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Abstract

While attention has focused on the U. S. Supreme Court protecting corporate political speech, the Court has left untouched a California Supreme Court ruling of significance to marketers in their efforts to use advertising and public relations to offset what they view as unfair criticism. The case, Kasky v. Nike, stems from 1995 accusations that athletic footwear and apparel manufacturer Nike exploited and abused employees in Asian sweatshops. Through advertising and public relations efforts, Nike denied the claims. In 1998, Californian Mark Kasky sued, claiming Nike’s denials violated laws regarding unfair competition and false advertising and, because the denials were “commercial speech,” they were not protected by the First Amendment. California Superior Court dismissed the case and Kasky also lost in the state Court of Appeal, but won at the California Supreme Court. The U.S. Supreme Court ultimately declined to hear an appeal from Nike. As a result, companies doing business in California, including online, risk being charged with false advertising when attempting to defend themselves against accusations of unfair, illegal, or unethical corporate practices.

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