Kasky V. Nike and the Quarrelsome Question of Corporate Free Speech

Abstract

ABSTRACT:In the Kasky case, the Supreme Court of California determined that Nike, Inc., might be accountable in a civil action for misleading statements that it made to the press and to the public about its operations in Southeast Asia. The Kasky case is examined here in its legal and ethical aspects. The U.S. Supreme Court's First Amendment cases that distinguish between commercial speech and political speech are explained, and the arguments in favor of greater protection for Nike's statements about its overseas operations are evaluated in light of Donaldson and Dunfee's integrative social contracts theory. The hypernorm of “necessary social efficiency” is invoked to claim that the arguments made by Nike and various “friends of the court” in favor of greater protection for corporate speech are problematic. Reliable information is the lifeblood of both democracy and efficient free markets. Thus, the more ethical approach is for corporations to support systemic legal reforms that would predictably sanction false and misleading statements in accordance with clear guidelines.