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Sheehan Phinney 
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Will Stewart 
Greater Manchester
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House Committees Address First Amendment Issues Already Resolved by US Supreme Court

Valerie Acres, Sheehan Phinney Capitol Group 

Two House committees are being asked to adopt legislation that would reopen questions already asked of, and recently answered by, the US Supreme Court. Given the financial challenges facing the state, legislators should tread carefully and avoid adopting questionable language that could put the state in the middle of complex federal litigation, especially when the highest court in the country has already spoken.

Interestingly, both bills involve free speech protections under the First Amendment of the US Constitution. Here's a summary:

SB 287, relative to confidential prescription data -

A subcommittee of the House Health, Human Services and Elderly Affairs Committee will meet next Tuesday to consider SB 287, relative to confidential prescription data. This bill seeks to bring a state law adopted in 2006 into compliance with an opinion rendered by the US Supreme Court in 2011. The brief history is this: In 2006, New Hampshire was the first state in the nation to adopt a law restricting the use of prescriber-identifiable data. This is data derived from medication prescriptions, demographic information on physicians maintained by the American Medical Association, and other sources, which identifies individual physicians and their prescribing habits. The information is used for medical and biological research, to facilitate product recalls, to support public health initiatives, and the like. It is also used by pharmaceutical salespeople to target sales calls to the appropriate physician practices and to tailor information to maximize sales. It is important to note that the data in question identifies physicians but does not, and never has, identified individual patients. Patient-identifiable information remains private. In 2011, the US Supreme Court considered a case involving a similar law adopted in the neighboring state of Vermont and ultimately overturned that law because it violated free speech protections in the US Constitution. In so doing, the Court determined that the law restricted speech (or use of the data) based on its content and based on the identity of the "speaker" (in this case, pharmaceutical salespeople). The Court said, "The First Amendment requires heightened scrutiny whenever the government creates 'a regulation of speech because of disagreement with the message it conveys.' ... A 'consumer's concern for the free flow of commercial speech often may be far keener than his concern for urgent political dialogue.' That reality has great relevance in the fields of medicine and public health, where information can save lives." (Sorrell v. IMS Health) After this decision was issued, the federal district court in New Hampshire entered a judgment that our law, too, is unconstitutional. SB 287, as introduced and as adopted in the Senate, would simply amend our law to bring it back into compliance with the US Constitution.

Proponents of laws restricting the use of prescriber-identifiable data, however, have proposed an amendment to SB 287 aimed at trying again to do exactly what the US Supreme Court has said is prohibited. The proposed language itself is still being analyzed; however, the motivation for it is clear - to shut down sales calls to physicians by pharmaceutical manufacturers. The US Supreme Court stated clearly that "[s]peech in aid of pharmaceutical marketing...is a form of expression protected by the Free Speech Clause of the First Amendment." Attempting to circumvent this clear expression by the US Supreme Court would create a circumstance that could involve the state in expensive legal proceedings. It could also shut down, for the second time, access to information that has many beneficial uses in addition to its use as a sales tool.

SB 175, regulating the commercial use of a person's identity

The banking/business division of the House Commerce Committee will hold a public hearing next Tuesday on SB 175, regulating the commercial use of a person's identity. This bill was introduced to solve a problem for the family of JD Salinger, the reclusive author of The Catcher in the Rye who lived in Cornish, NH. The bill has since become the battleground for a struggle between manufacturers of video games and the union representing professional athletes regarding the use of images in video games. Again, the US Supreme Court issued an opinion in 2011, this time making clear that video games are protected expression under the First Amendment. The court stated, "Like the protected books, plays, and movies that preceded them, video games communicate ideas - and even social messages - through many familiar literary devices (such as characters, dialogue, plot, and music) and through features distinctive to the medium (such as the player's interaction with the virtual world). That suffices to confer First Amendment protection. Under our Constitution, 'esthetic and moral judgments about art and literature ... are for the individual to make, not for the Government to decree, even with the mandate or approval of a majority [citation omitted]. And whatever the challenges of applying the Constitution to ever-advancing technology, 'the basic principles of freedom of speech and the press, like the First Amendment's command, do not vary' when a new and different medicum for communication appears." Just as pharmaceutical salespeople cannot be singled out, nor can purveyors of video games be singled out for disfavored treatment under the law. 

The players' union successfully persuaded the Senate to include language in SB 175 that treats video games differently than documentaries, motion pictures, television programs, or other audiovisual works under the proposed "Right of Publicity" statute. If the House chooses to adopt a Right of Publicity statute in New Hampshire, it should remove this distinction to ensure the law is in compliance with the US Constitution. Doing otherwise would, as above, create a circumstance that could involve the state in expensive legal proceedings.

Here are links to the two US Supreme Court cases discussed above -

http://www.supremecourt.gov/opinions/10pdf/10-779.pdf  (Sorrell v. IMS)

http://www.supremecourt.gov/opinions/10pdf/08-1448.pdf  (Brown v. Entertainment Merchants Association)

Where we go from here 

Will Stewart, Greater Manchester Chamber of Commerce 

     

Of the 22 bills on which the Chamber took a "support" or "oppose" position this year, only eight remain in play after Crossover. From now until the end of the session, we will focus our attention on these bills:

  • SB 295 - The Senate passed this bill, which doubles the state's financial commitment to the research and development tax credit from $1 million to $2 million per year, helping to ensure that New Hampshire manufacturers and tech companies retain their competitive edge. We ask the House to pass SB 295 as well.
  • SB 48 - This bill, passed by the Senate, represents a significant policy modernization for the state's telecom industry by leveling the playing field for all telecom competitors. The bill provides regulatory parity for all telecommunications companies with each other and the other providers of service - no more, no less. This bill has the support of the telecom industry including landline, cable, and wireless providers. We ask the House to pass SB 48.
  • SB 203 and SB 205 - Recognizing the need to modernize the laws regarding LLCs - by far the state's most popular business entity choice - the Senate passed SB 203, which favors the use of plain English over legal jargon and will help make business formation and governance easier to understand for new and existing entrepreneurs. Another business law modernization bill passed by the Senate, SB 205 addresses the Business Corporations Act and includes such modernizing aspects such as allowing for electronic notification with regard to corporate governance and meetings. The bill also increases the ability for entities to convert to a corporation, among other provisions. We encourage the House to pass both SB 203 and SB 205.
  • SB 204 - Like SB 203 and SB 205, this bill doesn't exactly grab headlines, but it's important to the business community nonetheless. The bill, passed by the Senate, seeks to revise Article 9 of the Uniform Commercial Code, relative to secured transactions, as proposed by the National Conference of Commissioners on Uniform State Laws. In short, by adopting the Article 9 amendments as proposed in SB 204, New Hampshire law will be in greater conformity with that of other states, a uniformity which can serve to lower transaction fees. We ask the House to pass SB 204.
  • HB 1282 - The existence of workforce housing (housing that allows families making median income-young professionals, blue collar workers, municipal employees and the like- in a town to afford to live there too) in our communities is of critical importance to the business community. HB 1282, however, guts the state's workforce housing law by allowing local municipalities to pass zoning laws make it such that developers can't supply the demand for workforce housing, thus hurting economic expansion. We ask the Senate to kill HB 1282.
  • SB 177 - Both insulting and unfair to the state's nonprofit business community, this bill, as amended and passed by the Senate, would require at least one board member of each nonprofit that receives more than $250,000 in government (state, local or federal) funds to attend a training session at least once every two years focusing mainly on fiscal management and ethics. If there are bad apples, address them individually, not with an industry-wide mandate. We ask the House to kill SB 177.
  • SB 291 - This bill gives municipalities a way to address the impacts of new developments through the use of impact fees for project-related improvements to state highways located within a municipality. As it now stands, there is no way for municipalities to utilize traffic impact fees for funding road improvements to state highways that connect to new developments. We ask the House to pass SB 291.