Moore v. Morales ( 1995 )

                          FOR THE FIFTH CIRCUIT
                               No. 94-20138
                           MARY MOORE, ET AL.,
                 DAN MORALES, Attorney General, Et Al.,
                     DAN MORALES, Attorney General,
                         ADRIANE ANDERSON, ETC.,
                      JOHN B. HOLMES, JR., ET AL.,
                     DAN MORALES, Attorney General,
                   DIRECT MAIL MARKETING, INC., ET AL.,
                          JOHN VANCE, ET AL.,
                     DAN MORALES, Attorney General,
                                DAN MORALES, ET AL.,
                                     DAN MORALES,
                        DAVID O. CHAMBERS, ET AL.,
                               STEVEN HILBIG, ET AL.,
                                     DAN MORALES,
               Appeal from the United States District Court
                    for the Southern District of Texas
         (CA-H-93-2170, c/w 93-2499, 93-2699, 93-2700 & 93-2701)
                                   (August 23, 1995)
    Before POLITZ, Chief Judge, REAVLEY and BARKSDALE, Circuit Judges.
         At   issue    is    the   constitutionality   of   Texas'   prohibiting
    several   groups        ("attorney[s],   chiropractor[s],    physician[s],
    surgeon[s], or private investigator[s] licensed to practice in this
    state or any person licensed, certified, or registered by a health
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    care    regulatory   agency    of   this    state"),    Tex.    Penal   Code    §
    38.12(b)(1) (1994), from direct mail solicitation to accident
    victims or their families within 30 days after the accident.                   In
    view of the Supreme Court's very recent holding in Florida Bar v.
    Went For It, Inc., 
    115 S. Ct. 2371
     (1995), we hold that, as to
    attorneys, it is constitutional, and REVERSE; but, as to the other
    groups, we REMAND for further proceedings.
           In 1993 the Texas legislature attempted, for the second time,
    to limit the solicitation efforts of several groups: "attorney[s],
    chiropractor[s],         physician[s],       surgeon[s],        or      private
    investigator[s] licensed to practice in this state or any person
    licensed, certified, or registered by a health care regulatory
    agency of this state".         Tex. Penal Code § 38.12(b)(1) (1994).1
    Among other things, the 1993 provisions (1) prevented those groups
    from direct mail solicitation to accident victims or their families
    until the 31st day after the day of the accident (the 30-day ban);
    (2) restricted access to accident reports for 180 days following
    the    accident;   and   (3)   prevented    direct     mail   solicitation     of
    criminal and civil defendants until the 31st day following the
    initiation    of   legal   proceedings.       (The   1993     provisions   also
    provided a means whereby an accident report may indicate a victim's
         Texas' first attempt to limit solicitation, which consisted of
    a complete prohibition on the use of crime or accident reports for
    the purpose of soliciting clients, was held by our court to be "too
    broad a means of effectuating the intended purpose of the law".
    Innovative Database Sys. v. Morales, 
    990 F.2d 217
    , 222 (5th Cir.
                                        - 3 -
    desire   to   not   receive   solicitation   letters,   and   prohibited
    solicitation of individuals so indicating.       The district court's
    order did not address these provisions.)
         Five actions, which were consolidated, challenged the 1993
    provisions as unconstitutional under the First and Fourteenth
    Amendments. The district court temporarily enjoined enforcement of
    the provisions, and, following an expedited bench trial, found them
    to be an unconstitutional hindrance of commercial speech.
         At issue is only one of the 1993 provisions: the 30-day ban on
    solicitation of accident victims and their families.           See Tex.
    Penal Code § 38.12(d)(2)(A) (1994).
         First we reject the suggestion that the Texas Attorney General
    lacks standing to maintain this appeal in his name for the State of
    Texas.   The Attorney General was a named party in three of the five
    consolidated cases.      Moreover, by statute, the State of Texas
    requires that, when the constitutionality of one of its laws is
    challenged, "the attorney general of the state must also be served
    with a copy of the proceeding and is entitled to be heard".        Tex.
    Civ. Prac. & Rem. Code § 37.006(b); see also Baker v. Wade, 
    743 F.2d 236
    , 242 (5th Cir. 1984) (holding that Texas Attorney General
    is presumptively adequate representative of State's interest when
                                      - 4 -
    constitutionality of Texas law is challenged), rev'd on other
    769 F.2d 289
     (5th Cir. 1985).2
         The direct mail solicitation that Texas seeks to regulate is
    a form of commercial speech protected by the First Amendment.3
    Therefore, pursuant to the Supreme Court's very recent holding in
    Florida Bar v. Went For It, Inc., 
    115 S. Ct. 2371
     (1995), the 30-
    day ban, in order to withstand constitutional scrutiny, must
    satisfy the three-prong test of Central Hudson Gas & Elec. Corp. v.
    Public Serv. Comm'n, 
    447 U.S. 557
    , 564-65 (1980): (1) the State
    must assert a substantial interest supporting the regulation; (2)
    the regulation must directly and materially advance that interest;
    and (3) the regulation must be narrowly drawn to advance that
    interest.   Prior to Florida Bar being rendered, the district court
         Appellees' contention springs, in large part, from the claim
    that the Attorney General has "no enforcement or other official
    authority" under the challenged statutes. They rely on League of
    United Latin Am. Citizens v. Clements, 
    999 F.2d 831
     (5th Cir.
    1993), cert. denied, 
    114 S. Ct. 878
     (1994) where our en banc court
    addressed the limitations on the power of the Texas Attorney
    General to settle a matter against the will of the state officials
    he was charged to represent. Id. at 840-43. Clements does not
    support the notion that the Attorney General cannot appeal the
    district court's judgment.
         Commercial speech that is false or misleading, however, is not
    entitled to such protection. Central Hudson Gas & Elec. Corp. v.
    Public Serv. Comm'n, 
    447 U.S. 557
    , 563-64 (1980).        The State
    concedes that, with the exception of Innovative Database Systems
    (IDS) and the National Association of Accident and Injury Victims
    (NAAIV), Appellees' commercial speech is not false or misleading.
    In this connection, the State has urged that, even if the 30-day
    ban is unconstitutional as to the other Appellees, IDS and NAAIV
    are not entitled to that protection because they engage in false
    and misleading speech. As discussed in part II.B.2., we do not
    reach this question.
                                   - 5 -
    held that Texas' 30-day ban failed each prong of this inquiry.                We
    first address the 30-day ban as to attorneys, then turn to the
    other affected groups.
          Along this line, Appellees insist that we review only for
    clear error, pursuant to Fed. R. Civ. P. 52.            But, as the district
    court's opinion illustrates, findings of fact in the constitutional
    free speech context are frequently informed by the relevant legal
    landscape; questions of law and fact are easily intertwined.
          Although a district court's findings of fact are normally
    reviewed under the clearly erroneous standard, our court recognizes
    the   distinctive    nature   of   fact-finding     with    respect     to   the
    constitutionality of commercial speech regulations.              E.g., Lindsay
    v. City of San Antonio, 
    821 F.2d 1103
    , 1107 (5th Cir. 1987), cert.
    484 U.S. 1010
     (1988); Dunagin v. City of Oxford, 
    718 F.2d 738
    , 748 n.8 (5th Cir. 1983), cert. denied, 
    467 U.S. 1259
    See Lockhart v. McCree, 
    476 U.S. 162
    , 168 n.3 (1986).             We review de
          Needless to say, as to attorneys, Florida Bar controls.                 At
    issue   was   a   Florida   Bar   rule   imposing   a   30-day    ban   on   the
    solicitation of accident victims and their families -- a regulation
    nearly identical to the one in issue.               115 S. Ct. at 2374.
    Applying the three-prong Central Hudson test, the Court held that
    the rule was constitutional.        Id. at 2376-81.
          For the substantial interest prong, the Florida Bar offered,
    inter alia, its interest in "protecting the privacy and tranquility
                                        - 6 -
    of personal injury victims and their loved ones against intrusive,
    unsolicited contact by lawyers".        Id. at 2375.   The Court had
    "little trouble crediting [this] interest as substantial", noting
    that its prior precedent has "consistently recognized that `[t]he
    State's interest in protecting the well-being, tranquility, and
    privacy of the home is certainly of the highest order in a free and
    civilized society'". Id. at 2376. (quoting Cary v. Brown, 
    447 U.S. 455
    , 471 (1980)).   The Court also noted that "a single substantial
    interest is sufficient to satisfy Central Hudson's first prong".
    Id. at n.1.
         For the second prong, requiring proof that the regulations
    directly and materially advance the State's interest, the Court was
    persuaded that "the Florida public views direct-mail solicitations
    in the immediate wake of accidents as an intrusion on privacy that
    reflects poorly upon the profession". Id. at 2376. Distinguishing
    prior precedent, the Court seized on the specific harm the Florida
    Bar sought to eliminate: the invasion of privacy and accompanying
    "outrage and irritation" associated with direct mail advertising to
    recent accident victims and their families.      See id. at 2377-79.
    Finding the scope and nature of the interest presented by the
    Florida Bar distinct from the claims made in prior cases before it,
    the Court concluded that the second prong of Central Hudson was
    satisfied.    Id. at 2378-79.
         Turning to the third, and final, prong, the Court noted that
    the government need not employ the "least restrictive means" to
    further its interest.    Id. at 2379.   Instead, that prong requires
                                    - 7 -
    only that the regulation's restrictions reasonably fit the desired
    objective. Id. That settled, the Court concluded that the Florida
    Bar rule was "reasonably well-tailored to its stated objective of
    eliminating targeted mailings whose type and timing are a source of
    distress to Floridians".   Id.
         Texas, like the Florida Bar, has advanced the interest of
    protecting the privacy of accident victims and their families.
    Indeed, in almost all respects, Texas' position supporting the 30-
    day ban as to attorneys essentially mirrors that of Florida Bar.
    Nonetheless, Appellees maintain there are significant distinctions,
    permitting us to affirm the district court's holding that Texas'
    30-day ban is unconstitutional.4
         Principally, Appellees contend that, unlike the record in
    Florida Bar, the record developed by Texas cannot support finding
    that its interests are substantial, or that its 30-day ban directly
    advances them.   We disagree.      Florida Bar does not require an
    overwhelming record in support of the 30-day ban.       Rather, it
    echoed prior precedent requiring only that there be more than "mere
    speculation and conjecture", and that "a governmental body seeking
    to sustain a restriction on commercial speech must demonstrate that
    the harms it recites are real and that its restriction will in fact
         Appellees assert that Florida Bar has no impact on this case,
    maintaining that it did not involve a claim that the 30-day ban
    constituted a content-based, discriminatory regulation.         For
    example, they claim that Texas' 30-day ban favors the speech of
    insurance companies, to the detriment of attorneys and health care
    professionals. This contention misses the mark. For content-based
    commercial speech restrictions of this type, Florida Bar holds that
    the Central Hudson test is the applicable standard.
                                     - 8 -
    alleviate them to a material degree".             Florida Bar, 115 S. Ct. at
    2376.    Informing our analysis of the sufficiency of the record is
    the Court's observance in Florida Bar that, in Edenfield v. Fane,
    113 S. Ct. 1792
    , 1801 (1993), where the Court struck down a
    regulation on commercial speech because of an inadequate record,
    there was "no evidence" in support of the regulation.                      115 S. Ct.
    at   2378.      The   Court   readily    distinguished           Florida    Bar   from
    Edenfield; we do the same here.
          Before    us    is   extensive   evidence       of   the    great    number   of
    complaints associated with direct mail solicitation in general. As
    to such solicitation within 30-days of an accident, experts for the
    State testified that it can be detrimental to an accident victim
    and his or her family.        They testified further that the 30-day ban
    would provide reasonable protection from many of these detrimental
          There is also testimony from individuals that their receipt of
    direct mail solicitation immediately following an accident outraged
    them, invaded their privacy, and contributed to their emotional
    distress.      Those same individuals testified that they would have
    been better able to cope with the intrusiveness of the solicitation
    letters had they not received them until at least one month after
    the accident.        The State's evidence was further supported by the
    co-chairman of the Houston Trial Lawyers' Association and the
    author   of    the    1993    provisions;      both    testified      to     numerous
    complaints of outrage and invasion of privacy regarding direct mail
                                           - 9 -
          Based on Florida Bar, we find this evidence sufficient to
    satisfy the first two Central Hudson prongs: Texas' stated interest
    in   protecting   its   citizens   from     the   invasion   of   privacy   is
    substantial; solicitation within 30 days of an accident creates,
    among other things, an invasion of privacy; and the 30-day ban
    substantially alleviates this invasion.
          Appellees next turn to the third prong of Central Hudson,
    requiring a "fit" between the ends and means of the 30-day ban.
    They note that Texas now has a system whereby accident victims may
    indicate, on the accident report, their desire not to be contacted
    through direct mail solicitation. Accordingly, Appellees claim the
    30-day ban is more than is necessary to prevent unwanted contact
    from attorneys.    This argument fails on two counts -- one factual,
    one legal.
          As the State's evidence illustrates, often it is the accident
    victim's family, not the victim, that the 30-day ban seeks to
    protect.     And, needless to say, when the victim dies, or is
    otherwise unable to sign or understand an accident report, the
    protection against unwanted solicitation is of no avail.              In any
    event, as noted in Florida Bar, the State is not required to employ
    the least restrictive means in promoting its interest.            115 S. Ct.
    at 2380.     Again, based on Florida Bar and its similarity to this
    case, we conclude that, as to attorneys, Texas' 30-day ban, like
    the Florida bar rule, passes the third, and final, prong of the
    commercial speech constitutional inquiry.
                                       - 10 -
         Finally, on behalf of the other licensed groups covered by the
    statute,   including,   but   not    limited   to   physicians,   surgeons,
    chiropractors,   and    private     investigators,    Appellees    seek   to
    challenge the 30-day ban.      But, almost the entire thrust of the
    case concerned the ban as to attorneys.         And, most interestingly,
    the other groups have not challenged the ban.5              Even assuming
    Appellees have third-party standing to assert this claim, see,
    e.g., Secretary of State of Md. v. Joseph H. Munson Co., 
    467 U.S. 947
    , 954-59 (1984), the validity of the ban as to the other groups,
    even if raised sufficiently in the district court, was far from
    sufficiently developed, especially in light of the new guidance
    from Florida Bar.6     We, therefore, will not consider it now.
         For example, it appears that the Texas medical and
    chiropractic associations supported the bill.          One of the
    Appellees, NAAIV, is made up entirely of chiropractors. However,
    it appears from the pretrial order that NAAIV's challenge was based
    only on the 1993 provisions that limited access to accident
    reports. In any event, the district court's opinion addressed the
    NAAIV only with respect to whether it engaged in "misleading or
    deceptive communication", and whether the 1993 provisions
    reasonably protect against that type of communication.      It is,
    therefore, difficult to determine in what capacity, and on who's
    behalf, NAAIV appears.
         The district court's opinion focused almost exclusively on the
    evidence relating to attorney solicitation. It did not discuss the
    evidence, or lack thereof, concerning solicitation by the other
    groups. Likewise, it is unclear whether Appellees contended that
    the 30-day ban, whether constitutional or not as to attorneys, was
    unconstitutional as to the other groups.          For example, no
    physician, surgeon or investigator testified; only one chiropractor
    did, and very little of his testimony concerned the 30-day ban. On
    the other hand, and as another example, there was testimony by the
    author of the bill that his constituents resented post-accident
    letters from attorneys and chiropractors. Now that Florida Bar has
    directed the fate of the 30-day ban as to attorneys, and has
    delineated the analytical framework, the district court may
                                        - 11 -
         For the foregoing reasons, the judgment of the district court
    is REVERSED in part, and the case is REMANDED with instructions to
    vacate the injunction as to the 30-day ban, and to enter judgment
    upholding the ban as to attorneys.    As to the other groups affected
    by the 30-day ban, this case is REMANDED for further proceedings
    consistent with this opinion and Florida Bar.       Such proceedings
    should include the issue of standing in this case by those other
                          REVERSED AND REMANDED
    consider this under-developed, if not undeveloped, issue.
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