be profound and serious. Any missteps will injure our country gravely and diminish our position
as the leading world economy.
77
Nor has the Commission shown, as it must, that Internet advertising transactions, or
transactions involving Internet and Web services, are uniquely susceptible to fraud.
Accordingly, the selective regulation of Internet advertising services would plainly violate
fundamental guarantees of equal protection under the Fifth Amendment.
78
B.
The Internet and Web Services Exception Violates The First Amendment.
The FTC's proposal to selectively target commercial speech about Web and Internet
services also is repugnant to the First Amendment. Even when strict scrutiny is not applied to
such regulations under an equal protection analysis, disparate regulations of commercial speech
and speakers still are subject to searching review under at least the intermediate level of
constitutional scrutiny under the First Amendment.
79
Under this commercial speech test, known
as the
Central Hudson
test, a governmental restriction on truthful commercial speech about
lawful activity will be upheld only if: (1) the asserted government interest is substantial; (2) the
regulation directly advances the governmental interest asserted; and (3) the regulation is not
more extensive than is necessary to serve that interest.
80
77
Commissioner Orson Swindle,
Should Policymakers Apply a Depression Era Tax System to the Economy of the
21st Century?
, Address at the Policy Perspectives on the Taxation of Cyberspace Conference on E Commerce (May
12, 2000),
at
http://www.ftc.gov/speeches/swindle/ denver000512.htm. Commissioner Swindle also noted that
[u]nwarranted taxes and regulation at a time when the technology is still rapidly evolving threaten to lock in or
limit the Internet to specific technologies and modes of service that fall far short of its likely potential.
Id.
78
See
,
e.g.
,
Burkhart Advertising Inc. v. City of Auburn
, 786 F. Supp. 721, 732 (N.D. Ind 1991) (invalidating statute
on equal protection grounds where the defendants could not show how billboards advertising commercial goods and
services were any more distracting or unattractive than billboards promoting noncommercial services and
messages).
79
See
,
e.g.
,
Lorillard Tobacco Co. v. Reilly
, 121 S. Ct. 2404, 2421 (2001
); Greater New Orleans Broadcasting
Ass'n v. United States
, 527 U.S. 173, 184 (1999);
Central Hudson
, 447 U.S. at 562 63 (1980). The Supreme Court
recently has acknowledged a movement among several Justices toward applying strict scrutiny to all government
restrictions on commercial speech, but the Court has yet to break [such] new ground.
Lorillard
, 121 S. Ct. at 2421.
80
Central Hudson,
447 U.S. at 566.
26