A federal appeals court ruled Wednesday that a district court judge rightly dismissed a lawsuit filed by the Arkansas Times challenging a law that added a pledge to not boycott Israel as a part of vendor contracts with the state of $1,000 or more.
A full panel of judges heard arguments over whether or not the state law, Act 710 of 2017, violates free speech protections in the U.S. Constitution.
Supporters of the law on Wednesday praised the ruling as a bulwark against discrimination, while opponents said the ruling failed to properly take into account the importance of boycotts in U.S. history.
A group of 10 judges ruled in the case after Arkansas Attorney General Leslie Rutledge requested a rehearing by a full panel of the 8th U.S. Circuit Court of Appeals. In February 2021, a three-person panel of judges had overturned the dismissal of the Arkansas Times lawsuit.
The panel's main opinion found it likely that the Arkansas Supreme Court would find the law as governing solely commercial -- rather than expressive -- conduct.
"It does not ban Arkansas Times from publicly criticizing Israel, or even protesting the statute itself. It only prohibits economic decisions that discriminate against Israel," the opinion stated. "Because those commercial decisions are invisible to observers unless explained, they are not inherently expressive and do not implicate the First Amendment."
The court's opinion stated that a past U.S. Supreme Court ruling in a different case, NAACP v. Claiborne Hardware Co., "held that First Amendment protection does not extend to non-expressive conduct intended to convey a political message."
Several states -- 27, according to a 2019 court filing by the state attorney general -- have enacted similar anti-boycott laws in contrast to the Boycott, Divestment and Sanctions movement, which advocates for economic measures against Israel because of actions described by supporters of the movement as human-rights violations against Palestinians.
The Arkansas Times, a news publication in Little Rock, and attorneys with the American Civil Liberties Union sued in 2018 to block the law.
In its lawsuit, the Arkansas Times stated it has never boycotted Israel nor editorialized in favor of a boycott. It sought to halt University of Arkansas System schools from requiring the pledge as a part of business contracts, as the state law affected advertising deals.
The law states that the requirement does not apply to contracts of less than $1,000 or to a company that "offers to provide the goods or services for at least twenty percent (20%) less than the lowest certifying business."
The ACLU has challenged similar laws in other states.
Brian Hauss, a staff attorney for the ACLU, in a statement called the judges' main opinion "wrong" and said a ruling will be sought from the U.S. Supreme Court.
"The court's conclusion that politically-motivated consumer boycotts are not protected by the First Amendment misreads Supreme Court precedent and departs from this nation's long standing traditions," Hauss said, calling boycotts "a fundamental part of American political discourse" and referring to "the fact that this country was founded on a boycott of British goods."
"We hope and expect that the Supreme Court will set things right and reaffirm the nation's historic commitment to providing robust protection to political boycotts," Hauss said.
Rutledge had support from 16 states in requesting what's known as an en banc hearing from the 8th U.S. Circuit Court of Appeals.
In a statement Wednesday, Rutledge praised the ruling.
"Today is a resounding victory for Arkansas's anti-discrimination law and reinforces Arkansas's relationship with our long-time ally, Israel," Rutledge said. "Arkansas had to spend taxpayer resources proving that Arkansas Times is not entitled to discriminate."
Alan Leveritt, publisher of the Arkansas Times, in a statement said the ruling Wednesday stated the law "requires the Arkansas Times to take a political position in return for advertising."
He added: "We don't do that. I acknowledge that this ruling will continue to damage us financially."
In an email to the Democrat-Gazette, Leveritt said the Arkansas Times is "continuing to offer a 20% discount to state agencies, per the law."
He added: "When we have to give a 20 percent discount, that really hurts."
Lynn Hamilton, president and general manager of the Arkansas Democrat-Gazette, said in an email, "We signed the pledge for several state entities. Saw nothing wrong with committing not to boycott the state of Israel."
Several journalism organizations have expressed support for the position taken by the Arkansas Times, including the Reporters Committee for Freedom of the Press.
"The big problem with the law is that it forces a newspaper to appear to take a side on an issue that it might cover," said Gabe Rottman, director of the journalism organization's Technology and Press Freedom Project.
Among those supporting Wednesday's ruling was Eugene Kontorovich, a law professor at George Mason University. He said the university's Center for the Middle East and International Law organized a friend-of-the-court brief supported by 11 constitutional law professors.
"The ruling demonstrates that laws protecting primarily Jews from discrimination, like this one, are no different from those [protecting] gays from discrimination. Just like states refuse to do business with companies that discriminate -- that is refuse to do business -- with people on the basis of their sexual orientation, here they extend that to Israel identity," Kontorovich said in an email.
He expressed doubt that the U.S. Supreme Court will take up the case.
"There are no courts of appeals that take a different position, and so lacking a circuit split, the chances of Supreme Court review are tiny," Kontorovich said.
However, an appeal filed by Texas officials seeking support for an anti-boycott law is before the U.S. 5th Circuit Court of Appeals.
Holly Dickson, executive director of the ACLU of Arkansas, noted previous legal victories in other states challenging similar laws.
"This decision is a departure from established First Amendment law, as indicated by the fact that courts in Texas, Arizona and Kansas also enjoined similar laws," Dickson said in an email.
The opinion Wednesday morning included a formal dissent from 8th U.S. Circuit Judge Jane Kelly, who authored the since-vacated February 2021 ruling that had reinstated the lawsuit.
"An examination of the Act as a whole reveals that the legislature intended to prohibit commercial and expressive behavior," Kelly wrote in her dissent, citing how the law allows for the state to "consider specified 'type[s] of evidence' to determine whether 'a company is participating in a boycott of Israel,'" including a company's statement that it is participating in such a boycott.
Kelly also cited how the law allows for the state to consider "evidence" of whether a boycott has taken place "at the request, in compliance with, or in furtherance of calls for a boycott of Israel."
'Implicates' free speech
Kelly stated in her dissenting opinion that "at a minimum, the State can consider a company's speech and association with others," and that in "this way" the law "implicates the First Amendment rights of speech, assembly, association, and petition recognized to be constitutionally protected boycott activity."
The other judge who ruled with Kelly back in February 2021, Michael J. Melloy, was not listed among the 10 judges who formed the en banc panel. Melloy is among three "senior judges" for the 8th Circuit but not among 11 "active judges," according to the website for the 8th Circuit.
The majority opinion Wednesday was authored by Jonathan Kobes, who in February 2021 had written a dissent opposing the three-member panel's majority opinion to reinstate the lawsuit.
Neal Devins, a law professor at William & Mary who has studied en banc rulings, noted that the 8th Circuit's active judges include 10 Republican-appointed judges. Kelly, who wrote the dissenting opinion, was appointed by President Barack Obama.
Marc Stern, chief legal officer for advocacy organization the American Jewish Committee, in a statement praised the majority's ruling.
"This was the first appellate test of laws that combat the Boycott, Divest and Sanctions movement, whose primary aim is to eliminate the State of Israel. The Eighth Circuit unequivocally affirmed that such laws do not infringe on the First Amendment.
As the court noted, Arkansas has broad power to regulate economic activity, and taking a position on a boycott does not inhibit free speech," Stern said.
Ramya Krishnan, a staff attorney with the Knight First Amendment Institute at Columbia University, referred back to the "landmark" NAACP v. Claiborne Hardware case, which involved Black residents of Mississippi in the 1960s boycotting white merchants as part of an effort seeking racial integration, among other demands.
"In NAACP v. Claiborne Hardware, the Supreme Court clearly held that the First Amendment protects political boycotts by consumers, not merely the speech associated with those boycotts. The Eighth Circuit's ruling drastically misreads this decision, allowing a law that brazenly targets political boycotts to escape First Amendment review," Krishnan said in an email.
The institute had filed a friend-of-the-court brief, and Krishnan said that "if the Supreme Court takes the case, we're very likely to file an amicus brief explaining that political boycotts by consumers are covered by the First Amendment."