This case involves regulation of commercial speech. GNOB represents broadcasters who want to broadcast advertisements for gambling activities that are licensed and legal in Louisiana and Mississippi. The broadcasters have refrained from doing so in fear of criminal prosecution and sanctions pursuant to 18 U.S.C. § 1304 and the corresponding FCC regulation. Section 1304 prohibits broadcast advertising of "any advertisement of, or information concerning any lottery, gift enterprise, or similar scheme, offering prizes dependent in whole or in part upon lot or chance."
The Supreme Court held 6/14/99 this statute violates the First Amendment. Applying the four-part test of Central Hudson Gas & Electric Corporation v. Public Service Commission of New York, 447 U.S. 557 (1980), the Court held that § 1304 and the FCC regulations implementing it did not directly and materially advance the government’s asserted interest in alleviating the social costs of casino gambling. Nor had the government shown that the prohibition was narrowly tailored to serve this asserted interest.
This case is extremely important to manufacturers because it continues to provide protection to speech relating to the sale of legal products and services.