifying information as part of their routine business operations.
- Data mining companies purchase this information from pharmacies and then lease reports based on the data to pharmaceutical manufacturers.
- In 2007, the Vermont legislature enacted the Prescription Confidentiality Law (Act 80), which, subject to certain exceptions, forbids pharmacies and similar entities from selling or disclosing prescriber-identifying information for marketing purposes without the prescriber's consent.
- The same law also prohibits pharmaceutical manufacturers from using this information for marketing without the prescriber's consent.
Procedural Posture:
- Three data miners and an association of pharmaceutical manufacturers (respondents) filed two separate lawsuits against Vermont state officials (petitioners) in the U.S. District Court for the District of Vermont.
- The suits, which were consolidated, sought declaratory and injunctive relief, arguing that the Vermont law violated the First Amendment.
- After a bench trial, the District Court found the law constitutional and denied relief.
- The respondents appealed to the U.S. Court of Appeals for the Second Circuit.
- The Second Circuit reversed the District Court, holding that the law was an unconstitutional burden on commercial speech.
- The Supreme Court granted certiorari to resolve a conflict between the Second Circuit's decision and a contrary ruling from the First Circuit on similar state laws.
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Issue:
Does a Vermont law that prohibits the sale, disclosure, and use of pharmacy records revealing individual doctors' prescribing practices for marketing purposes violate the First Amendment's protection of free speech?
Opinions:
Majority - Justice Kennedy
Yes, the Vermont law violates the First Amendment. The statute imposes content-based and speaker-based burdens on protected expression, which are subject to heightened judicial scrutiny. The law disfavors speech with a particular content (marketing) and disfavors specific speakers (pharmaceutical manufacturers), while allowing the same information to be used by other speakers for other purposes, such as health care research or educational communications. The state's asserted interests in protecting medical privacy and promoting public health are not directly advanced by this law in a permissible way. The statute is not narrowly tailored, as it allows widespread dissemination of the information for many purposes but singles out marketing for restriction. The state cannot burden the speech of some to tilt public debate in its preferred direction, and the fear that doctors might be persuaded by truthful, nonmisleading commercial speech is not a sufficient justification to suppress it.
Dissenting - Justice Breyer
No, the Vermont law does not violate the First Amendment. The statute is a form of economic regulation that only incidentally affects commercial speech and should be reviewed under a more lenient standard appropriate for such regulations, not heightened scrutiny. The law's effect on expression is inextricably related to a lawful governmental effort to regulate a commercial enterprise, specifically to protect public health, contain healthcare costs, and safeguard physician privacy. The statute directly advances these substantial state interests and is reasonably tailored to achieve them. The majority's application of heightened scrutiny threatens to return to a bygone era of striking down economic regulations and improperly transfers power from legislatures to judges to weigh policy ends and means.
Analysis:
This decision significantly strengthens First Amendment protections for commercial speech, particularly for data-driven marketing. The Court affirmed that even truthful, non-misleading commercial speech and the underlying data that informs it are protected forms of expression subject to heightened scrutiny when regulated in a content-based manner. By striking down the Vermont law, the Court signaled that states cannot restrict the flow of truthful commercial information to 'protect' a sophisticated audience like physicians from being persuaded, or to level the playing field in a public health debate. This ruling makes it more difficult for governments to regulate industries by targeting their marketing communications, requiring them to show a much closer and more direct link between such regulations and the substantial interests they claim to serve.
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