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Bad Frog Brewery, Inc. v. New York State Liquor Authority

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on 31 January 2014

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Transcript of Bad Frog Brewery, Inc. v. New York State Liquor Authority

Legal Issue
Whether the law is that a government agency had restricted commercial speech unconstitutionally when prohibiting the labels on alcoholic beverages.
Although the NYSLA claimed that banning the labels would protecting children from exposure to vulgarity, the action would not contribute to the substantial government interest. The removal of these labels would not protect children from exposure to vulgarity when there are other factors that can lead to the same exposure.By prohibiting the labels, the state interfered with BFB's commercial speech, which is unconstitutional.
The U.S Court of Appeals ( Second Circuit) reversed the judgment of the district court and remanded the case for a judgment in favor of Bad Frog. The NYSLA's ban on the use of the labels lacked "reasonable fit" to the state's interest to protect children from vulgarity.
-Bad Frog Brewery is a corporation in Michigan that manufactures alcohol, who's logo is designed with a photo of a frog "giving the finger". Though the label on the bottles has been approved by the Federal Bureau of Alcohol, Tobacco and Firearms as well as authorities in 15 states and Washington D.C.
- May 1996: BFB's distributor Renaissance Beer Co. filed an application to NYSLA for brand label approval.
- The application was denied in July and once again in September

Bad Frog Brewery, Inc. v. New York State Liquor Authority
134 F.3d 87 (1998)
US Court of Appeals, Second Circuit

-Bad Frog filed the present action in October 1996 and sought a preliminary injunction barring NYSLA from taking any steps to prohibit the sale of beer by Bad Frog under the controversial labels.
-The District Court denied the motion on the ground that Bad Frog had not established a likelihood of success.The Court determined that NYSLA's decision appeared to be a permissible restriction on commercial speech under Central Hudson Gas & Electric Corp. v. Public Service Commission.
- The Court review the action expressed in denying a preliminary injunction that the labels were commercial speech within the meaning of Central Hudson and that the first prong of Central Hudson was satisfied because the labels concerned a lawful activity and were not misleading.
-Turning to the second prong of Central Hudson, the Court considered two interests, advanced by the State as substantial; promoting temperance and respect for the law" and "protecting minors from profane advertising."
Assessing these interests under the third prong of Central Hudson, the Court ruled that the State had failed to show that the rejection of Bad Frog's labels "directly and materially advances the substantial governmental interest in temperance and respect for the law."

Facts continued

The Law is that the NYSLA must advance state interest in reducing exposure to vulgar behavior to children by prohibiting such displays on the labels of alcoholic beverages

Rule of Law
Full transcript