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Keywords

statutepartnershipregulationappellantdeclaratory judgment

statutepartnershipcorporationregulationdue processappellantappellee

Related Cases

Posadas de Puerto Rico Associates v. Tourism Co. of Puerto Rico, 478 U.S. 328, 106 S.Ct. 2968, 92 L.Ed.2d 266, 54 USLW 4956, 13 Media L. Rep. 1033

Facts

In 1948, Puerto Rico legalized certain forms of casino gambling through the Games of Chance Act, which prohibited gambling rooms from advertising to the public in Puerto Rico. The appellant, a partnership operating a casino, was fined for violating these advertising restrictions. After unsuccessful attempts to challenge the fines, the appellant filed a suit seeking a declaratory judgment that the Act and its regulations violated its commercial speech rights. The Superior Court ruled that the restrictions had been unconstitutionally applied but adopted a narrowing construction that allowed some advertising aimed at tourists.

Appellant, a partnership franchised to operate a casino in Puerto Rico, was fined by appellee public corporation which is authorized to administer the Act, for violating the advertising restrictions in the Act and the regulations.

Issue

Did the Puerto Rico statute and regulations restricting advertising of casino gambling to residents of Puerto Rico violate the First Amendment's protection of commercial free speech?

Rule

The court applied the four-pronged test from Central Hudson Gas & Electric Corp. v. Public Service Commission, which assesses whether restrictions on commercial speech serve a substantial governmental interest, directly advance that interest, and are no more extensive than necessary.

The advertising restrictions pass muster under the four-pronged test of Central Hudson Gas & Electric Corp. v. Public Service Comm'n of New York.

Analysis

The court determined that the advertising restrictions served a substantial governmental interest in reducing demand for casino gambling among Puerto Rico residents, which was believed to have harmful effects on their health and welfare. The restrictions were found to directly advance this interest and were not overly broad, as they did not affect advertising aimed at tourists. The court also noted that the legislature's decision to restrict advertising was reasonable given the unique risks associated with casino gambling.

The Act and regulations, as construed by the Superior Court, do not facially violate the First Amendment.

Conclusion

The Supreme Court affirmed the decision of the Puerto Rico Supreme Court, holding that the statute and regulations, as construed by the Superior Court, did not facially violate the First Amendment and were not unconstitutionally vague.

Affirmed.

Who won?

The Tourism Company of Puerto Rico prevailed in the case because the Supreme Court upheld the constitutionality of the advertising restrictions as they were applied under the narrowing construction provided by the Superior Court.

The Puerto Rico Supreme Court properly concluded that, as construed by the Superior Court, the Act and regulations do not facially violate the due process or equal protection guarantees of the Constitution.

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