January 13, 2021

Transit Agency Advertising: Reasoned Approach Needed for Evaluating Political Ads

Holland & Knight Transportation Blog
Maximillian J. Bodoin | H. Harold Lee | Nicholas M. Hasenfus
Election Impacts on Transportation & Infrastructure with Transportation themes

There's likely no mode of transportation that President-Elect Joe Biden savors more than public rail. A September 2020 ruling by the U.S. Court of Appeals for the Third Circuit holding the Southeastern Pennsylvania Transportation Authority's (SEPTA) prohibition on political advertisements unconstitutional is sure to be of interest. See Center for Investigative Reporting v. Southeastern Pennsylvania Transportation Authority, 975 F.3d 300, 304 (3d Cir. 2020).

Specifically, the Third Circuit found that SEPTA's Advertising Standards, which included a prohibition on political advertisements, violated the First Amendment because the prohibition was incapable of "reasoned application" and instead could be used to arbitrarily and inconsistently restrict speech.

The case against SEPTA was brought by the Center for Investigative Reporting (CIR), a California-based news organization that sought to place an advertisement on the interior of SEPTA buses. The proposed advertisement consisted of a comic strip explaining CIR's findings that, in certain metropolitan areas, applicants of color were more likely to be denied conventional home purchase mortgages. SEPTA concluded that disparate lending practices are a "matter of public debate and litigation" and, accordingly, the proposed advertisement violated the prohibition on political advertisements set out in its Advertising Standards.

At trial, the U.S. District Court for the Eastern District of Pennsylvania found that the provisions of the SEPTA Advertising Standards that banned political advertisements were overbroad. However, upon SEPTA's revision of the overbroad language, the District Court found that the Advertising Standards were "now facially valid, reasonable, and constitutional." Accordingly, the District Court denied CIR's motion for preliminary injunction. CIR appealed the decision to the Third Circuit.

On appeal, the Third Circuit held that SEPTA's restrictions on political advertisements, even as set out in the revised Advertising Standards, were incapable of meeting the "reasoned application" test, as required under a recent holding by the U.S. Supreme Court. In Minnesota Voters Alliance v. Mansky, the Supreme Court held that content-based speech restrictions in a nonpublic forum are unconstitutional if such restrictions are incapable of reasoned application. Here, the Third Circuit determined that SEPTA's prohibition on political advertisements failed to meet the Supreme Court's Mansky test because, based on various testimonies, SEPTA had inconsistently applied its Advertising Standards to determine the permissibility of advertisements containing political messages. The Third Circuit found that the Advertising Standards lacked "objective, workable standards", and that SEPTA's failure to implement "structure and clear policies governing the decision-making process" created a "real risk" that the restrictions are arbitrarily applied.

Takeaways and Next Steps

Public transit agencies often implement advertising policies that include content-based prohibitions, and the Third Circuit's ruling against SEPTA may give rise to similar complaints. In an increasingly polarized political environment, public transit agencies may be tempted to ban all political speech. In fact, in Lehman v. City of Shaker Heights, the Supreme Court held that a city's prohibition of political advertising on public transit vehicles was a permissible restriction on free speech. However, similar to the standard under Mansky, the Supreme Court explained in Lehman that such restrictions, in order to be constitutional, must not be "arbitrary, capricious, or invidious." Accordingly, for purposes of complying with Constitutional protections on free speech and the Mansky test, when enforcing such prohibitions, public transit agencies should ensure that its advertising policy is not arbitrarily applied. To mitigate the risk of litigation and potential exposure, a transit agency should: 1) include in its advertising policy objective and unambiguous standards; 2) establish clear decision-making processes for determining whether an advertisement is permissible; and 3) ensure that the reviewing boards or personnel consistently apply such standards. In the new administration, additional comment and guidance may also be provided to assist with navigating this increasingly sensitive issue.

20 Posts in 20 Days Leading to Inauguration Day on Jan. 20

Holland & Knight's Transportation & Infrastructure Industry Sector Group is prepared to assist industry clients in adapting to the anticipated changes by the new administration. Our team is writing new blog posts each day leading up to President-Elect Joe Biden's inauguration, with insights as to likely impacts on the various segments of the industry, including Aviation, Construction, Maritime, Freight Rail, Motor Carriers, Transit and Autonomous Transportation. Bookmark our Election Impacts on Transportation & Infrastructure resource page to follow along.

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