Central Hudson Gas & Electric Corp. v. Public Service Commission, 447 U.S. 557 (1980)
Author: Sam Biers

Commercial Speech Test

Facts: Comm’n ordered electric utility Co. in NY to cease all advertising promoting electricity use b/c it found connection btwn increase use resulted, which led to decrease in limited fuel sources necessary to provide winter supply.  3 years later the supply problem evaporated, but ban continued.

Issue(s): Whether New York Public Service Comm’n regulation that completely bans promotional advertising by an electric utility violates the 1^st Amend?

Holding: Yes, the Comm’n Order violates 1^st b/c it is more extensive than necessary to accomplish St Int-energy conservation.

Procedure: Central opposed cont’n of ban on promo advertising.  Comm’n upheld ban.  Central challenged in State Ct.  St Ct and intermediate App Ct upheld Comm’n order; Ct of App affirmed.  USSCt Reversed.

Rule(s): 1^st and 14^th.  Comm. Speech = “related solely to the economic interest of the speaker and its audience?

Rationale: Govt has total power to suppress or regulate commercial speech.  Const provides less protection to commercial vs. other forms of expression.  The level of protection turns on nature of expression and Govt Int served by the regulation.

1)  Is Commercial speech neither misleading or concerning illegality, (Govt power is limited); 

2) Has State asserted Subst’l interest to be achieved by restriction on commercial speech. (That regulation must be proportional to the interest).  If yes to 1 and 2, then:

3) Does Reg directly advance GI; {Limitation on Expression must be designed carefully to achieve Govt goal}–measured by: a) restriction must directly advance state interest involving; and b) it cannot be upheld if it provides ineffective or remote support for the Govt purpose.

4) Is the Reg more extensive than necessary to accomplish the Goal?

* IF GI can be served by a more limited restriction on Comm Speech, the excessive restriction cannot survive.

Monopoly over a supply does not protect against competition re: substitutes for that product.

The ST Int is subst’l. There is a link btwn St Int and Ban.

Critical Inquiry: Is complete ban of speech normally protected no more extensive than necessary

to further St Int?

Order reaches all promo advertising regardless of impact on overall energy use, including ads for services to reduce usage.  No showing that less restriction would accomplish St Goal.

Df’s A: B/c Central holds monopoly over the sale of Electricity in its area, the Comm’n order doesn’t restrict any valuable Comm Speech-advertising in non-competitive market does not improve consumer decision making.  St Int conserving energy is sufficient to support suppression of ads that would increase consumption.