Injunction Enforcing Anti-Disparagement Contract Provision Doesn't Violate First Amendment

From Chief Judge Hala Jarbou (W.D. Mich.) Friday in Lothamer Tax Resolution, Inc. v. Kimmel; I think it summarizes the current state of the law well:

Lothamer is a tax services company that hired Kimmel in June 2024 to improve its software. When he was hired, Kimmel signed an Employment Agreement [providing, among other things:]

[Kimmel] covenants and agrees not to make negative comments about [Lothamer] or its officers, directors, current and former employees, or other agents after he … signs this agreement. Such disparagement includes, but is not limited to, making disparaging or discrediting remarks on any internet web site, including but not limited to, internet complaint boards or social media sites, such as FaceBook, Instagram, X (Twitter), TickTock, UTube, Google Reviews, the Better Business Bureau, any employment sites, etc ….

Lothamer was ultimately unsatisfied with Kimmel's work and terminated his employment on March 7, 2025 …. [Lothamer sued Kimmel for breach of contract, unauthorized computer access, and trade secret infringement, and] after the commencement of this lawsuit, Kimmel posted an article about Lothamer on LinkedIn. In the article, Kimmel criticized Lothamer for having poor data security and provided details about Lothamer's system that, according to Lothamer, are confidential. (Lothamer argues that Kimmel's post significantly increased the number of attempts by bad actors to breach its Portal, which has forced Lothamer to shut down the Portal during nights and weekends.)

The court concluded that Kimmel's post was indeed a breach of contract, and ordered him to remove it. And it had this to say about Kimmel's free speech objections, which seems to me consistent with the cases I've seen:

As an initial matter, the application of the state action doctrine to court enforcement of private contracts is not well-settled. A court's enforcement of tort law, whether through monetary damages or an injunction, implicates the First Amendment even if the parties to the lawsuit are private. A lawsuit brought under a promissory estoppel theory also implicates the First Amendment, because promissory estoppel is "a state-law doctrine which, in the absence of a contract, creates obligations never explicitly assumed by the parties." Cohen v. Cowles Media Co. (1991). This principle implies that enforcement of contractual obligations, by contrast, would not implicate the First Amendment. However, this inference is not airtight because Cohen involved monetary rather than injunctive relief, and First Amendment concerns are heightened in the context of injunctions.

Even so, some courts have held that enforcing a contract via injunction does not implicate the First Amendment at all. See United Egg Producers v. Standard Brands, Inc., 44 F.3d 940, 943 (11th Cir. 1995) ("Where two disputing parties in positions of equal bargaining power agree, through a Settlement Stipulation, to restrict, in a limited degree, their First Amendment rights on commercial speech as was done here, we hold that court enforcement of that agreement is not governmental action for First Amendment purposes."); USA Techs., Inc. v. Tirpak, No. CIV.A. 12-2399, 2012 WL 1889157, at (E.D. Pa. May 24, 2012) ("[I]n the context of a contractual limitation of speech, there is no state action unless the court enjoins speech that is beyond the scope of the parties' agreement."); Fisher v. Biozone Pharms., Inc., No. 12-CV-03716-LB, 2017 WL 1097198, at (N.D. Cal. Mar. 23, 2017) (granting injunctive relief and holding that a "settlement's non-denigration term does not implicate First Amendment rights").

Other courts have suggested that court enforcement of a contract can constitute state action. See Nat'l Abortion Fed'n, NAF v. Ctr. for Med. Progress, 685 F. App'x 623, 626 (9th Cir. 2017) (considering First Amendment challenge to injunction enforcing non-disclosure agreement); Pizza Hut LLC v. Pandya, No. 4:19-CV-00726-RWS, 2019 WL 8331437, at (E.D. Tex. Nov. 26, 2019) (noting, in analysis of TRO request to enforce non-disparagement clause, that "prior restraints against speech are generally unconstitutional"); Head Kandy LLC v. McNeill, No. 23-CV-60345-RAR, 2023 WL 7318907, at (S.D. Fla. Nov. 7, 2023) (considering First Amendment challenge to injunction enforcing non-disparagement agreement); see also Shelley v. Kraemer, 334 U.S. 1, 19-20 (1948) (court enforcement of private racially restrictive covenants constitutes state action). And at least one federal court of appeals has explicitly left the question open. See Democratic Nat'l Comm. v. Republican Nat'l Comm., 673 F.3d 192, 204-05 (3d Cir. 2012) (declining to decide whether enforcement of a consent decree between private parties constitutes state action) ….

It is ultimately unnecessary to decide this issue because the Court is persuaded that issuing an injunction here complies with the First Amendment even if it constitutes state action. Courts have frequently held that it is constitutional to enjoin parties from violating speech-related contractual obligations that they have voluntarily undertaken. See, e.g., NAF, 685 F. App'x at 626 (upholding injunction against violation of non-disclosure contract because "the district court did not clearly err in finding that the defendants waived any First Amendment rights to disclose that information publicly by knowingly signing the agreements"); Romeo & Juliette Laser Hair Removal, Inc. v. Assara I LLC, 679 F. App'x 33, 36 (2d Cir. 2017) (holding that injunction complies with First Amendment because its "prohibition on speech that is false … or disparaging effectively enforces defendants' own covenant not to engage in such speech"); Head Kandy, 2023 WL 7318907, at *4 (granting injunctive relief to enforce non-disparagement clause because "a party can waive their free speech rights in the course of an agreement"); Millennial Plastic Surgery PLLC v. James, No. 21 CIV. 9590 (ER), 2021 WL 5988322, at n.2, (S.D.N.Y. Dec. 16, 2021) (granting injunctive relief to enforce non-disparagement clause because defendant waived First Amendment rights); Tirpak, 2012 WL 1889157, at *1, 10-12 (holding that injunction enforcing non-disparagement contract does not violate First Amendment because defendants waived their rights); Great Caesars Ghost LLC v. Unachukwu, No. CV 19-5408, 2020 WL 2394052, at *4-5 (D.N.J. May 12, 2020) (granting injunction requiring defendant to obey non-disparagement clause in prior settlement agreement); Moreno v. Tringali, No. CIV. 14-4002 JBS/KMW, 2015 WL 3991161, at (D.N.J. June 30, 2015) (discussing prior preliminary injunction requiring defendant to obey non-disparagement clause) ….

Ultimately, the Court is persuaded that enforcement of the non-disparagement clause against Kimmel will not violate his First Amendment rights. The precedent outlined above largely supports the principle that a person can waive their free speech rights via contract, including their right to not face prior restraints from a court. Accord Perricone v. Perricone, 972 A.2d 666, 679 (Conn. 2009) ("[O]ur research has not revealed[ ] a single case in which a court has held that a judicial restraining order that enforces an agreement restricting speech between private parties constitutes a per se violation of the first amendment's prohibition on prior restraints on speech."); Kneebinding, Inc. v. Howell, 201 A.3d 326, 348 (Vt. 2018) ("[P]rivate parties may enter agreements that waive their respective free speech rights, and courts may enforce those agreements").

That principle is also in line with the general rule that constitutional rights, including First Amendment rights, can be waived. See Cohen, 501 U.S. at 665 (allowing damages for breach of promise of confidentiality because "any restrictions that may be placed on the publication of truthful information are self-imposed"); Democratic Nat'l Comm., 673 F.3d at 204-05 (upholding validity of contract restricting speech because "[t]he Supreme Court has long recognized that a party may waive constitutional rights" (internal quotation marks omitted)); Janus v. Am. Fed'n of State, Cnty., & Mun. Emps., Council 31, 585 U.S. 878, 930 (2018) (non-union members who agree to pay union fees "are waiving their First Amendment rights" to free association); Powell v. SEC, No. 24-1899, 2025 WL 2233792, at (9th Cir. Aug. 6, 2025) ("Judicially enforceable non-disclosure and non-disparagement agreements are commonplace."); Lake James Community Volunteer Fire Dept., Inc. v. Burke, 149 F.3d 277, 278 (4th Cir. 1998) (finding contractual waiver of First Amendment right to petition government), cert. denied, 525 U.S. 1106 (1999); Perricone, 972 A.2d at 679 n.18 (collecting cases).

Courts that have allowed the waiver of First Amendment rights via contract have generally required it to be knowing, voluntary, and intelligent. See Leonard v. Clark, 12 F.3d 885, 889-90 (9th Cir. 1993), as amended (Mar. 8, 1994); Erie Telecommunications, Inc. v. City of Erie, Pa., 853 F.2d 1084, 1094-96 (3d Cir. 1988); Lake James, 149 F.3d at 280; see also D.H. Overmyer Co. v. Frick Co., 405 U.S. 174, 187 (1972) (suggesting that waivers of constitutional rights are generally valid if voluntary, knowing, and intelligent). Some courts have also held that a waiver is invalid "if the interest in its enforcement is outweighed in the circumstances by a public policy harmed by enforcement of the agreement." Leonard, 12 F.3d at 890; see Lake James, 149 F.3d at 280 ("The contractual waiver of a constitutional right must … not undermine the relevant public interest in order to be enforceable."); Town of Newton v. Rumery, 480 U.S. 386, 392 (1987) (applying the public interest requirement to a waiver of a right to sue); but see Erie Telecomm., 853 F.2d at 1099 (declining to conduct a public interest analysis before enforcement of First Amendment waiver).

At this stage, it appears Kimmel's waiver of his First Amendment rights under his Employment Agreement was knowing, voluntary, and intelligent. The record makes it clear that Kimmel signed the Employment Agreement, and he makes no allegations of coercion or duress …. Therefore, the non-disparagement provision of the Employment Agreement is enforceable.

My view is that injunctions enforcing agreements not to speak are state action, but are constitutionally permissible, on the strength of Cohen v. Cowles Media; Cohen is a damages case, but I think its logic applies to injunctions as well. In some situations, a court might be justified in not issuing such an injunction, either because the underlying contract not to speak is viewed as being against public policy under state law, or because some of the remedies law factors relevant to the injunction inquiry (such as the public interest) preclude an injunction. But I don't think there's a First Amendment barrier against such injunctions.

Aaron Landry Davis, Barrett Young, Catherine Fleming, and Garett Lee Koger (Butzel Long) represent plaintiffs.