There’s been a lot of good blogging at The Fifty Minute Hour lately (a blog which I’ve just this week added to the right-wing section of my blogroll). I think my readers will probably enjoy this post about how the US’s war on drug hurts Afghani farmers, and this post criticizing father’s rights radio host Glenn Sacks for spreading around dubious info from a biased father’s rights study.
But she’s utterly wrong about the Nike v. Kasky case.
For those of you unfamiliar with the case, what happened is this: Nike and many activists have been involved in a long dispute over Nike’s labor practices abroad. Nike claimed, in a series of press releases, official letters, and one paid advertisement, that their labor practices were great. Kasky, an activist, decided to sue Nike for false advertising.
The first and second causes of action, based on negligent misrepresentation and intentional or reckless misrepresentation, alleged that Nike engaged in an unlawful business practice in violation of Business and Professions Code section 17200 by making the above misrepresentations “In order to maintain and/or increase its sales and profits . . . through its advertising, promotional campaigns, public statements and marketing . . . .” The third cause of action alleged unfair business practices within the meaning of section 17200, and the fourth cause of action alleged false advertising in violation of Business and Professions Code section 17500. The prayer sought an injunction ordering Nike “to disgorge all monies” that it acquired by the alleged unlawful and unfair practices, “to undertake a Court-approved public information campaign” to remedy the misinformation disseminated by its false advertising and unlawful and unfair practices, and to cease “[m]isrepresenting the working conditions under which NIKE products are made . . . .”
Nike responded by saying that the first amendment precludes Kasky’s suit. The appelate court agreed with Nike; the California Supreme Court (pdf file) overruled the appellate court and said that Kasky could sue. Most recently, this has been in the news because of the Supreme Court’s decision to let the California ruling stand (although the Court could choose to revisit the issue at a later date, of course).
Note that what’s at issue in this specific ruling isn’t whether or not Nike lied. (That’ll be determined by a future court case). What’s at issue is – assuming Nike did lie – can Nike can be sued for lying?
The Fifty Minute Hour argues that Nike wasn’t “attesting to a property of a product they were trying to sell; they were responding to claims that the company is morally bad in some way.” But Nike was attesting to a property of their merchandise; how merchandise is made is a property of it.
In fact, The Fifty Minute Hour agrees with me in the next paragraph: ‘If it turns out that they said, “you should buy Nike shoes because they’re made by happy workers who each make six figure salaries,” and the statements of fact are not true, they shouldn’t be protected.’
By saying that, the Fifty Minute Hour is siding against Nike. Nike is arguing that, as a First Amendment matter, they should be protected against lawsuits over false statements like “Nike shoes are made by workers who each make six figure salaries” or (more realistically) “Nike pays average line-workers double-the-minimum wage in Southeast Asia,” so long as those statements are made in press releases and other such outlets, rather than in paid ads. If Nike had won this case, then it wouldn’t be possible to sue them over such false statements.
For the free market to function well, consumers need access to accurate information. Consumers who’d prefer to avoid buying shoes made with virtual slave labor, for example, need accurate information about labor practices in order to be able to express their preferences in the marketplace. Simply to keep the free market running reasonably well, corporations should not be given a right to lie about their products’ characteristics – including how the products were manufactured – in their press releases and public statements.
Reclaim Democracy has a good page of resources concerning this case. (Although they take Kasky’s side in the lawsuit, they also provide links to many pro-Nike arguments.).
I’ve been following this story for quite some time, and I find it amusing how many of my conservative associates will fight tooth and nail to convince me that Nike did nothing wrong here.
Corporations are fictional entities, which only exist because the public allows them to. We buy their products in exchange for (assumed) proper business practices & fairness. If they lie to their customers, the public should have the right to penalize them, through whatever means available to them.
I don’t see why these kinds of lies are any different from, say, a company that makes candy bars containing nuts but tells consumers (some of whom may be allergic to nuts), “Our food contains no nuts.”
Consumers of Nike products are being harmed because they’re buying the merchandise in full confidence that the company’s employees are being treated fairly. Nike’s employees are also being harmed because the company is trying to hide the fact that those employees aren’t being treated fairly. Speech that harms another person shouldn’t be protected.
Hestia, I’m in full agreement. Any lies by corporations should have consequences, as the lies are usually told in order to skew consumer perception. (i.e. GE running ads about how it “cares about the environment”, proof being that they’re cleaning up the Hudson… they don’t inform the viewer that they were ordered to clean up the Hudson).
If corporations are fictional entities, then why should people who participate in them have fewer free speech rights than they would if they didn’t do so? If I were to say “Nike pays all overseas workers $12 an hour,” you would have no right to sue me over that statement, even though it’s a lie. Why should I have the right to say that, but a person who works for Nike have no right to say that?
Amy, you don’t work for Nike, you don’t represent them. If you tell me something false about Nike, even if it’s a lie, nothing can really be done… you’re not responsible for properly representing the company. If someone in Nike’s PR department were to make that same fact, they are representing the company. The company then has a responsibility to correct the statement, or accept the consequences of lying to the public. I feel there should be stiff penalties, to dissuade this sort of dishonest practice.
If I came out and said “[the company I work for] is going to pay $1 billion to help clean up the Everglades” and I make it an official statement, I’d be fired. You know why? The company I work for would not want someone in their company lying in order to improve their image, especially when it involves a matter that someone can fact-check. Unfortunately, that’s not common corporate culture anymore… lying means business now.
oops… sort of a redundant statement there… something false would be a lie. I need to proof read a little better :-)
Amy, beside what blunted said, if you told someone that Nike pays its employees $12/hour, it would be up to the listener to verify the fact with the company. But if you worked for the company, then the listener would have to trust you. They’d have no other recourse to find the truth. There’s a difference between a rumor and an out-and-out lie.
And Nike employees can say whatever they want. But they run the risk, if they’re lying, of being punished by being suspended, or fired, or whatever. A company that lies should be punished by the consumers to whom it’s beholden.
PS. So should a government.
Perhaps a better way to view Amy’s question is from the perspective of business transactions. If one makes the assumption that corporations exist in order to make money and that their activities are engineered toward making money, then their statements are made in order to promote a business transaction. Thus, Nike telling a lie like “Nike pays average line-workers double-the-minimum wage in Southeast Asia” is not like Amy saying “Nike pays all overseas workers $12 an hour” in a casual conversation; rather, it would be more like Amy selling a car online and advertising that it has “New tires, freshly redone interior, and new brakes” when, in fact, the car has bald tires, ripped seats, and very worn brakes. By the law, if a person bought the car online then they could sue Amy when they discovered that she had lied about the condition of the car. Lying is not illegal, but lying for the sake of a business transaction is.
My friend, who is a finance major, had a good point. Nike’s lying is not just affecting the customer, but also the stockholders. They’re lying to their stockholders, which is fraud, which is absolutely punishable.
This reminds me of the recent Florida case which determined that the local Fox affiliate had the right to knowingly present false information on the TV news.
What is happpening to this country?
PinkDreamPoppies, the difference in the Nike case is that when you bought the car, what was wrong with it would be undetectable. Half a world away, people who made the car would be in slave labor or whatever. And you wouldn’t know.
I’m trying to find the actual ads and op-eds that Nike put out, because I want to see what they actually said. I’ve been unable to find any information other than what’s put out by Nike opponents. Have any of you actually seen the PR campaign, and if so, can you tell me where to find it?
Ummm…
I am confused here. The key leagle issue here has been repeatedly side stepped.
Nike’s whole claim to first amendment protection is predicated on the assumption, {absolutely wrong} that Nike, as a CORPORATION has ANY FIRST AMENDMENT RITS AT ALL.
The constitution was written for PEOPLE, and there is abundant evidence that they INTENDED that to mean only physical living people. NOT created legal entities.
There is some support for LIMITED protections in the press, but corporations currently HAVE NO LEGAL STANDING. In fact, as I understand it, part of Nike’s move to make a first amendment claim is to sneak a new interpretation GIVING corporations the same rights as citizens.
As I understand it, the courts were absolutely opposed to any rights of citizenship at all, until a ruling in the civil war era was mis-written, by a Supreme Court law clerk deliberately rewriting an option of the court.
I am not a lawyer, or even someone with any legal training, but there has been an extended discussion of this on some of the law blogs, and the consensus seems to be that Nike is trying to bluff the courts in to creating new law that gives corporations the same rights as natural citizens.
Some one with legal training could state the issues in more legalist terms, and likely in more detail.
Since the whole PURPOSE of a corporation is to create a legal entity to shelter it’s leaders from legal action in the first place, { you cannot put a “corporation” in prison, nor can it’s leaders be put in prison FOR ACTIONS TAKEN by the corporation,} why would any sane person expect that corporation to gain the rights of a citizen?
Mr Tek
Jim Roker
I don’t feel very chatty at the moment, but I think you rock. :-) And you are being added to my bookmarks, so … so there!
:-)
Planning to move out to Portland when my love and I can both get jobs out there. Ha ha ha ha ha ha.
For now, we will just have to keep suffering while we are surrounded by freaky bible thumpers… More on that later.
:-)
-A
Yeah, this is more like selling a used car and saying “pure evil and terror have not been somehow inserted in the engine.” And then the buyer buys the car, having no idea that pure evil and terror have been inserted into the engine, and has no way of knowing it until the car is turned on and evil demons from the nether regions of hell emerge to poke pitchforks in the buyer’s ass. You better bet there’s a law suit there. (Sorry, I’m tired)
And what also hasn’t been mentioned here is that even for citizens, freedom of speech has it’s limits. For example, a lie said by a person in public isn’t going to be legally punished, but the lie in court would. If I were to say to some random guy in a bar, “Hey, Jason Schmidt eats babies,” it would probably be ignored, but if I were to print it in a newspaper, in such a way that a reasonable person would think it’s true, then Jason Schmidt could rightly sue me for libel.
I have no idea why I chose Jason Schmidt as an example there. Damn, I need some sleep.
Jason Schmidt is a pitcher for the San Francisco Giants. As a Dodgers fan, I’m inclined to believe that he does eat babies.
hello. I am a Student at Nottingham Trent University. I am basing my dissertation on the Nike and Gap Sweatshops and how there advertising could hide the real picture. I therefore find your website very interesting. Do you know of any books or articles and pictures I would be able to purchase. It would be much appreciated. Thanks. Helen James
Hello again. Following on from a previous email I sent. I would be very grateful if you could give details of the press releases, official letters and one paid advertisement in which Nike claims that their labor prices were great. Personally I feeel very stronglt about the way labor is used by Nike and would be very grateful of any info you have on the topic. Thank you. Helen James
Hello again. Following on from a previous email I sent. I would be very grateful if you could give details of the press releases, official letters and one paid advertisement in which Nike claims that their labor prices were great. Personally I feeel very stronglt about the way labor is used by Nike and would be very grateful of any info you have on the topic. Thank you. Helen James
Hey good lookin’
Fair enough, Blunted, but you should realize that as a Dodgers fan, you probably don’t qualify as a reasonable person.
;-)
—Myca
Hello I’m in love with Melyn and i’m proud to say that my ‘member’ is very small.
Helloo. If anyone lives around the Canberra region, and you want some good lovin give Alec a call. Whips and other stuff are extra. Or, just give me a call to talk to some hot ass.
Ph. 0405567103 Alec
Ph. 0419976039 Melyn
Hey baby i live in the ACT send me some pics and i might give you some sugar….;) ariochlordofchaos_5@hotmail.com