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Central Hudson Gas and Electric Corp. v. Public Service Commission

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Constitutional Law Keyed to Cohen

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Bloomberg Law

Citation. 447 U.S. 557, 100 S. Ct. 2343, 65 L. Ed. 2d 341, 6 Med. L. Rptr. 1497 (1980)

Brief Fact Summary. In the winter of 1973-74 there existed an electricity shortage in the State of New York. Accordingly the Appellee, the Public Service Commission (Appellee), imposed a ban on all advertising that promotes the use of electricity. By 1976 the electricity shortage subsided, causing the Appellee to determine whether or not to continue the ban. Upon further inquiry, the Appellee decided to continue the ban, causing the Appellant, Central Hudson Gas and Electric Corp. (Appellant), to file suit claiming that the regulation of the Appellee was infringing on their First and Fourteenth Amendment constitutional rights involving commercial speech.

Synopsis of Rule of Law. This case established a four-part analysis for commercial speech cases. (1) Whether the expression is protected by the First Amendment of the United States Constitution (Constitution). To be protected, it must concern lawful activity and not be misleading. (2) Whether the asserted governmental interest is substantial. If both part one and part two are satisfied then (3) A court must determine whether the regulation directly advances the governmental interest asserted. (4)Whether it is not more extensive than is necessary to serve that interest.

Facts. In December 1973, the Appellee ordered electric utilities in New York State to cease all advertising that promotes the use of electricity. The Appellee based this regulation on a finding that the interconnected utility system in New York State does not have sufficient fuel stocks to continue furnishing all customer demands for the 1973-74 winter. In 1976, the fuel shortage ended, causing the Appellee to request public comment on its proposal to continue the ban on advertising. The Appellant opposes the ban on First Amendment constitutional grounds and filed this suit after the Appellee decided to continue the ban. The 1976 order from the Appellee was that information advertising, used to encourage shifts of consumption of electricity from peak use times to periods of low electricity demand would be allowed because it does not increase aggregate consumption, but would promote the leveling of demand throughout the day. The Appellee also offered to review specific proposals by co
mpanies to determine if their advertisement meets this criterion. The Appellant challenged this order in state court, arguing that the Appellee restrained commercial speech in violation of the First and Fourteenth Amendments of the Constitution. The Appellee’s order was upheld in the trial court, by the appellate level and by the New York Court of Appeals.

Issue. Whether a regulation of the Appellee of the State of New York violates the First and Fourteenth Amendments of the Constitution because it completely bans promotional advertising by an electrical utility?
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