The Superior Court Story
Nike Yells “Foul,” Cites First Amendment
-- Footwear News headline, July 6, 199867
“[U]nder Nike’s interpretation of the world, they can say whatever they want. . . . [T]hey can lie because it’s a public debate. . . . The First Amendment never contemplated that, ever.”68 So argued Kasky’s impassioned lawyer, Alan Caplan, in the Superior Court of San Francisco. It was Thursday, January 7, 1999, and Nike’s pre-trial motion to dismiss was being heard.69
The Honorable David A. Garcia presided. Though this was a novel suit, Judge Garcia was a judge with an open mind. In 1997, for example, the judge ruled that the San Francisco Cannabis Buyers’ Club was a primary caregiver whose practices were protected under the newly enacted Proposition 215.70 Translation: Marijuana could be prescribed for medical purposes. Liberal, open-minded and creative in approach, just the judge for Marc Kasky’s cause.
No doubt, Judge Garcia understood that, if allowed to proceed, Kasky v. Nike would set an important precedent: it would allow anybody to invoke false advertising and unfair business practice laws to contest the honesty of public relations statements made by American companies about their labor practices at home or abroad. And the specter of a multi-million-dollar judgment against Nike, along with a “corrective-commercial campaign,”71 might prove, in the end, to be economically disastrous. That possibility alone gave David J. Brown,72 Nike’s hired lawyer and a partner in a San Francisco law firm with a large international practice, great pause. Brown had already successfully represented the likes of Westinghouse Electric in a $100-million case brought against the company by the Bay Area Rapid Transit District (BART).73 But could he trump Caplan, a feisty plaintiffs’-bar lawyer who put the fear of God into corporations?
During the January 7th hearing,74 Judge Garcia was particularly attentive to Nike’s claims that the First Amendment protected it from being drawn into court by the likes of Marc Kasky. “He was concerned about whether Nike’s representations were commercial or non-commercial speech,” recounted Caplan.
“In this case,” argued Caplan, “there were criticisms of Nike’s labor practices and a call for a boycott. Nike’s response was to misrepresent [its] labor practices and encourage people not to boycott, but to continue to buy their shoes. That’s commercial speech.” If so, Nike’s speech could be regulated. Still, Judge Garcia was troubled about how, if at all, that could be done, even if he ruled Nike’s speech to be commercial expression. The situation did not look promising for the plaintiff, and Brown realized it. The judge, Brown stated, “essentially said, ‘If I buy into the plaintiff’s theory, when could Nike ever say anything?’ because the plaintiff’s theory is that every time Nike speaks, it is promoting its product.”
When judgment day came a few weeks later, on February 5th, David Brown’s hunches proved to be correct. Judge Garcia was unimpressed with Caplan’s novel arguments and the case was dismissed with prejudice.75 That was the end of the matter. Kasky v. Nike would never come before a jury, not as long as the judge’s order stood. Left unchallenged, the order meant that Nike could stand by its PR statements without fear of being held to legal account for them. “We’re delighted,” said Brown. “The bottom line is we were right,”76 he added. While Judge Garcia did not issue a written opinion, it seemed quite clear that he was taken with Nike’s First Amendment objections to Marc Kasky’s suit.
Alan Caplan was frustrated but determined to proceed nonetheless: “[W]e will be appealing,” he told reporters.77 The appellate phase of nike-fn.htm was about to begin.
