Central Hudson Gas v. Public Service Comm'n

447 U.S. 557 (1980)

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Nature of the Case

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Facts

The New York Public Service Commission prohibited electrical utilities from engaging in promotional advertising designed to stimulate demand for electricity. Appellant challenged the order in state court, arguing that the Commission had restrained commercial speech in violation of the First and Fourteenth Amendments. The Commission's order was upheld by the trial court and at the intermediate appellate level. The New York Court of Appeals affirmed. It found little value to advertising in 'the noncompetitive market in which electric corporations operate.' Since consumers 'have no choice regarding the source of their electric power,' the court denied that 'promotional advertising of electricity might contribute to society's interest in `informed and reliable' economic decision-making.' The court also observed that, by encouraging consumption, promotional advertising would only exacerbate the current energy situation. The court concluded that the governmental interest in the prohibition outweighed the limited constitutional value of the commercial speech at issue.