[Ip-health] Report on IMS oral argument

[Sean Flynn]

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The IMS v. NH argument, about whether companies have a first amendment
right to access prescription records for marketing purposes, was held on
Wednesday.  I argued the case on behalf of the public interest amici.
Here are a few notes on how I think it went.



The judges appeared very critical of the data mining industry's
assertion that collecting and selling prescription records amounted to
protected speech under the First Amendment.  The judges seemed very kind
to the NH attorney and did not grill her on any difficult points of the
argument.  Selya, who wrote the Wine and Spirits decision (holding that
advertising consulting services between companies are not 1st A speech)
asked a very nice leading question about "if there is any effect on
commercial speech, isn't it just incidental?"



All of their questions were focused on the degree to which states can
regulate economic conduct with an 'incidental effect' on commercial
speech rather than whether the law itself was narrowly tailored.  The
court never asked either side for detailed arguments on whether the law
was 'narrowly tailored' to meet its objectives, a possible indication
that they believe that the law does not regulate protected speech.



The judges were much more critical of IMS's argument.  Lipez asked very
skeptically whether NH had to have a "Turner record" (three years of
congressional hearings used to justify regulating cable speech) for this
law.  The attorney unwisely responded that NH needed more because this
law was akin to regulating the core of the 1st Amendment and therefore
required strict scrutiny.  The judges just let them go at that point and
became very disengaged in the IMS argument.



I gave rebuttal and responded to an earlier question about what similar
laws there are on the books that regulate access to information used in
marketing.  I led into the question by describing the difference between
commercial speech -- which is speech to the consumer about a product --
and consumer surveillance -- which is taking information about a
consumer, often without their knowledge or consent.  This law, like many
others, regulates the latter by cutting off access to consumption
information rather than regulating the substance of what marketers say.
It is thus similar in particulars to

*     Driver Privacy Protection Act (upheld Reno v. Condon)

*     Video Privacy Protection Act (video rental)

*     Stored Communications Act (internet)

*     Electronic Communications Privacy Act

*     Fair Credit Reporting Act (upheld Trans Union v. FTC)



The DPPA is particularly relevant since that law was passed in part to
cut down on harassing sales tactics by lawyers searching accident
records for potential clients.



I also got a soft ball from Lipez about whether we agreed that the law
effects commercial speech, at least indirectly.  I emphatically agreed
by noting the dangerous extent of a ruling that held that every law that
"effected" commercial speech was subject to heightened scrutiny under
the First Amendment.



I noted the reasons that a gift ban would not be sufficiently tailored
-- namely that the problem addressed here is the monitoring of
prescriptions to target a host of reinforcements of favored prescribing
behavior -- including consultancies, educational seminar invitations,
prestigious board appointments and even targeted expressions of
appreciation -- that are difficult or impossible to regulate under gift
bans.



I am optimistic about the chances for a favorable ruling.  If the First
Circuit overturns the ruling striking down New Hampshire's first in the
nation law regulating prescription data mining, several states and the
District of Columbia are expected to quickly enact similar laws.
Washington State and New York look primed to move soon, possibly without
waiting for the ruling.  The First Circuit's ruling will also affect
current litigation in Vermont and Maine that passed data mining
restrictions soon after New Hampshire.



-Sean