Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-ca9-18-15840/USCOURTS-ca9-18-15840-0/pdf.json

Nature of Suit Code: 950
Nature of Suit: Constitutionality of State Statutes
Cause of Action: 

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FOR PUBLICATION

UNITED STATES COURT OF APPEALS

FOR THE NINTH CIRCUIT

PACIFIC COAST HORSESHOEING

SCHOOL, INC.; BOB SMITH; ESTEBAN

NAREZ,

Plaintiffs-Appellants,

v.

KIMBERLY KIRCHMEYER, in her

Official Capacity as Director of

Consumer Affairs; MICHAEL

MARION, in his Official Capacity as

Chief of the Bureau for Private and

Postsecondary Education,

Defendants-Appellees.

No. 18-15840

D.C. No.

2:17-cv-02217-

JAM-GGH

OPINION

Appeal from the United States District Court

for the Eastern District of California

John A. Mendez, District Judge, Presiding

Argued and Submitted October 24, 2019

San Francisco, California

Filed June 10, 2020

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2 PACIFIC COAST HORSESHOEING SCHOOL V. KIRCHMEYER

Before: Michael J. Melloy,*Jay S. Bybee,

and N. Randy Smith, Circuit Judges.

Opinion by Judge Bybee

SUMMARY**

Civil Rights

The panel reversed the district court’s dismissal for

failure to state a claim of an action challenging, on First

Amendment grounds, aspects of California’s Private

Postsecondary Education Act of 2009, which prohibit

plaintiff, Esteban Narez, from enrolling in plaintiff Bob

Smith’s horseshoeing class unless he first passes an

examination prescribed by the U.S. Department ofEducation.

The Act requires that any student without a high school

certificate or its equivalent who wishes enroll in a private

postsecondary school must execute an enrollment agreement

with an authorized employee of the school which confirms

that the prospective student has the ability to benefit from the

proposed course of instruction. In order to execute the

ability-to-benefit agreement, the school shall have the student

take an independently administrated examination prescribed

by the United States Department of Education. The Act

*

 The Honorable Michael J. Melloy, United States Circuit Judge for

the U.S. Court of Appeals for the Eighth Circuit, sitting by designation.

** This summary constitutes no part of the opinion of the court. It has

been prepared by court staff for the convenience of the reader.

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PACIFIC COAST HORSESHOEING SCHOOL V. KIRCHMEYER 3

exempts certain courses and a number of private institutions

from these requirements. The district court determined that

the Act regulates only conduct—the forming of an enrollment

agreement—and any burdens on speech were incidental,

resulting from the government’s regulation of commercial

transactions. The district court thus concluded that plaintiffs

failed to allege a First Amendment claim.

The panel held that the Act regulates speech and therefore

rejected the assertion that only conduct was at issue. The

panel determined that, when viewed in its entirety, the Act

controls more than contractual relations. It also regulates

what kind of educational programs different institutions can

offer to different students. The panel held that the Act

implicates the First Amendment by restricting the rights of

both speakers (Smith) and would-be listeners (Narez).

The panel determined that the Act implicated heightened

First Amendment scrutiny by differentiating between speech

or speakers. The panel noted that the Act is riddled with

exceptions to the examination requirement and the exceptions

turned on one of two things: (1) the content of what is being

taught, or (2) the identity of the speaker. Together these

exceptions demonstrated that the Act did more than merely

impose an incidental burden on speech: it targeted speech

based on its communicative content. 

The panel held that the statutory scheme here not only

implicated speech, but also engaged in content

discrimination. Moreover, the panel held that because

content discrimination was apparent, the district court should

have applied some form of heightened scrutiny. The panel

left it to the district court on remand to determine whether

this case involves commercial or non-commercial speech,

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4 PACIFIC COAST HORSESHOEING SCHOOL V. KIRCHMEYER

whether California must satisfy strict or intermediate

scrutiny, and whether it could carry its burden under either

standard.

COUNSEL

Paul V. Avelar (argued) and Keith E. Diggs, Institute for

Justice, Tempe, Arizona; Bradley A. Benbrook and Stephen

M. Duvernay, Benbrook Law Group PC, Sacramento,

California; for Plaintiffs-Appellants.

P. Patty Li (argued), Deputy Attorney General; Paul Stein,

Supervising Deputy Attorney General; Thomas S. Patterson,

Senior Assistant Attorney General; Xavier Becerra, Attorney

General; Attorney General’s Office, San Francisco,

California; for Defendants-Appellees.

Eugene Volokh (argued), Professor of Law, Scott & Cyan

Banister First Amendment Clinic, UCLA School of Law, Los

Angeles, California; Rodney A. Smolla, Dean & Professor of

Law, Widener University, Delaware Law School,

Wilmington, Delaware; for Amici Curiae Professors Jane

Bambauer, David Bernstein, Clay Calvert, Mark Lemley,

Rodney Smolla, and Eugene Volokh.

Seth E. Mermin and Cindy Pan, Center for Consumer Law

and Economic Justice, Berkeley, California; Thomas

Bennigson, Public Good Law Center, Berkeley, California;

for Amici Curiae Housing and Economic Rights Advocates,

Consumers Union, Project on Predatory Student Lending, and

UC Berkeley Center for Consumer Law and Economic

Justice.

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PACIFIC COAST HORSESHOEING SCHOOL V. KIRCHMEYER 5

OPINION

BYBEE, Circuit Judge:

Plaintiff Bob Smith is an experienced farrier and offers

classes for those who would like to learn the art and craft of

horseshoeing. Plaintiff Esteban Narez is experienced with

horses and would like to enroll in Smith’s classes to become

a professional farrier. But because Narez does not have a

high school diploma or GED, California’s Private

Postsecondary Education Act of 2009 (“PPEA” or “the Act”)

prohibits him from enrolling in Smith’s courses unless Narez

first passes an examination prescribed by the U.S.

Department of Education. But if Smith were running a flight

school or teaching golf, dancing, or contract bridge, Narez

could enroll without restriction.

We are asked to decide whether the Act burdens

plaintiffs’ free speech. The district court determined that the

Act did not. We conclude that plaintiffs have stated a claim

that the PPEA burdens their rights under the First

Amendment. We therefore reverse and remand to the district

court for further proceedings.

I. BACKGROUND

A. Statutory Framework

In the PPEA, Cal. Educ. Code § 94800 et seq., the

California legislature found that, as of 2013, more than

300,000 Californians were attending more than 1100 private

postsecondary schools in California. Id. § 94801(a). The

legislature acknowledged that such schools “can complement

the public education system and help develop a trained

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6 PACIFIC COAST HORSESHOEING SCHOOL V. KIRCHMEYER

workforce to meet the demands of California businesses and

the economy.” Id. § 94801(b). Nevertheless, the legislature

expressed its “concern[] about the value of degrees and

diplomas issued by private postsecondary schools,” and found

that the “lack of protections” for “consumers of those

schools’ services” and the possibility of “fraudulent or

substandard educational programs and degrees” demonstrated

“the need for strong state-level oversight of private

postsecondary schools.” Id. § 94801(b), (d)(6).1 To that end,

California sought to ensure that students who enrolled in

private postsecondary schools would actually benefit from

such programs and regulate contracts between students and

any “private entity with a physical presence in [California]

that offers postsecondary education to the public for an

institutional charge.” Id. § 94858. The Act defines a

category of students, known as “[a]bility-to-benefit

student[s],” as those students “who do[] not have a certificate

of graduation from a school providing secondary education,

or a recognized equivalent of that certificate.” Id. § 94811.

Any student wishing to enroll in a private postsecondary

school must execute an enrollment agreement, signed by the

student and an authorized employee of the school. Id.

§ 94902(a). Critically for this case, no “ability-to-benefit

student may execute an enrollment agreement” unless “the

institution shall have the student take an independently

administered examination from the list of examinations

prescribed by the United States Department of Education.” 

Id. § 94904(a); see also Higher Education Act of 1965, 20

U.S.C. § 1091(d)(1)(A)(i). “[U]nless the student achieves a

1 The PPEA is enforced by the Bureau for Private Postsecondary

Education within the California Department of Consumer Affairs. See

Cal. Educ. Code §§ 94800.5, 94820.

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PACIFIC COAST HORSESHOEING SCHOOL V. KIRCHMEYER 7

score . . . demonstrating that the student may benefit from the

education and training being offered,” “[t]he student shall not

enroll.” Cal. Educ. Code § 94904(a).

The PPEA exempts certain courses and a number of

private institutions from these requirements. For example,

educational programs “sponsored by a bona fide trade,

business, professional, or fraternal organization” are exempt,

so long as the program is provided “solely for that

organization’s membership.” Id. § 94874(b)(1). Also exempt

are courses offering “avocational or recreational education

programs”; “[t]est preparation for examinations required for

admission to a postsecondary education institution,” such as

the SAT or ACT; “[c]ontinuing education or license

examination preparation”; and “[f]light instruction.” Id.

§ 94874(a), (d)(1), (j). Aside from subject-matter

exemptions, the PPEAexempts various institutions, including

“[a]n institution that does not award degrees and that solely

provides educational programs for total charges of [$2500] or

less.” Id. § 94874(f).

B. Facts

Narez has an affinity for horses and, after working with

a farrier, decided to enroll in the Pacific Coast Horseshoeing

School, Inc. (“PCHS”).2 He chose horseshoeing as a career

because it pays well and there are no licensing requirements

for farriers in California. Narez does not have a high-school

diploma or a GED and is considered an ability-to-benefit

student under the PPEA.

2 The facts are taken from the complaint. For purposes of this

decision we must assume them to be true. See Ashcroft v. Iqbal, 556 U.S.

662, 678 (2009).

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8 PACIFIC COAST HORSESHOEING SCHOOL V. KIRCHMEYER

PCHS is California’s only full-time horseshoeing school. 

It charges $6000 for an eight-week course, which includes

both classroom and hands-on learning. Smith, the owner of

PCHS, teaches the course himself. Because academic

prowess is not needed to be a good farrier, Smith is willing to

teach and accommodate less-educated students. If he

determines at the end of the first week that a student will not

benefit from the course, he refunds all but $250 of the tuition. 

As a private postsecondary-educational institution teaching a

vocational skill, PCHS is subject to the PPEA. Following

inspection by the Bureau of Postsecondary Education, PCHS

began declining admission to prospective students who did

not have a high-school diploma or a GED or who had not

passed an examination prescribed by the PPEA.

Narez alleges that no examination satisfying the abilityto-benefit requirementtests horseshoeing knowledge or skills. 

Because he works seven days a week, Narez does not want to

forgo income to study for a test that has no relevance to

horseshoeing. Absent the ability-to-benefit requirement,

Narez alleges that he would enroll in PCHS and PCHS would

accept him.

C. Procedural History

Smith, Narez, and PCHS filed this action challenging the

ability-to-benefit requirement on First Amendment grounds. 

The defendants, two California-state officials (“California”),

moved to dismiss the claim under Federal Rule of Civil

Procedure 12(b)(6). The district court granted the motion. 

Pac. Coast Horseshoeing Sch., Inc. v. Grafilo, 315 F. Supp.

3d 1195 (E.D. Cal. 2018). The court concluded that the

ability-to-benefit requirement does not prohibit the imparting

or disseminating of information. Instead, it determined that

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PACIFIC COAST HORSESHOEING SCHOOL V. KIRCHMEYER 9

the law regulates only conduct—the forming of an enrollment

agreement—and any burdens on speech were “incidental,”

resulting from the government’s regulation of commercial

transactions. Id. at 1200. The district court thus concluded

that plaintiffs failed to allege a First Amendment claim. Id.

at 1200–02. This appeal followed.3

II. DISCUSSION

The First Amendment, which is made applicable to the

states through the Due Process Clause of the Fourteenth

Amendment, provides: “Congress shall make no law . . .

abridging the freedom of speech.” U.S. Const. amend. I. 

This case raises two interrelated questions. First, is the PPEA

subject to First Amendment scrutiny at all? That is, does the

Act regulate speech? Second, if the Act regulates speech, is

it content based? The answers to these questions are critical

because they determine the level of scrutiny with which

courts will review the PPEA and its ability-to-benefit

requirement.

Ordinarily, we review challenges to legislation regulating

commercial transactions under a rational-basis standard: a

statute is consistent with the Due Process Clause if the

legislature has identified a legitimate state interest and the

legislation has a rational basis for furthering that interest. See

Pennell v. City of San Jose, 485 U.S. 1, 11–13 (1988); United

States v. Carolene Prods. Co., 304 U.S. 144, 152–53 (1938);

3 We review de novo the district court’s grant of a motion to dismiss

for failure to state a claim. Burgert v. Lokelani Bernice Pauahi Bishop

Tr., 200 F.3d 661, 663 (9th Cir. 2000). Constitutional questions

implicating the First Amendment are also reviewed de novo. Cohen v.

San Bernardino Valley Coll., 92 F.3d 968, 971 (9th Cir. 1996).

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10 PACIFIC COAST HORSESHOEING SCHOOL V. KIRCHMEYER

Retail Dig. Network, LLC v. Prieto, 861 F.3d 839, 847 (9th

Cir. 2017) (en banc). When, however, the legislation burdens

a fundamental right, such as the right to free speech, we must

examine the legislation with more exacting or “heightened

scrutiny.” Turner Broad. Sys., Inc. v. FCC, 512 U.S. 622,

640–41 (1994); Scheer v. Kelly, 817 F.3d 1183, 1189 (9th Cir.

2016).

This heightened scrutiny generally takes one of two

forms: intermediate scrutiny or strict scrutiny. If legislation

regulates conduct but incidentally burdens expression, we

review that legislation under “intermediate scrutiny” to see

whether it “advances important governmental interests

unrelated to the suppression of free speech and does not

burden substantially more speech than necessary to further

those interests.” Turner Broad. Sys., Inc. v. FCC, 520 U.S.

180, 189 (1997); see also United States v. O’Brien, 391 U.S.

367, 377 (1968). We likewise review content-neutral

restrictions on speech—such as time, place, and manner

restrictions—under this same intermediate scrutiny standard. 

See McCullen v. Coakley, 573 U.S. 464, 486 (2014) (noting

that a content-neutral regulation of speech violates the First

Amendment unless it is “narrowly tailored to serve a

significant governmental interest.” (quoting Ward v. Rock

Against Racism, 491 U.S. 781, 796 (1989)). But if legislation

regulates the content of the speech—when the government

regulates who may speak or what we may say—then the law

is ordinarily reviewed under “strict scrutiny”: the legislation

must serve a compelling state interest and must be narrowly

tailored to meet that interest. Reed v. Town of Gilbert, 135 S.

Ct. 2218, 2226 (2015); see also United States v. Playboy

Entm’t Grp., Inc., 529 U.S. 803, 813 (2000); Recycle for

Change v. City of Oakland, 856 F.3d 666, 669 (9th Cir.

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PACIFIC COAST HORSESHOEING SCHOOL V. KIRCHMEYER 11

based restrictions on commercial speech. See CTIA – The

Wireless Ass’n v. City of Berkeley, 928 F.3d 832, 842 (9th

Cir. 2019) (explaining that “one size does not fit all in

commercial speech cases” and contrasting Central Hudson

Gas & Electric Corp. v. Public Service Commission, 447 U.S.

557 (1980), with Zauderer v. Office of Disciplinary Counsel

of the Supreme Court of Ohio, 471 U.S. 626 (1985)).

California maintains, and the district court concluded, that

this case does not implicate speech at all and, therefore, the

legislation must only satisfy rational-basis scrutiny. The state

argues that the ability-to-benefit requirement is a consumerprotection provision that regulates only non-expressive

conduct—namely, the execution of the enrollment agreement

between a private postsecondary school and a prospective

student. The district court agreed, reasoning that “the Act

does not restrain Smith and the School from ‘imparting

information,’ ‘disseminating opinions,’ or ‘communicating a

message.’” Pac. Coast Horseshoeing Sch., Inc., 315 F. Supp.

3d at 1200 (quoting Pickup v. Brown, 740 F.3d 1208, 1230

(9th Cir. 2014), abrogated by Nat’l Inst. of Family & Life

Advocates v. Becerra, 138 S. Ct. 2361 (2018)). “[T]he only

thing that the School cannot do is execute an enrollment

agreement with a student who has not demonstrated an ability

to benefit under the Act.” Id. Thus, “[n]othing in the Act

prohibits Smith and the School from sharing information and

communicating about horseshoeing generally. Nothing

prohibits Narez from learning about horseshoeing outside of

enrollment at a private postsecondary educational institution

prior to passing an ability-to-benefit-examination.” Id. The

district court concluded that the Act regulated “economic

activity” that was “speech-adjacent” and imposed only an

“incidental burden[] on speech.” Id. Applying rational basis

review, the court upheld the Act. Id. at 1200–02.

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12 PACIFIC COAST HORSESHOEING SCHOOL V. KIRCHMEYER

In our view, California “is wrong that the only thing

actually at issue in this litigation is conduct.” Holder v.

Humanitarian Law Project, 561 U.S. 1, 27 (2010). Although

the PPEA is a form of education licensing by the state, the

First Amendment deprives the states of “unfettered power to

reduce a group’s First Amendment rights by simply imposing

a licensing requirement.” Nat’l Inst. of Family & Life

Advocates, 138 S. Ct. at 2375. California points out that the

Act regulates enrollment agreements. We agree, but when

the Act is viewed in its entirety, it becomes clear that it

controls more than contractual relations. It also regulates

what kind of educational programs different institutions can

offer to different students. Such a regulation squarely

implicates the First Amendment. See Humanitarian Law

Project, 561 U.S. at 28 (noting that a law which “may be

described as directed at conduct” nevertheless implicates

speech where “the conduct triggering coverage under the

statute consists of communicating a message”); see also

Thomas v. Collins, 323 U.S. 516, 536 (1945) (highlighting

how courts must consider a restriction’s practical effects in

determining whether it implicates speech).

There can be little question that vocational training is

speech protected by the First Amendment. Smith’s “speech

to [students] imparts a ‘specific skill’ or communicates

advice derived from ‘specialized knowledge.’” 

Humanitarian Law Project, 561 U.S. at 27. “Facts, after all,

are the beginning point for much of the speech that is most

essential to advance human knowledge and to conduct human

affairs.” Sorrell v. IMS Health Inc., 564 U.S. 552, 570

(2011). And, important to this case, “[a]n individual’s right

to speak is implicated when information he or she possesses

is subjected to ‘restraints on the way in which the information

might be used’ or disseminated.” Id. at 568 (quoting Seattle

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PACIFIC COAST HORSESHOEING SCHOOL V. KIRCHMEYER 13

Times Co. v. Rhinehart, 467 U.S. 20, 32 (1984)). 

Furthermore, “the Constitution protects [Narez’s] right to

receive information and ideas.” Stanley v. Georgia, 394 U.S.

557, 564 (1969). We have explained that when there is “a

speaker who is willing to convey . . . information,” state

“restriction[s] of the right to receive information” produce

“actual injury” under the First Amendment. Johnson v.

Stuart, 702 F.2d 193, 195 (9th Cir 1983). This right to

receive information naturally extends to educational settings. 

See Kleindienst v. Mandel, 408 U.S. 753, 765 (1972) (holding

that students had a “constitutional interest” in hearing a

Marxist theoretician speak at academic conferences and

discussions in the United States). Thus, the PPEA implicates

the First Amendment by restricting the rights of both speakers

(Smith) and would-be listeners (Narez).

California contends that if we find that the PPEA

implicates protected First Amendment speech, then we will

“transform every law or regulation applicable to

postsecondary educational institutions into a direct regulation

of speech requiring strict scrutiny.” California points out that

generally applicable regulatory schemes—such as laws taxing

income, controlling the use of property, and regulating

employer-employee relations—do not implicate the First

Amendment. We agree for the most part.4 To be effective,

the government must have the power to maintain public

safety and order, and this requires the government to regulate

4 Even generally applicable laws can implicate First Amendment

concerns, warranting greater scrutiny. See, e.g., O’Brien, 391 U.S.

at 376–77 (making clear that “incidental limitations on First Amendment

freedoms” at times implicate the First Amendment); see also Clark v.

Cmty. for Creative Non-Violence, 468 U.S. 288, 289–98 (1984)

(subjecting a law generally prohibiting sleeping in public parks to First

Amendment scrutiny).

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14 PACIFIC COAST HORSESHOEING SCHOOL V. KIRCHMEYER

aspects of our lives. In the main, governments can subject

individuals and entities to “generally applicable economic

regulations without creating constitutional problems.” 

Minneapolis Star & Tribune Co. v. Minn. Comm’r of

Revenue, 460 U.S. 575, 581 (1983); see also Sorrell, 564 U.S.

at 567 (“It is true that restrictions on protected expression are

distinct from restrictions on economic activity or, more

generally, on nonexpressive conduct. It is also true that the

First Amendment does not prevent restrictions directed at

commerce or conduct from imposing incidental burdens on

speech.”). As a result, not every regulation that financially

burdens a person or an institution affects its First Amendment

rights. Although “[m]oney is fungible,” Humanitarian Law

Project, 561 U.S. at 31, the fact that “[an organization] does

not have as much money as it wants, and thus cannot exercise

its freedom of speech as much as it would like” is irrelevant

to whether its First Amendment rights have been infringed. 

Regan v. Taxation with Representation of Wash., 461 U.S.

540, 550 (1983). “[T]he Constitution does not confer an

entitlement to such funds as may be necessary to realize all

the advantages of that freedom.” Id. (internal quotation

marks omitted); see also Interpipe Contracting, Inc. v.

Becerra, 898 F.3d 879, 892 (9th Cir. 2018) (“In other words,

there exists no standalone right to receive the funds necessary

to finance one’s own speech.”).

The question here is not whether the PPEA places a

burden on private postsecondary institutions—it plainly does,

as do California’s tax, zoning, and workplace laws. See

Minneapolis Star, 460 U.S. at 585 (“We need not fear that

government will destroy a selected group of taxpayers by

burdensome taxation if it must impose the same burden on the

rest of its constituency.”). The question is whether, in the

course of that regulation, the Act implicates heightened First

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PACIFIC COAST HORSESHOEING SCHOOL V. KIRCHMEYER 15

Amendment scrutiny. One way for us to tell is to ask whether

the PPEA differentiates between speech or speakers. See

Humanitarian Law Project, 561 U.S. at 27–28. It does. 

California’s PPEA is riddled with exceptions to the ability-tobenefit rule, and the exceptions turn on one of two things: 

(1) the content of what is being taught, or (2) the identity of

the speaker. Together these exceptions demonstrate that the

Act does more than merely impose an incidental burden on

speech: it “target[s] speech based on its communicative

content.” Reed, 135 S. Ct. at 2226. We begin with the first

of these points.

An ability-to-benefit student (one not holding a high

school diploma or a GED) may not enroll in a for-profit

postsecondary educational institution without meeting the

ability-to-benefit requirement. Cal. Educ. Code § 94904(a).5

But the Act contains a number of exemptions that turn on the

nature of what is being taught. If, for example, the course is

“solely avocational or recreational,” Cal. Educ. Code

§ 94874(a), then the course is not covered by the ability-tobenefit requirement. If, however, the course’s content is not

“solely avocational or recreational,” the restriction is

triggered and covered institutions cannot enroll certain

students. Id. The fact that the Act distinguishes between,

say, golf lessons because they are “solely avocational or

recreational,” and horseshoeing lessons because they are not,

5

It is not entirely clear to us from the statute whether the institution

is responsible for refusing enrollment to the student, or whether the

student is responsible for determining his own eligibility. See Cal. Educ.

Code § 94904(a) (“The student shall not enroll unless the student achieves

a [qualifying] score.”). Under some circumstances the enrollment

agreement is “not enforceable,” which suggests that the student has a

defense to any effort to collect tuition and fees. Id. § 94902(b). The

question of how the Act is enforced is not essential our disposition here.

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16 PACIFIC COAST HORSESHOEING SCHOOL V. KIRCHMEYER

is significant—even if we assume that the state has no

particular interest in encouraging speech related to golf

lessons or suppressing speech related to horseshoeing. See

Reed, 135 S. Ct. at 2230 (“[A] speech regulation targeted at

specific subject matter is content based even if it does not

discriminate among viewpoints within that subject matter.”). 

Communication of factual information about horseshoeing

surely qualifies as protected free speech the same as

communication about golf. See Sorrell, 564 U.S. at 570

(explaining that conveying factual information constitutes

“the creation and dissemination of information are speech

within the meaning of the First Amendment”). The Act

excepts other courses as well. See, e.g., Cal. Educ. Code

§ 94874(d)(1) (exempting test preparation courses for

standard examinations), (d)(2) (exempting test preparation

courses for continuing education or license examinations),

(j) (exempting flight instruction courses).

Second, the PPEA distinguishes between speakers. It

picks winners and losers when it comes to which institutions

must ensure that its listeners have satisfied the ability-tobenefit requirement. For example, the Act exempts

“educational programs sponsored by a bona fide trade,

business, professional, or fraternal organization, solely for

that organization’s membership.” Id. § 94874(b)(1). There

is a similar exemption for “a bona fide organization,

association, or council that offers preapprenticeship training

programs” approved by the California Workforce

Development Board. Id. § 94874(b)(2)(A). There are

exemptions for “[a] state-recognized professional licensing

body . . . that licenses persons in a particular profession,

occupation, trade, or career field” or “[a] bona fide trade,

business, or professional organization,” id. § 94874(d)(2)(B),

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PACIFIC COAST HORSESHOEING SCHOOL V. KIRCHMEYER 17

(C); for nonprofit religious organizations, id. § 94874(e)(1)6;

for “[a]n institution that does not award degrees and that

solely provides educational programs for total charges of

[$2500 or less],” id. § 94874(f); for a “nonprofit public

benefit corporation,” id. § 94874(h); and for certain nonprofit

“community-based organization[s],” id. § 94874(k)(1).

The PPEA thus favors particular kinds of speech and

particular speakers through an extensive set of exemptions.7

See Sorrell, 564 U.S. at 567 (“[The state’s] law does not

simply have an effect on speech, but is directed at certain

content and is aimed at particular speakers.”); Playboy Entm’t

Grp., 529 U.S. at 812 (“Not only does [the statute] single out

particular programming content for regulation, it also singles

out particular programmers.”). That means the PPEA

necessarily disfavors all other speech and speakers. See

Sorrell, 564 U.S. at 564.

Sorrell is instructive in understanding these principles. 

There, the Supreme Court struck down a Vermont law that

prohibited pharmacies from selling doctors’ prescribing

6 The nonprofit religious organization exemption comes with its own

content-based restriction: “The instruction is limited to the principles of

that religious organization . . . .” Cal. Educ. Code § 94874(e)(1)(A).

7 The state’s fallback position is that even if the PPEA does not

regulate pure conduct, any regulation of speech is incidental because it is

not related to expression and the O’Brien intermediate scrutiny standard

applies. See Texas v. Johnson, 491 U.S. 397, 403 (1989); O’Brien,

391 U.S. at 377. This standard is identical to the standard we apply to

content-neutral time, place, and manner restrictions. See McCullen,

573 U.S. at 486; Humanitarian Law Project, 561 U.S. at 27–28; Ward,

491 U.S. at 798. Because we have determined that the Act is contentbased, we necessarily conclude that O’Brien is not the appropriate

standard of review.

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18 PACIFIC COAST HORSESHOEING SCHOOL V. KIRCHMEYER

records to pharmaceutical companies, which the companies

could then use to market prescription drugs to specific

doctors. Id. at 557, 580.8 The statute, however, exempted

entities that did not use the information for marketing

purposes. Id. at 559–60. And if the information somehow

ended up in the hands of a pharmaceutical company, the

statute proscribed that company’s use of the information to

market drugs to doctors absent certain circumstances. Id.

at 559. Pharmaceutical and data-mining companies

challenged the law, claiming a violation of their First

Amendment right to disseminate information. Id. at 561.

Much like California in this case, Vermont argued that the

case was really about regulating “conduct, not speech.” Id.

at 570. Indeed, Vermont asserted that the prescription

records were simply a “commodity,” entitled to no more

“First Amendment protection than ‘beef jerky.’” Id. The

Supreme Court flatly rejected this argument. It explained

“that the creation and dissemination of information are

speech within the meaning of the First Amendment.” Id. The

Court saw Vermont’s law as presenting two major contentbased restrictions. First, it “disfavor[ed] marketing, that is,

speech with a particular content.” Id. at 564. Second, it

“disfavor[ed] specific speakers, namely pharmaceutical

manufacturers.” Id.; see id. at 567 (“Vermont’s law imposes

a burden based on the content of speech and the identity of

the speaker.”). This created a double burden on the

companies’ speech rights, preventing them “from

communicating with physicians in an effective and

8 The information was usually first sold by the pharmacy to a datamining firm, which in turn sold it to the pharmaceutical manufacturer. 

564 U.S. at 558. But they were all part of the same economic and

informational chain.

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PACIFIC COAST HORSESHOEING SCHOOL V. KIRCHMEYER 19

informative manner.” Id. at 564. Accordingly, the Court

concluded that conveying purely factual information is

speech protected by the First Amendment and the state had to

satisfy “heightened judicial scrutiny.” Id. at 557. Finding

that Vermont could not satisfy any standard of heightened

scrutiny, the Court held the statute unconstitutional.

Sorrell controls this case. The PPEA’s operative impact

is similar to that of the Vermont statute held unconstitutional

in Sorrell. In both schemes, the speaker is the one being

forbidden to act: private, for-profit postsecondary institutions

here and pharmaceutical companies in Sorrell. Id. at 559–61. 

And in each case, a violation occurs because of who the

listener is and the message the speaker seeks to convey. In

Sorrell, the listener was the doctor and the forbidden topic

was the marketing of prescription drugs. Id. at 564–65. 

Here, the listener is a student without a high-school education

and the topic is vocational education. See Cal. Educ. Code

§§ 94811; 94857; 94904. Thus, the PPEA’s overall statutory

scheme precludes certain would-be students from taking a

course when the institution would otherwise admit such

students “because of the topic discussed.” Reed, 135 S. Ct. at

2227.9

9 California argues that the ability-to-benefit requirement does not

preclude speech because PCHS is free, for example, to post online videos

of horseshoeing which Narez could watch. This argument, however,

ignores the value the First Amendment places on in-person expression of

ideas, see Kleindienst, 408 U.S. at 765 (finding First Amendment injury

to listeners who did not have face-to-face access to a speaker), and

ultimately goes to whether California can carry its burden under the

requisite level of scrutiny, see McCullen, 573 U.S. at 477 (explaining that,

even in the intermediate scrutiny context, restrictions on speech must

“leave open ample alternative channels for communication of the

information” to survive First Amendment scrutiny (quoting Ward,

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20 PACIFIC COAST HORSESHOEING SCHOOL V. KIRCHMEYER

In sum, we agree with the plaintiffs that the PPEA

“requires authorities to examine the contents of the message

to see if a violation has occurred.” Tschida v. Motl, 924 F.3d

1297, 1303 (9th Cir. 2019); see also McCullen, 573 U.S.

at 479. We thus agree that the statutory scheme here not only

implicates speech, but also engages in content discrimination. 

Moreover, because content discrimination is apparent, the

district court should have applied some form of heightened

scrutiny. See Sorrell, 564 U.S. at 571–72.10

Before us, the parties disputed only whether the First

Amendment applies, not whether the Act violates the First

Amendment. Although the Supreme Court has warned that

“[i]n the ordinary case it is all but dispositive to conclude that

a law is content based,” id. at 571, the Court has also

recognized that in the commercial-speech context, “contentbased restrictions on protected expression are sometimes

permissible.” id. at 579; see also Fla. Bar v. Went for It, Inc.,

515 U.S. 618, 623 (1995) (“[W]e engage in “intermediate”

scrutiny of restrictions on commercial speech . . . .”); Cent.

491 U.S. at 791)), not whether speech is implicated in the first instance,

see Kleindienst, 408 U.S. at 765 (noting that the Court was “loath to hold

on th[e] record that existence of other alternatives extinguishes altogether

any constitutional interest on the part of the appellees in this particular

form of access”).

10 In reversing the judgment of the district court, we have no reason

to question California’s motives: “A law that is content based on its face

is subject to strict scrutiny regardless of the government’s benign motive,

content-neutral justification, or lack of ‘animus toward the ideas

contained’ in the regulated speech.” Reed, 135 S. Ct. at 2228 (quoting

Cincinnati v. Discovery Network, Inc., 507 U.S. 410, 429 (1993)); see also

Minneapolis Star, 460 U.S. at 592 (“We need not and do not impugn the

motives of the . . . legislature . . . . Illicit legislative intent is not the sine

qua non of a violation of the First Amendment.”).

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PACIFIC COAST HORSESHOEING SCHOOL V. KIRCHMEYER 21

Hudson, 447 U.S. at 562–63 (“The Constitution . . . accords

lesser protection to commercial speech than to other

constitutionally guaranteed expression.”). The parties did not

brief the question of whether the PPEA regulates commercial

speech and, if so, what level of heightened scrutiny should

apply here. Given the historically different treatment of

commercial versus non-commercial speech, and some

variations within the class of commercial speech, see

Zauderer, 471 U.S. at 651, we decline to assume that

admonitions from non-commercial-speech cases apply with

equal force to cases involving possible commercial speech. 

See Ohralik v. Ohio State Bar Ass’n, 436 U.S. 447, 456

(1978) (“To require a parity of constitutional protection for

commercial and noncommercial speech alike could invite

dilution, simply by a leveling process, of the force of the

Amendment’s guarantee with respect to the latter kind of

speech.”); see also Contest Promotions, LLC v. City & Cty.

of S.F., 874 F.3d 597, 601 (9th Cir. 2017) (rejecting “the

notion that Reed altered Central Hudson’s long-standing

intermediate scrutiny framework”).

We will leave it to the district court on remand to

determine whether this case involves commercial or noncommercial speech, whether California must satisfy strict or

intermediate scrutiny, see Expressions Hair Design v.

Schneiderman, 137 S. Ct. 1144, 1151 (2017), and whether it

can carry its burden under either standard. Cf. Nat’l Inst. of

Family & Life Advocates, 138 S. Ct. at 2375 (declining to

decide what heightened standard of review applies because

the law “cannot survive even intermediate scrutiny”); Sorrell,

564 U.S. at 571 (“[T]he outcome [in this case] is the same

whether a special commercial speech inquiry or a stricter

form of judicial scrutiny is applied.”). We simply hold that,

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22 PACIFIC COAST HORSESHOEING SCHOOL V. KIRCHMEYER

because California’s PPEA regulates the content of speech,

plaintiffs have stated a First Amendment claim.

III. CONCLUSION

The district court’s judgment dismissing this cause of

action for failure to state a First Amendment claim is reversed

and the case is remanded for further proceedings consistent

with this opinion.

REVERSED AND REMANDED.

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