State By Spannaus v. Century Camera, Inc.

• Decision Date: 28 August 1981
• Docket Number: No. 51636.,51636.
• Citation: 309 NW 2d 735
• Parties: STATE of Minnesota, by Warren SPANNAUS, its Attorney General, Respondent, v. CENTURY CAMERA, INC., et al., Appellants, Propper Oil and Auto Supply Warehouse Distributing Co., Inc., d.b.a. 10000 Auto Parts, et al., Defendants.
• Court: Minnesota Supreme Court

309 N.W.2d 735 (1981)

STATE of Minnesota, by Warren SPANNAUS, its Attorney General, Respondent, v. CENTURY CAMERA, INC., et al., Appellants, Propper Oil and Auto Supply Warehouse Distributing Co., Inc., d.b.a. 10000 Auto Parts, et al., Defendants.

No. 51636.

Supreme Court of Minnesota.

August 28, 1981.

Maslon, Edelman, Borman, Brand & McNulty, William Z. Pentelovich, Barbara R. Hauser and Mary P. Foarde, Minneapolis, for appellants.

Warren Spannaus, Atty. Gen., and Erica Jacobson, Sp. Asst. Atty. Gen., St. Paul, for State.

Heard, considered, and decided by the court en banc.

OPINION

SHERAN, Chief Justice.

I.

This case presents the question whether defendants'¹ constitutional rights of free speech and due process of law, guaranteed by both federal and state constitutions, are infringed by Minn.Stat. §§ 181.75-.76 (1980). Section 181.75 prohibits employers and their agents from "directly or indirectly soliciting or requiring" their employees or prospective employees to take a "polygraph, voice stress analysis, or any test purporting to test their honesty."²-³ It also prohibits persons who sell, administer, or interpret such tests from doing so when they know the test has been solicited or required by an employer or his or her agent.⁴ The disclosure of the fact that an individual has taken a "polygraph or any test purporting to test honesty" or the results of the test, without authorization of the individual, is prohibited by section 181.76.⁵ Defendants are an employer that has utilized polygraph tests and a partnership of two businesses that have administered them.

Specifically, we are called upon to answer three questions certified by the trial court as important or doubtful under Minn.R.Civ. App.P. 103.03(i) after the court's denial of defendants' motion for summary judgment on the ground of the unconstitutionality of the two statutes sought to be applied against them. The questions we consider are:

1. Are sections 181.75 and 181.76 unconstitutionally overbroad, in violation of the first amendment, as incorporated by the fourteenth amendment, and Minn.Const. art. 1, § 3?⁶

2. Are sections 181.75 and 181.76 unconstitutionally vague, in violation of the first amendment as incorporated by the fourteenth amendment, and Minn.Const. art. 1, § 3?⁷

3. Do sections 181.75 and 181.76 constitute a deprivation of property without due process of law, in violation of the fifth amendment, as incorporated by the fourteenth amendment, and Minn.Const. art. 1, § 7?

II.

Suit was brought by the State of Minnesota against defendants Century Camera, Inc., and Foresight Security Services of Minnesota for declaratory relief, injunctive relief, and civil penalties under Minn.Stat. § 181.75, subd. 3 (1980).⁸ Foresight Security conducts background investigations, undercover investigations, and polygraph examinations of employees or potential employees for employers. Century Camera is a retail seller of photographic equipment and supplies that has utilized Foresight's services, including polygraph testing. It is also the sole shareholder of the stock of one of the companies in the Foresight partnership. In its complaint, the plaintiff State of Minnesota alleges that employees of Century Camera and applicants for employment have been asked to undergo either background interviews or polygraph examinations in a manner constituting a violation of section 181.75. The state also alleges that Foresight Security acts as an agent for Century Camera, soliciting or requiring the examinations, and disclosing the results in violation of sections 181.75 and 181.76. The factual questions of whether violations of these sections occurred have not yet been tried. Defendants moved for summary judgment in their favor on the ground of unconstitutionality of the two statutes, and this appeal followed.

The district court found no violations of constitutional rights. That court considered the speech in issue under sections 181.75 and 181.76 to be commercial speech and therefore subject "to certain modes of regulation which might be impermissible in the realm of non-commercial expression." The trial court found the state's perception of the harm which employees may suffer "well founded," and the goal of preventing this harm "important and legitimate." The statutes survived overbreadth challenge because a "broad prophylactic" measure was necessary. Defendants' second and third claims were also rejected by the trial court.

III.

Are sections 181.75 and 181.76 unconstitutionally overbroad?

In analyzing this question, the trial court concluded that the speech affected by sections 181.75 and 181.76 was commercial speech, thereby invoking the type of judicial review accorded regulations of commercial speech rather than that accorded regulations of noncommercial expression. With that conclusion we agree.

Commercial speech is protected by the first amendment. Central Hudson Gas & Electric Corp. v. Public Service Commission, 447 U.S. 557, 561, 100 S.Ct. 2343, 2348, 65 L.Ed.2d 341 (1980); Virginia State Board of Pharmacy v. Virginia Citizens Consumer Council, Inc., 425 U.S. 748, 762, 96 S.Ct. 1817, 1825, 48 L.Ed.2d 346 (1976). But "the State does not lose its power to regulate commercial activity deemed harmful to the public whenever speech is a component of that activity." Ohralik v. Ohio State Bar Assn., 436 U.S. 447, 456, 98 S.Ct. 1912, 1918, 56 L.Ed.2d 444 (1978). Commercial speech is given "a limited measure of protection, commensurate with its subordinate position in the scale of First Amendment values, * * allowing modes of regulation that might be impermissible in the realm of noncommercial expression." Id.

Commercial speech is "expression related solely to the economic interests of the speaker and its audience." Central Hudson Gas & Electric Corp. v. Public Service Commission, 447 U.S. 557, 561, 100 S.Ct. 2343, 2348, 65 L.Ed.2d 341 (1980). It includes speech which does "no more than propose a commercial transaction," such as price advertising. Virginia State Board of Pharmacy v. Virginia Citizens Consumer Council, Inc., 425 U.S. 748, 762, 96 S.Ct. 1817, 1825, 48 L.Ed.2d 346 (1976) (quoting Pittsburgh Press Co. v. Human Relations Commission, 413 U.S. 376, 385, 93 S.Ct. 2553, 2558, 37 L.Ed.2d 669 (1973)). We find no abstract definition of commercial speech, but there is a "`common-sense' distinction between speech proposing a commercial transaction * * * and other varieties of speech." Ohralik v. Ohio State Bar Assn., 436 U.S. 447, 455-56, 98 S.Ct. 1912, 1918, 56 L.Ed.2d 444 (1978).

Defendants, who disagree that the speech in issue is commercial speech, have suggested that the doctrine of commercial speech is intended to be limited to the context of advertising related to goods and services and should not be extended to the case before us involving communication in the context of employment. Defendants suggest that we should proceed cautiously in striking forth into the uncharted area of commercial speech.

Although the few cases in this area reaching the Supreme Court have discussed questions of service and price advertising,⁹ other courts have expanded the doctrine beyond that limited context. In Harris v. Beneficial Finance Co., 338 So.2d 196 (Fla. 1976), cert. denied, 430 U.S. 950, 97 S.Ct. 1591, 51 L.Ed.2d 800 (1977), the commercial speech doctrine was applied to the communication between agents of a finance company and a debtor's employer. See Equifax Services, Inc. v. Cohen, 420 A.2d 189 (Me. 1980), cert. denied, 450 U.S. 916, 101 S.Ct. 1360, 67 L.Ed.2d 342 (1981) (commercial speech assumed arguendo to include credit information collected under the Maine Fair Credit Reporting Act); Motor & Equipment Manufacturers Association v. Environmental Protection Agency, 627 F.2d 1095 (D.C. Cir.1979), cert. denied, 446 U.S. 952, 100 S.Ct. 2917, 64 L.Ed.2d 808 (1980) (communication of maintenance information by manufacturer to consumer found to be commercial speech); K.D. v. Educational Testing Service, 87 Misc.2d 657, 386 N.Y.S.2d 747 (1976) (publication of test results held to be commercial speech).

In our view, there is no question but that the speech affected by sections 181.75 and 181.76 is commercial speech. An employer is not deprived of his or her first amendment right to communicate views, arguments, or opinions to employees by sections 181.75 and 181.76. See NLRB v. Gissel Packing Co., 395 U.S. 575, 617, 89 S.Ct. 1918, 1941, 23 L.Ed.2d 547 (1969). The employer who solicits or requires an employee to have a lie detector examination "does not wish to editorialize on any subject, cultural, philosophical, or political. He does not wish to report any particularly newsworthy fact, or to make generalized observations even about commercial matters." Virginia State Board of Pharmacy v. Virginia Citizens Consumer Council, Inc., 425 U.S. 748, 761, 96 S.Ct. 1817, 1825, 48 L.Ed.2d 346 (1976). An employer engaging in the verbal activity of soliciting or requiring these examinations does not have any purpose other than the advancement of his or her business interests.

The defendants have claimed that sections 181.75 and 181.76 are overbroad. A statute is overbroad if within its reach it prohibits constitutionally protected activity, as well as activity which may be prohibited without offending constitutional rights. Grayned v. City of Rockford, 408 U.S. 104, 114, 92 S.Ct. 2294, 2302, 33 L.Ed.2d 222 (1972). The defendants' standing to challenge these statutes as facially overbroad does not depend upon whether their own activity is or is not privileged itself. Village of Schaumburg v. Citizens for a Better Environment, 444 U.S. 620, 634, 100 S.Ct. 826, 834, 63 L.Ed.2d 73 (1980); Bates v. State Bar of Arizona, 433 U.S. 350, 379-80, 97 S.Ct. 2691, 2706-07, 53 L.Ed.2d 810 (1977); State v. Hipp, 298 Minn. 81, 86-87, 213 N.W.2d 610, 614 (1973). We allow persons to challenge a statute, even if their own speech may be validly prohibited, because of the...