The great Supreme Court free-speech cases of the 20th century arose from the suppression of political dissent in wartime and the struggle for civil rights in the South. These days, the court’s First Amendment docket is thinner and odder.
A recent sample: Minor celebrities swearing. Dog fight videos. A monument to the Seven Aphorisms of the Summum religion. A banner reading “Bong Hits 4 Jesus.”
But the Supreme Court did just agree to hear a free-speech case that captures the tenor of our times. It concerns bankruptcy.
One of the plaintiffs in the case is Robert J. Milavetz, a 73-year-old lawyer from Minnesota. In the 1960s and 1970s, he represented conscientious objectors and people accused of violating obscenity laws. The new free-speech battleground, he says, is whether the government can gag lawyers seeking to help their clients arrange their financial affairs.
In 2005, Congress enacted a law that seems to bar lawyers from advising their clients to take on more debt if they are considering bankruptcy.
“Any lawyer with a First Amendment background would immediately recognize the First Amendment problems in this statute,” Mr. Milavetz said.
The law was meant to combat what it called bankruptcy abuses. It is certainly possible to abuse the bankruptcy system by piling on debt right before filing in the hope that you will not have to repay it. But ethics rules already forbid lawyers from advising their clients to break the law.
At the same time, not all new debt in the face of bankruptcy is abusive. It may be perfectly legal and prudent, for instance, to refinance a home mortgage to pay down credit card debt. It may make sense to buy a car on credit to make sure you can get to work — so you can pay back your creditors. But the law seems to forbid lawyers from suggesting or even discussing such things.
Joseph R. Prochaska, a bankruptcy lawyer in Nashville who represents creditors, said a client might get plausible advice from, say, a brother-in-law or from Suze Orman on CNBC about refinancing a loan.
“You go to your lawyer for confirmation,” Mr. Prochaska continued. “As a lawyer, what do you say to that — if I told you to do that, I’d be breaking the law.”
Experts in First Amendment law and legal ethics said the law, at least if read broadly, is deeply flawed.
“To say that a lawyer can’t advise a client to take on legal debt is clearly unconstitutional,” said Erwin Chemerinsky, the dean of the new law school at the University of California, Irvine.
Stephen Gillers, who teaches legal ethics at New York University, agreed. “Congress has no legitimate interest in denying people knowledge of their lawful alternatives,” Professor Gillers said.
In its brief urging the Supreme Court to hear the case, the government did not defend the broader and more natural reading of the law, the one that would forbid even lawful advice. Instead, it said the law contained “a term of art” with “a specialized meaning” that should allow for a more limited reading, one that applies only to abusive situations.
The law forbids advising someone “to incur more debt in contemplation of such person filing” for bankruptcy. The term of art, the government says, is the three-word phrase “in contemplation of.” You probably have to be a very good lawyer to make that phrase mean what the government says it means: “actions taken with the intent to abuse the protections of the bankruptcy system.”
In fairness, the government’s interpretation won support from a dissenting appeals court judge in the case the Supreme Court agreed to hear, from the United States Court of Appeals for the Eighth Circuit, in St. Louis, and from a unanimous three-judge panel of the Fifth Circuit, in New Orleans.
To avoid holding a law unconstitutional, the Fifth Circuit said, it is sometimes a good idea to give a “restrictive meaning” to “what appear to be plain words.” That approach has a name: the doctrine of constitutional avoidance.
Mr. Milavetz’s firm challenged the law, asking that it be struck down in all possible applications. Its briefs discuss hypothetical problems. The law prohibits advice about co-signing on a child’s student loan, one brief said, or borrowing to pay for credit counseling.
But the Supreme Court has not welcomed these kinds of sweeping challenges in recent cases, preferring more focused “as applied” cases that take issue with particular applications of laws.
The law also requires bankruptcy lawyers covered by it to publish disclosures when they advertise. The law says they must use this statement or something “substantially similar”: “We are a debt relief agency. We help people file for bankruptcy relief under the Bankruptcy Code.”
Mr. Milavetz said the language was aimed to stifle speech. “I feel the term ‘debt relief agency’ is pejorative,” he said. “It deters lawyers from advertising.”
Other lawyers welcome the requirement.
“Most consumer bankruptcy lawyers like to call themselves a ‘debt relief agency,’ ” Mr. Prochaska said. “They have buttons that say ‘Federal Debt Relief Agent.’ It’s a marketing tool.”
There are traces of history in every era’s First Amendment cases. These days, it seems, the great open question is what may be said in the face of looming financial ruin.