Gibson v. Tex. Dep't of Insurance—Division of Workers' Comp.

• Decision Date: 30 October 2012
• Docket Number: No. 11–11136.,11–11136.
• Citation: 700 F.3d 227
• Court: U.S. Court of Appeals — Fifth Circuit
• Parties: John E. GIBSON, In his Individual Capacity, doing business as John Gibson & Associates, Plaintiff–Appellant, v. TEXAS DEPARTMENT OF INSURANCE—DIVISION OF WORKERS' COMPENSATION; Rod Bordelon, Commissioner, Texas Department of Insurance, Division of Workers' Compensation, in His Official Capacity, Defendants–Appellees.

700 F.3d 227

John E. GIBSON, In his Individual Capacity, doing business as John Gibson & Associates, Plaintiff–Appellant,

v.TEXAS DEPARTMENT OF INSURANCE—DIVISION OF WORKERS' COMPENSATION; Rod Bordelon, Commissioner, Texas Department of Insurance, Division of Workers' Compensation, in His Official Capacity, Defendants–Appellees.

No. 11–11136.

United States Court of Appeals, Fifth Circuit.

Oct. 30, 2012.

Robert Smead Hogan (argued), Hogan Law Firm, P.C., David Michael Guinn, Jr., Hurley & Guinn, Lubbock, TX, for Plaintiff–Appellant.

Shelley Nieto Dahlberg, Office of the Atty. Gen., Gen. Lit. Div., James Patrick Sullivan, Asst. Sol. Gen. (argued), Office of the Atty. Gen., Office of the Sol. Gen., Austin, TX, for Defendants–Appellees.

Appeal from the United States District Court for the Northern District of Texas.

Before REAVLEY, DENNIS and CLEMENT, Circuit Judges.

EDITH BROWN CLEMENT, Circuit Judge:

In February 2011 the Texas Department of Insurance issued a cease and desist letter to Appellant John Gibson, arguing that his use of the words “Texas” and “Workers' Comp” in the domain name of his website violated § 419.002 of the Texas Labor Code. Gibson filed a complaint in the Northern District of Texas, alleging that the statute was unconstitutional under the First, Fifth, and Fourteenth Amendments. The district court dismissed the complaint for failure to state a claim. For the following reasons, we AFFIRM in part and REVERSE in part.

FACTS AND PROCEEDINGS

John Gibson is an attorney who represents plaintiffs in workers' compensation claims and contested cases in Texas. Pursuant to this practice, Gibson maintains a website under the domain name of “texasworkerscomplaw.com” in which he discusses matters related to Texas workers' compensation law. He also uses the website to advertise and disseminate information about his law practice.

On February 7, 2011, Gibson received a cease and desist letter from the Texas Department of Insurance, Division of Workers' Compensation (“DWC”), requesting that he no longer use the above-stated domain name. The letter alleged that Gibson's website violated § 419.002 of the Texas Labor Code, which states:

(a) Except as authorized by law, a person, in connection with any impersonation, advertisement, solicitation, business name, business activity, document, product, or service made or offered by the person regarding workers' compensation coverage or benefits, may not knowingly use or cause to be used:

(1) the words “Texas Department of Insurance,” “Department of Insurance,” “Texas Workers' Compensation,” or “division of workers' compensation”;

(2) any term using both “Texas” and “Workers' Compensation” or any term using both “Texas” and “Workers' Comp”;

(3) the initials “T.D.I.”; or

(4) any combination or variation of the words or initials, or any term deceptively similar to the words or initials, described by Subdivisions (1)-(3).

(b) A person subject to Subsection (a) may not knowingly use or cause to be used a word, term, or initials described by Subsection (a) alone or in conjunction with:

(1) the state seal or a representation of the state seal;

(2) a picture or map of this state; or

(3) the official logo of the department or the division or a representation of the department's or division's logo.

Tex. Labor Code § 419.002. Although DWC's letter requested a response, Gibson did not provide any written response, nor did he request any form of procedural review from DWC.

Instead, Gibson filed the instant suit, alleging that the regulation violates various constitutional provisions including the First Amendment's guarantee of freedom of speech, the Fourteenth Amendment's guarantees of equal protection and due process, and the Fifth Amendment's prohibition on takings. Gibson sought declaratory and injunctive relief pursuant to 28 U.S.C. § 2201 and 42 U.S.C. § 1983 as well as attorneys' fees pursuant to 42 U.S.C. § 1988. The district court dismissed Gibson's Fifth and Fourteenth Amendment claims under Federal Rule of Civil Procedure 12(b)(6), along with Gibson's First Amendment as-applied challenge. The district court declined to consider Gibson's First Amendment facial challenge. Gibson appealed.

STANDARD OF REVIEW

This court reviews a district court's dismissal for failure to state a claim de novo, accepting all well-pleaded facts as true and viewing those facts in the light most favorable to the plaintiff. Bowlby v. City of Aberdeen, 681 F.3d 215, 219 (5th Cir.2012) (citation and internal quotation marks omitted). A complaint will not survive a motion to dismiss unless it pleads sufficient facts to allow the court to draw a reasonable inference that the defendant is liable for the alleged misconduct. Ashcroft v. Iqbal, 556 U.S. 662, 678, 129 S.Ct. 1937, 173 L.Ed.2d 868 (2009) (citing Bell Atl. Corp. v. Twombly, 550 U.S. 544, 556, 127 S.Ct. 1955, 167 L.Ed.2d 929 (2007)). The allegations stated in the complaint must be enough to “raise a right to relief above the speculative level[.]” Twombly, 550 U.S. at 555, 127 S.Ct. 1955. “Threadbare recitals of the elements of a cause of action, supported by mere conclusory statements, do not suffice.” Iqbal, 556 U.S. at 678, 129 S.Ct. 1937 (citing Twombly, 550 U.S. at 555, 127 S.Ct. 1955).

DISCUSSION

1. Gibson's First Amendment As–Applied Challenge

The United States Supreme Court has recognized that commercial speech is protected by the First Amendment. Va. State Bd. of Pharmacy v. Va. Citizens Consumer Council, Inc., 425 U.S. 748, 770, 96 S.Ct. 1817, 48 L.Ed.2d 346 (1976). However, “[t]he Constitution ... accords a lesser protection to commercial speech than to other constitutionally guaranteed expression.” Cent. Hudson Gas v. Pub. Serv. Comm'n, 447 U.S. 557, 562–63, 100 S.Ct. 2343, 65 L.Ed.2d 341 (1980). Regulations on commercial speech are permissible as long as they satisfy the four-part test set forth in Central Hudson:

At the outset, we must determine whether the expression is protected by the First Amendment. For commercial speech to come within that provision, it at least must concern lawful activity and not be misleading. Next, we ask whether the asserted governmental interest is substantial. If both inquiries yield positive answers, we must determine whether the regulation directly advances the governmental interest asserted, and whether it is not more extensive than is necessary to serve that interest.

Id. at 566, 100 S.Ct. 2343. Before reaching the commercial speech analysis we must first dispose of two arguments put forward by Gibson in support of his allegation that the regulation at issue deserves a higher level of protection than that normally reserved for commercial speech.

First, Gibson argues that the regulation is not content-neutral, and therefore this court should evaluate the regulation under the test traditionally reserved for content-based discrimination . See Turner Broad. Sys., Inc. v. F.C.C., 512 U.S. 622, 642, 114 S.Ct. 2445, 129 L.Ed.2d 497 (1994) (“Our precedents thus apply the most exacting scrutiny to regulations that suppress, disadvantage, or impose differential burdens upon speech because of its content ... [but] regulations that are unrelated to the content of speech are subject to an intermediate level of scrutiny[.]”). Gibson's argument is unavailing. Texas's law does not prohibit Gibson's use of his domain name because of the viewpoint it expresses, nor does it prohibit all speech relating to workers' compensation in Texas. See Hill v. Colorado, 530 U.S. 703, 719, 722–23, 120 S.Ct. 2480, 147 L.Ed.2d 597 (2000) (holding that a statute is content-neutral when it “places no restrictions on—and clearly does not prohibit—either a particular viewpoint or any subject matter that may be discussed by a speaker”).

Gibson nevertheless argues that the statute at issue amounts to content discrimination because the domain name is “inextricably intertwined” with the content of his website, which includes his views on the need for compensation law reform. But Gibson cannot bootstrap this challenge into one of content discrimination simply by alleging that the content-neutral regulation has a secondary effect on speech that is outside the reach of the regulation. Seeid. at 725, 120 S.Ct. 2480 (holding that a statute prohibiting protestors within eight feet of an abortion clinic was constitutional because the statute was “not limited to those who oppose abortion ... [it applies] to all demonstrators whether or not the demonstration concerns abortion, and whether they oppose or support the woman who has made an abortion decision. That is the level of neutrality that the Constitution demands.”). Because the regulation at issue applies equally to all individuals regardless of their position or viewpoint, and because it does not prohibit all speech relating to workers' compensation in Texas, it does not amount to content discrimination.

Second, Gibson argues that this law places a prior restraint on speech because it operates as a “wholesale prohibition on the use of certain words[.]” This argument is also unavailing. The SupremeCourt has stated that laws aimed at prohibiting deceptive commercial speech are unlikely to implicate the prohibition on prior restraints. Friedman v. Rogers, 440 U.S. 1, 10, 99 S.Ct. 887, 59 L.Ed.2d 100 (1979). Moreover, there is a clear distinction, “solidly grounded in our cases, between prior restraints and subsequent punishments.” Alexander v. United States, 509 U.S. 544, 550, 113 S.Ct. 2766, 125 L.Ed.2d 441 (1993). Prior restraints typically involve “administrative and judicial orders [such as temporary restraining orders and permanent injunctions] forbidding certain communications when issued in advance of the time that such communications are to occur [,]” or, in other words, laws which require a speaker “to obtain prior approval for any expressive activities.” Id. at 550, 551, 113 S.Ct. 2766 (emphasis in original) (citation and internal quotation marks omitted). Because the...