F OR P UBLICATION



### UNIT E D ST AT E S CO URT O F APPE AL S FO R T H E NINT H CIRCUIT

A M E R I C A N B E V E R

A G E A S S O C I A T I O N ; C A L I F O R N I A R E T A I L E R S A S S O C I A T I O N ,

Plaintiffs-Appellants
,

and

C A L I F O R

N I A S T A T E O U T D O O R A D V E R T I S I N G A S S O C I A T I O N ,

Plaintiff
,

v

.

C I T Y A N D C O U N T Y O F S A

N F R A N C I S C O , Defendant-Appellee. No. 16-16072

D.C. No. 3:15-cv-03415-EMCA M

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A M E R I C A N B E V E R

A G E A S S O C I A T I O N ; C A L I F O R N I A R E T A I L E R S A S S O C I A T I O N ,

Plaintiffs
,

and

C A L I F O R

N I A S T A T E O U T D O O R A D V E R T I S I N G A S S O C I A T I O N , Plaintiff-Appellant
,

v

.

C I T Y A N D C O U N T Y O F S A

N F R A N C I S C O , Defendant-Appellee. No. 16-16073

D.C. No. 3:15-cv-03415-EMC

OPI NI ON

Appeals from the United States District Court for the Northern District of California Edward M. Chen, District J u dg e, Presiding

Arg ued and Submitted En B a n c September 25, 2018 Pasadena, California

F iled J anuary

31, 2019

B efore: Sidney

R. Thomas, Chief J udg e, and Dorothy W

. N elson, Susan P. Graber, W illiam A. F letcher, Marsha S. B erz on, Sandra S. I kuta, Mary H. Murg uia, Morg an Christen, J acqueline H. Ng uy en, Andrew D. Hurwitz
, and J ohn B . Owens, Circuit J udg es.A M

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Opinion by

J udg e Graber; Concurrence by J udg e I kuta; Concurrence by

J udg e Christen; Concurrence by

J u dg e Ng uy en

SUMMARY *

Civil Rights

The en banc c ourt reversed the district court’s denial of a preliminary injunction a

nd remanded in an action challeng ing the City a

nd Coun t y of San F r ancisco’s Sug ar-Sweetened B everag e W arning Ordinance, which requi r e s health warning s on advertisements for c ertain sug ar-sweetened beverag es.

Plaintiffs, the American B everag e Associati o n , C a l i fornia Retailers A ssociation, and California Sta te Outdoor Advertising Association, arg ued that the Ordinance v iolated their F irst Amendment rig ht to freedom of spee c h

. The en banc court, relying on National Institute of Family & Life Advocates v. Becerra (NI F L A), 138 S. Ct. 2361 (2018 ), concluded that Plaintiffs will likely succeed on the merits of their claim that the Ordin ance is an “unjustified or unduly burdensome disclosure requirement[ ] [ that] mig ht offend the F irst Amendment by chilling protected commercial speech.” Zauderer v

. Office o

f D isciplinary Counsel
, 471 U.S. 626, 651 (1985). The en banc court determined that the remaining

* T h is su m m ary co n stitu

tes n o p art o f th e o pin io n o f th e co u rt. It h as b een p rep ared b y

co u rt staf

f f o r th e co n v en i en ce o f

th e read er.A M

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preliminary injunction factors also w eig hed in P laintiffs’ favor.

C o n cu rring
, J udg e I kuta stated that because the Associations h ad shown a likelihood of prev a i l i ng on the merits and because the other factors for g rantin g a preliminary injunction weig hed in the Ass o c i a tions’ favor, she ag reed with the majority ’ s conclusion that the district

c o u r t abused its d iscretion by deny ing the Associations ’ motion for a prelimina r y i n junction. B ut J udg e I kuta stated that because the majority failed to apply NIFLA ’s framework for analy z ing when g overnment-compelled speech v iola tes the F irst Amendment, she dissented from the major i t y ’s reasoning

. Concurring in part and c o ncurring in the judg ment, J udg e Christen, joined by Ch i ef J udg e Thomas, a g reed with the majority that Zauderer ’s f r a m e work applied to the
g overnment-compelled speech at issue in this case. J udg e Christen also ag reed that the district c o urt’s decision must be reversed, but she would not reach the issue the majority relied
upon. J udg e Christen would reverse because the City a nd County of San F rancisco could no t s h o w that the speech it
soug h t to compel was purely factual.

Concurring in the judg ment, J udge N g uy en disag reed with the majority ’s e x pansion of Zauderer ’s rational basis review to c ommercial speech that is n ot false, deceptive, o r misleading

. J udg e N gu y en stated that b ecause the majority reached the r ig ht result u nder the wrong l e ga l standard, she respectfully

concurred only

in the judg ment.A M

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COUNSEL

Richard P

. Bress (arg

ued), Georg e C. Chipev, Michael E. B ern, and Melis s a Arbus Sherry
, L atham & W atkins L L P, W a shing ton, D.C.; Marcy C. Priedman, L atham & W atkins L L P, San F r ancisco, California; for Plaintiffs-Appellants.

J eremy Michael Goldman (arg u ed) a nd W ay ne Snodg rass, Deputy City A ttorney s; Dennis J

. Herrera, City Attorney ; O f fice o f the City Attorney
, San F rancisco, California; for Defendant-Appellee.

W en c ong F a and Meriem L

. Hubbard, Pacific L eg al F oundation, Sacramento, California, for Amicus Curia e Pacific L eg a l F oundation.

R obert Corn-Revere, Ronald G

. L ondon, Davis W ri gh t Tremaine L L P, W ashing ton, D .C., for A m icus Curiae The Association of National Advertisers, I n c.

W arren Postman and Kathery n Comerford Todd, L itig at i o n Center I nc., Washing ton, D.C.; J e r e m y J

. B rog g i, Meg an L

. B rown, and B ert W. Rein, Wiley Rein L L P, W ash i n gt on, D. C., for Amicus Curiae Chamber of Commerce of the United States of America.

Mark S. Chenoweth, Cory L

. A ndrews, and Richard A. Samp, W a shing ton L eg al F oundation, W ashing ton, D.C., for Amicus Curiae W ashing ton L e g al F oundation.

Allison M. Z ieve, J ulie A. Murray
, an d Scott L

. N elson, Public Citiz en L itiga tion Group, W ashing ton, D .C., for Amicus Curiae Public Citiz ens, I nc.A M

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Sophia TonNu, Thomas B ennig son, an d S e t h E. Mermin, Public Good L aw Center, B erkeley
, California; Sabr ina Adler, I an McL aug hlin, and B enjam i n D. W ing
, Chang elab Solutions, Oa k l a nd, California, for A mici Curiae American Heart Association
, American Academy o f Pediatrics, California, Ca l i fornia Academy of F amily Phy sicians, California Chapter of the American Associ a t i o n of Clinical Endocrinolog ists, California Endowment, C a l i f o r nia Medical Association, California Pan

- E t h n i c H e a l t h Network, Chang elab Solutions, Community Health Partnership, Crossfit F oundation, Diabetes Coali t i on of California, Healthy F ood A merica, L a tino C oalition for a Healthy California, N ational Association of C h r o nic Disease Directors, National Association of L o cal B oards of Health, Network o f Ethnic Phy sician Org aniz ations, Nicos Chinese Health Coalition, Prevention I nstitute, Public Healt h I n s t i t u t e , Public Health L aw Center, San F rancisco B a y Area Phy sicians for Social Responsibility
, San F rancisco Community Clinic Consortium
, San F rancisco Medical Society
, Southern California Public Health Association, and Strateg ic Alliance.

Rachel B loomekatz
, Gupta Wessler PL L C, Washing ton, D.C., for A mici Curiae American Canc e r S o ciety Cancer Action Network, Public Health L aw Center
, Action on Smoking & Health, African Americ an Tobacco Control L eadership Council, American L ung Association, American Thoracic Soc i ety , Americas for N onsmokers’ Rig hts, Campaig n for Tobacco-F ree Kids, NAATPN, and Truth I nitiative F oundation.

Maia C. Kats
, Center for Science in the Public I nterest, W a shing ton, D.C., for Amicus Curiae Center f o r S cience in the Public I nterest.A M

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Peter C. Tolsdorf and L inda E

. Kelly
, Manufacturers’ Center for L eg al Action, W ashing ton, D.C. ; J

. Michael Connolly
, Thomas R. McCarthy
, and W illiam S. Consovoy , Consovoy McCarthy Park PL L C, Ar ling ton, Virg inia; for Amicus Curiae National Association for Manufacturers.

Deborah R. White, Retail L itig ation Center I nc., Arling ton, Virg inia; Gabriel K

. G illett, J e nner & Bl o c k L L P, Chicag o, I llinois; Adam G. Unikowsky
, J enner & B lock L L P, W a shing ton, D.C., f

or A micus Curiae Retail L itig ation Center.

Ca t h e r ine E. Stetson, Hog an L ovells US L L P, Washing ton, D.C., for Amicus Curiae Grocery Manufacturers Association.

OP INION

GRAB ER, Circuit J udg e:

Plaintiffs A merican B everag e As s ociation, California Retailers Association, a nd California State Outdoor A d vertising Association challeng e Defendant City a nd County of San F rancisco’s Sug ar-Sweetened B e verag e W a r ning Ordinance, City & Cty

. of S.F
., Cal., B d. o f Supervisors Ordinance No. 100-15, § 1 (J une 16, 2015). The Ordinance requires health warning s on advertisements for certain sug ar-sweetened b everag e s (“SSB s”). Plain t i f fs a rg ue that the Ordinance violates t h eir F irst Amendment rig ht to freedom of speech. Rely ing o n the United States Supreme Court’s decision in National Institute of Fam i l y & Life Advocates v. Becerra (“

NIFLA ” )
, 138 S. Ct. 2361 (2018), we conclude that P l aintiffs w ill likely succeed on the merits o f their claim that the Ordinance is an “unjustified or u n dulyA M

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burdensome disclosure requirement[ ] [ that] mig ht offend the F irst Amendment by chilling protected commercial speech.” Zauderer v

. Office of Disciplinary Counsel
, 471 U.S. 626, 651 (1985). The remaining preliminary injunction f actors also weig h in Plaintiffs’ favor. We therefore h o l d that the district c ourt abused its discretion b y deny ing Plaintiffs’ motion for a preliminary in j u nction, a

nd we reverse a

nd remand.

F ACTUAL

AND PROCEDURAL

B ACKGROUND

I n J u ne 2015, Defendant enac t e d the Ordinance, which require s t h a t c e r t a in SSB a dvertisements ( “SSB Ads”) include the following statement:

W A RNI NG: Drinking beverag es with added
sug ar(s) contributes to obesity
, di abetes, a nd tooth decay . This is a messag e from the City and County

of San F rancisco.

City & Cty

. of S.F
., Cal., Health Code art

. 4 2, div. I
, § 4203(a) (2015). An “SSB Ad” covers

any a dvertisement, including
, without limitation, any log o, that identifies, promotes,

or markets a Sug ar-Sweetened B everag e for sale or use that is any of the f ollowing : (a) on paper, poster, or a bi l l b o a rd; (b) in or o n a st a d ium, arena, transit shelter, or any other structure; ( c ) in or o n a bus, car, train, pedicab, or a

n y other vehicle; or ( d) on a wall,
or any other surface or material.A M

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Id. § 4202

. U n d er section 4202, thoug h, an “SSB Ad” does
not include advertising i n o r on: periodicals; television; electronic media; SSB containers or packag ing ; menus; shelf tag s; vehicles used by those in the business of manufacturing
, selling
, or distributing SSB s; or log os that occupy an area o f less than 36 square inches. Id. The Ordinance defines “SSB ”

as “any Nonalcoholic B everag e sold for h uman consumption, including
, without limitation, beverag es produced from Concentrate, that has one or more added Caloric Sweeteners and contains more than 25 c alories per 12 o unces o f beverag e.” Id. B u t “SSB ” does not i n cl ude drinks such a s milk, plant-based milk alternatives, natur al fruit a nd
veg etable juices, infant formulas, and supplements. Id. The Ordinance provides detailed instructions reg arding the f o rm, content, and placement of the warning on SSB Ads, including

a requirement that the wa rn i n g o ccupy at least 20% of the advertisement and be set off with a rectang u lar b order. Id. § 4203(b).

Defendant’s stated purpose in requiring the warning is,
among o ther r easons, to “inform the public of the presence o f adde d s u g ars and thus promote informed consumer choice that may r esult in r e d u ced caloric intake and improved diet and h e alth, thereby reducing illnesses to which SSB s contribute and associated economic b u r dens.” Id. § 4201. F ailure to comply with the warning r equirement c an r esult in administrative penalties imposed by San F rancisco’s D irector of Health. Id. § 4204(a).

Plaintiffs sued to prevent imp l e m entation of the Ordinance. T he district court d enied Plaintiffs’ motion for a preliminary inju n c t ion. Concluding that Plaintiffs likely would not succe e d on the merits of their F irst A mendment challeng e, the district court held that the warning is notA M

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misleading, d o es not place an undue burden on Plaintiffs’ commercial speech, a

n d is rationally rela t e d to a substantial
g overnmental interest. B ut the court stay ed implementation of the Ordinance pending this timely

interlocutory

appeal.

A three-judg e panel of t his c ourt reversed the district court’s denial of a preliminary injunction, Am. B e v erage Ass’n v. City & County of San Francisco , 871 F .3d 884 (9th Cir. 2017). We then o rdered that the case be reheard en banc, 880 F .3d 1019 (9th Cir. 2018).

J U RI SDI CTI ON AND STANDARDS OF REVI EW

W e have jurisdiction under 28 U.S.C. § 1292.

W e review the denial of a preliminary injunction for abuse of discretion. Harris v. Bd. of Supervis o r s , 3 66 F .3d 754, 760 (9th Cir. 2004). A district court abuses its discretion if it rests its decision “on a n erroneous leg al stand a r d o r on clearly e rroneous factual finding s.” United S t a t e s v. Schiff
, 379 F .3d 621, 625 (9th Cir

. 2 004) (internal quotation marks omitted). “W e review conclusions o f law de novo a nd finding s of fact for clea r e rr o r. ” All. for the W ild Rockies v

. Co t t r el l
, 632 F

. 3d 1127, 1 131 (9th Cir. 2011) (internal quotation marks omitted).

D I SCUSSI ON

A preliminary injunction is an ex traordinary remedy that
may be a warded only if the plaintiff clearly shows entitlement
to such re l i e f

. W inter v

. Nat. Res. Def. Council, Inc.
, 555 U.S. 7, 22 ( 2 0 0 8 )

. “A plaintiff seeking a preliminary injunct i on must establish [ 1] that he is likely to succeed on the merits, [ 2 ] that he i s l i k ely to suffer irreparable h arm inA M

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the absence of preliminary relief, [ 3 ] that the balance o f equities tips in his favor, and [ 4] that a n i n j u n c t i o n is in the public interest.” Id. at 20.

A. Test for Analyzing a Claim of Compelled Speech

W e beg in by considering Plaintiffs’ likelihood of success on the merits o f their F irst Amendment challeng e. The F irst Amendment provides t hat “Cong r e ss shall make no law

. . . abridg ing the f

reedom of speech.” 1 U .S. Const. amend. I

. I ts protection is bro a d
, a nd the Supreme Court has “been reluctant to mark off new categ ories of speech for d iminished

c o nstitutional protection.” NIFLA
, 138 S. Ct. at 2 3 7 2 ( i nternal quotation marks omitted). B u t NIFLA a ls o acknowledg ed that the Court has “applied a lower level o f scrutiny to laws that c o mpel disclosures in certain contex ts,” including cases analy

z ing the r equired disclosure o f “factual, noncontroversial information in

. . . ‘commercial speech.’” Id.

The Ordinance reg ulates commercial speech a nd compels certain disclosures. 2 Therefore, in addressing Plaintiffs’ claim, we f

irst determine what level of scrutiny applies. The parties d ispute whether we should an a l y z e the Ordinance’s compliance with the F irst Amendment under Central Hudson Gas & Electric Corp. v. Public Service Commission
, 447 U.S.

1 T h e Du e Pro cess C lau se o f th e Fo u rteen th A m en dm en t in co rp o rates th e First A m en d m en t ag ain s t th e states. Va

. S ta te Bd

. of Ph a rma cy v. Va

. Citizen s Co n su mer Co u ncil, In c. , 4 2 5 U.S. 7 4 8 , 7 4 9 n .1 (1 9 7 6 ).

2 J u d g e Ik u ta’ s sp ecial co n cu rren ce d iscu s s es at len g th a p ro p o sitio n th at n o o n e d i sp u te s: t h at th e w arn in g i s co m p elled sp eech
, req u irin g a First A m en dm en t an aly sis.A M

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557 (1980), or under Zauderer
, 4 71 U.S. 6 2 6. We have discussed those two tests previously , stating that:

Unde r Central Hudson
, the g overnment may restrict or prohibit commercial speech that is neither mi sleading nor c onnected to unlawful activity
, as long as the g overnmental interest in r eg ulating the speech is substantial. 447 U.S. at 564. The r estriction or prohibition
must “d i r ectly advance the g overnmental interest asserted,” and must not be “more

ex tensive than is necessa r y to serve that interest.” Id. at 566. Under Zauderer

. . . , the
g overnment may c ompel truthful disclosure in commercia l speech as long a s the compelled disclosure is “reasonably r elated” t o a substantial g overnmental interest. Zauderer
, 471 U.S. at 651.

CTIA–The W

ireless Ass’n v. City of

B erkeley
, 854 F

. 3d 1105, 1115 (9th Cir. 2017). 3

I n NIFLA
, the Supreme Court applied the Zauderer test without d e c i d i n g w hether that test, in fact, applied. NIFLA
, 138 S. Ct. a t 2 376–77. B ut before NIFLA
, we ex a mined a similar health and safety warning and held squarel y t hat Zauderer p r o v ides the proper analy tical framework for considering required w arning s o n commercial products:

3 T h e Su p rem e Co u

rt v acated an d rem an d ed o u r o p in io n in CTIA f or

reco n sid eratio n i n lig h t o f NIFLA

. CTIA
, 13 8 S. C t. 2 7 0 8 (2 0 1 8 ). A s w i l l b e e vi d en t f

ro m th e tex t th at f

o llo w s, w e reco n sid er relev an t p ortio n s of CTIA h ere in lig h t o f NIFLA an d see n oth i n g in NIFLA th at is in co n sisten t

w ith th o se asp ects o f CTIA w ith w h ich w e ag ree in th is o p in io n

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“[ T] he g overnment may compel truth f u l disclosure in commercial speech as long as the c ompelled disclosure is ‘reasonably related’ to a substant i al g overnmental interest.” CTIA
, 854 F .3d at 1115. We rejected the a r g u m e n t that int e r mediate scrutiny

—as required by Central H udson
, 447 U.S. 557, f

or situations in w hich speech is r estricted o r prohibited—should g overn. CTIA
, 854 F .3d at 1115–17. W e also rejected the arg ument that Zauderer applies only to situations in which the g overnment r equ ires disclosures to prevent consumer deception, p ointing out that we were joining the holding s of se v e ra l o f our sister c ircuits. Id. at 1116–17 (citing Am. Meat I nst. v. U.S. Dep’t of Agri c

. , 760 F .3d 18 (D.C. Cir. 2014) ( en ba n c ) ; D isc. Tobacco City & Lottery, Inc. v. United States
, 674 F .3d 509 (6th Cir. 2 012); N.Y

. State Rest. Ass’n v. N.Y

. City Bd. o

f Health
, 556 F .3d 114 (2d Cir. 2009); Nat’l Elec. Mfrs. Ass’n v. Sorrell
, 2 7 2 F. 3d 104 (2d Cir. 2001)).

NIFLA r equires u s to reex amine how we approach a F irst Amendment c l aim concerning compelled speech. B ut nothing in NIFLA sug g ests that CTIA was wrong ly decided. To the c ontrary , NIFLA preserved the ex ception to heig htened scrutiny for h ealth and safety warning s. The Supreme Court made cle a r that it w as not calling into “question the leg ality of health and safety warning s long considered permissible.” NIFLA
, 138 S

. C t

. at 2376. 4 NIFLA did not address, and a

4 J u d g e Ik

u ta’ s sp ecial co n cu

rren ce read s th is p ortio n of N I F LA to

m ean th at on ly certain h ealth an d saf ety w arn in g s (th o se o f an cien t o rig in )

are ex cep t ed f

ro m h eig h ten ed scru tin y

. Bu t th e m o st n atu ral read in g of th is p assag e i n t h e Co u rt’ s o p i n io n is t h at req u ired h ealth an d s af ety

w arn in g s, w

h ich h av e lo n g b een p erm i t t e d
, are still allo w ed

. In th is
statem en t, th e NIFLA m aj o rity w as co u n terin g J u stice B rey er’ s d i s sen t,

w h ich lists ex am

ples o f su ch w arn in g s, in clu d in g b o th m an d ato ry

ad v i ce

co n cern i n g seat b elts an d m an d ato ry ad v ice a bo u t th e av ailab ility o f aA M

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fortiori did not disapprove, the circuits’ precedents, including CT I A
, which have unanimously held that Zauderer applies outside the contex t of misleading advertisements. See CTIA
, 854 F .3d a t 1116–17 (citing cases from the D.C., Second, a nd Six th Circuits )

. I n short, we r eaffirm our reasoning a nd conclusion in C T

I A t hat Zauderer provides the appropriate framewo r k t o analy

z e a F irst Amendment claim involving compelled commercial speech—even when the g overnment requires health and safety wa rning s, rather than warning s to prevent the deception of consumers. CTIA
, 854 F .3d at 1117. W e therefore proceed to a p p ly Zauderer to Defendant’s required warning

.

B

. Application of the Z a

uderer test

The Zauderer tes t , a s applied in NIFLA
, contains three inquiries: whether the n o t i c e is (1) purely factual, (2) noncontroversial, and (3) not u njustified or unduly burdensome. A compelled disc l o s ure a ccompany ing a r elated
p r oduct o r service must meet all three criteria to be constitutional. NIFLA
, 138 S. Ct. at 2 372. N either NIFLA

nor a n y other Supreme Court precedent requires that we apply these criteria in any particular or d er. The NIFLA Court’s analy sis b eg an with the question whether the notice

was “unjustified or unduly burdensome.” Id. at 2377 (citing Zauderer
, 471 U.S. at 651). B y following the same sequence,

we do n ot s u gg est that courts must beg in by analy zing whether a disclosure r equirement is u njustified or unduly

w h o o p in g co u g h v accin e, 1 3 8 S. C t. at 2 38 0

– 8 1

. T h ere is n o i n d icatio n th at eith er o f th o se req u ired d isclo su res is o f an cien t o rig i n o r th at th e

m aj o rity i n ten d ed so m e h ealth an d saf ety w arn in g s (if accu rate,

u n co n tro v ersial, an d n o t u n d u ly b u rd e n s o m e) to b e p reclu ded m erely b ecau se th e k

n ow led g e th at th e w arn in g s co n v ey is n ew

.A M

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burdensome, b ut we find it useful to beg in with t hat prong here. Defendant has the b u r d en of p roving that the warning is neither unjustified nor unduly burdensome. Ibanez v. Fla. Dep’t of Bus. & Prof’l Regulation
, 512 U.S. 136, 146 (1994). On this preliminary record, Defendant has not carried its burden. 5

Def endant’s arg ument that the border and 20% siz e requirements adhere to the best practices for health a nd safety warning s is u npersu asive. W e recog niz e that some tobacco and prescription warning s must occupy a t least 20% of those products’ labels or advertisements. Am. Beverage Ass’n v

. City & County of San Francisco
, 1 87 F

. Supp

. 3 d 1123, 1138–39 (N.D. Cal. 2016). A nd Defendant’s ex pert concluded that larg er w arning s are more effective. B ut the record here shows that a smaller warning

— h alf the siz e—would accomplish Defendant’s stated g oals.

Defendant’s e x p e rt cited and discussed a study that

ex a mined a warning similar to that required by the Ordinance. 6 That study used warning s covering only 10% o f the imag e. The ex p ert concluded that the cited study “provides empirical support that the mess ag e content a nd

5 Co n trary to J u d g e Ik

u t a’ s c h aracterizatio n , w e d o n ot p reclu d e Def en d an t f ro m arg u in g th at th e Ord in an ce su rv iv es h eig h ten ed scru t in y

. Co n cu rren ce at 2 8

. L o g ically
, th o u g h
, if th e w arn in g d o es n o t m eet a lo w er stan d ard
, it n ecessarily d o es n ot m eet a h ig h er s tan d a rd

. S ee NIFLA
, 1 3 8 S. Ct. at 2 37 7 (“ Ev en u n d er Za u d erer , a d i sclo su

re req u irem en t can n o t b e ‘ u n j u stif ied o r u n d u ly b u r d en so m e.’ ” (q u o tin g Za u d erer , 4 7 1 U.S. at 6 5 1)).

6 T h e stu d y ’ s w arn i n g read “ Saf ety W arn in g : D rin k in g bev erag es

w ith ad d ed s u g ar[s] co n trib u tes to o b esity
, diab etes, an d to o th d ecay ,” an d in clu d ed a b ord er.A M

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desig n of the San F rancisco w arning is associated [ with] an improved understanding o f h e a l th harms associated with overconsumption o f SSB s and may r e d u c e the purchase o f SSB s—two of the primary o bjectives ident i f i e d in the San F rancisco ordinance.” The finding s of that stu d y t h u s undermine D efendant’s position, because th e f i n d i n g s s u g g e st that the Ordinance’s g oals could be accomplished with a smaller warning

. O n this record, therefore, the 20% requirement is not justified when balanced ag ainst it s l i k ely burden on protected speech.

I n addition, the arg ument that the Ordinance incorporates best practices does not respond to the F irst Amen d m e n t balancingtest that we must apply

. Althoug h the disclosures in NIFLA were more o nerous than the Ordinanc e’s disclosure, similar c oncerns a r e p resent here: Defendants have not shown that the contrasting rectang ular border containing a warning that covers 20% o f the adve r t i s ement does not “drown[ ] out” Plaintiffs’ messag e s and “effectively r u le[ ] out the possibility of having [ an advertisement] in the first place.” 138 S. Ct. at 2378 (internal quotation marks omitted). O n this record, therefore, the 20% requirement is not justified and is unduly burdensome when balanced a ga i n st its likely burden on protected speech.

To b e clear, we do not hol d that a warning occupy ing 10% of product labels o r advertisements necessarily is valid,

nor do we hold that a warning occupy ing more than 1 0% of product labels or advertisements necessarily is invalid. See id. (“W e ex press no view on the leg al i t y of a similar disclosure requirement that is better supported or less burdensome.”). R ather, we hold only that, on this record, Defendant h as not carried i t s burden to demonstrate that the Ordinance’s requirem en t is not “unjustified or undulyA M

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burdensome.” See id. at 2377. The requi r e d warning s therefore offend Plaintiff s ’ F irst Amendment r ig hts b y chilling protected speech. See id. at 2378 ( “ [The notice] imposes an unduly burdensome disclosure r e q uirement that will chill [ the speaker’s] protected speech.”).

The S upreme Court made clear in NIFLA that a go v ernment-compelled disclosure that imposes an und u e burden fails for th at reason a lone. Id. at 2377. I ndeed, the Court ended its own analy sis w ith that holding

. I d. at 2378. W e need not, and therefor e d o not, decide w hether the warning here is factually

accurate and noncontroversial.

The remaining f

ac tors of the p reliminary injunction test also favor an injunction. B ecause Plaintiffs have a colorable F irst Amendment cl a im, they have demonstrated that they likely will suffer irreparable h a r m if the Ordinance takes effect. See Doe v. Harris
, 772 F .3d 563, 583 (9th Cir. 2 014) (“A colorable F irst Amendmen t c laim is irreparable injury sufficient to merit the g rant of reli e f.” (internal quotation marks omitted)). Nex t, “[ t] h e fact that [ Plaintiffs] have raised serious F irst Amendment questions c ompels a finding that

. . . the balance of ha r d s h i p s tips sharply in [ Plaintiffs’] favor.” Cmty. House, I

nc. v. City of B o ise
, 490 F .3d 1041, 1059 (9th Cir. 2007) (in t e r n al q

uotation marks omitted). F inally
, we have “ consistently recog n iz ed the sig n ificant public int erest in upholding F irst A mendment principles.” Doe
, 7 72 F .3d at 583 (internal quotation marks o mitted). I ndeed, “it is alway s in the public interest to prevent the violation of a party ’s

c o n s titutional rig hts.” Melendres v. Arpaio
, 695 F .3d 990
, 1002 (9th Cir. 2012) (internal quotation marks omitted).

I n summary , Plaintiffs have met each of the requirements for a preliminary injunction. W e therefore conclude that theA M

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district c ourt abused its discretion b y deny ing Plaintiffs’ motion.

REVERSED and

REMANDED

.

I KUTA, Circuit J udg e, dissenting f rom most of the reasoning
, concurring

in the result:

I n National Institute of Fa m i ly & Life Advocates v

. Becerra ( NIFLA ), the Supreme Court provided a framework for analy z ing F ir s t A mendment challeng es to g overnmentcompelled speech. 138 S. Ct. 2361 (2018). Under this framework, a g overnment reg u lation that compels a disclosure (like the San F rancisco o rdinance in this c ase) is a content-based reg ulation of speech, wh i c h is subject to heig htened scrutiny u nder the F irst Amend ment u nless the Zauderer ex ception applies. The majority fails to follow this analy tical framework and makes several cruci a l errors. I therefore dissent.

I

NIFLA broke new g round o n s everal key issues. Althoug h the Cour t has previously considered the constitutionality of g overnment reg ulations requiring lawy ers to disclose c ertain information in their advertisements, see Zauderer v. Office of

Disciplinary Counsel of Supreme Court of Ohio
, 471 U .S. 626
, 6 50–51 ( 1 985); see also M ilavetz, Gallop & Milavetz, P.A. v. U nited States
, 559 U.S. 2 2 9
, 250–52 (2010); Ohralik v. O h i o State B ar Ass’n
, 436 U.S. 447, 457–59 (1978), NIFLA is the first Supreme Court case to apply Zauderer

to commercial speech more g e nerally

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NIFLA considered th e constitutionality of a California
st a t u te that required clinics that primarily served preg n ant

women to post g overnment-drafted noti c e s

. NIFLA
, 138 S. Ct. a t 2368. State-licensed clinics were required t o p o s t a notice that st a t ed: “California has public prog rams that provide immediate free or low-cost access to comprehensive family planning services ( i n cluding all F DA-approved methods of contraception), p renatal care, and abortion for eli g i b l e women.” Id. at 2369 ( referred to a s the “licensed notice”). Unlicensed cl i n i c s were required to post a notice stating that the “facility is not licensed as a medic al facility by the State of California and has no lice n s e d medical provider who provides or directly supervises the provision o f services.” Id. at 2370 (referred to as the “ unlicensed n otice”). Two crisis preg nancy centers, among o ther plaintiffs, broug ht suit, claiming that both the licensed a nd unlicensed notices violated their F irst Amendment rig hts.

N I F L A beg an by making two important contributions to F irst Amendment jurisprudence. F irst, in its consideration o f the two g o vernment disclosur e requirements, NIFLA established, for the f

irst time, that g overnment-compelled speech is a cont e n t

- b a sed reg ulation of speech. 1 The Court

ex p lained that “[ b ] y compelling individuals to speak a particular messag e,” the licensed notices “alte r [ e d] the
content of [ their] speech” and thus were content-based
reg ulations. Id. at 2371. Such c ontent-based reg ulations “are

1 T h is h o ld in g ar g u a b ly su p ersed es Za u d

erer , w h ich ap peared to ap p ly ratio n al basis rev iew to l aw s req u irin g atto rn ey s to m ak e certain d isclo su res, statin g , “ w e h o ld th at an ad v ertiser’ s rig h ts are ad eq u ately
p ro tected as lo n g as d isclo su re req u irem en ts are reaso n ab ly related to th e State’ s in terest in p rev en tin g d ecep tio n o f co n su m ers.” S ee Za u d erer , 4 7 1 U.S. at 6 5 1

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presumptively unconstitutio n a l and may be justified only if the g overnment proves that they ar e n arrowly tailored to serve compelling

state interests.” Id.

S e cond, NIFLA made clear that g o vernments may not “impose conten t -based restrictions on speech without persuasive evidence of a long (if heretof o r e unrecog niz ed) tradition to that effect.” Id. (cleaned up). The Court therefore rejected a line of circuit court cases holding that professional speech is ex empt “from the rule that conte n t-based

r e gulations of speech are subject to strict scrutiny .” Id. at 2371–72. I n doing so, NIFLA overruled our opinion in Pickup

v. Brown
, 740 F .3d 1208 (9th Cir. 2014), as well as a line o f decisions in the Third and F ourth Ci r c u i t s , see, e.g. , King v

. Governor o

f N.J. , 767 F .3d 216 (3d Cir. 2014); M o ore-King

v. Cty. of Chesterfield
, 7 08 F .3d 560 (4th Cir. 2013). F urther, NIFLA emphasiz ed that “[ t] h i s Court has been reluctant to mark off new categ ories of speech f or d iminished constitutional protection.” Id. at 2 3 7 2 (internal quotation marks o mitted)

. W hile the Court did not “ qu e s t ion the l eg ality of health and safety warning s long conside r e d permissible,” id

. a t 2 3 7 6, the Court did not c reate a standalone ex ception for such co n tent-based restrictions. I nstead, NIFLA reiterated that a categ ory of speech is e x empt from h eig htened scrutiny under the F irst Amendment only if the state c an show a “long (if heretofore unrecog niz ed) tradition to that effect.” Id. at 2372.

Ag ainst this backdrop, the Court estab lished its analy tic framework. A g o vernment r eg ul a t ion “compelling individuals to speak a p articular messag e” is a content-based
reg ulation tha t is subject to strict scrutiny
, subject to two

ex c e ptions. Id. at 2372–73

. Fi r s t , the Court held that its precedents (most notably Zauderer
, 471 U.S. at 650) affordedA M

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more de f

e r ential review to “some laws that require
p r o f e s s i o n a l s t o d i s c l o s e f a c t u a l
, n o n c o n t r o v e r s i a l information in their ‘commercial speech.’” NIFLA
, 138 S. Ct. at 2372. Second, states may reg ulat e professional conduct, even tho u g h that conduct incidentally involves speech, such a s throug h informed consent requirements. Id. ;

see also Planned P arenthood of Southeastern Pa. v. Casey
, 505 U.S. 833, 884 (1992).

To determine whether the Zau d erer ex ception applies, a court must consider whether the compelled speech g overns only [ 1] “commercial advertising ” and requires the disclosure of [ 2] “purely factual and [3] u nco n t r oversial information ab o u t [ 4] the terms under which

. . . services will be available.” NIFLA
, 1 38 S. Ct

. at 2 3 7 2 (internal quotation marks and c itations omitted). I f the g ov e r nment reg ulation
meets those requirements, t h e reg ulation should be upheld unless it is [ 5 ] “unjustified or [ 6] unduly burdensome.” Id.

I f the reg ulation does not q ualify for the Zauderer

ex c e ption, the reg ulation must survive heig htened scrutiny to avoid violating the F irst Amendment. Id. at 2372. The Court did not d ecide whether strict scrutiny or intermediate scrutiny applies to g overn

m e n t

- c o m p e l l e d c o m m e r c i a l d isclosures that do not fall under the Zauderer ex c eption. See id.

Apply ing this leg al framework to both t h e licensed a nd unlic e n sed notice requirements, the Court held that neither
regu l ation survived F irst A mendment scrutiny

. The Court beg an by considering the notices required for licensed clinics. Id. at 2 371–7 2. I t first determined that the Zauderer

e x c ep t i on did not apply for two reasons. Id. at 2372. F irs t , the licensed notice was “not limited to purely factual a nd uncontroversial information about the terms under which

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services w[ ould] be a vailable,” because the notice “in no way relate[ d] to the ser v i c e s that licensed c linics provide.” Id. (internal quotation marks and citations omitted). Second, the notice was n ot limited to uncontroversia l information, because abortion is “any

thing but an ‘uncontroversial’ topic.” Id.

B e c a u s e the Zauderer ex ception did n ot apply (and because the ex ception applicable to r egu l a t i ons of conduct that incidentally burdens speech, such as informed consent

r e q uirements, did not a

pply
, see id. at 2373–74), the Co u r t then c onsidered whether the licensed notice r equirement survived heig htened scrutiny

. The Court declined to determine w hether strict scrutiny o r intermediate scrutiny applied to the licensed n otice, because that notice failed even under intermediate scrutiny

. Id. at 2375. Even assuming the
state had a substantial state interest in providing low-income

women with information about state-sponsored services, the Court held that the licensed notice was not sufficiently drawn
to achieve this interest: it was underinclusive, imprecisely drawn, a nd could have been replaced with l ess intrusive alternatives. Id. at 2375–76.

Turning to the notice required for unlicensed clinics, the Court ag ain beg an by considering t h e a p plicability of the Zauderer ex ception. Id. at 2 376–77. B ecause the unlicensed notice stated only th a t the “ facility is not licensed as a medical facility by the State of California and has no licensed med i c a l provider who provides or directly supervises the provision of services,” the Court did n ot need to address the threshold Zauderer f

actors; i t wa s apparent that the unlicensed n otice required the disclosure of purely factual a nd uncontroversial information about the terms under which services would be available. See id. a t 2377. The CourtA M

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instead focused on whether the notice req u i r e ment was unjustified or unduly burdensome. S ee id. The Court concluded th a t C a l ifornia had not satisfied its burden o f proving that the unlicensed notice r equirement satisfied these
two prong s, b ecause “California has not dem o n s t rated any justification for the licensed notice that is more than “purely hy pothetical,’” id.
, and the notice unduly burdened protected speech
, i d

. a t 2377–78. The Court held that the notice was underinclusive because it covered “ a curiously narrow subset of speakers.” I

d. at 2377. Moreover, the notice would have

a chilling effect because the statute required t h at the
g overnment-drafted statement be in “larg er tex t [ than surrounding tex t] or c ontrasting ty pe o r c olor” and be p osted in as many as 13 different lang uage s

. I d

. at 2378. These requirements woul d “drown[ ] out the facility ’s o wn messag e.” Id.

I n contrast to its analy sis of the licensed notice, the Court did not address the q

uestion wh e t h er the unlicensed notice requirement survived heig h tened scrutiny ; there was no need
to do so, b e cause California did “not ex plain how the unlicensed notice could satisfy any standard o t her than Zauderer

. ” Id. at 2377 n.3. I n other words, because the state did not make a colorable arg ument that the unlicensed notice requirement would survive heig h tened scrutiny
, there was no dispute tha t t he notice requirement violated the unlicensed clinics’ F irst A mendment r ig hts unless the Zauderer

ex c e ption applied. B e c a u s e Zauderer did not a pply
, the unlicensed n otice requirement w as invalid, and the Court did not have to proceed further.A M

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I I

Under NIFLA
, San F rancisco’s ordinance requir ing companies who advertise certain sug ar-sweetened b everag e s

on billboards wit h i n San F rancisco to include a warning
messag e constitutes a “content-based reg ul a t i o n of speech” subject to heig htened scrutiny unless an ex ception applies.

Turning first to the Zauderer ex cepti o n, a court should consider whether the r eg u lation requir e s the disclosure o f purel y factual and uncontroversial information about the
terms u nder which services will b e available. The re q u ired warning states:

W A RNIN G: D rinking beverag es with added
sug ar(s) con tributes to obesity
, diabetes, a nd tooth decay . This is a messag e from the City and County

of San F rancisco.

S.F . Health Code § 4203(a).

T h is warning does not p rovide “purely factual a n d uncontroversial information about the terms under which

. . . services wil l b e a v ailable.” Cf. NIFLA
, 138 S. Ct. at 2372; Zaudere r , 4 7 1 U.S. at 651. The factual accuracy of the warning is d i s puted in the record. Among other thing s, the warning is contra r y to statements by the F DA that added
sug ars a re “ g enerally recog niz ed as safe,” 21 C.F .R. §§ 184.1, 184.1866, and “can b e a p a rt of a healthy dietary pattern” when not consumed in ex cess amounts, 8 1 F e d. Reg

. 33,742, 33,760 (May 27, 2016). Moreover, as J udg e Christen’s

concurrence p oints out, the disclosure is literally f alse with respect to Ty

pe I d i a b et es. MB C Op. at 34–35. Althoug h NIFLA did not defi n e “ uncontroversial,” the warning hereA M

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requires the advertisers to convey San F rancisco’s one-sided policy view s about sug ar-sweetened b everag es. The record shows t h is is a controversial topic, and therefore, the ordinance does not qualify as “ uncontroversial information” under the third prong of NIFLA

. F inally
, t h e w a r n ing does not relate to the terms on which the advertisers provide their services. Th e warning merely relates to the consumption o f
sug ar-sweetened beverag es, which is a p roduct rather than a service, and does not address the terms on which that product is provided.

Even if the warning requirem e n t provided factual a nd uncontroversial information about the terms of ser v i c e , the requirement would fail because it is unduly burdensome. A s the majority acknowledg es, the w arning ’s siz e, required font siz e , c ontrasting color, and other requirements contribute to the severity of the warning ’s burden. Maj. Op. at 15–16. NIFLA makes clear that requiring commercial speakers, like the u nlicensed clinics in NIFLA
, t o f ig ht a g overnmentscripted messag e that drowns out their own advertisements is unduly burdensome. Moreover, the record indicates that the warning label would have a chilling ef f e c t , causing some manufacturers o f sug ar-sweetened beverag e s to cease advertising on cov er e d media. Therefore, the Zauderer

ex c e ption does not apply

.

Nor does a

ny othe r ex ception apply

. 2 The majority is
wrong to the ex tent it sug g ests that “ N IFLA preserved the

e x c e ption to heig h tened scrutiny for health and safet y warning s.” Maj. O p. at 13. NIF L A m a de clear that only

2 Ob v io u sly
, t

h e w arn in g req u i rem en t d oes n o t co n stitu te a reg u latio n

o f p ro f essio n al co n d u ct th at in cid en t ally i n v o lv es sp eech
, s u ch as in f o rm ed co n sen t req u irem en ts.A M

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“health and safety warning s lon g c o n sidered permissible” would be ex cepted. S

ee 1 3 8 S. Ct. at 2376. California has made no showing that the warning h ere was “long considered permissible,” n or could it do so. The ty pes of speech e x empt from F irst Amendment pro t e c t ion are “well-defined a nd

n a r rowly limited classes of speech, the prevention a nd punishment of which have n ever been thoug ht to raise any Constitutional problem,” from 1791 to pr e s e nt. See United States v. Stevens
, 55 9 U .S. 460, 468–69 (2010). These limited ex ceptions include defamation, o bscenity
, and fraud,

see id.
, not newly i n v e n ted classes o f speech, see NIFLA
, 138 S. Ct. at 2371–72. NIFLA did not specify what so r t s o f health and safety warning s date bac k to 1791, but warning s about sug ar-sweetened b everag es a re clearly not among them. I ndeed, the F irst Amendment applies even to products that
pose more obvious t h r eats to health and safety
, such a s cig arettes. I n a case involvin g r estrictions on cig arette advertisements, the Court h eld that the “F irst A mendment also constrains state efforts to limit the advertising of tobacco products, b ecause so long as the sale and use of tobacco is lawful for adults, the tobacco industry has a protected interest in communicating information about its products and adult
customers have an interest in r eceiving that information.” Lorillard Tobacco Co. v. R ei lly
, 533 U.S. 525, 571 (2001). Given this contex t, our precedents creat i n g a F irst Amendment ex ception for g overnment-compelled health a nd safety warning s, see CTIA

– The W ireless Ass’n v. City of Berkeley, Calif.
, 854 F

. 3d 1 105, 1116

– 1 7 ( 9th Cir. 2017), vacated
, 138 S. Ct. 2708 (2018), are no more persuasive than

our precedents creating a F irst Amendment ex ception for professional speech, which were struck down by NIFLA

. I n neither case is there a long tradition of g overnment reg ulation dating back to 1791.A M

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B e cause Zauderer does not apply h ere, NIFLA directs us to consider whether the ordinance survives heig htened scrutiny

. U nder intermediate scrutiny
, even a s s uming that th e r e i s a substantial state interest in warning the public o f health dang ers from drinking sug ar-sweetened beverag es, the warning r equirement is not sufficiently drawn to that interest. F irst, the requirement is underinclusive both as to the covered products and as to the m eans of advertisement. The ordinance does not e v e n apply to all sug ar-sweetened beverag es, much less all sug ar-sweetened p ro d u cts. Moreover, it applies to posters and billboards, but not dig ital ads or o ther t y

p e s of media. L ike the notices in NIFLA
, the warning requirement is “wildly underinclusive.” See 138 S. Ct. at 2367. Second, San F rancisco could disseminate health information by

other, less burdensome means, such as a less intrusive n otice o r a public health c ampaig n. Cf. id. at 2376. B ecause the w arning requir e ment is n ot narrowly drawn, it does not survive even intermediate scrutiny

. Thus, i t i s not necessary to determine whether strict o r intermediate scrutiny applies here.

I I I

W hile the majority correctly concludes that t h e advertisers have shown a likelihood of prevailing on the merits of their F irst Amendment claims, the majority fails to follow the analy

tic framework set out in NIFLA and ma k e s several crucial errors.

F irst, the majority errs by skip p i ng over the threshold question reg arding Zauderer ’s applicability
, namely whether the notice requirement applies to commercial advertising a nd requires the d isclosure of purely factual and uncontroversial information about the terms under w hich services will beA M

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available. D espite focusing primarily o n the u n d u e b urden
prong , the majority fail s to provide any g uidance reg arding when a warning is unjustified or unduly burdensome. I nstead of following NI

F L A in considering the totality of the requirements of the unlicensed notice and their effect on the speaker ( there, the clinics) to conclude t h a t t he unlicensed notice was undul y b u r densome, see 138 S. Ct. at 2378, the majority seems to sug g est that t h e t e s t is whether a smaller warning would accompl i s h San F rancisco’s stated g o als. Maj. Op. at 15–16.

Most imp o rtant, the majority errs by failing to consider wh e t her San F rancisco’s o rdinance could be upheld under heig htened scrutiny

even if the Zauderer ex ception does not apply

. The majority c oncedes that it does not “preclude [ San F rancisco] from arg uing that the Ordinance survives heig htened scrutiny .” Maj

. O p

. a t 15 n.5. And here, San F rancisco has done just tha t , arg u ing vig orously that its ordinance survives intermediate scrutiny

. The majority f ails
to address this arg ument, apparently o n t he g round that “log ically ” any such arg ument would be futile because “if the warning does not meet a l o wer standard, it necessarily does
not meet a hig her standard.” Maj. Op. at 15 n.5. This reasoningis flawed. A g overnment reg ulation, f or instance,
may r equire a commercial speaker to include imag es of dy ing

cancer pati en t s on cig arette p a c kag es. See, e.g. , Required W a r ning s for Cig arette Packag es and Advertisements, 75 F ed. Reg

. 69,524, 69,533 (Nov. 12, 2010) (proposed rule). W h ile a court mig ht conclude that such compelled speech is
not “purely factual and u n controversial
, ” the c ourt mig ht nevertheless conclude that the reg ulation meets the test under Ce n tral Hudson Gas & Electric Corp. v. Public Service Commission of New Y

ork
, 447 U.S. 5 57, 563– 6 5 ( 1 980) (assuming this case provides the applicable test), because theA M

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g overnment has a substantial interest in discourag ing smoking
, the reg ulation directly and materially advances the interest, and the restriction is narrowly tailored to discourag e y oung people from smoking (based on ex pe r t o p i nion). I n any event, the m a

j o r i ty is b ound by NIFLA
, w hich requires
courts to c onsider s uch arg uments: NIFLA a pplied heig ht e n e d scrutiny to the licensed notice and indicated that it wou l d h ave applied heig htened scrutiny to the unlicensed notice had California made any arg uments on that p oint. See NIFLA
, 138 S. Ct. a t 2 3 77 n.3. The majority ’s failure to address San F rancisc o ’ s arg ument is therefore contrary to Supreme Court direction.

Be cause the Associations have shown a likelihood o f prevailing on the merits a nd b ecause the o ther factors for
g ranting a preliminary injunction weig h in the Associations’ favor, I ag ree with the majority ’s conclusion that the district
court abused its discretio n b y deny ing the Associations’ motion for a preliminary injunction. B ut be cause the majority f

ails to a pply NIFLA ’s frame w o r k for analy zing when g o vernment-compelled speech violat e s the F irst Amendment, I

dissent from the majority ’s reasoning

.

CHRI STEN, Circuit J udg e, joined by THOMAS, Chief J udg e , concurring

in part and concurring

in the judg ment:

I a g r e e with the majority that Zauderer ’ s framework applies to the g overnment-compelled speech at issue in this

case. See Zauderer v. Offic e of Disciplinary Counsel
, 471 U.S. 626, 6 51 (1985). I also ag ree that the district court’s decision must be reversed, but I would not reach the issue the

ma j o r ity relies upon. I would reverse b ecause the City a ndA M

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County of San F r ancisco cannot show that the speech it seeks
to compel is “purely fac t ual[ .] ” Id. F or this reason, San F ranci sco’s p roposed w arning fails w hat should be the threshold inq u i ry in this case, and it violates the F irst Amendment.

Zauderer considered an attorney ’s Fi r s t A mendment challeng e to a state b ar rule. I d

. a t 6 32–33, 659 n.3. F o r attorney s advertisi n g t h a t their c lients would not pay fees if their lawsuits were unsuccessful, the rule required disclosure that the c lients w o u l d s t i ll be liable for litig ation costs. Id. The Court held that the b ar rule did n o t v iolate the F irst Amendment. I n reaching this r esult, the Court observed that “disclosure requirements trench much more narrowly o n an advertiser’s interests than do flat prohibitions on speech[ .] ” Id. at 651. I t was critical to the Court’s decision that the bar rule was intended to prevent co n s u m er deception; the Court stressed that the rule required only the inclusion of “ purely factual and uncontroversial information abou t t h e t e r m s u n d er which [ a n attorney ’s] services will b e available.” Id. (emphasis added).

Any sort of compelled speech potentially i n fring e s F irst Amendment rig hts, and case l aw a pproves g overnmentmandated messag es only in v ery limited contex ts. See, e.g. , Milavetz, Gallop & M

ilavetz
, P .A. v. United States
, 559 U.S. 229, 2 49–50 (2010) ( u

pholding requirement that lawy ers disclose certain information in a dver t i s e ments to prevent

consumer deception); Pharm. Ca r e Mgmt. Ass’n v. R o we , 429 F .3d 294, 310 (1st Cir. 2005) (per c u r iam) (upholding requirement that p harmacy benefit manag ers d isclose conflicts of interest and certain financial arrang ements) ; Nat’l Elec. Mfrs. Ass’n v. Sorrell
, 272 F .3d 104, 113–1 5 ( 2 d C i r. 2001) (upholdi n g labeling requirement intended to increaseA M

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consumer awareness about the a mount of mercury in products). W h ere a g overn ment-compelled messag e “does not require the disclosure of purely factual information” and instead “compels the c arry ing of the [ g overnment’s] controversial o pinion[ ,] ” it is clearly “unconstitutionally compelled speech[ .] ” Video Softw a re Dealers A ss’n v

. Schwarzenegger
, 556 F .3d 950, 953 (9th Cir. 2009), a ff’d sub

nom. B rown v. Entm’t Merch. Ass’ n , 5 6 4 U.S. 786 (2011). Z a u d e r e r and subsequent case law leave no doubt that an y g overnment-compelled speech must be, at th e v e r y least, factually accurate.

The majority acknowledg es that National Institute of Family & Life Advocates v. Becerra (“ NIFLA ”), 138 S. Ct. 2361 (2018), does not require courts to beg in the Zauderer analy sis by addr e s s ing whether the compelled speech is unjustified or unduly b u r d ensome; NIFLA did not modify Zauderer

. NIFLA struck down a California law r equiring that clinics p rimarily serving pre g nant women provide c ertain notices. See id. at 2378. L icensed c linics were required to post notices that California provides f ree or low-cost services, including abortions, an d unlicenced clinics were required to g ive notice that they wer e n ot licensed to provide medical services. Id. at 2 3 6 9

. NIFLA held that the speech imposed
upon licensed clinics did not satisfy Zauderer b e cause, unlike the disclosure required for attorney s’ services ads, the notice
reg arding the availability of abortion services did not “relate[ ]
to the services that licensed c linics provide[ d] ,” and it concerned the controversial topic of abortion. I d

. at 2372. The notice that unlicensed c linics were c o m pelled to post violated the F ir s t Amendment because, “ [ e] ven under Zauderer
, a d isclosure requirement cannot be ‘unjustified o r unduly burdensome,’” a

nd the Court ruled that California did
not demonstrat e any justification for the compelled speechA M

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that was more than purely hy pothetical. Id. at 2377 (quoting Zauderer
, 471 U.S. at 651).

Here, our c ourt holds that Zauderer requ ires compelled speech to be (1) purely factual; (2) noncon t r oversial; a nd (3) n ot unjustified or unduly burdensome. Additionally
, the compelled speech m u s t relate to the speaker’s services o r products. W here I d iffer is with the majority ’s application o f the tes t

. T h e majority skips whether San F rancisco’s compelled warning is factually accurate and jumps straig ht to asking whether the p r oposed warning i s “unjustified o r unduly burdensome.” The c ourt reasons tha t NIFLA made clear that “ a g overnment-compelled d i s c losure that imposes an undue burden fails for that reason a lone,” but the same is
true of Z

a u d e rer ’s other requirements. The majority ’s deci s i o n to follow NIFLA a nd address the “unduly burdensome” question fi r s t o verlooks that there was no dispute in NIFLA about the factual accuracy of the compelled speech. W e h ave no precedent addressing a g overnment proposal to appropriate commercial advertising space for the
purpose of convey

ing a factually in a c c u r ate messag e, but where, as here, the partie s disag ree about the v eracity o f compelled speech, the court should b eg in by asking whether th e government’s messag e is objectively true. Deciding whether a compelled messag e is controversial or unduly burdensome w ill o f

t en entail much more subjective judg ments. I f compelled speech is not factually accurate, the court’s inquiry

should end.

San F r a n ci s co seeks to require that advertisements for
sug ar-sweetened beverag es include the following :

W A RNI NG: Drinking beverag es with added
sug ar(s) con tributes to obesity
, diabetes, a ndA M

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tooth decay . This is a messag e from the City and County

of San F rancisco.

To survive the “purely factual” part of Zauderer ’s t es t , the
statement that beverag es with added sug ars “contribute[ ] to” obesity
, diabetes, and tooth decay
, must be true—y e t there is

no evidence that it is. To the contrary , “diabetes” is an umbrella term referring to both ty pe 1 d i a b etes (sometimes called juvenile-onset or insulin-dependent diabetes) and ty pe 2 diabetes. Rather than using the g e neric term “diabetes,” medical studies investig ating causa tion are careful to differentiate between the two forms of the disease. 1 The precise causes of ty

pe 1 diabetes a r e u n k n own, but g enetic

an d e n v ironmental factors, including viruses, are thoug ht to contribute to its development. 2 Research demonstrates a correlation b etw een the consumption of sug ar-sweetened beverag es and the development of ty p e 2 diabete s , 3 but San F rancisco has not shown that there is any a s s o c i a tion at all between consumption of sug a r -sweetened beverag e s and the development of ty

pe 1 diabete s

. I ronically
, the American Diabetes A ssociation directly addresses this on its “Diabetes

1 S ee, e.g

. , M. Van sto n e et al., Pa tien t Persp ectives o n Qu a l ity o f Life with Un co n tro l led T

yp e 1 D ia b etes Mellitu s : A S ystema tic Review a n d Qu a lita tive Meta -syn th esis
, 1 5 O NT A RI O H E A L T H T E CH

. A SS ES S ME NT S E RI E S 1 (2 01 5 ); Vasan t i S. Malik et al

. , S u ga r-S weeten ed Bevera g es, Ob esity, Typ e 2 Dia b etes M ellitu s, a n d Ca rd i o va scu la r Disea se Risk
, 1 2 1 C I R CUL

A T I ON 1 3 5 6 (2 0 1 0).

2 S ee Typ e 1 Dia b etes: S

ymp to ms & Ca u s es , M A YO C L I N I C (A u g . 7
, 2 0 1 7 )
, h t t p s : / / w w w

. m a y o c l i n i c

. o r g / d i s e a s e s

- c o n d i t i o n s / t y p e

- 1

- d iab etes/sy

m p to m s- cau ses/sy c- 2 0 35 30 1 1

.

3 S ee, e.g

. , Vasan ti S. Malik et al., S u g a r-S weeten ed Bevera g es a n d R i sk o f Meta b o lic S

yn d ro me a n d Typ e 2 Dia b etes: A Meta -An a l y si s , 3 3 D I A BE T E S C A RE 2 4 7 7 (2 0 1 0 ).A M

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My ths” webpag e, stating that ty pe 1 diabetes is not caused b y sug ar, it “ i s c aused b y g enetics and unknown factors that trig g er the onset of the disease.” 4 T he messag e that drinking
sug ar-sweetened bevera ge s “contributes to” diabetes (including ty

pe 1 diabetes) is not only n ot “purely factual a nd uncontroversial,” it is devoid of scientif i c support. See Zauderer
, 471 U.S. at 651.

I n this particular ca s e , it cannot be doubted that the
g o v e r n ment’s proposed messag e is controversial: it would

r equire that manufacturers, retailers, and advertisers include i n their ads, under a banner that beg ins “W arning ,” t h e

me s s ag e that their product contributes to diabetes even thoug h the causes of ty

pe 1 diabetes are not actually known. 5 Thus, in addition to being factually inaccurate, San F rancisco’s proposed warning a ls o fails Zauderer ’s requirement that the compe l l ed speech be u ncontroversial. Thoug h I would strike the w arning u n d e r e i t her the first o r second part of Zauderer ’s tes t , my view is that, g iven the facts of this case, we should treat Zauderer ’s “purely factual” inquiry as the threshold q uestion because it p rovides a much

more o b jective basis for disqualify ing San F rancisco’s compelled speech. I t is possible to envision a scenario in which the “ unjustified o r unduly burdensome” inquiry could provide a more objective basis for striking a g overnmentma n d a t e d messag e. F or ex ample, that could occur if determining the accuracy of a propos ed m e s sag e w as not a s

4 S e e D i a b e t e s M

y t h s , A M ER I C AN D I AB ETES A S S O C

. , h ttp ://w w w .d iab etes.o rg /d iab etes- basics/m y th s/ (last u

p d ated A u g

. 2 0
, 2 0 1 8 ).

5 S ee Dia b etes: S

ymp to ms & Ca u ses , M A YO C L I N I C (A u g . 8 , 2 0 1 8 ), h t t p s : / / www. m a y o c l i n i c

. o r g / d i s e a s e s

- c o n d i t i o n s / d i a b e t e s / s ym p t o m s

cau ses/sy c- 2 0 3 7 1 4 4 4

.A M

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cut-and-dried as it is here, or if the g overnme n t t r i e d to commandeer the majority of a vailable a d space. This is not

one of those cases. B e cause San Fr ancisco’s compelled warning undeniably f

ails Zauderer ’s “purely factual” hurdle, we should not reach w hether the messag e is uncontroversial

or unduly burde n s o me; both of those inquiries require the court to make more subjective judg ments.

San F r ancisco a

r g ues that its w arning must not be read too literally
, and that consumers will understand that its warning refers to ty

pe 2 diabetes. B u t the contention that a reasonable
person w ould understand San F rancisco’s intended messag e is in tension with the g oal of having a public health messag e underst ood by the max imum number of consumers, not just those with sophisticated levels of health literacy

. B ecause the
messag e would be c onvey ed to sophi s ticated a nd unsophisticated consumers, we must read it literally

.

R e latedly
, San F rancisco acknowledg es that n ot every

consumer of sug ary drinks will b ecome obese or suffer from tooth decay or diabetes. I t arg ues that readers will understand that its warning is intended to convey a commun i t y -wide
messag e: th at consuming sug ar-sweetened beverag es will lead to more i n s t a n ces of o besity
, diabetes, and tooth decay within the City and County as a whole. B ut even if the
qu al i f i e r “ may ” is read into the messag e, and the warning is understood as “su ga r y drinks may contribute to obesity
, diabetes and tooth dec ay on a community -wide basis,” it remains untrue with reg ard to ty pe 1 diabetes.

F inally
, San F rancisco ’s compelled messag e is problematic because it sug g ests that suga r i s alway s dang erous for d iabetics. I n fact, consuming sug ar-sweetened beverag es can b e medically indicated for a ty pe 1 diabeticA M

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when there are sig n s of hy pog ly c emia, a complication of ty pe 1 diabetes, because drinking fruit juice o r s o da raises blood
sug ar levels quickly

. 6

I nsisting that compelled s p eech b e purely factual may

seem persnickety
, but there are sig n ifican t c o nstitutional implications whenever the g overnment seeks to control our speech

. There are also societal consequences to inaccurate
go v e rnment-mandated messag es. I n o ne study
, over e ig ht y percent of parents of children w ith ty p e 1 diabetes and over seventy percent of patients with ty pe 1 diabetes, reported that they a re stig matiz e d
, most commonly b y t h e perception that diabetes is a character flaw or the result of a failure in personal responsibility

. 7

San F r ancisco may be c o mmended for aiming to address serious and g rowing p ublic health problems, but b y compelling speech that is n ot f actually accurate, it runs afoul of Zauderer ’s caution—“in some instan ces compulsion to speak may be as violative o f t h e F irst Amendment a s prohibitions on speech.” Z a u d e rer , 471 U.S. at 650. W h en the g o v ernment takes the momentous step of mandating that its messag e be delivered b y private p a r ties, it is ex ceptionally important that the compelled speech be purely factual.

F or these reasons, thoug h I reach the same result a s t h e majority , I would hold that the warning San F rancisco seeks

6 S ee Typ e 1 Dia b etes: Dia gn o s is & T rea tmen t , M A YO C L I NI C (A u g

. 7
, 2 0 1 7 ), h ttp s://w

w w .m a y o c l i n i c

. o r g / d i s e a s e s

- c o n d i t i o n s / t y p e

- 1

- d i a b e t e s / d iag n o sis- treatm en t/d rc- 20 3 5 3 0 1 7

.

7 S ee Nan cy F. L i u et al., S tig ma in Peo p l e wit h T

y p e 1 o r Typ e 2 Dia b etes , 3 5 C L I

NI CA L D I

A BE T E S J . 2 7 (2 01 7 ).A M

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to compel fails the threshold r equirement of factual accuracy , and end the Zauderer a

naly sis there.

NGUYEN, Circuit J u dg e, concurring in the judg ment:

I n C e ntral Hudson
, the Supreme Court held that
reg ulation of commerci a l speech is e valuated under an in termediate scrutiny standard. See Cent. Hudson Gas & Elec. Corp. v. Pub. Serv. Comm’n
, 447 U .S. 557, 566 (1980) (requiring that commercial speech r eg ulation “ directly advanc e s ” a “substantial” g overnmental interest and “is not

more ex tensive than is necessary to serve that interest”). P ri or to apply ing this standard, however, courts must f irst determine whether the speech at issue “is false, deceptive, o r misleading .” Zauderer v. Office of Disci p l i nary Counsel
, 471 U.S. 626, 638 ( 1985); see Central H uds o n , 447 U.S. at 566. I f the reg ulation addresses speech that falls into one of these categ o ries, then Zauderer ’s rational basis test appli e s

. See Zauderer
, 4 7 1 U.S. at 6 51 (holding that disclosure requirements comport with the F irst Amendment “as long a s [ they ] are reasonably related to the State’s interest in preventing d

eception of

consumer s ” ( emphasis added)). W ith almost all other ty

pes o f regu l ations, 1 “the g overnment’s
power is more circumscribed,” Central Hudson , 447 U.S. at 564, and Central Hudson ’s intermediate scrutiny applies.

1 P resu m ab ly
, th e ratio n al b asis test also ap p lies t o “ co m m ercial
sp eech related to illeg al activ ity ,” Cen t

. Hu d so n , 4 4 7 U.S. at 56 4
, w

h ich
, lik e o th er d ecep tiv e sp eech
, d eserv es less co n stitu tio n al p ro tectio n , see id

. at 5 6 3

– 6 4.A M

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I d isag ree with the majority ’ s ex pansion of Zauderer ’s rational b asis review to commercial speec h that is not false, deceptive, or mislead i n g. I n the majority ’s view, Zauderer applies to reg u lations requiring public h ealth d isclosures. B ut it is the c ommercial m e ssag e’s accuracy —not its completeness—that demarcates the boundary b etween Central H

udson ’s intermediate scrutiny and Zauderer ’s rational basis test. “The F irst A mendment’s concern for commercial speech is based o n the informational function o f advertising .” Id. at 563. “Even when a dv ertising communicates only an incomplete version of the r e levant facts, the F irst A mendment presumes that s o m e accurate information is better than n o information at all.” 2 Id. a t 562.

The Supreme Court stressed that “ Zauderer g overns our review” rather than C e n tral Hudson when a statute is “directed at m isleading commercial speech.” M ilavetz, Gallop & M

ilavetz, P.A. v. United States , 559 U.S. 229, 249 (2010) (emphasis in o rig inal). That the “required d isclosures

are intended to combat the problem of inherently misleading commercial a dvertisements” is one o f the “essential features of the rule at issue in Zauderer .” I d. at 250. B y treating the

“ false or misleading ” r equirement as non-essential, t h e majority invites reversal.

2 T h e an aly sis d o es n o t dif f er s im p ly b ecau se C

en tra l Hu dso n in v o lv ed pro h ib ited co n ten t an d t h e in stan t case in v o lv es m an d ated

co n ten t. A law co m

pellin g th e p u

b licatio n o f certain co n ten t “ o perates as

a co m m an d in th e sam e sen se as a statu te o r reg u l a t i o n fo rb i d d in g [a b u sin ess] t o p ub l ish sp ecif ied m atter.” Mia mi Hera ld Pu b l’g Co

. v. To rn illo
, 4 1 8 U.S. 2 4 1
, 2 56 (1 9 7 4 ); see a lso W oo ley v. Ma

yn a rd
, 4 3 0 U .S. 7 0 5
, 7 1 4 (1 97 7 ) (“ [T ]h e rig h t o f f reed o m of th o u g h t p ro tected b y th e First A m en d m en t ag ain st state actio n in clu d es bo t h th e rig h t to sp eak f

reely an d th e rig h t to ref

rain f ro m sp eak in g at all.”).A M

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The Supreme Court r ecently h ad the opportunity to

ex p and Zauderer ’s application bey ond deceptive speech but declined to do so. See Nat’l I nst. of Family & Life Advocates

v. Becerra (“

NIFLA ”), 138 S. Ct. 2361, 2376–77 (2018). I nstead, the Court reiterated its “reluctan[ ce] to mark off new

c a t e go r i e s o f s p e e c h for diminis h e d c o n s t i t u t i o n al protection.” NIFLA
, 138 S. Ct. at 2372 (quoting Denver Area Educ. Telecommc’ns Consortium, Inc. v. FCC
, 518 U.S. 727, 804 ( 1996) (Kennedy
, J
., dissenting in p a rt, concurring in judg ment in part, and dissenting in pa r t ) ). The Court was “especially reluctant to ‘ex e mpt a categ ory of speech from the normal p r o h ibition on content-based restrictions.’” Id. (quoting United States v. Alvarez
, 567 U.S. 709, 722 (2012) (plurality opinion)) (alteration in NIFLA omitted).

The majority ’s applicatio n o f Zauderer to San F rancisco’s
sug ary beverag e ordinance is particularly troubling g iven that it reg ulates speech based on content. The o rdinance applies
to “any a dvertisement

. . . t h a t i dentifies, p r omotes, o r markets a Sug ar-Sweetened B everag e for sale or use” in specified media. S.F

. Health Code § 4202. To the ex tent San F rancisco is c oncerned a bout the health effects o f sug ar in food and beverag e s , i ts f ocus o n a specific subset of sug arladen products is n o t e v enhanded. See Reed v. Town of Gilbert
, 135 S. Ct. 2218, 2232 (2015). And a requirement for
any vendor of sug ary products to convey a particular messag e “is a content-based reg ulation of speech.” NIFLA
, 138 S. Ct.
at 2 3 7 1

. W hile San F r ancisco’s g oal of reducing obesity is laudable, the appropriate level o f scrutiny does not turn on the
g overnment’s g ood intent.

I join my colleag ues who have previously disag reed with apply ing Zauderer outside the contex t o f false and misleading speech, see CTIA–T

h e W ireless A ss’n v. City of B e rkeley
,A M

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854 F .3d 1105, 1125 n.2 (9th Cir. 2017) (F riedland, J
., concurring in part and d issenting in part) (sug g esting that

“ Zauderer applies only w hen the go v e r n ment compels a truthful disclosure to counter a false or mi s l e a ding advertisement”), vacated and remanded for reconsideration in light of NIFLA
, 138 S. Ct. 2708 (2018), a n d I s h a re their

concerns that our current case law will lead to “a proliferation

o f warning s and disclosures compelled by local munic i p al
aut h o r ities” that have “only a tenuous link to a ‘more than
t r i v i a l’ g overnment interest,” CTIA
, 873 F .3d 774, 777 ( 9th Cir. 2017) (W ardlaw, J

. , dissenting from denial of reh’g en banc).

B e cause the majority r eaches the rig ht result under the
wrong leg al s t a n dard, I respectfully concur only in the judg ment.