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ACLU on the NRA's Lawsuit Against N.Y. Gov. Cuomo

The NRA accuses N.Y. government officials of unconstitutionally pressuring financial services companies into not dealing with the NRA -- an ACLU friend-of-the-court brief says, "If true, those allegations represent a blatant violation of the First Amendment."

Here's the ACLU's brief (filed Friday), which strikes me as quite sound legally (some paragraph breaks added):

INTRODUCTION

Political advocacy organizations throughout the United States, including the American Civil Liberties Union, rely on access to a number of basic services in order to function. Many of these services are highly regulated, including insurance, banking, legal services, and accounting. In this case, Plaintiff National Rifle Association of America ("NRA") has alleged that the New York Department of Financial Services ("DFS"), the Department's Superintendent Maria Vullo, and Governor Andrew Cuomo have carried out a "campaign to chill the political speech of the NRA and other so-called 'gun promotion' organizations by leveraging state power to punish[] financial institutions which maintain business arrangements with the NRA." Amended Complaint, Dkt. No. 37 ("Compl.") ¶ 21.

If true, those allegations represent a blatant violation of the First Amendment. Although public officials are free to express their opinions and may condemn viewpoints or groups they view as inimical to public welfare, they cannot abuse their regulatory authority to retaliate against disfavored advocacy organizations and to impose burdens on those organizations' ability to conduct lawful business.

On a motion to dismiss, the plaintiff's factual allegations must be accepted as true and all reasonable inferences must be drawn in the plaintiff's favor. McCarthy v. Dun & Bradstreet Corp., 482 F.3d 184, 191 (2d Cir. 2007).

Under that standard, the NRA has stated a First Amendment claim. It alleges that: core political speech is a major purpose of the organization; Defendants have threatened adverse actions against New York banks and insurers that maintain ties with the NRA or other gun promotion groups; Defendants took these actions based on hostility to the NRA's political advocacy; and Defendants' actions have caused millions of dollars in damages and jeopardized the NRA's access to essential corporate liability insurance and banking services.

In particular, the NRA points to the April 2018 Guidance Letters issued by Superintendent Vullo, entitled "Guidance on Risk Management Relating to the NRA and Similar Gun Promotion Groups." The NRA alleges that those letters—which have no connection to DFS's regulatory mission and which explicitly target the NRA and similar groups based on their constitutionally protected political advocacy—threatened adverse action against banks and insurers that associate with groups espousing a disfavored viewpoint. Under Federal Rule of Civil Procedure 12(b)(6) and well-established doctrine, those allegations are sufficient to survive Defendants' motion to dismiss.

Defendants make two kinds of arguments, neither of which avails. First, Defendants maintain that the NRA has failed to plausibly allege that Defendants threatened adverse action against New York banks and insurers associated with the NRA. Under Defendants' theory, the Court may look only to the allegedly threatening public statements—in this case, the Press Releases and Guidance Letters issued by Superintendent Vullo and Governor Cuomo—to determine whether the state directly threatened adverse action. But courts assessing retaliation claims must consider the whole context to determine whether adverse action was threatened.

Here, the allegations of the Amended Complaint as a whole support the NRA's charge that Defendants implicitly threatened adverse action: Superintendent Vullo has regulatory authority over banks and insurers in New York; her Guidance Letters to banks and insurers instructing them to "take prompt" action to "manag[e] their risks, including reputational risks, that may arise from their dealings with the NRA or similar gun promotion organizations" could reasonably be construed as threatening, id., Exhibit C; two weeks after the Guidance Letters were issued, DFS announced consent decrees with two insurers, imposing millions of dollars in fines and prohibiting them from carrying NRA-endorsed insurance programs; and the NRA has alleged that numerous banks and insurers have refused to provide even basic services to the NRA because of the perceived threat in the Guidance Letters and consent decrees.

Second, Defendants attempt to impose several new requirements that, they maintain, the NRA must satisfy in order to state a First Amendment retaliation claim. According to Defendants, plaintiffs alleging First Amendment retaliation must show that: their speech was subjectively chilled, regardless of whether they have suffered other kinds of harm; the government was motivated by hostility to a "particularized" instance of speech, instead of broad hostility to a speaker's politics or viewpoint; and the government attempted to directly suppress protected expression, rather than retaliating financially against a disfavored speaker. None of these requirements has any foundation in the caselaw; all would radically constrict the scope of First Amendment protection against government retaliation.

The NRA ultimately may not be able to prove their allegations, or Defendants may eventually succeed in refuting them. But at the motion-to-dismiss stage, the NRA's allegations are sufficient to make out a claim under the First Amendment.

If the NRA's allegations were deemed insufficient to survive the motion to dismiss, it would set a dangerous precedent for advocacy groups across the political spectrum. Public officials would have a readymade playbook for abusing their regulatory power to harm disfavored advocacy groups without triggering judicial scrutiny. And it is extremely difficult, if not impossible, for any advocacy group to operate effectively without routine access to basic banking and insurance services. For these reasons, Defendants' motion to dismiss should be denied, and the NRA should be given an opportunity to investigate and substantiate its First Amendment claims.

FACTUAL BACKGROUND

In October 2017, DFS initiated an investigation of the Carry Guard insurance program, focusing on two insurance companies, Chubb Ltd. ("Chubb") and Lockton Affinity, LLC maintains violated New York insurance law. The NRA alleges that throughout the investigation, DFS communicated "backchannel threats" to banks and insurers with ties to the NRA that they would face regulatory action if they failed to terminate their relationships with the NRA. Compl. ¶¶ 38, 45. According to the NRA, the Chairman of Lockton called the NRA on February 25, 2018 and confided that Lockton would need to "drop" the NRA entirely for fear of losing its license to operate in New York; the next day, Lockton tweeted it would discontinue providing brokerage services for all NRA-endorsed insurance programs. Id. ¶¶ 42-43. Days later, the NRA alleges, its corporate insurance carrier severed ties with it and said it would not provide the NRA insurance at any price. Id. ¶ 44. The NRA alleges that the corporate carrier learned about the state's threats against Lockton and feared it would be subject to similar reprisals. Id.

In April 2018, Governor Cuomo and Superintendent Vullo issued a Press Release and "Guidance[s] on Risk Management Relating to the NRA and Similar Gun Promotion Organizations," encouraging banks and insurance companies to reconsider their relationships with the NRA. Superintendent Vullo's Guidance Letter to insurance companies, for instance, states: "[T]he Department encourages its insurers to continue evaluating and managing their risks, including reputational risks, that may arise from their dealings with the NRA or similar gun promotion organizations, if any, as well as continued assessment of compliance with their own codes of social responsibility. The Department encourages regulated institutions to review any relationships they have with the NRA or similar gun promotion organizations, and to take prompt actions to managing these risks and promote public health and safety."

Just a few weeks later, the Defendants announced consent orders with Chubb and Lockton, in which the insurers agreed to cease underwriting affinity insurance programs for the NRA in perpetuity, regardless of the programs' legality. Id. ¶¶ 55, 62. Thus, the consent orders did not only cover the Carry Guard insurance policies that violated New York state law, but any affinity insurance programs at all. Shortly after the consent decrees were made public, Lloyd's of London announced that it would terminate all affinity insurance programs associated with the NRA, citing the DFS investigations. Id. ¶ 65.

The NRA alleges that it also encountered serious difficulty replacing its corporate insurance carrier, and that nearly every potential replacement carrier has indicated that it fears transacting with the NRA, specifically because of the DFS investigations. Id. ¶ 66. The NRA further alleges that numerous banks have withdrawn bids to provide basic depository services because the April guidance letters indicated to the banks that any association with the NRA could expose them to regulatory retaliation, citing a banker's anonymous comment to American Banker magazine. Id. ¶¶ 67, 68. The NRA alleges it has suffered tens of millions of dollars in damages as a result of Defendants' actions. Id. ¶ 69. The NRA alleges that, without access to essential banking and insurance services, "it will be unable to exist as a not-for-profit or pursue its advocacy mission." Id. ¶ 70.

ARGUMENT

[I.] The Court Must Consider All the Circumstances to Determine Whether Defendants Threatened Adverse Action Against the NRA's Banks and Insurers.

The NRA's First Amendment retaliation claim turns on its allegation that Defendants issued "threats to financial institutions that DFS ... will exercise its extensive regulatory power against those entities that fail to sever ties with the NRA." Id. at 2. The Amended Complaint's key allegation states: "Read in the context of the preceding months' private communications—as well as disclosures that would soon follow concerning consequences imposed on firms doing business with the NRA—[Superintendent Vullo's] April 2018 [Guidance] Letters were threats that deliberately invoked DFS's 'risk management' authority to warn of adverse action if institutions failed to support Defendants' efforts to stifle the NRA's speech and to retaliate against the NRA based on its viewpoint." Id. ¶ 48.

The April 2018 "Guidance[s] on Risk Management Relating to the NRA and Similar Gun Promotion Organizations," indisputably targeted the NRA and similar groups based on their "gun promotion" advocacy. It is important to note that, however controversial it may be, "gun promotion" is core political speech, entitled to the same constitutional protection as speech advocating for reproductive rights, marijuana legalization, or financial deregulation. The central questions, then, are whether the Guidance Letters threatened adverse action against banks and insurers that associate with the NRA or other "gun promotion" advocacy groups, and whether this threat was motivated by the government's hostility to a "gun promotion" viewpoint.

As Defendants acknowledge, Memorandum of Law in Support of Defendant's Motion to Dismiss, Dkt. No. 40-1 ("Memo. in Support of Motion to Dismiss") at 20, the First Amendment sometimes "require[s] courts to draw fine lines between permissible expressions of personal opinion [by public officials] and implied threats to employ coercive state power to stifle protected speech." Hammerhead Enterprises, Inc. v. Brezenoff, 707 F.2d 33, 39 (2d Cir. 1983). On the one hand, public officials are undoubtedly free to promote their views about public welfare, including by using their bully pulpits to "cajole[] and exhort" others to repudiate positions or groups the officials view as pernicious. Gravel v. United States, 408 U.S. 606, 625 (1972); see also, X-Men Sec., Inc. v. Pataki, 196 F.3d 56, 70 (2d Cir. 1999) ("[W]e have noted that where a public official, without engaging in any threat, coercion, or intimidation, 'exhort[ed]' private entities not to distribute a board game whose ideas the official viewed as pernicious, the official's speech did not violate any constitutional right of the game's authors." (quoting Hammerhead, 707 F.2d at 39 & n.6)). On the other hand, "'oral or written statements made by public officials' could give rise to a valid First Amendment claim '[w]here comments of a government official can reasonably be interpreted as intimating that some form of punishment or adverse regulatory action will follow the failure to accede to the official's request.'" Okwedy v. Molinari, 333 F.3d 339, 342 (2d Cir. 2003) (internal citation omitted).

Defendants argue that the NRA failed to state a retaliation claim because "neither the Press Releases nor the Guidance Letters contain any threat or suggestion of State action, or imply that companies with ties to the NRA are somehow complicit in unlawful behavior that merits State regulatory attention." Memo. in Support of Motion to Dismiss at 22. But Defendants' analysis is too formalistic and narrow. It would allow the government to threaten retaliation through the use of subtle language and visible enforcement actions against the threatened group. To prevent such gamesmanship, the First Amendment requires the Court to "look through forms to the substance." Bantam Books, Inc. v. Sullivan, 372 U.S. 58, 67 (1963).

"While the precise language" of the Press Releases and Guidance Letters "is certainly important," the Second Circuit has "never held that it is the only relevant factor in determining whether a public official has crossed the line 'between attempts to convince and attempts to coerce.'" Zieper v. Metzinger, 474 F.3d 60, 66 (2d Cir. 2007) (quoting Okwedy, 333 F.3d at 344). Rather, the First Amendment requires the Court to consider all the circumstances, including "the entirety of the defendants' [alleged] words and actions," to determine "whether they could reasonably be interpreted as an implied threat." Id.; see also Bennett v. Hendrix, 423 F.3d 1247, 1252 (11th Cir. 2005) (explaining that "adverse effect" in a retaliation claim "depends on context"). A number of factors bear on this inquiry, including: (1) the defendants' regulatory or other decisionmaking authority over the targeted entities; (2) the language of the allegedly threatening statements; (3) allegedly retaliatory exercises of regulatory authority over the targeted entities; and (4) the perception of a threat by the targeted entities and their response. See Zieper, 474 F.3d at 66. The Amended Complaint contains numerous allegations relevant to this analysis, all of which must be weighed by the Court to determine whether the NRA has plausibly alleged a First Amendment claim.

First, "the existence of regulatory or other direct decisionmaking authority is certainly relevant to the question of whether a government official's comments were unconstitutionally threatening or coercive ...." Okwedy, 333 F.3d at 343. In Bantam Books, for instance, the Supreme Court observed that, although the Rhode Island Commission to Encourage Morality in Youth lacked the "power to apply formal legal sanctions," it had the authority to initiate investigations and recommend prosecutions. 372 U.S. at 66-67. This power imbued the Commission's "advisory notices" with extra weight, since "[p]eople do not lightly disregard public officers' thinly veiled threats to institute criminal proceedings against them if they do not come around." Id. at 68; see also Okwedy, 333 F.3d at 344 ("Even though Molinari lacked direct regulatory control over billboards, PNE could reasonably have feared that Molinari would use whatever authority he does have, as Borough President, to interfere with the 'substantial economic benefits' PNE derived from its billboards in Staten Island."). Here, the Defendants exercise even more direct regulatory authority over the allegedly threatened financial institutions. Superintendent Vullo has the authority to initiate investigations and civil enforcement actions against regulated financial services firms operating in New York, as well as "the power to refer matters to the attorney general for criminal enforcement." Compl. ¶¶ 2, 24, 25.

Second, given Superintendent Vullo's direct regulatory authority over the allegedly threatened financial institutions, the Court should closely scrutinize the language of her Guidance Letters. The Guidance Letters state in relevant part that regulated banks and insurers should "continue evaluating and managing their risks, including [but perhaps not limited to] reputational risks, that may arise from their dealings with the NRA or similar gun promotion organizations," and that they should "take prompt actions to manag[e] these risks." Id., Exhibits B and C. DFS's mandate—"effective state regulation of the insurance industry" and the "elimination of fraud, criminal abuse and unethical conduct by, and with respect to, banking, insurance and other financial services institutions," Fin. Servs. Law § 102(e), (k)—does not extend to "gun promotion," and it is not apparent why regulated entities would require guidance from DFS regarding the "risks" of associating with the NRA or other gun promotion groups.

Viewed in the light most favorable to the NRA, as required at this stage of the proceedings, the Guidance Letters could reasonably be interpreted as a threat of retaliatory enforcement against firms that do not sever ties with gun promotion groups. See Okwedy, 333 F.3d at 344 ("Because the district court was considering a motion to dismiss, it should have viewed the language of Molinari's letter in the light most favorable to plaintiffs."); id. at 342 (holding that a jury could find that the defendant's letter contained an implicit threat of retaliation where it invoked the defendant's position as the Borough President of Staten Island, pointed out that the targeted company "owns a number of billboards on Staten Island and derives economic substantial benefits from them," and directed the company to contact the defendant's legal counsel and chair of his anti-bias task force); Rattner v. Netburn, 930 F.2d 204, 206-10 (2d Cir. 1991) (holding, on motion for summary judgment, that there were genuine issues of material fact about whether Defendant's letter—stating that Plaintiff's publication "raises significant questions and concerns about the objectivity and trust which we are looking for from our business friends"—was "threatening or coercive").

Third, the Court should consider the history of enforcement actions against the threatened entities. See Rattner, 930 F.2d at 210 (observing that "the Chamber member who had been 'in charge of' the Gazette testified that following receipt of the Netburn letter, he had actually lost business and had been harassed by the Village"); see also Bantam Books, 372 U.S. at 63 (noting that "[a] local police officer usually visited Silverstein shortly after Silverstein's receipt of a [Commission] notice to learn what action he had taken"). Here, the Amended Complaint asserts that Defendants linked the threats in the Guidance Letters to the enforcement actions carried out by DFS against Chubb and Lockton. For example, the NRA alleges that, during the course of the DFS investigations into Chubb and Lockton in late 2017 and early 2018, "DFS communicated to banks and insurers ... that they would face regulatory action if they failed to terminate their relationships with the NRA.... indicating that any business relationship whatsoever with the NRA would invite adverse action." Compl. ¶ 38. The NRA also notes that the Chubb and Lockton consent decrees, which imposed several million dollars in monetary penalties and permanently prohibited those entities from participating in any NRA-endorsed insurance program in New York State, were announced just two weeks after the Guidance Letters were issued. Id. ¶ 54. The timing could be purely coincidental, or it could have been intended to reinforce the message that insurers and financial institutions associated with the NRA will be subject to further retaliatory action by the state. See Vereecke v. Huron Valley Sch. Dist., 609 F.3d 392, 401 (6th Cir. 2010) ("In analyzing the facts in temporal proximity cases, we have always looked at the totality of the circumstances to determine whether an inference of retaliatory motive could be drawn.").

Finally, the perception of a threat by the targeted entities is probative as to whether an implicit threat was made. In Rattner, for instance, a village trustee sent a letter to the village's chamber of commerce expressing concern about the plaintiff's political advertisement in the chamber's newsletter. 930 F.2d at 205-06. Although the trustee's letter did not suggest that the publication was unlawful or directly threaten adverse action, the "Chamber directors testified that they regarded the letter, and [the trustee's] statement that he had made a list [of businesses at which he shopped], as clearly threatening boycott or other retaliatory action by the Village, including discriminatorily strict enforcement of parking and zoning regulations." Id. at 206. As a result, the chamber prevented the plaintiff from publishing further advertisements in its newsletter. Id. at 206-07. The Second Circuit held that the trustee's letter to the chamber "may reasonably be viewed as an implicit threat," largely because "a threat was perceived and its impact was demonstrable." Id. at 210. See also Bantam Books, 372 U.S. at 68 ("The Commission's notices, phrased virtually as orders, reasonably understood to be such by the distributor, invariably followed up by police visitations, in fact stopped the circulation of the listed publications ex proprio vigore." (emphasis added)); Hammerhead, 707 F.2d at 39 (noting that "not a single store was influenced by [defendant's allegedly threatening] correspondence").

Defendants argue that "no individual company was singled out or coerced as a result of the statements," Memo. in Support of Motion to Dismiss at 22, but such specific targeting is not required in order to make out a First Amendment claim in these circumstances. Moreover, the Amended Complaint includes numerous allegations regarding the perception of a threat by New York insurers and financial institutions, and its impact on the NRA's ability to procure insurance and banking services. The NRA alleges that: during DFS's investigation into Lockton, Lockton's chair "confided [to the NRA] that Lockton would need to 'drop' the NRA—entirely—for fear of 'losing [our] license' to do business in New York," Compl. ¶ 42; a week after the Chubb and Lockton consent decrees were entered, Lloyd's of London "announced ... that it would 'terminate all insurance offered, marketed, endorsed, or otherwise made available' through the NRA in light of the DFS Investigation," id. ¶ 65; the NRA's corporate insurance carrier "severed mutually beneficial business arrangements with the NRA because it learned of Defendants' threats directed at Lockton, and feared it would be subject to similar reprisals," id. ¶ 44; the NRA has encountered serious difficulties obtaining [replacement] corporate insurance coverage" because "nearly every carrier has indicated that it fears transacting with the NRA specifically in light of DFS's actions against Lockton and Chubb," id. ¶ 66; "[m]ultiple banks withdrew their bids in the NRA's RFP process following the issuance of the April 2018 Letters, based on concerns that any involvement with the NRA—even providing the organization with basic depository services—would expose them to regulatory reprisals," id. ¶ 67; and "one community banker from Upstate New York told American Banker magazine that in light of the apparent 'politically motivated' nature of the DFS guidance, '[i]t's hard to know what the rules are' or whom to do business with, because bankers must attempt to anticipate 'who is going to come into disfavor with the New York State DFS' or other regulators," id. ¶ 68.

Taken together, these allegations are sufficient to draw a reasonable inference that Defendants threatened adverse action against banks and insurers that associate with the NRA, and that this threat was motivated by the government's hostility to the NRA's "gun promotion" viewpoint.

[II.] The Motion to Dismiss Misstates the Requirements for a First Amendment Claim.

Defendants further argue that, even if they coercively threatened banks and insurers to sever ties with the NRA, the Amended Complaint fails to state a First Amendment claim. It is black-letter law that the government may violate the First Amendment through "action that falls short of a direct prohibition against speech," including by retaliation or threats of retaliation against speakers. Zieper, 474 F.3d at 65 (internal quotation marks omitted) (quoting Aebisher v. Ryan, 622 F.2d 651, 655 (2d Cir. 1980)). It is equally well-established that the government may violate a speaker's First Amendment rights by pressuring third parties to carry out its unconstitutional designs. See, e.g., Okwedy, 333 F.3d at 344; Rattner, 930 F.2d at 209-10. "To plead a First Amendment retaliation claim a plaintiff must show: (1) he has a right protected by the First Amendment; (2) the defendant's actions were motivated or substantially caused by his exercise of that right; and (3) the defendant's actions caused him some injury." Dorsett v. Cty. of Nassau, 732 F.3d 157, 160 (2d Cir. 2013). The Amended Complaint plainly meets this test. The Complaint alleges that: "political speech is a major purpose of the NRA," and "[t]he NRA engages in extensive legislative advocacy to promote its purposes," Compl. ¶ 11; Defendants are engaged in a "campaign to chill the political speech of the NRA and other so-called 'gun promotion' organizations by leveraging state power to punish[] financial institutions which maintain business arrangements with the NRA," id. ¶ 21; and, as a result of Defendants' actions, the NRA has incurred tens of millions of dollars in damages and risks losing access to essential insurance and banking services in New York, id. ¶¶ 66-70.

To avoid this straightforward analysis, Defendants have grafted several nonexistent requirements onto the test. According to Defendants, a plaintiff claiming First Amendment retaliation under these circumstances must allege that: (1) the plaintiff was actually chilled in the exercise of its First Amendment rights; (2) the government retaliated against the plaintiff because of specific hostility to a particular communication, rather than broad hostility to the plaintiff's advocacy; and (3) the government interfered directly with the publication or dissemination of the plaintiff's speech, rather than imposed financial or other harms on the plaintiff. If upheld, Defendants' proposed requirements would radically narrow the scope of constitutional protection against government retaliation. Fortunately, Defendants' arguments are misplaced.

First, Defendants contend that the NRA has failed to state a retaliation injury because its expression has not been completely suppressed or chilled. Memo. in Support of Motion to Dismiss at 25-26 ("Nothing Defendants have done, or are doing, has prevented the NRA from spreading its message—whether through rallies, conventions, publications, or NRATV—as shown by the NRA's continued public condemnation of Governor Cuomo and others who speak out in favor of common sense gun control."). However, "[c]hilled speech is not the sine qua non of a First Amendment claim. A plaintiff has standing if he can show either that his speech has been adversely affected by the government retaliation or that he has suffered some other concrete harm. Various non-speech harms are sufficient to give a plaintiff standing." Dorsett, 732 F.3d at 160; see also Zieper v. Metzinger, 392 F. Supp. 2d 516, 527 (S.D.N.Y. 2005) ("It would indeed be ironic were we to hold that persons who are persevering and resolute, who overcome their inhibitions and fears to proceed on a course they believe constitutionally protected, would thereby lose the very protection which they rely on in asserting their rights." (internal quotation marks omitted) (citing Trotman v. Bd. of Trustees of Lincoln University, 635 F.2d 216, 227-28 (3d Cir. 1980))), aff'd, 474 F.3d 60 (2d Cir. 2007).

The NRA's allegations of significant interference with its business relationships are sufficient to establish a First Amendment retaliation injury. See Bantam Books, 372 U.S. at 64 n.6. The Amended Complaint alleges that Defendants' retaliatory threats are causing "insurance, banking, and financial institutions doing business with the NRA ... to rethink their mutually beneficial business relationships with the NRA for fear of monetary sanctions or expensive public investigations." Compl. ¶ 65. As a result, the NRA states that it is at risk of losing "access to basic banking services," that it "has encountered serious difficulties obtaining corporate insurance coverage to replace coverage withdrawn by the Corporate Carrier," and that "there is a substantial risk that NRATV will be forced to cease operating" if it cannot "obtain insurance in connection with media liability." Id. ¶¶ 66, 67. The NRA claims it has incurred "tens of millions of dollars in damages based on Defendants' conduct," and that it "will be unable to exist as a not-for-profit or pursue its advocacy mission" if it is unable to obtain basic insurance and financial services. Id. ¶¶ 69, 70. If these alleged injuries fail to suffice, it is hard to imagine what could.

Second, Defendants maintain that "First Amendment protection is afforded only to 'particularized' instances of speech or expressive conduct." Memo. in Support of Motion to Dismiss at 25. Although the NRA has alleged that Defendants' actions undermine its ability to engage in political advocacy, Defendants assert that "the First Amendment does not protect such a broad and attenuated category of speech." Id. "[B]y this logic," Defendants argue, "all government speech that could ever theoretically affect an organization whose 'major purpose' is political speech would violate that organization's First Amendment rights. No such sweeping weaponization of the First Amendment is recognized by the Supreme Court, the Second Circuit, or elsewhere." Id. Accordingly, Defendants maintain that the NRA's complaint should be dismissed because it "fails to identify any specific, particularized instance of protected speech or expressive conduct that has been directly infringed by Defendants." Id. at 26.

To the contrary, the NRA has squarely alleged that Defendants are retaliating against it based on hostility to its "gun promotion" advocacy, Compl. ¶¶ 15-21, 47-48, 51, 53, 76, and the Guidance Letters' reference to the NRA "and similar gun promotion organizations" bears out Defendants' animus to the NRA's viewpoint, id., Exhibits B and C. Courts have readily acknowledged that government retaliation against a person based on broad hostility to that person's politics or viewpoint violates the First Amendment, even if the plaintiff has not identified a "particularized" instance of speech that the government seeks to suppress. For example, in Planned Parenthood Association of Utah v. Herbert, the Tenth Circuit held that the Planned Parenthood Association of Utah (PPAU) was likely to succeed on its First and Fourteenth Amendment claims by showing that the Government of Utah denied the PPAU government funding in order to "weaken the organization and hamper its ability to provide and advocate for abortion services." 828 F.3d 1245, 1262 (10th Cir. 2016) (emphasis added); see also Dye v. Office of the Racing Comm'n, 702 F.3d 286, 295-302 (6th Cir. 2012) (holding that the plaintiffs could go to trial on the claim that their government employer retaliated against them based on their perceived political affiliation, even though the court rejected their claim that the employer retaliated against them based on particular instances of protected speech). To be sure, unbiased application of facially neutral laws does not violate the First Amendment simply because those laws may affect expressive associations. But the NRA has alleged that Defendants are explicitly targeting the NRA based on its hostility to the NRA's viewpoint and its constitutionally protected political advocacy. Under those circumstances, it should not make any difference whether Defendants are attempting to suppress a "particularized" instance of speech or "gun promotion" writ large.

Third, Defendants argue that the NRA must allege that the government attempted to directly suppress the NRA's expression in order to state a First Amendment retaliation claim, and that interference with the NRA's non-expressive business relationships does not qualify. See Memo. in Support of Motion to Dismiss at 30 ("[T]he actual basis of the NRA's claims in this case is alleged interference with the NRA's ability to contract for insurance and banking services; it is not that the NRA is being hampered, in any way, from engaging in political speech advocating in favor of the Second Amendment.").

Courts have never required plaintiffs to demonstrate that the government directly attempted to suppress their protected expression in order to establish First Amendment retaliation, and they have often upheld First Amendment retaliation claims involving adverse economic action designed to chill speech indirectly. See, e.g., Davis v. Vill. Park II Realty Co., 578 F.2d 461, 463 (2d Cir. 1978) (reversing dismissal of a complaint by president of a tenants' association who claimed that the owner of a federally funded housing project had threatened her with eviction in retaliation for her advocacy of tenants' rights); Krause v. Buffalo & Erie Cty. Workforce Dev. Consortium, Inc., 425 F. Supp. 2d 352, 379 (W.D.N.Y. 2006) (failure to hire the plaintiff based on alleged hostility to her political beliefs satisfied injury prong of First Amendment retaliation claim). Were it otherwise, the First Amendment would prohibit the government from pressuring a newspaper to remove a speaker's advertisement, but it would allow the government to bankrupt the speaker by pressuring its business partners to terminate their contracts. That absurd result has no foundation in the law. See Okwedy, 333 F.3d at 344 ("A public-official defendant who threatens to employ coercive state power to stifle protected speech violates a plaintiff's First Amendment rights, regardless of whether the threatened punishment comes in the form of the use (or, misuse) of the defendant's direct regulatory or decisionmaking authority over the plaintiff, or in some less-direct form." (emphasis added)).

CONCLUSION

Because the NRA has plausibly alleged that Defendants threatened adverse action against banks and insurers associated with the NRA, and that Defendants' actions were motivated by hostility to the NRA's political advocacy, the Motion to Dismiss should be denied.

Editor's Note: We invite comments and request that they be civil and on-topic. We do not moderate or assume any responsibility for comments, which are owned by the readers who post them. Comments do not represent the views of Reason.com or Reason Foundation. We reserve the right to delete any comment for any reason at any time. Report abuses.

  • MaverickNH||

    It's one thing to advocate that individuals bring economic pressure to bear on organizations that one opposes. It's quite another thing for government to take a hand in doing so. You should buy your coffee elsewhere vs our state will not do business with your firm - black and white issue.

  • M.L.||

    Even when it comes to "private" action, payment card processors have significant market power and are routinely checked by the DOJ. To see Mastercard engaging in this kind of discrimination against the Horowitz center is ... ominous. Google is getting close to the line of monopoly as well.

  • M.L.||

    Forgot link

  • jdgalt1||

    Google has gone well beyond that "line" by purging conservatives from Youtube. So have Twitter and Facebook, by "shadowbanning".

    At the very least, CDA sec 230 ought to be revised to withdraw its protection from forum owners that engage in that level of editing and/or discrimination.

  • Krayt||

    How well would Cuomo & friends like a state that issued guidance against insurance companies that insured Planned Parenthood clinics, that they should consider the risk to reputation, and that they are insuring advocacy that is inherently dangerous (to unborn babies.)

    The only difference is that PP kills more, and the right being tromped on isn't explicitely called out in the Constitution.

    Neither should be, but you know, throw philosophy out the window when inconvenient.

  • Krayt||

    Neither should be tromped on, that is.

  • Toranth||

    Planned Parenthood and abortion clinics are obvious targets for harassment, but it can get much worse.

    Political campaigns need insurance, loans. Businesses need to rent them space and equipment. What's a rental company to do if the state government starts suggesting that people supporting Party X might find themselves unable to get insurance, unable to do business with the state government, unable to work with banks, and under constant threat of investigation?

  • MatthewSlyfield||

    "Political campaigns need insurance, loans."

    And basic banking services. There was a story just in the last week or two about a Democratic primary candidate whose campaign's bank accounts were closed due to the candidate supporting marijuana legalization and receiving donations from marijuana legalization advocacy groups.

  • ||

    IIRC, what the bank was concerned about was not receiving donations from advocacy groups, but from marijuana businesses themselves. Federal law prohibits banks from touching the proceeds of drug money, which is why most mortgage lenders won't lend to a strip mall that contains a dispensary, for example.

  • Absaroka||

    It's 2020, halfway through a contentious and close campaign between Trump and Elizabeth Warren. In a surprise move one of them, who we'll call Candidate A comes out for federal legalization of MJ. Fearing some contribution from an MJ business might slip through, Candidate A's banks etc. immediately suspend all of A's bank accounts, etc, etc, halting his/her campaign in it's tracks.

    Nothing to see here, just move along?

  • ||

    Look, you'll get no argument from me on this. The federal government has no Constitutional authority to regulate drugs at all, and even if it does, marijuana doesn't belong on Schedule 1. But the banks are not being irrational here.

  • Absaroka||

    Fair enough.

    "But the banks are not being irrational here."

    Isn't that a problem, though? Let's take an edge case - a candidate is advocating legalizing something that is and should be illegal - legalizing post-birth abortion until age 21, deporting the Amish, or confiscating guns :-). Isn't it still a big problem that the government regulator could cause banks to shut down their campaign?

    To put it another way, what political advocacy positions ought to justify being shut down at the behest of the government?

  • James Pollock||

    "what political advocacy positions ought to justify being shut down at the behest of the government?"

    Advocacy for the violent overthrow of the rule of law.
    Advocacy BY government actors for positions that are contrary to the Constitution.

    Probably more, that I can't think of right now.

  • FlameCCT||

    What political advocacy positions ought to justify being shut down at the behest of the government?

    In the USA? None!

    IMO the Constitution ensures the Rights of everyone to publicly display their ignorance for all to see.

  • James Pollock||

    "What political advocacy positions ought to justify being shut down at the behest of the government?
    In the USA? None!"

    So those prosecutions for raising money for al qaeda were all wrongful?

  • James Pollock||

    "The federal government has no Constitutional authority to regulate drugs at all"

    The Controlled Substances Act stretches the edges of the Commerce Clause, but even if you redraw the Commerce Clause back, it still leaves the federal government with some authority. And the federal government still controls the borders, so they have authority over imported drugs, too.

    " marijuana doesn't belong on Schedule 1"
    But while it is, Mr. Sessions is going to stamp it out.

  • ||

    Also, I'd support declaring all banks, Facebook, Amazon, Twitter, Instagram, Youtube and the like to be common carriers and regulate them accordingly.

  • perlchpr||

    Also, I'd support declaring all banks, Facebook, Amazon, Twitter, Instagram, Youtube and the like to be common carriers and regulate them accordingly.

    If the left wants "Net Neutrality" so bad, let it be a double edged sword for them.

  • Careless||

    It's a problem, but it's a different problem

  • Absaroka||

    Can you explain how it's different from the situation being discussed, which was "a Democratic primary candidate whose campaign's bank accounts were closed due to the candidate supporting marijuana legalization"?

  • Careless||

    Because it's a problem of government force being used to effect the end, instead of government force presumably incidentally having that effect.

    Now, if someone said "hey, we're going to use these laws to screw anyone related to marijuana businesses, so hey, Candidate A's bank, listen up..." yes, that would be the same thing

  • James Pollock||

    "Now, if someone said "hey, we're going to use these laws to screw anyone related to marijuana businesses, so hey, Candidate A's bank, listen up..." yes, that would be the same thing"

    How about if someone says "Hey, this didn't used to be a problem, because MJ was illegal everywhere, but now that it IS legal, sort of, in some places, what happens if someone like Candidate A starts getting money from MJ businesses, in places where it's legal, but for a campaign for federal office, like Candidate A is running for, where it isn't?

    Is that a warning, or a threat?

  • Careless||

    It's just you randomly rambling because you're not smart enough to understand what the adults are talking about. *pat*

  • jdgalt1||

    Federal law already bans state-legal MJ businesses from having bank accounts. The bank that opened one for them would be guilty of felony money laundering.

  • LarryA||

    Planned Parenthood and abortion clinics are obvious targets for harassment, but it can get much worse.

    Amen. It's nice the ACLU is siding with the NRA here, and I'll applaud for that. But they're also acting in self-defense.

    If courts hold that the NY state governor can blackmail banks and insurance carriers to kill the NRA, 49 other state governors are going to be making lists, and checking them twice. They'll have different opinions on who's naughty and nice. Then the POTUS will be sayin', "Well, if governors can do it..." Then the big city mayors will start pondering.

    Planned Parenthood is already in red state crosshairs, with ACLU a high second priority, but pretty much every corporation (for profit or not) and partnership is going to be on somebody's list.

    The court should be buried in f-o-t-c briefs.

  • floridalegal||

    I wonder which representation was more difficult for the ACLU. Representing Nazi's 20 + years ago and a right to march in Skokie or friend brief in support of the NRA today? I wonder how many people will condemn the ACLU and withhold contributions? In today's social culture, NRA is worse than actual Nazi's.

  • M.L.||

    After cooling on free speech, the ACLU could use a token boost. It's a thoroughly leftist organization, but it's supposed to be one with principles.

  • santamonica811||

    Florida,
    The answer is: both were simple (albeit controversial) calls. The ACLU defends constitutional rights. It's just that here, when it's a "conservative/Republican" right; people have to sputter with indignation, since it would cost too much emotionally to just say, "Good call, ACLA. Glad you're standing by your principles."

  • Brett Bellmore||

    "The ACLU defends constitutional rights."

    The ACLU used to defend constitutional rights. Their current position, as articulated here in Reason by Nadine Strossen, is that they defend what THEY view as "rights", and inclusion in the Constitution doesn't really have anything to do with it.

  • nonzenze||

    Of course they would defend what THEY view as rights. What did you expect, for them to defend what BRETT views as rights?

  • Brett Bellmore||

    Of course they're going to defend what they view as rights. The point is that they've explicitly cut lose "what they view as rights" from what the Constitution declares to be rights.

    Now they just tautologically defend whatever they feel like defending, instead of having an external standard they can be judged against.

    They did this because they were tired of people pointing out that they claimed to be defending the Bill of Rights, when there were obviously rights in it they wouldn't defend, and 'rights' they do defend that aren't in it.

    Well, you can't claim they're lying now, because their claim to defend 'rights" is now largely meaningless. It just means that they defend "what they defend".

  • Sarcastr0||

    Moar Third Amendment Cases or the ACLU is a FRAUD!!!

  • James Pollock||

    Not only that, but they FLATLY REFUSE to advocate in support of the 18th amendment. Not a word.

  • MatthewSlyfield||

    "but they FLATLY REFUSE to advocate in support of the 18th amendment."

    Yes, they (quite rightly) refuse to advocate in support of the only amendment to the US Constitution that has actually been repealed (21st amendment).

  • James Pollock||

    Congratulations. You (officially) got the joke.

  • James Pollock||

    "Now they just tautologically defend whatever they feel like defending, instead of having an external standard they can be judged against"

    So did the Founders, since the factory-original Constitution didn't list the rights of individuals. And then, when the first Congress decided to add one, they punted on completing the list.

  • nonzenze||

    Of course they're going to defend what they view as rights. The point is that they've explicitly cut lose "what they view as rights" from what the Constitution declares to be rights.

    Are you really going to do this? We understand that you disagree with them on what the Constitution declares to be rights.

    Heck, on some of the disagreements, some of us even believe that you are correct and they are incorrect.

    But the whole "well what they are defending isn't the Constitution" boils down to nothing more than "I think my view of the Constitution is right and their view, where it differs from mine, is wrong". But we already knew that Brett thinks that Brett's view of the Constitution is right. In fact, it's hard to imagine a world where this is not true.

  • Brett Bellmore||

    "We understand that you disagree with them on what the Constitution declares to be rights."

    Look, just read that interview with Strossen here in Reason. It's not simply a matter of disagreeing on what the Constitution declares to be rights. They've declared what the Constitution declares to be rights irrelevant.

    To quote Strossen, "Putting all that aside, I don't want to dwell on constitutional analysis, because our view has never been that civil liberties are necessarily coextensive with constitutional rights. Conversely, I guess the fact that something is mentioned in the Constitution doesn't necessarily mean that it is a fundamental civil liberty."

  • nonzenze||

    I don't think that quote means what you think it means.

    I don't want to dwell on constitutional analysis, because our view has never been that civil liberties are necessarily coextensive with constitutional rights.

    Translation: there are civil liberties beyond those enumerated in the Constitution, which we ought to advocate for. This is the entire point of RFRA, RLUIPA, the SCA, Eminent Domain reform --- to promote civil liberties beyond what the Constitution protects.

    That is to say, one can believe concurrently that Oregon v Smith was decided correctly but that a broader view of civil liberties means one ought to advocate for the passage of RFRA. Or the same for Washington v Glucksberg. Or really any other area in which society protects civil liberties beyond what the Constitution requires.

    Conversely, I guess the fact that something is mentioned in the Constitution doesn't necessarily mean that it is a fundamental civil liberty

    Translation: The Constitution contains many clauses, some of which are not relevant to our mission. For instance, the Origination Clause is most certainly "mentioned in the Constitution" but is not a civil liberty issue, it's a legislative process issue. That doesn't make it any less worthy of attention, but it's not within their ambit.

  • Brett Bellmore||

    So, the fact that something isn't declared by the Constitution to be a right doesn't matter, and the fact that something IS declared by the Constitution to be a right doesn't matter, either.

    How is this not what I said: That they'd declared what the Constitution says is a right to be irrelevant?

  • Absaroka||

    "But the whole "well what they are defending isn't the Constitution" boils down to ...."

    FWIW, I was OK with e.g. their pre-Heller view of the 2nd. I personally disagreed with the collective rights view, but it was certainly one of the possible interpretations that was in play. Once Heller came out, though, and their position was 'we think the SC is wrong', then I think it's fair to say they can no longer claim that their position is 'we support all civil rights, even unpopular ones for unpopular people', which was what I thought their position had been.

    Similarly, as a policy matter I don't object to hanging serial rapists, and if I was a justice I wouldn't have 8th amendment objections to that, on originalist grounds. But once the SC said the 8th forbids hanging rapists, then I can't fault the ACLU from advocating against hanging rapists, because that's what the SC said.

    In short, I guess, I liked when I thought the ACLU's position was to advocate for whatever civil rights were, as defined by the SC. That's a clean approach. I liked that they would step up to defend relatively powerless people being stepped on by the government, whether the right in question or the person involved was popular. I liked having that implicit threat hanging over the head of officials who were contemplating throwing their weight around.

    That's not to say the ACLU can't change their mission, of course. They are a privately run organization, and can do what they like.

  • nonzenze||

    I'm not sure I follow this. If the ACLU believes (right or wrong) that hanging rapists is unconstitutional, why does the SC ruling one way or the other change that?

    Maybe it changes the strategy they should use for such advocacy. After all, if the SC agrees with them then they can pursue such advocacy with the courts citing it as precent. If the SC disagrees, they would have to advocate legislatively or through referendum.

    I guess the model is, I think of the ACLU's litigation arm as a body that pursues their objectives in court under such cases that they think are impactful and that also have a reasonable chance of winning under current doctrine. If the litigation arms says "You know what, don't try to litigate the right to physical assisted suicide under the 14A because that's a losing case", that doesn't mean the organization as a whole has to abandon it.

  • Krayt||

    So...they defended Nazi rights to march in the 1970s not out of principle but because Mr. and Mrs. Mildly-Conservative Middle America outlawed it and this was a way to politically kick them in the teeth?

    That...is a theory with more explanatory power that covers both eras and flipping.

  • ||

    No, they don't. They don't defend the 2nd Amendment at all, and they are one of the biggest supporters of race based affirmative action. They also oppose the death penalty of Constitutional grounds. They don't defend the Constitution. They defend the Constitutions as Ruth Bader Ginsburg invents it

  • James Pollock||

    "They don't defend the 2nd Amendment at all"

    Current events notwithstanding.

  • ||

    They're not defending the 2nd Amendment. They're defending what they see as an attack on the 1st Amendment.

  • James Pollock||

    Or, and give this thought just a trial run, but...

    Maybe they're doing BOTH

    AT THE SAME TIME!

    (cue dramatic score)

  • croaker||

    They're defending the 1st. That it also defends the 2nd is circumstantial, and they explicitly say so in their press release.

  • mad_kalak||

    Agreed. The ACLU's official position on the 2A is that it protects a collective right for militias, not an individual right to keep and bear arms.

  • Careless||

    The ACLU has a stated position on the 2nd Amendment, James. And it is that it protects no right (that it protects the right of the government to have weapons, which was never in doubt)

  • FlameCCT||

    Of course it's a good call by the ACLU especially as they see how it could be used against them and other organizations it supports like Planned Parenthood, etc.

  • jdgalt1||

    The previous attempt to deny banking services this way (FDIC's Operation Choke Point) affected many businesses that ACLU and its members are much more likely to want to use than the NRA (it covered gun dealers but also porn producers and check cashing stores). Hopefully, the argument in this article will succeed against any further use of this tactic either by feds or states, no matter who is the target.

  • Sarcastr0||

    Must be hard to see the ACLU doing something you agree with. Glad to see you and ML managed to brazen through this cognitive dissonance and kept things Manichean and full of your side being oppressed!

  • ||

    Even a broken clock is right twice a day.

  • OtisAH||

    Making you worth less than a broken clock.

  • Jerry B.||

    As this continues, it'll be interesting to see how diligent the ACLU is in defending the NRA. They could just put the JV team on it, and when they lose claim to have done their best.

  • James Pollock||

    Because the NRA is incapable of mounting a defense?

    That's like claiming your sports team lost because the bandwagon fans weren't cheering loud enough.

  • FlameCCT||

    I expect the ACLU will be vigorous in this case as they can easily see how approval of government abuse could be used against them in many States.

  • James Pollock||

    "In today's social culture, NRA is worse than actual Nazi's."

    Duh. In America, today, the NRA has power that affects people in ways they can see. The actual Nazi's are cartoonish bad guys for Indiana Jones to defeat. (And they were defeated, rather soundly).

    The NRA made a lot of progress for the membership by virtue of having a large organization of citizens involved in the political process, while their opposition was disarrayed and diffuse. To a politician, a group that can put a roomful of people into every meeting room for every meeting on the schedule looks like a really big organization. But they aren't really that big. They're very, VERY motivated on their single issue, whereas most Americans aren't interested in it very much.

  • Brett Bellmore||

    Actually, the NRA IS "very big", if your standard is "relative to the normal size of such organizations"; Its paid membership is well over 1% of the population, and pushing 2%. That means that, in most parts of the country, you're continually encountering NRA members, mostly without knowing it.

    The NRA's opposition isn't so much "disarrayed and diffuse", as it is "small but very well placed"; The anti-gun movement punches well above their weight class based on the membership being concentrated in media, law, and political professionals. In terms of membership numbers, the anti-gun groups are a tiny, tiny fraction of the NRA's size. But they have influence all out of proportion due to where they're found.

  • James Pollock||

    "Actually, the NRA IS 'very big', if your standard is 'relative to the normal size of such organizations'"

    Yes, yes, your membership is all swollen and engorged. Very manly.

    "the anti-gun groups are a tiny, tiny fraction of the NRA's size."

    In a word, diffuse. In two words, diffuse and disarrayed. As in "not organized into groups"

  • ||

    The NRA has five times the number of members that NARAL (a group dedicated to legal baby murder) does.

  • James Pollock||

    But fewer than peak "World of Warcraft" subscribers.

  • Careless||

    So you don't know what "diffuse" means.

  • Brett Bellmore||

    Apparently he doesn't.

  • James Pollock||

    You apparently don't.

  • FlameCCT||

    He appears to be one of those "confused" types. He/she/it should have used concentrated not diffuse; as the opposition is concentrated in large urban areas aka Progressive Plantations.

  • James Pollock||

    "He appears to be one of those 'confused' types."

    True enough, assuming you use "confused" to mean people who are smarter than you are.

  • FlameCCT||

    Thanx for the confirmation James. Do you happen to work at/with CNN or perhaps that is your news source; they too are confused and have trouble telling the difference between an apple and a banana?

  • James Pollock||

    I don't know, but yes, I'm assuming that both apples and bananas have more functional brain capacity than you do.

  • Brett Bellmore||

    "Diffuse:

    adjective
    adjective: diffuse
    dəˈfyo͞os/

    1.
    spread out over a large area; not concentrated."

    The NRA's opposition is the exact opposite of "diffuse", it is concentrated, and in particularly influential occupations. That's the only reason they're at all effective, given their much smaller numbers.

    If anybody is "diffuse", it's the NRA's membership.

  • James Pollock||

    "If anybody is 'diffuse', it's the NRA's membership."

    So, even after quoting a dictionary definition, you STILL can't use the word correctly?

  • Careless||

    It is kind of funny that after being humiliated with your lack of understanding of fairly common words, you manage to land a shot on Brett

  • WJack||

    "[W]hile their opposition was disarrayed and diffuse' . . . could it be that the mainstream propaganda pumps, i.e., the N.Y. Times et. al. and there tens of millions of believers are clueless?

  • James Pollock||

    How does that thing relate to this thing?

  • James Pollock||

    "it is extremely difficult, if not impossible, for any advocacy group to operate effectively without routine access to basic banking and insurance services."

    Is it also impossible to obtain insurance and banking services from sources which are outside of New York's regulatory jurisdiction?

  • Brett Bellmore||

    Regulatory jurisdiction? Probably not. Regulatory influence? Pretty much. If you're not headquartered in NY, you're probably dependent on somebody headquartered in NY.

  • AustinRoth||

    For nationwide services, yes, as the large national banks are primarily based in New York.

  • James Pollock||

    Most of the biggest banks are incorporated in Delaware or South Dakota, and Charlotte, NC is also a major center of banking.

    But the question was whether or not ANY provider exists outside of NY.

    Ultimately, the question I have comes when the script is reversed... what is the legal result if the regulators are pushing FOR something, instead of AGAINST something?

  • FlameCCT||

    Does it hurt being this ignorant Jimmy?
    Or just normal for a Progressive serf?

  • James Pollock||

    "Does it hurt being this ignorant Jimmy?"

    If it does, you must be in agony.

    "Or just normal for a Progressive serf?"

    Oh, never I mind. I see the meds are kicking in.

  • FlameCCT||

    Poor Jimmy has gone way past projection and is well into delusions of grandeur.

  • James Pollock||

    Jimmy? Fuck THAT guy.

  • mad_kalak||

    Please share with us your deep experience in the financial industry by which you come to this conclusion?

  • James Pollock||

    To what conclusion are you referring?

  • mad_kalak||

    The implicit one. What do you think? That this issue could go away if the NRA just got any 'ol bank without a presence in NY state, like one just in NC. Again, what is your experience in the finance industry? I'm ready to be wowed on that one.

  • James Pollock||

    "The implicit one"

    Ah. So you're asking me what qualifications I have to form the conclusion that's in your head, and not mine?

    "what is your experience in the finance industry?"
    Couple of years in a major regional bank. Plus a JD with a certificate in business law, and a partly-completed but long-abandoned MBA program. You?

  • mad_kalak||

    Don't play coy, you know perfectly well what you were getting at.

    What position at a bank, teller? Be specific please, if you'd like to be that is. Business...that covers an awful lot of ground, from bond counsel to employment law. As for the MBA, you maybe learned a ton, but what's sad about the education racket is that you could be 1 credit shy but without that degree it gets you pretty much nothing in the real world. That aside, I suppose what you wrote shows that you're lacking expertise in the financial industry, thus it shows your assumption that if you could just get a bank to take your business that doesn't have a presence in NY, than all's well that ends well.

    Me? I never pretended to be an expert in the finance industry, but I know enough about it to know that every big bank is deeply affected by what happens in NY, and enough to know that the premise of your question was, put bluntly, ignorant. And my ABD is in poly sci and public administration, but I'm a budget analyst the finance dept. for a large metropolitan county with a half a billion dollar budget, but I don't pretend to be an expert on anything that I'm not experienced with.

  • James Pollock||

    "Don't play coy, you know perfectly well what you were getting at."

    I know what I was getting at.
    I have no idea what idea you got into your head, assigned to me, and decided to argue with.

    "What position at a bank, teller?"
    I'm an IT administrator.

    "what's sad about the education racket is that you could be 1 credit shy but without that degree it gets you pretty much nothing in the real world."

    It's an MBA. WITH the degree it gets you pretty much nothing in the real world. I got a real MS, instead.

    "it shows your assumption that[...]"
    Yeah, that's still YOUR assumption. Do you think you could try to keep your assumptions separate from mine, in the future? It'll save us a little time if I don't have to keep pointing out that you're arguing with yourself every time you start arguing with yourself.

    "Me? I never pretended to be an expert in the finance industry"
    hahahahahahahahahahahahahahaha (and so on, for about four an a half minutes).

    "every big bank is deeply affected by what happens in NY"
    and big banks are the only banks there are?

    "the premise of your question was, put bluntly, ignorant."
    Pretty strong words, for someone who apparently didn't understand it.

    "I'm a budget analyst the finance dept. for a large metropolitan county with a half a billion dollar budget"

    Does your boss know how you spend your taxpayer-funded work time?

  • mad_kalak||

    I get an hour for lunch, which I can use throughout the day if I desire. Or, for all you know, I'm on vacation. Does *your* boss know that you're on Reason right now?

    So an IT administrator asks ignorant questions about the financial industry and tries to boomerang it around on me. M'kay. Asks a leading question, gets a direct reply, then engages in petty insults. 2x M'kay.

    So, possibly, you were asking in good faith why the NRA just didn't get banking services from a bank with no presence in NY, but let's call a spade a spade, shall we?

  • James Pollock||

    "Does *your* boss know that you're on Reason right now?"
    Yep. I checked with me, and I don't mind.

    "So an IT administrator asks ignorant questions"
    " then engages in petty insults"
    m'kay?

    "So, possibly, you were asking in good faith why the NRA just didn't get banking services from a bank with no presence in NY, but let's call a spade a spade, shall we?"

    OK. You're an asshole.

  • mad_kalak||

    Right, I am an asshole, who doesn't mind calling out ignorant as fuck questions. Perhaps I should have done it more politely, but I tend to notice that it takes about 3-4 comments in before JP slings an ad hominem or two, usually at Brett, when you've no effective comeback.

  • James Pollock||

    "Right, I am an asshole, who doesn't mind calling out ignorant as fuck questions."

    So I STILL need to point out that the ignorant-as-fuck-ness came from you?

  • James Pollock||

    That was cathartic, and very likely accurate, but how does it help you overcome your insistence on replacing what I said with what you wish I said?

  • mad_kalak||

    One last thing, the NRA has a $75 million fund balance, and gets in $163 million or so in member dues. It takes a "big" bank.

    NRA IRS Form 990

  • James Pollock||

    "It takes a 'big' bank."

    Yes, yes. A great big swollen engorged one.

  • Rossami||

    re: "Is it also impossible to obtain insurance and banking services from sources which are outside of New York's regulatory jurisdiction?"

    In one word, yes.

    New York DFS asserts the right to regulate any company that provides any financial service to any New York resident, to any non-resident who happens to step on New York soil or to any person anywhere if the company is registered to do business anywhere in the state of New York.

    Even if you could find a California-based bank with no NY customers (or few enough that they'd be willing to toss out those customers in your favor), you'd have to be sure that absolutely zero of those other customers ever had an accident with a NY resident on vacation or had any other tangential connections sufficient to trigger the DFS's self-defined scope of regulation.

    By the way, you also could not deliver advocacy services yourself to any NY person without triggering those same rules. So even if you could comply with everything else and keep your banking outside NY, DFS is infringing on the First Amendment as it applies to NY residents.

  • James Pollock||

    "New York DFS asserts the right to regulate any company that provides any financial service to any New York resident"

    Alas for them, asserting a right and actually having jurisdiction to enforce your inflated opinion of your right(s) are two different things.

    The reason I'm so skeptical on this question (the original one I asked) is because my own banking needs are met by an unnamed-to-you entity, which exists entirely outside of NY. As shocking as that is to NY residents, yes, there are people who don't really give a damn what happens in NY. There are a LOT of commercials on the local TV stations which bleat on and on about how non-NY they are. Insurance companies are a lot more complex, but each state has its own requirements, and some choose not to operate in certain states (that's in the fine print they flash on the screen for a third-of-a-second during their commercials.)

  • Brett Bellmore||

    You're neglecting the secondary boycott aspect of this. Sure, there are companies that don't do much business in New York, but there are basically no companies that don't do business with companies that do business in New York.

    Anyway, damages don't have to be fatal, to be a tort. All it takes is Cuomo raising the NRA's expenses to produce millions of dollars in damages, even if they do ultimately find somebody willing to provide these services outside New York. And what of the NRA's members who are unfortunate enough to live in that state?

  • James Pollock||

    "Anyway, damages don't have to be fatal, to be a tort."

    Thanks for this newsflash.
    But bad reporting isn't a tort.

  • Rossami||

    As someone working in the compliance department of a non-NY company, the ability of NY regulators to assert jurisdiction and to make your life miserable if you object to it is astonishing. If you have good enough contacts inside your unnamed banking entity, I suggest you ask them about their compliance efforts under the recent DFS cybersecurity rule. Unless you do your banking entirely outside the US, I'm going to guess with very high confidence that they are complying.

    I am right with you among the people who really doesn't want to care what happens in NY. But their regulators are remarkably adept at making me care even though our business connections to the state are trivial.

  • James Pollock||

    " I suggest you ask them about their compliance efforts under the recent DFS cybersecurity rule."

    They're trendsetters in IT security, so I'd guess they were in compliance with any rule(s) before they even came out.

  • Rossami||

    You clearly have not read the DFS cyber rules. They are nothing about actual security. They are completely about reporting and certifications with a not-very-subtle agenda of trapping the certifiers (company executives) when something inevitably goes wrong.

  • Longtobefree||

    but GUNS!

  • qlangley||

    The NRA advocates a position, support for the Second Amendment, which is broadly popular in the United States. Certainly its views are controversial, in that a minority not only opposes them, but opposes them strongly, but there are strong feelings on may other issues too.

    If association with a popular view is a "reputational risk" then association with a minority view is all the more so. Support for the Second, for example, is more popular than either side of the abortion debate.

    If such regulatory powers can be used to "chill" speech that is broadly popular, then the protection for minority views is very weak indeed.

  • James Pollock||

    "The NRA advocates a position, support for the Second Amendment, which is broadly popular in the United States. Certainly its views are controversial, in that a minority not only opposes them, but opposes them strongly, but there are strong feelings on may other issues too."

    Support for the second amendment is broad, but so is support for regulation (in lots and LOTS of different variations)

    "Support for the Second, for example, is more popular than either side of the abortion debate."
    There's more than two sides of the abortion debate. Again, support for the right is broad, but so is support for regulation (in lots of different variations).

  • Brett Bellmore||

    None of this invalidates the point, which is that NY regulators are treating having any association with an organization promoting a relatively popular position as invoking reputational risk.

    Normally you only get reputational risk on account of doing banking for the mob, or your own company getting caught engaging in a pattern of criminal behavior. Even providing banking services to NAMBLA wouldn't have invoked it.

    So they're treating the NRA as though it were more radioactive than the pedophile lobby.

    It's not legitimate "reputational risk", it's just an excuse.

  • ||

    Support is high for "effective" regulation. If you poll people and say "Do you support doing X, which is proven to not reduce crime, but it'll make us feel good and impose burdens on law abiding people?" what percentage do you think will say yes?

  • James Pollock||

    "Support is high for 'effective' regulation."

    Yes, and what is considered "'effective' regulation" by citizens varies widely.

    Different actual applications or proposed applications of law achieve widely varying degrees of support, with some approaching 100%. Some approach 0%.

    The rest of your comment comes down to "push polling works". It isn't really a question that how you word a question affects the results you obtain.

    It is a fact that any debate on the question is quickly overwhelmed by people who express extreme positions.

  • Unicorn Abattoir||

    How long until Jimmy Fish uncloaks as Hihn? I think that's the real question.

  • James Pollock||

    WTF are you on?

  • NToJ||

    It's hard to see what "support for the Second Amendment" means. 67% of the country think gun control laws should be "more strict", which is the highest it has been since 1991 (in the middle of a nationwide crime epidemic). A majority of the country favors banning "semi-automatic weapons such as the AR-15", and 92% support background checks for all gun sales.

    "...then the protection for minority views is very weak indeed."

    This is probably the wrong way to think about reputational risk. Commercial businesses worried about reputational risk care about their customers, not just things like "majority" or "minority" views. Liberty University isn't going to care about how popular nationally the abortion debate goes, because it would lose its core constituency by switching positions. Cabela's is not going to cross its anti-gay constituency by loudly championing LBGT issues, even if the tide turns. Facebook is going to cater to social liberals because it leans young and hires a young workforce, and young people lean socially liberal.

  • Krayt||

    Hmmmm..Mr. Cynical wonders: Will political leadership give up on free speech and the ACLU, allowing hatred of the NRA to override previous principles?

    (Shakes Magic 8 Ball amd upends it) Outlook not fuzzy at all, it is decidedly so.

  • Joe_JP||

    One of multiple cases where the ACLU supported gun rights in some fashion.

    The lawsuit is political gold for Cuomo.

  • Michael Ejercito||

    How is it gold for Cuomo?

  • mad_kalak||

    What other cases are there where the ACLU supported gun rights in some fashion? I am unfamiliar with any.

    My political instincts must be different from yours. Cuomo is going through a bruising primary with a TV star where he has to run to the left more than usual (which is perhaps why he is burnishing his anti-NRA street cred), and is under a very real ethics/corruption investigation.

    Then comes a popular lefty organization that is very publicly disagreeing with Cuomo, not only by filling this brief in support in the NRA, but letting everyone know in blog posts and media releases. While I think the average leftist is always for the end justifying the means, I think they are also smart enough to see how this tactic can be used against them (and is already to an extent, with Texas' burdensome regulations on abortion clinics).

  • Joe_JP||

    One example would be a regulation from former President Barack Obama's administration that required the Social Security Administration to disclose to the FBI information about people who are getting disability benefits due to severe mental illness that was the Republican Congress overturned.

    Some supporters of gun regulations strongly spoke out against that. But, the ACLU joined the NRA in supporting it, arguing that the regulation was a discriminatory one. Gun rights are protected in a variety of ways when constitutional rights are equally applied even when guns are involved (e.g., the Fourth Amendment). The ACLU's well criticized official line on the 2A didn't alter their concern over those things.

    Cuomo -- as I notice while watching the ads over and over again while watching Mets games -- is highlighting his fight against the NRA in his advertising. In NY, especially in a "bruising primary," the NRA is not very popular. One need not to be a "lefty" in NY to be wary about some heavy-handedness (in the minds of many) of the NRA. Anyway, being attacked by the NRA is gold for Cuomo in the current context.

  • Joe_JP||

    ETA: The first part of the comment referenced the Republican Congress changing the regulation once Trump came into office. The words "ending the" regulation should have been added.

  • ||

    It wasn't necessarily "severe mental illness." It could have been a standard elderly person who might forget to pay bills on time but wouldn't hurt a fly (or himself).

  • mad_kalak||

    Well, thanks for that information about the ACLU and the NICS. I knew those opposing it were a bunch of strange bedfellows, but not that the ACLU was part of that. Bravo to them.

    I will take your word for it on the NYC opinions on the NRA. That being said, while being attacked the NRA may be good for Cuomo, is Cuomo being attacked by the ACLU for attacking the NRA good for Cuomo? I would surmise that they could cancel each other out.

  • ||

    The ACLU supported the Congressional repeal of the law adding elderly people who needed help managing their finances to the NICS "adjudicated mental defective" list. But they made clear that their concerns were over due process, and not the gun rights.

  • perlchpr||

    Well, good on the ACLU for still being willing to defend the 1A rights of literal Nazis. ;)

  • tekcoyote||

    We have yet to see what the ACLU does. They don't really believe in the Second Amendment. Bet you a buck they drop their interest in it.

  • Mesoman||

    I think the ACLU often defends Nazi creeps because it is good PR and helps them lie about their impartiality.

  • tekcoyote||

    "In April 2018, Governor Cuomo and Superintendent Vullo issued a Press Release and "Guidance[s] on Risk Management Relating to the NRA and Similar Gun Promotion Organizations," encouraging banks and insurance companies to "reconsider" [emphasis mine] their relationships with the NRA."

    If someone wearing a long coat and fedora walked into a shop and said words to the effect that the shop owner was "at risk" for bad things happening to him, but that Mr. Fedora would protect him from the evildoing if he "reconsidered" a friendship business association, or perhaps paid him a tribute, that would be a no-brainer RICO suit.

    So what happens when the government does it? Is it still a felony? If not, explain.

  • James Pollock||

    "So what happens when the government does it? Is it still a felony?"

    The problem is in your analogy.

    Suppose it's more like this:

    Guy in a nice suit walks into a business and asks details about the construction. Upon being given the information (or not, as your personal preference suggests the exchange should go) the guy leans on the counter and says "you got a good escape plan for fire? This place looks highly flammable" then leaves his card, for ACME fire escape supply and maintenance.

    The fact is, both a legit insurance guy AND a protection racketeer might be VERY interested to know if other gangsters have been frequently seen in the neighborhood.

    There's a legit issue for regulators to be concerned with. Did the regulators in question leverage that legit issue to improper purpose? The skeptic side of me says "I haven't seen evidence of that" while the cynical side says "but probably, yeah, they did."

  • Brett Bellmore||

    Reputational risk is a legitimate concern, but if you're defining it to include being associated with a popular organization as large as the NRA, you're way, way beyond its range of legitimate application. It's not even a close call.

  • James Pollock||

    "Reputational risk is a legitimate concern"

    Full stop.

    If you're running a private company, and you choose to advocate for positions that cost your company money, that's fine. If you're running a public company, and you choose to advocate for positions that cost your company money, that can be a violation of your fiduciary duty. It doesn't matter how big the organization you advocated for, if the result is a net loss of other peoples' money, you might have legal problems..

  • jdgalt1||

    If the law would so rule, then it is an outrageous heckler's veto and needs to be changed.

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