Kimberly-Clark Corp. v. Dist. of Columbia
Kimberly-Clark Corp. v. Dist. of Columbia
Opinion of the Court
Lurking beneath this city's streets lies a purported scourge of our sewer system: nonwoven disposable wipes. While unwitting consumers might blithely flush baby or facial wipes down the toilet, little do they know, those wipes may bind together in the subterranean realm, creating plumbing clogs of substantial proportions. And when they do, Defendants District of Columbia and the D.C. Water & Sewer Authority must clean up the mess. The District has thus understandably embarked on a "Protect Your Pipes" campaign, encouraging consumers to rethink their flushing habits. The question in this case is how far *133it can go in enlisting wipes manufacturers to help fight that battle.
Specifically, the city recently enacted a law that limits when a manufacturer can market its wipes as flushable. The Act includes a three-part standard for "flushability"; if a company's wipes flunk that test, it must clearly and conspicuously label that the product "should not be flushed." D.C. Law 21-220 § 3(b). The problem? Plaintiff Kimberly-Clark Corporation has allegedly engineered certain of its wipes to be flushable and currently markets them as such. It fears the Act may compel it to say otherwise and has moved for a preliminary injunction to prevent enforcement thereof. Because the Court agrees that the Act likely treads impermissibly on Plaintiff's First Amendment rights, it will grant the injunction. As the District is still in the process of promulgating regulations to implement the Act, the Court will subsequently reassess whether the injunction remains appropriate once those regulations become final.
I. Background
A. The Nonwoven Disposable Products Act
On March 24, 2017, the District of Columbia enacted the Nonwoven Disposable Products Act of 2016. The Act targeted a hobgoblin of D.C. pipes-viz. , nonwoven disposable wipes, which include "wet wipes used for personal hygiene, baby wipes, facial tissues ...." District Opp., Exh. B, Committee Report, Bill 21-833 (Nov. 7, 2016) at 2. These wipes "are popular for both child and adult use" and, when flushed, "cause serious problems in the [District's] sewer system." Id. The Committee Report, in fact, estimated that D.C. Water "pays approximately $50,000 each year to combat issues caused by wipes," and that "[c]logs also pose risks for utility workers, who can suffer physical injuries when cutting and pulling wipes out of mechanical equipment and illness due to exposure to raw sewage." Id.
The Act addressed two types of products plaguing the District's sewers. First, it set its sights on wipes that were never intended to be flushable. As Kimberly-Clark agrees, "[M]any adult customers were using-and then flushing" these wipes, which "were not designed for flushing [and] were not labeled safe for flushing." ECF No. 15 (Memorandum for PI Mot.) at 3. The wipes, which Plaintiff describe[s] as "indestructible squares of plastic," "can increase the incidence of plumbing clogs." Id. Although some manufacturers labeled that their products "should not be flushed," the District determined that "there [was] no standard way to communicate this message across the industry." Committee Report at 3. The D.C. Council also heard testimony that manufacturers often obfuscated labels advising consumers not to flush their products. See District Opp., Exh. A, Hearing Record (October 24, 2016) at 14. As an example, one witness presented baby wipes whose "do not flush" label appeared in small print on the back of the package and was partially obscured by a flap. Id. The District sought to impose new guidelines on those manufacturers, compelling them to label their products "clearly and conspicuously." D.C. Law 21-220 § 3(b).
Second, the city targeted "flushable" wipes, or those that are ostensibly "designed to pass safely through household plumbing and municipal wastewater systems." PI Memo. at 3. These products, which constitute about 7% of wipes on the market, are currently labeled and marketed to consumers as "flushable." Committee Report at 2; see also Hearing Record at 9. Despite the reassuring labels, the District worried that " 'flushable' wipes are contributing to clogs in U.S. sewer systems."
*134Committee Report at 3. Although estimates vary as to the toll that these items take on plumbing, testing in other municipalities shows that a "non-negligible amount of material recovered from sewage systems consisted of flushable wipes." Id. To wit, wipes labeled as flushable compose an estimated 2% to 8% of the debris in water systems; at the extreme, one study found that they made up 35% of total wipes in the pipes. Id. To the District, "any wipe labeled 'flushable' that can be found in a clog after going through the sewer system is inaccurately labeled." Committee Report at 6.
As to this second category, therefore, the District sought to provide more rigorous standards regarding flushability. Before the legislation, there was little consensus over the term "flushable." For example, an industry trade association, the International Nonwovens and Disposables Association (INDA), promulgated voluntary guidelines, which required a product to pass seven different tests before being labeled "flushable." Hearing Record at 10. Yet the Council also heard testimony from the National Association of Clean Water Agencies (NACWA), an organization representing 300 public wastewater utilities, that INDA's guidance was inadequate. Id. at 13. NACWA promotes the use of a more stringent three-part test, which would require flushable wipes to: 1) break into small pieces quickly; 2) not be buoyant; and 3) not contain plastic or regenerated cellulose and only contain material that will readily degrade in a range of natural environments. Id. According to NACWA, other countries adhere to these guidelines, but current U.S. products fall far short of its standards. Id. at 16. In a field test, only one product marketed as flushable (a Kimberly-Clark wipe, as it happens) met NACWA's guidelines. Id.
After evaluating testimony on those competing standards, the District ultimately hewed closely to NACWA's approach. The final Act defined "flushable" as a nonwoven disposable product that: (1) "[d]isperses in a short period of time after flushing in the low-force conditions of a sewer system"; (2) "[i]s not buoyant"; and 3) "[d]oes not contain plastic or any other material that does not readily degrade in a range of natural environments." D.C. Law 21-220 § 2(1). It then prohibited "a manufacturer of a nonwoven disposable product for sale in the District [from] label[ing] the nonwoven disposable product as safe to flush, safe for sewer systems, or safe for septic systems," unless its product met the District's definition of flushable. Id., § 3(a). The Act also required manufacturers of products that are "not flushable [to] clearly and conspicuously label the ... product to communicate that [it] should not be flushed." Id., § 3(b).
The Act empowers the Mayor to "impose civil fines and penalties as sanctions for violations of [its] provisions." Id., § 4(a). It also authorized the Department of Energy & Environment to issue rules implementing the terms of the Act, in consultation with D.C. Water. Id., § 5. Although the Act goes into effect on January 1, 2018, DOEE has not yet promulgated regulations for its implementation, see ECF No. 34 (Stipulation by District Defendants), which task is expected to take at least a few more months. See District Opp., Exh. D (Declaration of Marc A. Nielson), ¶¶ 4-10 (describing DOEE's regulatory process). Notably, the Act punishes only manufacturers, regardless of their location in or outside of the city, but not any retailer who sells the wipes in the District.
B. Procedural History
Kimberly-Clark is a multinational corporation that creates products for personal *135care and hygiene. Its brands include such familiar names as Cottonelle®, Scott®, Huggies®, and Kleenex®. See Compl., ¶ 5. Over the past twenty years, it has allegedly invested "millions of dollars" in engineering flushable nonwoven wipes and now has more than 30 patents for such products. Id., ¶ 44. These wipes, it says, are unique: "Unlike baby wipes, which are made from plastics or other synthetic fibers, Kimberly-Clark's wipes are made only from wood pulp-the same substance that is the primary ingredient in toilet tissue." PI Memo. at 4 (citing Compl., ¶ 45). It also uses sodium chloride (i.e. , salt) to bind the wood pulp together. Id. It markets those of its wipes using that technology as "flushable," in accordance with INDA's guidelines on the term. Id., ¶¶ 48-50. Plaintiff manufactures all of its wipes outside the District and then sells them to middlemen, who in turn sell them to retailers located in the city. See Compl., ¶¶ 37-38.
On September 15, 2017, Kimberly-Clark filed a Complaint seeking injunctive and declaratory relief to prevent Defendants from enforcing the Nonwoven Disposable Products Act. Id., ¶ 1. Shortly thereafter, it also moved for a preliminary injunction on the same ground. The Court held several conference calls with the parties to assess whether the District might stay enforcement of the Act pending the issuance of its regulations. When this effort bore no fruit, the Court held oral argument on the PI Motion on December 13, 2017, and this Opinion follows on an expedited basis.
As a preliminary matter, the Court briefly addresses whether all Defendants are properly before it. The Complaint names the District and various city personnel in their official capacities as Defendants, including Mayor Muriel Bowser, Attorney General Karl A. Racine, and DOEE Director Tommy Wells. It also tacks on a more curious party, D.C. Water, which has no authority to implement, enforce, or rescind the Act. Although it is not clear whether this entity belongs in such a suit, no motion to dismiss has been filed. The Court, for the timing being, thus treats the PI Motion as brought against all named Defendants.
II. Legal Standard
"A preliminary injunction is an extraordinary remedy never awarded as of right." Winter v. NRDC,
Before the Supreme Court's decision in Winter, courts weighed these factors on a "sliding scale," allowing "an unusually strong showing on one of the factors" to overcome a weaker showing on another. Davis v. PGBC,
*136Regardless of the extent to which showings of irreparable harm and success on the merits can be diminished, some fundamentals of the four-factor test bear reiterating. Because "the basis of injunctive relief in the federal courts has always been irreparable harm," Chaplaincy of Full Gospel Churches v. England,
III. Analysis
Kimberly-Clark raises a slew of constitutional challenges to the Act, including violations of the Commerce Clause, the First Amendment, and the Fifth Amendment's Due Process Clause. See Compl., ¶ 2. Before delving into the merits, the Court must take a brief detour to consider-and reject-Defendants' threshold positions that the company lacks standing and that its suit is not ripe for review. See Steel Co. v. Citizens for a Better Environment,
A. Justiciability
1. Standing
While the District does not dispute Plaintiff's standing to challenge the Act, D.C. Water questions whether Kimberly-Clark will suffer any injury-in-fact. It argues that because the parties do not yet know whether the Act applies to Kimberly-Clark, the company lacks standing unless it "assume[s] that its wipes cannot pass any future standard the regulations might set." D.C. Water Br. at 21. The Court can dispose of that argument quickly. In a pre-enforcement suit, "a plaintiff satisfies the injury-in-fact requirement," and thus has standing, "where [it] alleges 'an intention to engage in a course of conduct arguably affected with a constitutional interest, but proscribed by a statute, and there exists a credible threat of prosecution thereunder." Susan B. Anthony List v. Driehaus, --- U.S. ----,
Such is plainly the case here. The Act exists for the specific purpose of targeting products, like Kimberly-Clark's wipes, that are "labeled 'flushable.' " Comm. Report at 2. By its terms, the Act regulates "a product constructed from nonwoven sheets, including moist toilet tissue or cloth, that is designed, marketed, or commonly used for personal hygiene purposes." D.C. Law 21-220 § 2(3). No one disputes that Kimberly-Clark's wipes qualify. Although it is not yet clear whether those wipes will meet the District's definition of "flushable," it is at least "arguable" that they will not, given that the city adopted more stringent standards than industry guidelines (and it is fair to assume that the regulations will map onto *137the statute in this respect). See Susan B. Anthony List,
2. Ripeness
Defendants next argue that Kimberly-Clark's suit is not ripe, as the District has yet to promulgate regulations implementing the Act. At its foundation, ripeness is about whether a federal court "can or should decide a case." Am. Petroleum Inst. v. EPA,
The parties primarily debate whether the Act will impose any hardship on Kimberly-Clark. The District argues the negative, noting that it has stipulated that it "will take no action to enforce" the Act until the "implementing regulations are promulgated and any 'compliance' period offered by [DOEE]" expires. See Stipulation by District Defendants. It currently anticipates that such compliance period will last 12 to 18 months.
Appealing as this might seem, the District's reassurances come with a catch: Kimberly-Clark might still incur liability retroactively for products manufactured but not sold during the compliance period. In other words, the statute attaches liability to any non-complying wipes manufactured after January 1, 2018. At oral argument, the District made clear that its "grace period" does not change that trigger date for liability. See Oral Arg. Tr. 35:3-15. Kimberly-Clark could thus still face fines for any wipes manufactured after January 1, 2018, so long as they happened to be sold in the District once the compliance period ends. The company believes it cannot risk manufacturing any non-complying wipes in 2018 because once wipes enter the stream of commerce, it has no control over how long they stay on retailers' shelves. See Compl, ¶ 7. As the Act imposes no liability on retailers for selling mislabeled wipes, see D.C. Law 21-220 § 3, Kimberly-Clark has no guarantee that any wipes manufactured moving forward will be sold within the compliance period.
Unlike in Zukerberg, then, the statute will have "concrete, legally binding effect[s]" as soon as the clock strikes midnight on New Year's Eve. See
B. Preliminary-Injunction Factors
Although Plaintiff enumerates five separate counts, it need only satisfy the preliminary-injunction factors on one to prevail. The Court concludes that Kimberly-Clark's First Amendment argument checks all the boxes in that respect, and it therefore declines to reach Plaintiff's positions on the Commerce Clause and Due Process Clause.
1. Likelihood of Success on Merits
The Court begins, naturally enough, with the first prong, which asks whether Kimberly-Clark can establish a likelihood of success on its First Amendment challenge. To refresh, the Act includes two key components: section 3(b) requires the company to disclose that its wipes sold in the District "should not be flushed"; as a corollary, section 3(a) forbids Kimberly-Clark from advertising that those wipes can be flushed. See D.C. Law 21-220 § 3 (emphasis added). To prevail, Plaintiff must show that this sort of labeling requirement is likely to violate its free-speech rights.
a. Scope of Challenge
At the outset, the Court must define the scope of that First Amendment claim: Does Kimberly-Clark challenge the Act on its face or as applied? D.C. Water categorizes the Complaint as a "facial challenge," which would immediately halt all enforcement of the Act. See D.C. Water Resp. at 22. To mount such an offensive, the company would need to establish "that no set of circumstances exists under which the Act would be valid"-i.e. , that the law is unconstitutional in all of its applications. United States v. Salerno,
Recognizing as much, Kimberly-Clark wisely conceded at oral argument that the Court need not construe its Complaint as a facial attack in order to afford it full relief. See Oral Arg. Tr. 11:4-7 (agreeing Kimberly-Clark had "no objection" to proceeding "on an as-applied basis that covered [its] products"). Rather, the Court can treat its challenge as applied solely to "the "flushable wipes currently before" it, which were designed to be safely flushed. Id. at 12:16-20. In other words, Plaintiff recognizes that other non-woven disposable products, such as baby wipes, were never intended to be flushable, and it does not question whether the District can require manufacturers of those wipes, including Kimberly-Clark, to say as much. Following suit, the Court considers only this narrow question: is the Act constitutional as applied to wipes that Kimberly-Clark engineered to be flushable?
b. Validity of Labeling Requirements
As a starting point, the parties agree that the disputed labels qualify as commercial speech or "expression related solely to the economic interests of the speaker and its audience." Central Hudson Gas & Elec. Corp. v. Pub. Serv. Comm'n of New York,
Typically, courts subject commercial-speech claims to intermediate scrutiny, as set forth in the Supreme Court's marquee case on the subject, Central Hudson. The District, however, disputes the applicability of even that test here, at least as to section 3(b)'s requirement that manufacturers communicate that their products "should not be flushed." For that provision, the District champions the more "relaxed" standard of review set forth in Zauderer v. Office of Disciplinary Counsel of Supreme Court of Ohio,
i. Zauderer
In Zauderer, the Supreme Court reasoned that "the First Amendment interests implicated by disclosure requirements are substantially weaker than those at stake when speech is actually suppressed."
The District frames section 3(b)-which requires that manufacturers communicate that their products "should not be flushed"-as the same sort of mine-run "labeling regulation that frequently has been upheld." Def. Opp. at 1. Although the city focuses on this disclosure requirement, the same logic would sweep in section 3(a)'s restriction on the term "flushable." The D.C. Circuit recently affirmed that disclosure rules may-and "often do"-"incidentally prohibit speech, because the requirement to say one thing necessarily means the speaker cannot say the opposite." Pursuing America's Greatness v. FEC,
The problem for the District is that Zauderer applies only to disclosures of " 'purely factual and uncontroversial information' about the good or service being offered." AMI,
So what does it mean for a disclosure to be "purely factual and uncontroversial"? Nobody knows exactly. The D.C. Circuit has "made no attempt to define those terms precisely," NAM II,
By contrast, a disclosure is"controversial" if it is "inflammatory," such as a proposed FDA warning for cigarette packages that was designed to "evoke emotion ... and browbeat consumers into quitting." R.J. Reynolds Tobacco, Co. v. FDA,
Most relevantly, a requirement can be controversial because it expresses "a matter[ ] of opinion," Zauderer,
Such is the case here. Kimberly-Clark "vehemently disagrees" that its wipes "should not be flushed." PI Mot. at 37. Indeed, that is what this suit is fundamentally about. The company designed its wipes to be flushable and "strongly believes" it did so successfully. Id. Yet the Act would suppress that view, while simultaneously compelling Plaintiff to announce that its wipes "should not be flushed." D.C. Law 21-220 § 3(b). That requirement is hardly a "disclosure" of undisputed facts; rather, whether the wipes can be flushed-and the harms they might cause to sewers-is subject to serious debate. True, terms like "environmentally sustainable" or "fair trade" may leap out as more controversial to the layperson. As it turns out, however, the term "flushable" carries its own baggage. Surprising as it may be, "flushability" is a lightning rod for those in the know, and the District itself pitches this case as involving a long-running "dispute over the proper definition of 'flushable.' " District Opp. at 2-4; see also id. at 3 (highlighting "debate on [the] divergent standards" of flushability between industry and environmental groups). On the one hand, corporations like Kimberly-Clark favor INDA's approach, which treats wipes as flushable even if they do not fully disperse underground. On the other, NACWA espouses a more rigorous definition, requiring wipes to dissolve within thirty minutes. While the District is free to pick sides in that battle, it cannot force Kimberly-Clark to be the messenger for its position, at least without surviving intermediate scrutiny.
Admittedly, the city has not yet promulgated regulations implementing the Act, and it is therefore not entirely clear what Kimberly-Clark's label must include. Some requirements, of course, might be harder to swallow than others. For instance, DOEE might mandate that Kimberly-Clark disclose: "The District has found these wipes do not comply with the NACWA definition of flushable." Or it might simply require a warning that flushing the wipes "contributes in non-negligible amounts to clogs in sewer systems." Either fact-based warning could well avoid the above questions about accuracy and, therefore, might be appropriate for review under Zauderer. At this stage, however, the Court can look only to the statute for guidance. That Act provides that companies must affix a "clear[ ] and conspicuous[ ]" label that the product "should be not be flushed." D.C. Law 21-220 § 3(b). On its face, the statute thus seems to *142require Kimberly-Clark to warn consumers, without qualification, not to flush its wipes.
The legislative history supports that interpretation. Originally, the Act would have required manufacturers to employ a "Do Not Flush" label. See Committee Report at 4. The final version allowed "additional flexibility to use logos or other images" that communicate the same message. Id. Such a logo might appear as follows:
Hearing Record at 14 (witness approvingly citing this emblem). Those type of warnings or logos do not present "facts"; they simply advise the consumer about what to do with a product. Such an unqualified stance against flushing would run headlong into Kimberly-Clark's views on how its product can be disposed. It is therefore inappropriate for the Zauderer framework.
The District resists that conclusion, but its arguments to the contrary are unpersuasive. First, it contends that the phrase "should not be flushed" is factual, at least when backed by a statutory definition. That is, it believes that so long as the statute supplies a standard for flushability, it does not matter whether Plaintiff disputes the underlying methodology. See Opp. at 29 (citing Mass. Ass'n of Private Career Schs. v. Healey,
Unfortunately for the city, however, the majority in NAM II felt differently. It held that a statutory definition could not save a disputed term, as otherwise "there would be no end to the government's ability to skew public debate by forcing companies to use the government's preferred language."
The District fares no better in arguing that a "factual disclosure does not reflect an opinion merely because it compels a speaker to convey information contrary to its interest." Opp. at 29 (quoting Grocery Mfrs. Ass'n v. Sorrell,
Other courts have regularly struck down disclosure requirements that "promote[ ] policies or views that are ... expressly contrary to the corporation's views." Am. Beverage Ass'n v. City & Cty. of San Francisco,
But wait, the District says. What if DOEE ultimately concludes that Kimberly-Clark's wipes are compliant with the Act? In that case, the company would face no disclosure requirement, and no "controversy" would exist about the District's definition of flushable. While that happy ending may yet come to pass, nothing in the statute requires it to be so. Under the Act's terms, Kimberly-Clark might need to advise its consumers that its wipes "should not be flushed," no matter how reasonable its belief to the contrary. Indeed, the D.C. Council anticipated exactly that outcome: it heard testimony that the Act would likely preclude almost all products currently on the U.S. market from being labeled flushable. See Hearing Record at 16. So long as the Act includes no carve-out for these manufacturers, they must include the District's preferred messaging or face a real risk of enforcement. As that message is not "purely factual and uncontroversial," such a disclosure regime must survive at least intermediate scrutiny under Central Hudson.
ii. Misleading Speech
Before turning to that scheme, the Court pauses to discuss a variant argument offered by the District. At times, the city seems to suggest that Kimberly-Clark's use of the word "flushable" might be misleading, at least insofar as those wipes do not satisfy the District's definition of that term. In such a scenario, it says, it could ban the word "flushable" without infringing any First Amendment interests. While it is true that the First Amendment does not cover "inherently" or "actually" misleading commercial speech, see Pearson v. Shalala,
iii. Central Hudson
The appropriate standard now determined, the Court can analyze the interests at stake. Under Central Hudson, the government must show 1) a substantial interest that 2) its restriction directly and material advances and 3) that the regulation is not "more extensive than is necessary to serve that interest."
Kimberly-Clark assails each of those arguments. First, it questions whether the financial toll from wet wipes, which the District variously estimates as between $50,000-$500,000, could constitute a "substantial interest," particularly in relation to D.C. Water's $535.8 million budget. See PI Memo. at 11. Second, it claims that the District has failed to supply evidence that restrictions on "flushable" wipes would serve its ends. Indeed, Kimberly-Clark contends that the Act might be counter-productive, as it would leave consumers unable to distinguish between wipes designed to be flushable and those that are not. Left with fewer "flushable" options, consumers might just throw out the baby with the bath water and flush all wipes without discriminating.
The Court need not resolve either debate. Even assuming arguendo that the District is correct on those prongs, it would still trip on the final hurdle: its regulation is not narrowly tailored to its ends. To explain why, the Court must decouple the Act's two labeling requirements, each of which must survive intermediate scrutiny. First, the District required manufacturers to disclose that their wipes "should not be flushed," unless those wipes satisfied a three-part test for flushability. See D.C. Law 220-21 § 3(b). Second, as a corollary, it prohibited manufacturers from labeling those wipes as flushable. Id. § 3(a). Perhaps inadvertently, the city argues only that the latter requirement passes intermediate scrutiny. It makes no case that section 3(b)'s disclosure requirement could satisfy Central Hudson's final prong. In any event, the Court discusses each restriction, determining that neither passes muster.
SECTION 3(B): DISCLOSURE REQUIREMENT
Although the government need not choose the "least restrictive means" of achieving its goals, there must be a "reasonable fit" between means and ends. See Bd. of Trustees of St. Univ. of New York v. Fox,
*145Nat'l Ass'n of Manufacturers v. SEC (NAM I),
In NAM I, the D.C. Circuit considered the SEC's mandate that manufacturers disclose whether their materials had been found to be "DRC conflict-free." Id. at 375. The plaintiffs there suggested that "rather than the 'conflict free' description the statute and rule require[d], issuers could use their own language to describe their products, or the government could compile its own list of products that it believes are affiliated with the Congo war." Id. at 372. Although the Commission asserted that those proposals would be "less effective," the Court concluded that the agency had "failed to explain why (much less provide evidence that) the Association's intuitive alternatives to regulating speech would be any less effective." Id. at 373 ; see also NAM II,
The District's disclosure requirement suffers from the same flaw. The city might have published a centralized list of products considered flushable and promoted that list in conjunction with its ongoing "Protect Your Pipes" outreach campaign. Or it might have chosen an alternative, less restrictive disclosure requirement, such as one that expressly tied the "Do Not Flush" warning to the District's factual findings (e.g. , "The District has found these products cannot be safely flushed.") or one that provided a more nuanced view on the product's flushability (e.g. , "Flushing this wipe contributes to clogs in the sewer system."). Plaintiff agrees that it would be less restrictive, for example, if the District required it to carry a "Protect Your Pipes" logo and encouraged consumers to learn more at a District website. Of course, the city was not required to employ any of those alternatives, nor must it select the least restrictive means to achieve its goal, but it needed to at least consider whether some alternative might suffice. After reviewing the statutory text and legislative history-including the Hearing Record, a videotape of the Hearing, and the Committee Report-the Court sees no effort in that regard.
SECTION 3(A): BAN ON "FLUSHABILITY"
That leaves section 3(a), which banned the use of the word "flushable." Once again, there is no evidence that the District considered alternatives to its labeling requirement, much less that it gathered evidence that any such measures would be less effective. And once again, such a one-track mind is fatal under Central Hudson. See NAM I,
Ordinarily, the "preferred remedy" for potentially misleading speech is "more disclosure, rather than less." Pearson,
In this case, there is no evidence that the District considered a disclaimer in lieu of a ban on the word "flushable." Instead, it apparently thought that prohibiting the term "flushable" was necessary to make its disclosure requirement, outlined in section 3(b), workable. That is, the D.C. Council concluded that "for a disclosure regarding 'non-flushable' products to be effective[,] ... a concomitant restriction on labeling those same products as 'flushable' is needed; otherwise the two terms will work at *146cross-purposes ... and the Act will accomplish nothing." Dist. Opp. at 35; see also Oral Arg. 44:1-8 ("assuming ... that the disclosure ... is appropriate," it would not "accomplish much at all" without "a restriction on [the] use of the term 'flushable.' ").
The District's arguments might find traction were its disclosure requirement constitutional. As explained above, disclosure rules "often ... incidentally prohibit speech, because the requirement to say one thing necessarily means the speaker cannot say the opposite." Pursuing America's Greatness v. FEC,
In its briefing on this question, the District offers little in the way of counter-argument. It claims that the Act is narrowly tailored because it does not "ban claims of 'flushability" when a product complies with its statutory definition, nor does it prohibit manufacturers from providing supplemental information. See District Opp. at 35-36. That may be so. But the fact that the Act is not the most restrictive means possible does not absolve the District from considering less restrictive means. Defendants do not face a particularly demanding burden in that regard, but they must present at least some "evidence that less restrictive means would fail." NAM I,
* * *
The Court therefore holds that Kimberly-Clark is likely to succeed on its First Amendment challenge. That is not to say, however, that the District's "Protect Your Pipes" campaign is a pipe dream. As noted above, the Court's holding is limited to a certain subset of Kimberly-Clark wipes, which it designed and believes to be flushable. The city may thus continue to regulate other wipes, such as baby wipes, which disintegrate less readily. The D.C. Council heard testimony that those wipes constitute 93% of all nonwoven disposable products, see Hearing Record at 9, and even NACWA conceded that these "non-flushable" products were the main source of the District's sewer woes. Id. at 14.
The Court also acknowledges the possibility that the regulations, whenever promulgated, might change the game, particularly if the District tailored its disclosure requirement to satisfy the "factual and uncontroversial" prong of Zauderer. The D.C. Council, moreover, might consider alternatives to its current labeling requirement; if it were to collect evidence that those efforts would be less effective, it could impose the same restrictions and stand a better chance of surviving Central Hudson scrutiny. All the Court holds today is that the statute, in its current form, is likely unconstitutional as applied to Kimberly-Clark's flushable wipes.
2. Remaining Factors
"In First Amendment cases, the likelihood of success 'will often be the determinative factor' in the preliminary injunction analysis." Pursuing America's Greatness,
The District questions whether Kimberly-Clark can show any "imminent harm at all, given the rulemaking process and enforcement plans described by DOEE." District Opp. at 41. As explained above, however, the city concedes that it might still attach retroactive liability for wipes manufactured after January 1, 2018. Kimberly-Clark thus faces an imminent decision as to whether to change its labels or expose itself to civil penalties. That Hobson's choice impinges on Plaintiff's First Amendment freedoms and therefore constitutes irreparable harm.
The remaining two factors follow along the same lines. When a court "see[s] likely success" in a First Amendment challenge, it should "view more favorably [the plaintiff's] arguments regarding ... the balance of the equities[ ] and the public interest." Pursuing America's Greatness,
The District contends that a preliminary injunction will undermine its (and the public's) interest in "preventing consumer deception and the costly deterioration of its sewer system." Dist. Opp. at 43. At this stage, however, an injunction is not particularly disruptive. The District has yet to enact regulations and has stipulated that it will not enforce the Act until, at the earliest, those regulations are issued. Indeed, it expects to provide companies with an additional 18-24 months' grace period. In the interim, it professes an interest only in preserving retroactive liability for any wipe manufactured after January 1, 2018. Those wipes might still remain on the shelves in two years, and the District anticipates logistical hurdles in distinguishing between wipes based on manufacture date. See Oral Arg. Tr. 37: 17-19. The problem with that theory is that the District already must make that distinction, as the Act only applies to wipes manufactured after January 1, 2018. So the city's regulators must still check to see if a wipe was manufactured on, say, December 28, 2017. The marginal costs imposed by checking for wipes manufactured on, for example, January 2, 2018, is not so steep as to tip the equities in its favor.
C. Remedy
Last but not least: the question of remedy. In its Motion, Kimberly-Clark requests a "preliminary injunction enjoining defendants from implementing or enforcing the Act pending the entry of final judgment on Kimberly-Clark's constitutional claims." PI Memo. at 45. At oral argument, however, Plaintiff agreed that it *148would receive sufficient relief if the Court enjoined the District from enforcing the Act as to its"flushable" wipes. See Oral Arg. Tr. 11:4-7; id. at 12:16-20; id. at 55:5-18. Because the Court considers Kimberly-Clark's suit an as-applied challenge, it will impose the injunction only as to wipes that Kimberly-Clark engineered and believes to be flushable.
True, that remedy stops short of "all the relief" Plaintiff requested and might receive, for instance, from its Commerce Clause challenge. See Nw. Austin. Mun. Utility Dist. No. One v. Holde r,
Plaintiff also agreed that the Court might revisit whether an injunction is necessary after the District issues regulations implementing the Act, so long as it gives notice before dissolving any injunction. See Oral Arg. Tr. 56:12-24 (indicating that Kimberly-Clark would be "satisfied" with that relief). In other words, for the time being, Kimberly-Clark may safely manufacture flushable wipes without fear of any retroactive liability. Finally, the Court will hold a status hearing promptly after issuance of the regulations and may reconsider the injunction (and Plaintiff's other constitutional challenges) at that time.
IV. Conclusion
For the foregoing reasons, the Court finds that a preliminary injunction as applied to Kimberly-Clark's flushable wipes is appropriate here. The injunction will remain in effect until further Order of the Court. A separate Order consistent with this Opinion will be issued this day.
IT IS SO ORDERED.
Reference
- Full Case Name
- KIMBERLY-CLARK CORPORATION v. The DISTRICT OF COLUMBIA
- Cited By
- 5 cases
- Status
- Published