Court Opinion

ID: 4204465
Source: CourtListenerOpinion
Date Created: 2017-09-19 17:01:12.880175+00
Date Added: 2024-06-11T14:41:12.363083
License: Public Domain

FOR PUBLICATION

  UNITED STATES COURT OF APPEALS
       FOR THE NINTH CIRCUIT

AMERICAN BEVERAGE                      No. 16-16072
ASSOCIATION; CALIFORNIA
RETAILERS ASSOCIATION,                    D.C. No.
              Plaintiffs-Appellants,   3:15-cv-03415-
                                            EMC
                and

CALIFORNIA STATE OUTDOOR
ADVERTISING ASSOCIATION,
                        Plaintiff,

                 v.

CITY AND COUNTY OF SAN
FRANCISCO,
             Defendant-Appellee.
2 AM. BEVERAGE ASS’N V. CITY & CTY. OF SAN FRANCISCO

 AMERICAN BEVERAGE                                 No. 16-16073
 ASSOCIATION; CALIFORNIA
 RETAILERS ASSOCIATION,                              D.C. No.
                                 Plaintiffs,      3:15-cv-03415-
                                                       EMC
                    and

 CALIFORNIA STATE OUTDOOR                            OPINION
 ADVERTISING ASSOCIATION,
                Plaintiff-Appellant,

                     v.

 CITY AND COUNTY OF SAN
 FRANCISCO,
              Defendant-Appellee.

        Appeal from the United States District Court
           for the Northern District of California
         Edward M. Chen, District Judge, Presiding

            Argued and Submitted April 17, 2017
                 San Francisco, California

                   Filed September 19, 2017

 Before: Dorothy W. Nelson and Sandra S. Ikuta, Circuit
 Judges, and J. Michael Seabright,* Chief District Judge.

    *
      The Honorable J. Michael Seabright, Chief United States District
Judge for the District of Hawaii, sitting by designation.
    AM. BEVERAGE ASS’N V. CITY & CTY. OF SAN FRANCISCO 3

                    Opinion by Judge Ikuta;
               Concurrence by Judge D.W. Nelson

                            SUMMARY**

         First Amendment / Preliminary Injunction

    The panel reversed the district court’s denial of the
plaintiff Associations’ motion for a preliminary injunction,
seeking to enjoin the implementation of the City and County
of San Francisco’s ordinance that would require warnings
about the health effects of certain sugar-sweetened beverages
on specific types of fixed advertising within San Francisco.

    The plaintiffs – the American Beverage Association, the
California Retailers Association, and the California State
Outdoor Advertising Association – alleged that the ordinance
violated their First Amendment right to freedom of speech.

    The panel held that the plaintiffs were likely to succeed
on the merits of their claim that the ordinance was an
“unjustified or unduly burdensome disclosure requirement[]
[that] might offend the First Amendment by chilling
protected commercial speech.” Zauderer v. Office of
Disciplinary Counsel of Supreme Court of Ohio, 471 U.S.
626, 651 (1985). Specifically, the panel joined other circuits
in holding that the Zauderer framework applied beyond the
context of preventing consumer deception. The panel held
that because the required warning was not purely factual and

    **
       This summary constitutes no part of the opinion of the court. It has
been prepared by court staff for the convenience of the reader.
4 AM. BEVERAGE ASS’N V. CITY & CTY. OF SAN FRANCISCO

uncontroversial, San Francisco had not established that the
plaintiffs’ constitutionally protected interest in not providing
the warning was minimal under Zauderer. The panel agreed
with the plaintiffs that the warning requirements – a black
box warning that overwhelmed other visual elements of the
ads – unduly burdened and chilled protected speech.

    The panel held that the remaining preliminary injunction
factors also weighed in the plaintiffs’ favor. The panel
concluded that the district court abused its discretion in
denying the plaintiffs’ motion for a preliminary injunction,
and reversed and remanded.

    Judge Nelson concurred in the judgment because she
believed that the ordinance, in its current form, likely violated
the First Amendment by mandating a warning requirement so
large that it would probably chill protected commercial
speech. Judge Nelson would reverse and remand without also
making the conclusion that the warning’s language was
controversial and misleading.

                         COUNSEL

Richard P. Bress (argued), Melissa Arbus Sherry, and
Michael E. Bern, Latham & Watkins LLP, Washington, D.C.;
James K. Lynch and Marcy C. Priedeman, Latham & Watkins
LLP, San Francisco, California; for Plaintiff-Appellant
American Beverage Association.

Thomas S. Knox, Knox Lemmon & Anappolsky LLP,
Sacramento, California; for Plaintiff-Appellant California
Retailers Association.
   AM. BEVERAGE ASS’N V. CITY & CTY. OF SAN FRANCISCO 5

Theodore B. Olson, Andrew S. Tulumello, and Helgi C.
Walker, Gibson Dunn & Crutcher LLP, Washington, D.C.;
Charles J. Stevens and Joshua D. Dick, Gibson Dunn &
Crutcher LLP, San Francisco, California; for Plaintiff-
Appellant California State Outdoor Advertising Association.

Christine Van Aken (argued), Jeremy M. Goldman, and
Wayne Snodgrass, Deputy City Attorneys; Dennis J. Herrera,
City Attorney; Office of the City Attorney, San Francisco,
California; for Defendant-Appellee.

                         OPINION

IKUTA, Circuit Judge:

    American Beverage Association, California Retailers
Association, and the California State Outdoor Advertising
Association (we refer to these organizations and their
members collectively as “the Associations”), filed suit against
the City and County of San Francisco challenging a city
ordinance that would require warnings about the health
effects of certain sugar-sweetened beverages on specific types
of fixed advertising within San Francisco. The Associations
argue that the ordinance violates their First Amendment right
to freedom of speech. After the district court denied the
Associations’ motion for a preliminary injunction, the
Associations filed this interlocutory appeal. We conclude
that the Associations are likely to succeed on the merits of
their claim that the ordinance is an “unjustified or unduly
burdensome disclosure requirement[] [that] might offend the
First Amendment by chilling protected commercial speech.”
Zauderer v. Office of Disciplinary Counsel of Supreme Court
of Ohio, 471 U.S. 626, 651 (1985). The remaining
6 AM. BEVERAGE ASS’N V. CITY & CTY. OF SAN FRANCISCO

preliminary injunction factors also weigh in the Associations’
favor. We hold that the district court abused its discretion in
denying the Associations’ motion for a preliminary
injunction, and we reverse and remand.

                                      I

    San Francisco enacted an ordinance in June 2015
requiring advertisers who post advertisements for sugar-
sweetened beverages within San Francisco to include the
following statement:

          WARNING: Drinking beverages with added
          sugar(s) contributes to obesity, diabetes, and
          tooth decay. This is a message from the City
          and County of San Francisco.

S.F. Health Code § 4203(a). The ordinance applies to a
certain type of advertisement for sugar-sweetened beverages,
termed an “SSB Ad.” Id. As defined, an “SSB Ad” includes
any advertisement or logo that “identifies, promotes, or
markets a Sugar-Sweetened Beverage for sale or use” that is
posted on billboards, structures, or vehicles, among other
things. Id. § 4202.1 The term “Sugar-Sweetened Beverage”

   1
       Section 4202 provides in relevant part:

          “SSB Ad” means any advertisement, including, without
          limitation, any logo, that identifies, promotes, or
          markets a Sugar-Sweetened Beverage for sale or use
          that is any of the following: (a) on paper, poster, or a
          billboard;· (b) in or on a stadium, arena, transit shelter,
          or any other structure;· (c) in or on a bus, car, train,
          pedicab, or any other vehicle; or (d) on a wall, or any
          other surface or material.
    AM. BEVERAGE ASS’N V. CITY & CTY. OF SAN FRANCISCO 7

is defined to include soda and other non-alcoholic beverages
that contain one or more added sweeteners and more than
twenty-five calories per twelve fluid ounces of beverage.2 Id.
The ordinance provides detailed instructions regarding the
form, content, and placement of the warning on SSB Ads,
including the requirement that it occupy 20 percent of the
advertisement and be set off with a rectangular border. Id.
§ 4203. Failure to comply with the ordinance’s warning
requirement results in administrative penalties imposed by
San Francisco’s Director of Health. Id. § 4204. According
to the ordinance, San Francisco’s purpose in requiring the
warning for certain sugar-sweetened beverages is, among
other things, to “inform the public of the presence of added
sugars and thus promote informed consumer choice that may
result in reduced caloric intake and improved diet and health,
thereby reducing illnesses to which [sugar-sweetened

S.F. Health Code § 4202. This section also provides that “SSB Ad” does
not include advertising in periodicals, television, electronic media, SSB
containers or packaging, menus, shelf tags, vehicles, or logos that occupy
an area less than thirty-six square inches, among other things. Id.
    2
        Section 4202 provides in relevant part:

           “Sugar Sweetened Beverage” means any Nonalcoholic
           Beverage sold for human consumption, including,
           without limitation, beverages produced from
           Concentrate, that has one or more added Caloric
           Sweeteners and contains more than 25 calories per
           12 ounces of beverage.

S.F. Health Code § 4202. The definition also provides that “Sugar
Sweetened Beverage” does not include Milk, Milk alternatives primarily
consisting of plant-based ingredients, 100% Natural Fruit Juice, Natural
Vegetable Juice, infant formula, Medical Food, supplements, and certain
other products. Each of the capitalized terms is defined separately in the
ordinance.
8 AM. BEVERAGE ASS’N V. CITY & CTY. OF SAN FRANCISCO

beverages] contribute and associated economic burdens.” Id.
§ 4201.

    The Associations sued San Francisco in July 2015,
seeking injunctive relief to prevent the implementation of the
ordinance, which was set to go into effect on July 25, 2016.
S.F. Health Code § 4203(a). The district court denied the
Associations’ motion for a preliminary injunction in May
2016. In concluding that the Associations were not likely to
succeed on the merits of their First Amendment challenge, the
district court held that the warning was not misleading, would
not place an undue burden on the Associations’ commercial
speech, and was rationally related to a government interest.
Nevertheless, the court granted the Associations’ motion for
an injunction pending appeal. The Associations filed a timely
interlocutory appeal.

                               II

    We have jurisdiction pursuant to 28 U.S.C. § 1292(a)(1).
We review the district court’s denial of a preliminary
injunction for an abuse of discretion. Inst. of Cetacean
Research v. Sea Shepherd Conservation Soc., 725 F.3d 940,
944 (9th Cir. 2013). “A district court would necessarily
abuse its discretion if it based its ruling on an erroneous view
of the law or on a clearly erroneous assessment of the
evidence.” Id. (citation and internal quotation marks
omitted). When we consider First Amendment claims,
“[h]istorical questions of fact (such as credibility
determinations or ordinary weighing of conflicting evidence)
are reviewed for clear error, while constitutional questions of
fact (such as whether certain restrictions create a severe
burden on an individual’s First Amendment rights) are
reviewed de novo.” Prete v. Bradbury, 438 F.3d 949, 960
   AM. BEVERAGE ASS’N V. CITY & CTY. OF SAN FRANCISCO 9

(9th Cir. 2006) (internal quotation marks omitted). This
“requirement of independent appellate review . . . is a rule of
federal constitutional law, which does not limit our deference
to a trial court on matters of witness credibility, but which
generally requires us to review the finding of facts by a [trial
court] . . . where a conclusion of law as to a Federal right and
a finding of fact are so intermingled as to make it necessary,
in order to pass upon the Federal question, to analyze the
facts.” Hurley v. Irish-Am. Gay, Lesbian & Bisexual Grp. of
Boston, 515 U.S. 557, 567 (1995) (citations and internal
quotation marks omitted). “This obligation rests upon us
simply because the reaches of the First Amendment are
ultimately defined by the facts it is held to embrace, and we
must thus decide for ourselves whether a given course of
conduct falls on the near or far side of the line of
constitutional protection.” Id. Because the questions whether
a compelled disclosure is purely factual and uncontroversial
and whether it unduly burdens commercial speech are “so
intermingled” with the conclusion of law as to whether a
commercial speaker’s First Amendment rights are violated,
these are constitutional questions of fact that we review de
novo. See id.; cf. Peel v. Attorney Registration &
Disciplinary Comm’n, 496 U.S. 91, 108 (1990) (“Whether the
inherent character of a statement places it beyond the
protection of the First Amendment is a question of law over
which Members of this Court should exercise de novo
review.”).

    A preliminary injunction is “an extraordinary remedy that
may only be awarded upon a clear showing that the plaintiff
is entitled to such relief.” Winter v. Nat. Res. Def. Council,
Inc., 555 U.S. 7, 22 (2008). “A plaintiff seeking a
preliminary injunction must establish that he is likely to
succeed on the merits, that he is likely to suffer irreparable
10 AM. BEVERAGE ASS’N V. CITY & CTY. OF SAN FRANCISCO

harm in the absence of preliminary relief, that the balance of
equities tips in his favor, and that an injunction is in the
public interest.” Id. at 20.

    The “burdens at the preliminary injunction stage track the
burdens at trial.” Gonzales v. O Centro Espirita Beneficente
Uniao do Vegetal, 546 U.S. 418, 429 (2006); see also
Ashcroft v. Am. Civil Liberties Union, 542 U.S. 656, 666
(2004). At trial, San Francisco would carry the burden “of
demonstrating the legitimacy of its commercial-speech
regulations,” and of showing that its regulation “directly and
proportionally” addresses San Francisco’s interest. Zauderer,
471 U.S. at 658–59; see also Ibanez v. Fla. Dep’t of Bus. &
Prof’l Regulation, 512 U.S. 136, 142 n.7 (1994) (“It is well
established that the party seeking to uphold a restriction on
commercial speech carries the burden of justifying it.”
(citations and internal quotation marks omitted)). Therefore,
at the preliminary injunction stage, once the Associations
have demonstrated that the ordinance burdens protected
speech, they “must be deemed likely to prevail” unless San
Francisco demonstrates that the requirements imposed by the
ordinance pass constitutional muster. Ashcroft, 542 U.S. at
666.

                              III

    With these principles in mind, we turn to our review of
the district court’s order denying the Associations’ motion for
a preliminary injunction. At the first step of the preliminary
injunction analysis, we consider the Associations’ likelihood
of success on the merits of their First Amendment challenge.
   AM. BEVERAGE ASS’N V. CITY & CTY. OF SAN FRANCISCO 11

                                  A

    We begin by setting forth the legal framework applicable
to the Associations’ First Amendment challenge. The First
Amendment provides that “Congress shall make no law . . .
abridging the freedom of speech.”3 U.S. Const. amend. I.
Even commercial speech, defined as “expression related
solely to the economic interests of the speaker and its
audience,” enjoys some First Amendment protection. Cent.
Hudson Gas & Elec. Corp. v. Pub. Serv. Comm’n, 447 U.S.
557, 561 (1980); see also Va. State Bd. of Pharmacy v. Va.
Citizens Consumer Council, Inc., 425 U.S. 748, 772 (1976).
In reaching this conclusion, the Supreme Court reasoned that
“even if the First Amendment were thought to be primarily an
instrument to enlighten public decisionmaking in a
democracy,” the free flow of commercial information serves
that end because it is indispensable to ensuring that economic
decisions “in the aggregate, be intelligent and well informed.”
 Va. State Bd. of Pharmacy, 425 U.S. at 765; see also
Thompson v. W. States Med. Ctr., 535 U.S. 357, 366 (2002).
Indeed, a “consumer’s concern for the free flow of
commercial speech often may be far keener than his concern
for urgent political dialogue.” Sorrell v. IMS Health Inc.,
564 U.S. 552, 566 (2011) (internal quotation marks omitted).

   Because “the extension of First Amendment protection to
commercial speech is justified principally by the value to
consumers of the information such speech provides,”
Zauderer, 471 U.S. at 651, and the government has a

    3
     The First Amendment is incorporated against the states via the Due
Process Clause of the Fourteenth Amendment. See Va. State Bd. of
Pharmacy v. Va. Citizens Consumer Council, Inc., 425 U.S. 748, 749 n.1
(1976).
12 AM. BEVERAGE ASS’N V. CITY & CTY. OF SAN FRANCISCO

“legitimate interest in protecting consumers from commercial
harms,” commercial speech “can be subject to greater
governmental regulation than noncommercial speech,”
Sorrell, 564 U.S. at 579; see also City of Cincinnati v.
Discovery Network, Inc., 507 U.S. 410, 426 (1993). While
content-based regulations of noncommercial speech are
subject to strict scrutiny, see, e.g., Reed v. Town of Gilbert,
135 S. Ct. 2218, 2227 (2015), regulations of commercial
speech are subject to lesser review.

    The level of scrutiny for burdens placed on commercial
speech depends on the nature of the regulation at issue. In
Central Hudson Gas & Electric Corp. v. Public Service
Commission of New York, the Supreme Court established a
standard of review for restrictions that limit commercial
speech. 447 U.S. at 566.         Such restrictions “on
nonmisleading commercial speech regarding lawful activity
must withstand intermediate scrutiny—that is, they must
‘directly advanc[e]’ a substantial governmental interest and
be ‘n[o] more extensive than is necessary to serve that
interest.’” Milavetz, Gallop & Milavetz, P.A. v. United
States, 559 U.S. 229, 249 (2010) (quoting Central Hudson,
447 U.S. at 566). By contrast, regulations that “impose a
disclosure requirement rather than an affirmative limitation
on speech” are governed by the lesser standard set forth in
Zauderer. Id.

    In Zauderer, the Supreme Court considered the
constitutionality of an Ohio State Bar rule requiring “that any
advertisement that mentions contingent-fee rates must . . .
inform clients that they would be liable for costs (as opposed
to legal fees) even if their claims were unsuccessful.”
471 U.S. at 633 (internal quotation marks omitted). An
attorney was disciplined under this rule for publishing an
   AM. BEVERAGE ASS’N V. CITY & CTY. OF SAN FRANCISCO 13

advertisement stating that “cases are handled on a contingent
fee basis of the amount recovered. If there is no recovery, no
legal fees are owed by our clients.” 471 U.S. at 631. In
assessing the attorney’s constitutional challenge to this rule,
the Court first determined that the intermediate scrutiny
standard developed in Central Hudson was not applicable,
because “disclosure requirements trench much more narrowly
on an advertiser’s interests than do flat prohibitions on
speech.” Id. at 651; see also id. at 651 n.14 (noting that “the
First Amendment interests implicated by disclosure
requirements are substantially weaker than those at stake
when speech is actually suppressed”). The disciplinary rule
required only the inclusion of “purely factual and
uncontroversial information about the terms under which [the
attorney’s] services will be available,” and therefore the
attorney’s “constitutionally protected interest in not providing
any particular factual information in his advertising is
minimal.” Id. at 651 (emphasis in original). Despite the
lesser First Amendment interest in compelled commercial
speech, the Court recognized that “unjustified or unduly
burdensome disclosure requirements might offend the First
Amendment by chilling protected commercial speech.” Id.
Nevertheless, disclosure requirements that are “reasonably
related to the State’s interest in preventing deception of
consumers” generally do not offend a commercial speaker’s
First Amendment rights. Id.

    Applying this framework, the Court upheld the
disciplinary rule, reasoning that the required disclosures were
“purely factual and uncontroversial,” and were not unduly
burdensome. Id. at 651 & 653 n.15. Although the attorney’s
advertisement was not technically false—it accurately stated
that clients would not be responsible for legal fees if there
was no recovery—the Court concluded that it would mislead
14 AM. BEVERAGE ASS’N V. CITY & CTY. OF SAN FRANCISCO

“substantial numbers of potential clients,” and that the
disclosure requirements were “reasonably related to the
State’s interest in preventing deception of consumers.” Id. at
651–52.

    Subsequent Supreme Court cases have applied Zauderer’s
analytic framework only to government-mandated disclosures
aimed at preventing consumer deception. See, e.g., Milavetz,
Gallop & Milavetz, 559 U.S. at 249. The Supreme Court has
not yet considered whether the Zauderer framework applies
when a state requires disclosures for a different state interest,
such as to promote public health. Nevertheless, the Supreme
Court’s reasoning in Zauderer “seems inherently applicable
beyond the problem of deception, as other circuits have
found.” Am. Meat Inst. v. U.S. Dep’t of Agric., 760 F.3d 18,
22 (D.C. Cir. 2014). Zauderer observed that “the extension
of First Amendment protection to commercial speech is
justified principally by the value to consumers of the
information such speech provides.” 471 U.S. at 651.
Accordingly, a commercial speaker’s constitutionally
protected interest in refraining from providing consumers
with additional information is minimal if a required
disclosure is “purely factual and uncontroversial” and is not
“unjustified or unduly burdensome” so as to chill protected
speech. Id. These principles seem applicable to evaluating
the constitutionality of compelled disclosures regardless of
the government’s purpose. Therefore, Zauderer’s conclusion
that “an advertiser’s rights are adequately protected as long
as disclosure requirements are reasonably related to the
State’s interest in preventing deception of consumers,” id. at
651, is best read as a specific application of Zauderer’s more
general rule that a purely factual and uncontroversial
disclosure that is not unduly burdensome will withstand First
Amendment scrutiny so long as it is reasonably related to a
   AM. BEVERAGE ASS’N V. CITY & CTY. OF SAN FRANCISCO 15

substantial government interest.4 Accordingly, we have
joined our sister circuits in holding that the Zauderer
framework applies beyond the context of preventing
consumer deception. See CTIA-The Wireless Ass’n v. City of
Berkeley, 854 F.3d 1105, 1117 (9th Cir. 2017); see also Am.
Meat Inst., 760 F.3d at 22; Disc. Tobacco City & Lottery, Inc.
v. United States, 674 F.3d 509, 554–55 (6th Cir. 2012); N.Y.
State Rest. Ass’n v. N.Y. City Bd. of Health, 556 F.3d 114,
132 (2d Cir. 2009); Pharm. Care Mgmt. Ass’n v. Rowe,
429 F.3d 294, 310 (1st Cir. 2005).

    Applying the Zauderer framework, we first consider
whether there is any controversy regarding the factual
accuracy of the disclosure. CTIA-The Wireless Ass’n,
854 F.3d at 1117–18.5 This is a key inquiry, because
Zauderer justified the lower standard of scrutiny based on its
conclusion that an advertiser’s First Amendment interest in
not providing “purely factual and uncontroversial
information” was low. Zauderer, 471 U.S. at 651. Therefore,
a required disclosure cannot be upheld under the Zauderer

    4
      We also recognize that “[i]nnumerable federal and state regulatory
programs require the disclosure of product and other commercial
information,” Nat’l Elec. Mfrs. Ass’n v. Sorrell, 272 F.3d 104, 116 (2d
Cir. 2001), including requirements for tobacco labeling, nutritional
labeling, disclosures in prescription drug advertising, and reporting of
releases of toxic substances, none of which are aimed directly at
preventing consumer deception. Id. To hold that the Zauderer framework
applies only when the state interest is in preventing consumer deception
“would expose these long-established programs to searching scrutiny by
unelected courts.” Id.
    5
      As we have clarified, the term “uncontroversial” in this context
“refers to the factual accuracy of the compelled disclosure, not to its
subjective impact on the audience.” CTIA-The Wireless Ass’n, 854 F.3d
at 1117.
16 AM. BEVERAGE ASS’N V. CITY & CTY. OF SAN FRANCISCO

framework if the disclosure is not purely factual and
uncontroversial. CTIA-The Wireless Ass’n, 854 F.3d at
1117–18; see also Video Software Dealers Ass’n v.
Schwarzenegger, 556 F.3d 950, 953 (9th Cir. 2009), aff’d sub
nom. Brown v. Entm’t Merchants Ass’n, 564 U.S. 786 (2011)
(holding that a state’s “labeling requirement is
unconstitutionally compelled speech under the First
Amendment because it does not require the disclosure of
purely factual information; but compels the carrying of the
State’s controversial opinion”). Generally, a disclosure
requirement is purely factual and uncontroversial under
Zauderer so long as it “provide[s] accurate factual
information to the consumer.” CTIA-The Wireless Ass’n,
854 F.3d at 1118. However, if a compelled disclosure is
“literally true but nonetheless misleading and, in that sense,
untrue,” then it is not purely factual under Zauderer. Id. at
1119. Zauderer illustrates this point. In Zauderer, the
attorney advertisement at issue was literally true; everything
included in the advertisement was factual. Nonetheless, the
Supreme Court concluded that the “possibility of deception”
from the technically truthful advertisement was “self-evident”
because it omitted key information about the meaning of the
terms “legal fees” and “costs.” 471 U.S. at 652–53.
Applying this principle to disclosure requirements, a literally
true but misleading disclosure creates the possibility of
consumer deception. A disclosure that may deceive
consumers does not further the free flow of accurate
information or add to the “value to consumers of the
information [commercial] speech provides.” Id. at 651; see
also Am. Meat Inst., 760 F.3d at 22 (stating that a required
disclosure “could be so one-sided or incomplete that [it]
would not qualify as ‘factual and uncontroversial’” under
Zauderer).
    AM. BEVERAGE ASS’N V. CITY & CTY. OF SAN FRANCISCO 17

     We must also determine whether the compelled disclosure
is an “unjustified or unduly burdensome” regulation that may
chill protected commercial speech. Zauderer, 471 U.S. at
651; see also Ibanez, 512 U.S. at 146–47.6 A required
disclosure may be unduly burdensome if it “effectively rules
out” advertising in particular media. Ibanez, 512 U.S. at 146.
In Ibanez, for instance, the Supreme Court considered a
Florida Board of Accountancy rule prohibiting the “use of
any ‘specialist’ designation unless accompanied by a
[detailed and lengthy] disclaimer, made ‘in the immediate
proximity of the statement that implies formal recognition as
a specialist.’” Id. at 146. The Board had disciplined an
attorney who had placed “Certified Public Accountant” and
“Certified Financial Planner” next to her name in her yellow
pages listing and on her business cards and law office
stationery. Id. at 138. The Court concluded that under those
facts, and given “the failure of the Board to point to any harm
that is potentially real, not purely hypothetical,” the rule was
both unjustified and unduly burdensome. Id. at 146. The
Court reasoned that “[t]he detail required in the disclaimer
currently described by the Board effectively rules out notation
of the ‘specialist’ designation on a business card or
letterhead, or in a yellow pages listing.” Id. at 146–47.

    A number of our sister circuits have recognized that
“Zauderer cannot justify a disclosure so burdensome that it
essentially operates as a restriction on constitutionally

    6
      This issue did not arise in CTIA-The Wireless Association because
in that case the ordinance at issue required a retailer to provide specified
information to cell phone purchasers at the point of sale. 854 F.3d at
1110. Because the disclosure requirement was triggered by a sale, not by
an advertiser’s speech, the requirement did not burden or chill any
protected speech.
18 AM. BEVERAGE ASS’N V. CITY & CTY. OF SAN FRANCISCO

protected speech . . . [n]or can it sustain mandates that chill
protected commercial speech.” Am. Meat Inst., 760 F.3d at
27 (citations and internal quotation marks omitted). In Dwyer
v. Cappell, for example, the Third Circuit considered the
constitutionality of a New Jersey Bar Committee requirement
that attorneys who chose to quote a judicial opinion in their
advertising also include the full-length opinion. 762 F.3d
275, 283–85 (3d Cir. 2014). The Third Circuit concluded that
the disclosure requirement was unduly burdensome because
it “necessarily prevent[ed] any form of advertisement with
simply a judicial excerpt,” and made advertising in most
mediums unrealistic. Id. at 284. As such, the restriction
infringed on the attorney’s First Amendment rights. Id.7
Similarly, in Public Citizen Inc. v. Louisiana Attorney
Disciplinary Board, the Fifth Circuit held that a Louisiana
State Bar Association rule dictating the font size and speed of
speech attorneys must use in written and spoken disclaimers
in advertisements was unduly burdensome because it
“effectively rule[d] out the ability of Louisiana lawyers to
employ short advertisements of any kind.” 632 F.3d 212, 229
(5th Cir. 2011); see also Tillman v. Miller, 133 F.3d 1402,
1404 n.4 (11th Cir. 1998) (concluding that a requirement that
plaintiff devote five seconds of his thirty second television ad
to a disclosure imposed an undue burden on plaintiff’s
commercial speech).

    7
       The Third Circuit noted that the onerous nature of the disclosure
requirement indicated that its purpose was “to make it so burdensome to
quote judicial opinions that attorneys will cease doing so.” 762 F.3d at
284. For this reason, the requirement was effectively a restriction rather
than a disclosure, and would be subject to the higher level of scrutiny set
forth in Central Hudson. Id. Because the restriction failed under the lesser
Zauderer standard, it would necessarily fail under intermediate scrutiny.
Id.
   AM. BEVERAGE ASS’N V. CITY & CTY. OF SAN FRANCISCO 19

    A disclosure requirement may also be unduly burdensome
and chill commercial speech if the disclosure promotes
policies or views that are one-sided or “are biased against or
are expressly contrary to the corporation’s views.” Pac. Gas
& Elec. Co. v. Pub. Utilities Comm’n, 475 U.S. 1, 15 n.12
(1986) (plurality opinion). A compelled disclosure that
requires speakers “to use their own property to convey an
antagonistic ideological message,” or “to respond to a hostile
message when they ‘would prefer to remain silent,’” or “to be
publicly identified or associated with another’s message,”
cannot withstand First Amendment scrutiny. Glickman v.
Wileman Bros. & Elliott, 521 U.S. 457, 471 (1997) (citations
omitted).

    If the required disclosure is not factually inaccurate or
unduly burdensome, then it will pass constitutional muster so
long as it is reasonably related to a government interest of
sufficient weight. Zauderer, 471 U.S. at 651. Like other
circuits, we have concluded that the government must
identify a “substantial—that is, more than trivial—
governmental interest,” such as “protecting the health and
safety of consumers.” CTIA-The Wireless Ass’n, 854 F.3d at
1117–18 (quoting NEMA, 272 F.3d at 115 n.6). Further, the
government must demonstrate that there is a “rational
relationship” between the disclosure requirement and the
government interest. See Video Software Dealers Ass’n, 556
F.3d at 967. In the context of commercial speech, this means
that the required disclosure “must relate to the good or
service offered by the regulated party.” Am. Meat Inst., 760
F.3d at 26; see also NEMA, 272 F.3d at 115 (holding that
there must be a “rational connection between the purpose of
a commercial disclosure requirement and the means
employed to realize that purpose”).
20 AM. BEVERAGE ASS’N V. CITY & CTY. OF SAN FRANCISCO

    The government must carry the burden of demonstrating
that its disclosure requirement is purely factual and
uncontroversial, not unduly burdensome, and reasonably
related to a substantial government interest. See Zauderer,
471 U.S. at 658–59; Ibanez, 512 U.S. at 146.

                               B

    Because San Francisco’s ordinance imposes a disclosure
requirement on commercial speech, we first consider whether
the “inherent character,” Peel, 496 U.S. at 108, of the
compelled disclosure is “purely factual and uncontroversial”
under Zauderer such that it imposes a lesser burden on
commercial speech. Zauderer, 471 U.S. at 651; see also
CTIA-The Wireless Ass’n, 854 F.3d at 1118. Because this is
a constitutional question of fact, we review this issue de novo.
See Prete, 438 F.3d at 960; see also Hurley, 515 U.S. at 567.

    We conclude that the factual accuracy of the warning is,
at a minimum, controversial as that term is used in the
Zauderer framework. The warning provides the unqualified
statement that “[d]rinking beverages with added sugar(s)
contributes to obesity, diabetes, and tooth decay,” S.F. Health
Code § 4203(a), and therefore conveys the message that
sugar-sweetened beverages contribute to these health
conditions regardless of the quantity consumed or other
lifestyle choices. This is contrary to statements by the FDA
that added sugars are “generally recognized as safe,”
21 C.F.R. § 184.1866, and “can be a part of a healthy dietary
pattern when not consumed in excess amounts,” 81 Fed. Reg.
33,742, 33,760 (May 27, 2016). Although San Francisco’s
experts state that “there is a clear scientific consensus” that
sugar-sweetened beverages contribute to obesity and diabetes
through “excessive caloric intake” and “by adding extra
   AM. BEVERAGE ASS’N V. CITY & CTY. OF SAN FRANCISCO 21

calories to the diet,” the experts do not directly challenge the
conclusion of the Associations’ expert that “when consumed
as part of a diet that balances caloric intake with energy
output, consuming beverages with added sugar does not
contribute to obesity or diabetes.” Because San Francisco’s
warning does not state that overconsumption of sugar-
sweetened beverages contributes to obesity, diabetes, and
tooth decay, or that consumption of sugar-sweetened
beverages may contribute to obesity, diabetes, and tooth
decay, the accuracy of the warning is in reasonable dispute.

    Moreover, the warning is “misleading and, in that sense,
untrue.” CTIA-The Wireless Ass’n, 854 F.3d at 1119. The
warning is required exclusively on advertisements for sugar-
sweetened beverages, and not on advertisements for other
products with equal or greater amounts of added sugars and
calories. By focusing on a single product, the warning
conveys the message that sugar-sweetened beverages are less
healthy than other sources of added sugars and calories and
are more likely to contribute to obesity, diabetes, and tooth
decay than other foods.8 This message is deceptive in light of
the current state of research on this issue. According to the
FDA, “added sugars, including sugar-sweetened beverages,
are no more likely to cause weight gain in adults than any
other source of energy.” 79 Fed. Reg. 11880, 11904 (Mar. 3,
2014). The American Dental Association has similarly
cautioned against the “growing popularity of singling-out
sugar-sweetened beverages” because “ the evidence is not yet

    8
      The Associations provide a pertinent example. If car dealers were
required to post a warning only on Toyota vehicles that said:
“WARNING: Toyotas contribute to roll-over crashes,” the common-sense
conclusion would be that Toyotas are more likely to cause rollovers than
other vehicles.
22 AM. BEVERAGE ASS’N V. CITY & CTY. OF SAN FRANCISCO

sufficient to single out any one food or beverage product as
a key driver of dental caries.” American Dental Association,
Technical Comments of the American Dental Association on
the Scientific Advisory Report of the 2015 Dietary Guidelines
Advisory Committee at 6 (May 8, 2015). Acknowledging
that there is still debate over whether sugar-sweetened
beverages pose unique health risks, San Francisco also argues
that sugar-sweetened beverages uniquely contribute to
obesity, diabetes, and tooth decay because people are more
likely to over-consume sugar-sweetened beverages than other
foods. But even if it were undisputed that consumption of
sugar-sweetened beverages gives rise to unique behavioral
risks, the warning does not communicate that information.
Rather, the warning singles out sugar-sweetened beverages
without mentioning behavioral risks, and thus clearly implies
that there is something inherent about sugar-sweetened
beverages that contributes to these health risks in a way that
other sugar-sweetened products do not, regardless of
consumer behavior.9 Therefore, the district court erred in
concluding that it would be unreasonable to interpret the
warning to mean that sugar-sweetened beverages are uniquely
or inherently unhealthy. Because the warning is not purely
factual and uncontroversial, we conclude that San Francisco
has not established that the Associations’ constitutionally
protected interest in not providing the warning is minimal
under Zauderer, 471 U.S. at 165.

    9
      San Francisco argues that even if its warning is under-inclusive
because it singles out only sugar-sweetened beverages, it is entitled “to
attack problems piecemeal.” Zauderer, 471 U.S. at 651 n.14. This
argument misapprehends Zauderer. San Francisco’s warning requirement
here is problematic because it is potentially misleading, not because it
“does not get at all facets of the problem it is designed to ameliorate.” Id.
   AM. BEVERAGE ASS’N V. CITY & CTY. OF SAN FRANCISCO 23

     In short, rather than being “purely factual and
uncontroversial,” the warning requires the Associations to
convey San Francisco’s disputed policy views. While the
government “has substantial leeway in determining
appropriate information disclosure requirements for business
corporations,” Pacific Gas & Electric Co., 475 U.S. at 15
n.12, Zauderer does not allow the state to require
corporations to provide one-sided or misleading messages, cf.
id., or “to use their own property to convey an antagonistic
ideological message,” Glickman, 521 U.S. at 471 (citing
Wooley v. Maynard, 430 U.S. 705 (1977)).

    We next turn to the question whether San Francisco’s
ordinance imposes an undue burden that may chill protected
speech. Zauderer, 471 U.S. at 651; Ibanez, 512 U.S. at 146.
We review this issue de novo. Prete, 438 F.3d at 960.

    The Associations argue that the warning unduly burdens
their protected commercial speech because a warning that
satisfies the ordinance—a black box, bold warning that
covers 20 percent of their advertisements—effectively takes
over their message.10 Moreover, the Associations argue that
the ordinance forces them to carry San Francisco’s message
about the health effects of sugar-sweetened beverages, which
the Associations claim is misleading and one-sided.
Accordingly, the Associations argue that the ordinance chills
their protected speech because it renders their speech on
covered media so ineffective as to make it impractical to
advertise on covered media.

     10
        The Associations’ sample advertisements containing the warnings
in the form required by the ordinance are set forth in Appendix A.
24 AM. BEVERAGE ASS’N V. CITY & CTY. OF SAN FRANCISCO

    We agree with the Associations that the warning
requirement in this case unduly burdens and chills protected
commercial speech. As the sample advertisements show, the
black box warning overwhelms other visual elements in the
advertisement. As such, it is analogous to other requirements
that courts have struck down as imposing an undue burden on
commercial speech, such as laws requiring advertisers to
provide a detailed disclosure in every advertisement, Ibanez,
512 U.S. at 146, to use a font size “that is so large that an
advertisement can no longer convey its message,” Public
Citizen Inc., 632 F.3d at 228, or to devote one-sixth of the
broadcast time of a television advertisement to the
government’s message, Tillman, 133 F.3d at 1404 n.4.

    The district court recognized that the burden imposed by
the warning requirement was substantial, but concluded that
it was not unduly burdensome. It noted that a commercial
speaker could use the remaining 80 percent of its advertising
space to engage in counter-speech. In reaching this
conclusion, the court failed to recognize that forcing a
speaker “to tailor its speech to an opponent’s agenda,” and to
respond to a one-sided and misleading message when it
would “prefer to be silent,” Pacific Gas & Electric Co.,
475 U.S. at 10–11, burdens the First Amendment right to be
silent, a right which “serves the same ultimate end as freedom
of speech in its affirmative aspect,” Harper & Row
Publishers, Inc. v. Nation Enters., 471 U.S. 539, 559 (1985).
Moreover, even though advertisers would be free to engage
in counter-speech, countering San Francisco’s misleading
message would leave them little room to communicate their
intended message. This would defeat the purpose of the
advertisement, turning it into a vehicle for a debate about the
health effects of sugar-sweetened beverages.
    AM. BEVERAGE ASS’N V. CITY & CTY. OF SAN FRANCISCO 25

    Because the ordinance is not purely factual and
uncontroversial and is unduly burdensome, it offends the
Associations’ First Amendment rights by chilling protected
commercial speech. Indeed, the Associations submitted
unrefuted declarations from major companies manufacturing
sugar-sweetened beverages stating that they will remove
advertising from covered media if San Francisco’s ordinance
goes into effect. This evidence supports the Associations’
position that the disclosure requirement is unduly
burdensome because it effectively rules out advertising in a
particular medium, see Ibanez, 512 U.S. at 146, and will
cause advertisers to cease using that medium to speak, see
Dwyer, 762 F.3d 283–85. The district court erred in rejecting
this evidence on the ground that the Associations’
declarations were “self-serving.” “[D]eclarations are often
self-serving, and this is properly so because the party
submitting it would use the declaration to support his or her
position.” Nigro v. Sears, Roebuck & Co., 784 F.3d 495, 497
(9th Cir. 2015). A district court cannot disregard an affidavit
“solely based on its self-serving nature.” Id.11

    11
        In determining that the Associations’ declarations were not
credible, the district court reasoned that tobacco and pharmaceutical
companies continued to advertise despite being compelled to provide
similar warnings. We do not find this reasoning persuasive. Sugar-
sweetened beverages do not have the same physiologically addictive
qualities as tobacco, nor are they prescribed by doctors to treat health
conditions like pharmaceutical products. There is no evidence in the
record that advertisers have continued advertising products analogous to
sugar-sweetened beverages in the face of compelled disclosures of the sort
required here.
26 AM. BEVERAGE ASS’N V. CITY & CTY. OF SAN FRANCISCO

    Although there is no dispute that San Francisco has a
substantial government interest in the health of its citizens,12
see CTIA-The Wireless Ass’n, 854 F.3d at 1118, San
Francisco has not carried its burden “of demonstrating the
legitimacy of its commercial-speech regulations,” Zauderer,
471 U.S. at 659, because of substantial evidence in the record
that the regulation is misleading and would chill the
Associations’ protected commercial speech.13 We conclude
that the Associations have shown a likelihood of success on
the merits of their First Amendment claim. The district
court’s conclusion to the contrary was based on legal errors
and was accordingly an abuse of discretion.

                                    IV

    We now turn to the remaining steps of the preliminary
injunction test. At the second step of the preliminary
injunction test, we consider whether Associations have
demonstrated that they are “likely to suffer irreparable harm

    12
        It is less clear, however, whether San Francisco can establish that
providing misleading information through an unduly burdensome
disclosure is reasonably related to its substantial interest in the health of
its citizens. Indeed, San Francisco “has no legitimate reason to force
retailers to affix false information on their products.” Video Software
Dealers Ass’n, 556 F.3d at 967.
     13
        Because we conclude that the ordinance fails “under the less
stringent Zauderer standard,” because it is not purely factual and
uncontroversial and unduly burdens protected speech, it necessarily
follows that the ordinance would also fail under Central Hudson. See
Dwyer, 762 F.3d at 284; see also Video Software Dealers Ass’n, 556 F.3d
at 966 (holding that the court need not decide whether a heightened level
of scrutiny applies because the required disclosure was not purely factual
and uncontroversial and therefore “fails even under the factual information
and deception prevention standards set forth in Zauderer”).
   AM. BEVERAGE ASS’N V. CITY & CTY. OF SAN FRANCISCO 27

in the absence of preliminary relief.” Winter, 555 U.S. at 22.
The Supreme Court has made clear that “[t]he loss of First
Amendment freedoms, for even minimal periods of time,
unquestionably constitutes irreparable injury.” Elrod v.
Burns, 427 U.S. 347, 373 (1976). Accordingly, “[a] colorable
First Amendment claim is irreparable injury sufficient to
merit the grant of relief.” Doe v. Harris, 772 F.3d 563, 583
(9th Cir. 2014) (internal quotation marks omitted). Because
the Associations have made a colorable First Amendment
claim, they have demonstrated a likelihood of suffering
irreparable harm if the ordinance is allowed to go into effect.

    At the third step of the preliminary injunction test, we
consider the balance of hardships. Winter, 555 U.S. at 22.
Once again, our conclusion at this step is dictated by the
Associations’ likelihood of success on their First Amendment
claim. “The fact that the [Associations] have raised serious
First Amendment questions compels a finding that . . . the
balance of hardships tips sharply in [the Associations’]
favor.” Cmty. House, Inc. v. City of Boise, 490 F.3d 1041,
1059 (9th Cir. 2007).

    Finally, we must consider whether an injunction is in the
public interest. Winter, 555 U.S. at 22.           We have
“consistently recognized the significant public interest in
upholding First Amendment principles.” Doe, 772 F.3d at
583 (internal quotation marks omitted). Indeed, “it is always
in the public interest to prevent the violation of a party’s
constitutional rights.” Melendres v. Arpaio, 695 F.3d 990,
1002 (9th Cir. 2012) (internal quotation marks omitted).
Accordingly, a preliminary injunction is in the public interest
here.
28 AM. BEVERAGE ASS’N V. CITY & CTY. OF SAN FRANCISCO

   Because the Associations have met each of the
requirements for a preliminary injunction, we conclude that
the district court abused its discretion in denying the
Associations’ motion for a preliminary injunction.

    REVERSED AND REMANDED.

NELSON, Senior Circuit Judge, concurring in judgment:

    I concur in the judgment of this case because I believe
that the ordinance, in its current form, likely violates the First
Amendment by mandating a warning requirement so large
that it will probably chill protected commercial speech. See
Zauderer v. Office of Disciplinary Counsel of Supreme Court
of Ohio, 471 U.S. 626, 651 (1985) (“We recognize that
unjustified or unduly burdensome disclosure requirements
might offend the First Amendment by chilling protected
commercial speech.”). While I do not understand the
majority’s opinion to state that no properly worded warning
would pass constitutional muster, I agree that the City has not
carried its burden in demonstrating that the twenty percent
requirement at issue here would not deter certain entities from
advertising in their medium of choice. Because this case can
be disposed of on this question alone, I would reverse and
remand without making the tenuous conclusion that the
warning’s language is controversial and misleading.
AM. BEVERAGE ASS’N V. CITY & CTY. OF SAN FRANCISCO 29

                 APPENDIX A
30 AM. BEVERAGE ASS’N V. CITY & CTY. OF SAN FRANCISCO