The California Appellate Court Story

The vast majority of appeals lose. Failure is even more certain when the First Amendment stands in the way of victory. Still, Kasky and Caplan could take comfort in the fact that California State Attorney General Bill Lockyer, the Sierra Club, and the California Labor Federation/AFL-CIO, among others, all filed briefs in the California Court of Appeal in support of their claims.

Early in 2000, Paul R. Hoeber⁷⁸ left his office on Pine Street and headed toward 350 McAllister Street. There, on the fourth floor, he would argue Kasky v. Nike before a three-judge panel in Division One of the First Appellate District of the California Court of Appeal. Though the fifty-seven-year-old lawyer lacked much appellate experience, he more than made up for it in general legal experience.

At the time, Hoeber was with the San Francisco law firm of Bushnell, Caplan and Fielding, where he specialized in representing plaintiffs under the federal False Claims Act and the state Unfair Competition Law. During the heyday of the San Francisco counter-culture, he was an undergraduate at Berkeley; he then took his law degree from Boalt Hall at U.C. Berkeley. He went on, as do the brightest, to clerk in the U.S. Court of Appeals for the Ninth Circuit and then at the U.S. Supreme Court. Hoeber’s subsequent career spanned everything from teaching law at Boalt, to working as a lawyer in the Civil Rights and Criminal Divisions of the Justice Department, to serving as a staff attorney for the United Mine Workers. At one point in 1973-74, he was one of the prosecutors on the Watergate Special Prosecution Force. With such credentials, Hoeber could readily prepare for argument before one of California’s intermediate appellate courts.

Justices Douglas E. Swager and James J. Marchiano heard the case, along with the Acting Presiding Justice, William D. Stein.⁷⁹ When it was decided, the three jurists found themselves in complete agreement. On March 20, 2000, the court issued its ruling: trial court judgment affirmed, court costs awarded to Nike. There was “no reasonable possibility,” Justice Swager wrote for the court, that Kasky could win this case: “We see no merit to appellant’s scattershot argument that he might still be able to state a cause of action on some theory allowing content-related abridgement of noncommercial speech.”

Because “Nike exemplifies the perceived evils or benefits of labor practices associated with the processes of economic globalization,” Swager reasoned, the company’s statements could not be confined to the definition of more narrowly protected commercial speech. “Nike’s strong corporate image and widespread consumer market place its labor practices in the context of a broader debate about the social implications of employing low-cost foreign labor for manufacturing functions once performed by domestic workers,” Swager continued. Nike had provided “data relevant to a controversy of great public interest in our times.” Thus, what Nike had done by responding to its critics, Swager concluded, was to engage in “a public dialogue on a matter of public concern within the core area of expression protected by the First Amendment.”

Alan Caplan was incensed: “Nike would like to blow up their statements into a highfalutin’ public debate on globalization when really it’s much simpler than that—it’s specific statements about how their specific products are made . . . . Even though they’re lying, they could say they’re taking part in a public debate.”⁸⁰ Now it was on to the California Supreme Court with two losses to overcome. But there review was discretionary, which is never an encouraging prospect.

Somewhat surprisingly, on June 21, 2000, the California Supreme Court agreed to hear the case. Five justices had voted to take up Kasky v. Nike, Inc.: Chief Justice Ronald M. George and Justices Stanley Mosk, Joyce Kennard, Kathryn Mickle Werdeger and Janice Rogers Brown.⁸¹ Kasky and company were back in the running. Why else would the state high court hear the matter, if not to consider seriously the possibility of reversing the lower appellate court? But in Niketown, the sentiment was far more apprehensive. As Nike spokesman Vada Manager put it: “We certainly hope the [California] Supreme Court will affirm the earlier court ruling that this case didn’t have legal merit and didn’t have a place in the legal system.”⁸²