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ADVERTISING BY PROFESSIONALS.
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Historical, legal, regulatory & ethical issues of advertising by pharmacists, lawyers, doctors. Court cases, constitutional aspects, abuses, professional codes. 5 cases.... More...
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Paper Abstract:
Historical, legal, regulatory & ethical issues of advertising by pharmacists, lawyers, doctors. Court cases, constitutional aspects, abuses, professional codes. 5 cases.
Paper Introduction:
The focus of this paper is to analyze advertising by
professionals. The paper begins with a discussion of legal issues as expressed by the courts, including protection provided by the First and Fourteenth Amendments of the United States Constitution. A review of court decisions from 1976 through 1990 includes key holdings, a discussion of ethical considerations indicates the essential role of regulatory agencies as well as attitudes regarding advertising by professionals, and a contemporary analysis addresses future trends.
Legal Issues
Professionals engage in many activities for the purpose of cultivating clientele. A broad range of activities could be classified as advertising, such as joining country clubs, running for political office, sending holiday greeting cards, throwing
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Regulatory codes include a set ofdetailed rules to govern professional conduct and to serve as a basis foradjudicating grievances. State Bar of Arizona, 433 U.S. Attorney Registration & Disciplinary Commission of Illinois,88-1775. Since Shapero, the current regulation of legal advertising results infour rules. One of the primary factors inBates was the public's need for information relevant to their participationin the legal process. Central Hudson Gas & Electric v. Skipper in "Appeals and Media Use," Society(Jan.-Feb. Until this decision many statesplaced an absolute prohibition on advertising by lawyers. Appellant alleged the restrictions surrounding advertising wereunconstitutional under the First and Fourteenth Amendments. Supreme Court has prohibited absolute bans on advertising byprofessionals,3 required caveats as warnings, defined the type ofadvertising not permissible to regulate4 as well as indicated that statescould regulate certain advertising and could even ban certain types ofadvertisements.5 The court also established a four-prong test to identifywhen restriction of commercial speech may be exercised.6 The court hasstood firm on this issue of commercial speech, but its future direction isunclear as decisions are overruled, for example, the failure to utilize thefour-prong test in Shapero.7 These are the key rulings of the court, forfurther comprehension of the issue, a discussion of case law follows.Court Decisions Virginia Pharmacy Board v. Professional regulatory agencies haveascertained that one way to regain public confidence is through truthfuladvertising. Prior to 197 little to no legal challenge had been asserted in termsof advertising by professionals. In Re Primus, 436 U.S. The court followed the Virginia Pharmacy rulingthat the flow of truthful and legitimate information may not be lawfullyimpaired. 31Central Hudson, 447 U.S. 32Shapero, 1 8 S.Ct. State Bar of Arizona, 433 U.S. However, advertising andsoliciting present unethical opportunity to engage in deceptive practicesfor pecuniary gain and to invade the privacy of potential clients. Subsequent to Bates, the ABA proceeded cautiously in amending theModel Code. In Bates, the court considered whether thisextension applied to the regulation of advertising by lawyers. Ohio State Bar Association, 435 U.S. Appellantasserted that his job, as an employee of the ACLU, was to defend and informwithout distinction or compromise. 5See Ohralik v. 17Bates v. First, in-person solicitation for pecuniary gain may beabsolutely prohibited because it is hidden from public view and is uniquelysusceptible to abuse. With other forms of advertising, inherent dangers are greatestand the content of message incidental. 447 (1978). The court specifically considered the Board's regulation ofcommercial advertising by pharmacists. 1916 (1988). 35 (1977). The paper begins with a discussion of legal issues asexpressed by the courts, including protection provided by the First andFourteenth Amendments of the United States Constitution. However, studies indicate that consumersare not offended by advertising, but some professionals are. Willingboro Township, 431 U.S. "Congress shall make no law . Many professions continue to restrict advertising due to fearthat such activity would harm the image of the profession and that thepublic would react negatively. The court expressed no opinion regarding other professions. Protection of commercial speech may be the free speech battle of the199 s. Conflicts arise between the First Amendment rights of theprofessionals and protection of consumers. 557 (198 ). State Bar filedcomplaint that defendant/members violated the State Supreme Court'sdisciplinary rule which barred attorneys from advertising. In Re R.M.J., 455 U.S. 557 (198 ). 1988): 7. 35 (1977). Appellant charged with solicitinga client by informing a citizen by letter that free legal assistance wasavailable from the American Civil Liberties Union (ACLU). The propriety of making defineddistinctions between advertising and solicitationwas drawn into question in Zauderer. The focus of this paper is to analyze advertising byprofessionals. The court assertedthat warnings or disclaimers, which disclose hidden costs, are required inorder to dissipate the possibility of consumer confusion or deception.18 The court rejected Ohralik stating that print advertising presentsless risk of undue influence than in-person solicitation. The Virginia Pharmacy Board acted to preclude pharmacists fromadvertising prices of prescription drugs and other means of commercialspeech. Townshipallegedly enacted the ordinance to promote integrated housing. A broad range of activities could be classified asadvertising, such as joining country clubs, running for political office,sending holiday greeting cards, throwing office parties, sponsoring thearts, and engaging in community service. Hence, regulating agencies must bepermitted to establish and exercise reasonable regulations to eliminatedeceptive practices. Snizek and reported in itsentirety in Sociological Spectrum and summarized in Society, Ibid. 35 (1977). Advertising is essential to the promotion of free enterprise and thestimulation of competition, when regulated to preclude misleading anddeceptive information. Smaller firms havefound advertising indispensable in a fiercely competitive market andcontend that advertising makes professionals less intimidating and leads togreater competition as well as lower fees for consumers. 1988): 7.----------------------- 2 Plaintiff challenged theordinance seeking justification as outlined in Virginia Pharmacy. The court held that theflow of such information may not be restrained, thus the disciplinary rulewas determined in violation of the First Amendment. Proposals to limit advertising, especially in television, haveexposed a deep cultural split in many professions. This test came to provide guidance to agencies whichregulated licensed professionals as well as facilitated court decisions. The terminologyadopted by the courts to define advertising by professionals is commercialspeech. Thecourt noted that other professions may require consideration of differentfactors. In addition, consumer groups have gotten involvedand filed amicus briefs with various courts to assert the belief thatconsumers benefit from truthful information. In some approaches the dangers in form are minimal and thecontent of message, such as truthfulness and propensity, is of primaryconcern. 28Bates. 748 (1976). Regulation that banned the electric utility from advertisingto promote the use of electricity was ruled in violation of First andFourteenth Amendments. Rogers, 44 U.S. Zauderer published a newspaperadvertisement in which he gave specific legal advice and encouraged peoplewith a specific legal problem to consult him. Atownship ordinance prohibited the posting of real estate "For Sale" and"Sold" signs in a racially integrated community. Virginia Consumer Council, 425 U.S. 447 (1978). Although the U.S. Posadas de Puerto Rico Association v. The court held thatthe possibility of unlawful conduct like fraud and undue influence wasprobable in the context of in-person solicitation and, therefore, suchsolicitation could be prohibited.1 The court determined that the appellant engaged in associationalactivity for the advancement of his own commercial interests. The U.S. 412 (1978). 35 (1977). BibliographyBullard, Jerri Hayes and James K., Jr. 748(1976). A similar survey in 1986 found thatdentists were still the least favorable towards advertising, followed byattorneys,then accountants (physicians were not polled).21 The lattersurvey also found that these professionals believe that economiccompetition is inconsistent with their ethical and professional ideals.22 These attitudes are reflected in professional codes of ethics such asthe ABA Canons of Professional Ethics. Bates v. The court reviewed the challenged Missouri law to determine if itconformed to the requirements of Bates.17 The court followed the Batesruling that states may retain authority to regulate misleading advertisingor other substantial state interests, but that truthful advertising isconstitutional under the First Amendment. The Model Code was first amended to prohibit "any form ofpublic communication containing a false, fraudulent, misleading, deceptive,self-laudatory or unfair statement or claim."23 This scheme of regulationcame under attack in R.M.J.24 A Missouri attorney published anadvertisement which detailed information about the law practice and theattorney. However, advertising and soliciting presentunethical opportunity to engage in deceptive practices for pecuniary gainand to invade potential clients' privacy.27 Thus, an inherent conflictexists between professional ethical obligations and a desire to advanceself-serving pecuniary interests. 11425 U.S. Defendant alleged that the stateregulation was imposed to protect consumers from harmful commercial speech. Gambling casino operator challengedstatute and regulations that restricted advertising of casino gambling toPuerto Rico residents, contending violation of commercial free speechrights under the Constitution. 748 (1976). In 1983 the ABA adopted the Model Rules of Professional Conduct whichwere consistent with Bates and R.M.J., prohibiting any false or fraudulentcommunication. The regulations were amended in 1951 to allowbusiness cards, but restricted use of bold type in telephone directories.The Model Code of Professional Responsibility which was later adopted, waseven less tolerant of advertising than the Canons of Professional Ethics. Zauderer v. 1916 (1988). 1916 (1988). Also, in large measure, a profession's status and autonomy are linkedto the public's perceptions about its motives and the quality of itsperformance. Thebar found the advertisement neither false nor misleading, but refused toapprove it because the letter addressed a specific occurrence related tospecific addressees, rather than to the general public. 35 (1977). The United States Supreme Court, in the late 197 s, ruledrestrictions on commercial speech unconstitutional in violation of theFirst Amendment and, in some situations, the Fourteenth Amendment as well.The First Amendment prohibits abridgment of speech,1 while the Fourteenthprovides equal protection.2 The clauses essentially provide that all persons should be treatedalike under the law when there are no reasons for differences in treatment. Thisincludes information regarding quality of services, comparison of lawyers'services, testimonials, endorsements. . 85 (1977). . 447 (1978). The U.S.Supreme Court determined that an absolute,ban on direct-target mailsolicitation, one form of attorney advertising, violated the Constitution.Court concluded that Kentucky was unable to establish that Shapero's direct-target mail solicitation was misleading without substantial state interest. Supreme Court has affirmed that restrictions oncommercial speech violate the First and Fourteenth Amendments of theConstitution, additional clarification is required. The court defined advertisement asa form of commercial speech designed for the pecuniary gain of theadvertiser.8 The court asserted that reasonable restrictions on the time,the place, and the manner of advertising may be imposed. Definitions and boundaries are being cautiously determined. The court followed previous rulings asserting that Puerto Rico maynot suppress the dissemination of truthful information regarding entirelylawful activity merely to keep its residents ignorant. 27Ohralik at 461. Friedman v. NeitherVirginia Pharmacy11 nor Bates12 purported to permit these kinds ofcommercial regulation. Public Service, 447 U.S. That is, professionals have theright to exercise First Amendment rights and to advance pecuniaryinterests, but consumers are entitled to protection from overreaching anddeceptive practices. An Ohioattorney allegedly solicited family members of injured auto accidentvictim. Fourth, advertising which ispotentially misleading may not be absolutely prohibited but may beregulated. 412 (1978). abridgingthe freedom of speech, or of the press . To the extent that a code confersbenefits on clients, it will help persuade the public that professionalsare deserving of its confidence and respect, and of increased social andeconomic rewards. A 1978 survey2 analyzed attitudes of accountants, attorneys,dentists, and physicians and found that none of the groups had verypositive attitudes toward advertising their services, although accountantsand attorneys appeared more positive. 16Friedman, 44 U.S. Virginia Consumer Council, 425 U.S. A code embodies thecollective conscience of a profession and is testimony to the group'srecognition of its moral dimension. The court stated that this differencecould cause confusion and deception in advertising and, therefore, eachprofession or type of profession would have to be measured separately. 22Survey ascertained that lawyers who graduated after Bates are morelikely to favor advertising than those who graduated earlier. 1 (1979). The court asserted that the government may ban forms of communicationmore likely to deceive the public than to inform the public.16 The courtestablished a four-part analysis for courts to use to determine whether theFirst Amendment protects a particular commercial expression. The courtascertained that lawyer advertising was a form of commercial speechprotected by the First Amendment. Ethical standards prohibited suchpractices and those standards were accepted by the professional community.However, by the late 197 s, attitudinal change occurred as a result ofincreased competition, proliferating technology, and other factors. A 1984 FederalTrade Commission study concurred that legal fees are five percent tothirteen percent lower in cities that had minimal reductions onadvertising. Kentucky Bar Association, 1 8 S.Ct. In theordinary case, the activity would be upheld if it has any rational basis.However, in those cases in which there is an infringement upon afundamental right (such as the right to speak), the defendant would berequired to justify the action by demonstrating that action was taken toserve a substantial state interest. Ohio State Bar Association, 435 U.S. A review of courtdecisions from 1976 through 199 includes key holdings, a discussion ofethical considerations indicates the essential role of regulatory agenciesas well as attitudes regarding advertising by professionals, and acontemporary analysis addresses future trends.Legal Issues Professionals engage in many activities for the purpose ofcultivating clientele. The Missouri rules were basically the same as the amended ABArules. The Courtinvalidated the bar's approach and consequently invalidated the Model Rule,which treats forms of solicitation the same as in-person solicitation. 3 Ohralik, 435 U.S. If the courtdetermines the speech commercial then the court analyzes the speech underthe following factors: (1) speech must concern nonmisleading unlawfulactivity; (2) government interest must be substantial; (3) regulation mustdirectly advance the substantial government interest; (4) the regulationshould be no more extensive than necessary to advance substantialgovernment interest. 626 (1985).State charged misrepresentation in print advertising because the languageused in appellant's advertisements could be misconstrued by potentialclients unaware of certain routine legal practices. 14425 U.S. 1 (1979); Ohralik, 435 U.S. In the future, the professions could become more susceptible tomisuse, particularly if an increase in permissible forms of legaladvertising continue. For purposes of this paper, theword advertising refers to the use of newspapers, magazines, television,radio, flyers, letters, pamphlets, billboards, and the like, specificallydirected to the purpose of gaining or retaining clients. 748(1976). Rogers filed suit challengingthe constitutionality of the Texas Optometry Act which prohibited thepractice of optometry under a trade name. However, PuertoRico contended the intent was not to keep its residents ignorant but toprotect its citizens and its economy, because excessive casino gamblingcould result in harmful effects on the safety, health, and welfare ofPuerto Rican citizens. 33Central Hudson, 447 U.S. 447 (1978). 13Primus at 416. Initially these regulations,composed of severe advertising restrictions, suggested that even businesscards may be inappropriate. As regulators of both professionals and consumers,states may maintain ethical standards of its licensed professionals byrequiring specific procedures, policies, rules, and regulations and mayprotect them from competition, but states may not keep the public ignorantof lawful terms offered by those professionals. Office of Disciplinary Counsel, 471 U.S. . The Board of Ohio Supreme Court filed charges against appellantfor soliciting clients in violation of state rules. Peel v. 25435 U.S. Professionals are ethically and legally obliged to placeclients' interests before all other concerns. The Supreme Court upheld the distinction between advertising andsolicitation in Ohralik25 and Primus26. Tourism Company of Puerto Rico,1 6B Supreme Court 2968 (1986). 191 (1982). deny to any personwithin its jurisdiction the equal protection of the laws." 3See Bates v. Because the advertisementwas contained in a newspaper it was permissible, but Zauderer's approachdemonstrated the classic dangers associated with direct in-personsolicitation. Linmark Association v. Plaintiff used such wording on hisbusiness letterhead and contends the wording is not commercial speech.Plaintiff challenges the constitutionality of the regulation under theFirst and Fourteenth Amendments. Defendantsargued that the rule violated the Sherman Act because of its tendency tolimit competition and that it infringed upon their First Amendment rights. Court held that state action wasunconstitutional because the attorney was not engaged in associationalactivity for pecuniary gain (as in Ohralik) but for the "advancement ofbeliefs and ideas."13 In sum, noncommercial speech, which may advancepolitical ideals, lacks the motivation of pecuniary gain. However, ingeneral, the state may not lawfully suppress the dissemination of truthfulinformation, because such suppression is in violation of the First andFourteenth Amendments of the Constitution. This case concerned the regulation of commercialspeech and is applicable to advertising by professionals in part. Missouri Law permits lawyer advertising butrestricts it to certain categories of information and certain specifiedlanguage. 8Virginia Pharmacy at 76 -61. Ohralik v. 7Shapero v. Thus,regulatory agencies must be permitted to establish and exercise reasonableregulations to eliminate deceptive practices. Public Service Commission, 447 U.S.557 (198 ). 9Virginia Pharmacy Board v. Theincrease in permissible forms of legal advertising could harm both theconsuming public and professionals. In pastcases, Central Hudson19 provided guidance to agencies regulating attorneyadvertising, however, when the court failed to apply the test questionsarose as to the viability of many states' regulations addressing direct-target mail solicitation. 15433 U.S. Thecase is potentially important to the business community, consumers, and tothe development of legal specialties.Ethical Consideration A profession's code of ethics is perhaps its most visible andexplicit enunciation of its professional norms. 24455 U.S. Courtapplied the Central Hudson test to analyze the extensiveness ofrestrictions and ascertained that the constitution was not violated. Ethically, professionals are obliged to place clients' interestsbefore all other concerns. In recent years, a blend of economic, social, legal, and politicalevents has had a profound effect not only on the behavior and performanceof professionals, but also on the public's expectations of them. Sexually explicitspeech and political expression dominated free speech challenges during thepast three decades, but commercial speech, according to experts, is thearea in which the justices are still struggling with definitions andboundaries of constitutional protection. Theprofessions are exploring ways to improve professional service and toregain public confidence. 35 (1977). . Gambling was allowed for the development of tourismand to provide an additional source of income for Puerto Rico. Appellant publishedadvertisements regarding his law practice, which deviated from the preciselanguage used in Missouri Law. 455 U.S. Second, states may absolutely prohibit anyadvertising that is actually misleading. Shapero soughtthe approval of the Kentucky Bar to send out an advertisement letter. Defendant argues the certificationstatement is commercial speech and is misleading because it impinges on theinherent authority of the state Supreme Court to set qualification for thepractice of law. 35 (1977); VirginiaPharmacy 425 U.S. Kentucky Bar Association, 1 8 S.Ct. Bullard and W. 12433 U.S. 557 (198 ). For instance, pharmacies dispense standardized products whereasother professions render services. If the restriction is upheld, more state regulation is probable. The court determined that the ordinance was not needed in order topromote the objective. 447 (1978). Court upheld Virginia Pharmacy14 and Bates15 by declaring the optometryrule an unconstitutional restriction of the free flow of commercialinformation under the First Amendment. 21Survey conducted by J. I. 748 (1976). Courtperceived no definite connection between housing goal and use of signs tosell houses. 23Model Code DR 2-1 1 (1983). Virginia Pharmacy9 announced that First Amendment protection extendedto commercial speech. . The court held that both form and content of advertising isimportant. Corporate firms opposethe practice as misleading, tasteless, and undignified. "Appeals and Media Use." Society (Jan.-Feb. While there are significantdifferences among professional groups, the law may require that thedifferences be disregarded in commercial speech. ." 2Constitution, amend. Bullard and J. Shapero v. State Bar of Arizona, 433 U.S. 2 By J.Darling and D.Hackett in the Journal of Marketing assummarized by J. TheCourt has prohibited absolute bans on advertising by professionals,28required caveats as warnings, defined the type of advertising notpermissible to regulate29 as well as indicated that states could regulatecertain advertising and could even ban certain types of advertisements.3 The court also established a four-prong test to identify when restrictionof commercial speech may be exercised.31 The court has stood firm on thisissue of commercial speech, but its future direction is unclear asdecisions are overruled, for example, the failure to utilize the four-prongtest in Shapero.32 In Shapero the Supreme Court attempted to resolve the unsettled areaof the distinction between advertising and solicitation. The court specifically permitted lawyersto advertise fees for certain routine legal services, concluding that priceadvertising was not inherently misleading. 18R.M.J. 412 (1978). 29Primus, 436 U.S. 1 Ohralik at 462. Since theturn of the century, advertising by professionals has largely beenprohibited, due primarily to unprofessional conduct during the nineteenthcentury. This split is seen outside the court as well. A framework wasestablished which regulating agencies used to form permissible regulationsfor attorneys to follow. . The court asserted that the state mayconstitutionally discipline a lawyer for soliciting clients in person forpecuniary gain under circumstances likely to pose dangers that the statehas a right to prevent. Court of Appeals expressed a constitutional defect in the rule.State authority precluded publication of truthful advertisement regardingavailability and terms of routine legal services. 19Central Hudson Gas v. There are essentially two standards of review used when faced withclaims that an action violates the First and Fourteenth Amendments. 433 U.S. 557 (198 ). 4See In Re Primus, 436 U.S. The regulation may not be more extensive than is necessary tosubstantiate the government interest.33 Experts purport that although the Supreme Court has stood firm oncommercial speech protection, the court's future direction is unclear.Three justices are considered strong allies of commercial speechprotection, two are less so, and the direction of the remaining two isunknown. 191 (1982). State prohibits use of the words "certified" or "specialist" byattorneys in context to themselves. With this understanding of professional ethical codes, onecomprehends the hesitancy towards advertising by professionals. 412 (1978). While professionals have the right toexercise First Amendment rights, the public is entitled to protection fromfraudulent and deceptive practices. 191 (1982); Bates 433 U.S. Such rules are presumed to be enforceablethorough a system of monitoring and the application of a range ofsanctions. Third, advertisements usinginherently misleading information may be absolutely prohibited. On the other hand, advertisements of every sortencourage citizens to enforce their rights. Endnotes 1Constitution, amend. 6See Central Hudson Gas & Electric v. 26436 U.S. "No state shall . This case has import because the court ignored the four-part CentralHudson test and relied on previous attorney advertising decisions. Model Rules drew distinction between advertising which waspermissible and solicitation for pecuniary gain which was impermissiblesolicitation included in-person contact, contact by telephone or telegraph,by letter or other correspondence or communication directed to aprospective or potential client. Defendant alleged that this action violated the rights ofpharmacists as well as consumers of prescription drugs, who had the rightto obtain such information. Public Service Commission, 447U.S. If no differences exist, the distinction would be regarded as arbitraryand would be invalidated for that reason. The advertisement in Zauderer wasmore sophisticated as a marketing tool than the Bates advertisement. XIV. By adopting a code of ethics, a profession hopes to gain thepublic's trust and enhance its status.
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