Friday, January 02, 2004

Capitalism & Law: "Board Certified" Commercial Speech

The commercial speech doctrine reared its ugly ahead again in today’s Ninth Circuit opinion in American Academy of Pain Management v. Joseph. The AAPM is a 15-year old group that maintains voluntary standards for various professionals that administer pain medication, such as dentists, athletic trainers, and chiropractors. AAPM sued Ronald Joseph, the executive director of California’s Medical Board, because the state of California restricts the ability of AAPM members to advertise without the Board’s permission. The issue is whether California can exclusively define the term “board certified”.

“Board certified” generally refers to a physician certified by a specialty board. The problem here is who decides what boards can certify. California law prohibits a physician from using the phrase “board certified” in any advertising unless the board referred to is itself accredited by a group called the American Board of Medical Specialties. ABMS, like AAPM, is a voluntary nonprofit organization that maintains professional standards. Unlike AAPM, however, ABMS has been granted coercive power by most state governments to restrictively decide which specialty boards may “certify” physicians, and which may not. In California’s case, a physician may not claim to be “board certified” by any specialty group that doesn’t meet ABMS’s approval.

AAPM did not meet ABMS’s standards. For example, the Ninth Circuit’s opinion refers to a dispute between the two groups over the length of the certification exam administered by AAPM; it lasted about two hours. ABMS and the California Medical Board require an exam of at least sixteen hours. Reasonable minds can certainly differ on this question, but California allows for no competition or discussion: ABMS sets the rules for everyone, even though it’s a private organization, not a government agency.

AAPM argued that California’s prohibition on using “board certified” in advertising without ABMS accreditation violated AAPM’s First Amendment rights. The Ninth Circuit panel disagreed. Their basic argument is superficially compelling: California law defines “board certified” to mean certification by an ABMS-approved specialty board, thus AAPM’s attempt to use the term amounts to misleading advertising.

This is a compelling argument only if you believe California has the right to define commercial terms of art. We’re not talking about a trademark or intellectual property. ABMS does not have proprietary use of “board certified”. Furthermore, the certification standards are themselves completely arbitrary; they can be changed at the whim of ABMS or California without any rational context. This means the issue is not whether AAPM’s proposed advertising is truthful or beneficial to consumers, but rather whether AAPM is willing to subject its professional judgment to the dictates of ABMS and California regulators. This defeats the whole point of voluntary professional societies.

Unfortunately, under the commercial speech doctrine, California’s position is consistent with existing Supreme Court precedent. The Ninth Circuit held the state has an interest in preventing consumers from being misled into thinking the state is endorsing AAPM’s standards, which apparently the term “board certified” conveys. This exposes the very flaw discussed above: The entire point of voluntary societies is to develop standards and practices based outside of the state’s arbitrary exercise of force.

Put another way, consumers should be free to receive and judge information for themselves outside of state-approved entities. Given the easy accessibility of information today, a consumer can easily review the accreditation standards of different societies and decide for themselves which standards make the most sense. The commercial speech doctrine, however, was created by the Supreme Court long before the Internet, and the justices paternalistically assumed the public was subject to easy manipulation outside of state protection from “false and misleading” advertising. The Court has also failed to recognize state-run licensing regimes as monopolistic cartels. Together, these two judicial errors have produced a litany of useless, “anticompetitive” regulation that violates the spirit and the letter of the Constitution.

(Editor's Note: This post was board certified by the American Academy of Webloggers, Fiskers, and Krugman Stalkers. This certification may not be valid in California, Tennessee, and any state with a "d" in its name.)

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