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Legal Principle at Issue

Does the First Amendment allow a government regulator to threaten regulated entities with adverse regulatory actions if they do business with a controversial speaker, as a consequence of (a) the government’s own hostility to the speaker’s viewpoint or (b) a perceived “general backlash” against the speaker’s advocacy?

Action

The Supreme Court unanimously reaffirmed its prior 60-year-old ruling that governments cannot cannot use third parties to censor speech they disfavor. Associate Justice Sonia Sotomayor wrote that "a government official cannot do indirectly what she is barred from doing directly."

Facts/Syllabus

The National Rifle Association sued Maria Vullo, former superintendent of the New York State Department of Financial Services, alleging that she made a series of thinly veiled threats against regulated banks and insurance companies to pressure them to sever ties with the NRA because she opposed its political advocacy. In 2018, for example, Vullo met with the insurance company Lloyd’s of London to discuss her views on gun control. Vullo’s office regulates insurance companies and can impose serious consequences on insurers that violate the rules, like imposing fines and rescinding their license to do business. Vullo told Lloyd’s that the company’s underwriting of NRA-endorsed concealed-carry insurance policies could violate some of the agency’s rules. But she told Lloyd’s executives the company could “avoid liability” (that is, the government would look the other way) if the company canceled its NRA insurance plans and joined her agency’s “campaign against gun groups.” Lloyd’s broke ties with the NRA a few months later. 

The NRA alleged that these pressure tactics amounted to coercive viewpoint discrimination based on the content of the NRA’s advocacy — a violation of the First Amendment. The Second Circuit disagreed, however, and dismissed the case. The court asserted that bank regulators are right to be concerned about unpopular political speech from bank customers. Further, the Second Circuit ruled New York’s actions amounted to government speech, not an infringement of the NRA’s First Amendment rights. 

On May 30, 2024,  a unanimous Supreme Court ruled that the NRA plausibly alleged New York violated the First Amendment by pressuring regulated banks and insurance companies to end their business ties with the NRA to punish the group for their pro-gun advocacy.

Importance of Case

The Supreme Court reaffirmed the bedrock First Amendment principle that a government official cannot coerce a private party to punish or suppress disfavored speech on her behalf.