I previously wrote a post earlier this year that the United States Supreme Court (SCOTUS) had granted a writ of certiorari to hear the case of Sorrell v. IMS Health Inc., in which Vermont sought to restrict the ability of companies to data mine pharmacy prescribing data. Oral argument is scheduled for tomorrow.
A brief background as an introduction; in 2007, Vermont passed a law that restricted the use of prescriber-identifiable (PI) data for marketing or promoting a prescription drug. Vt. Stat. Ann. tit. 18, § 4631 (2007).
This law had a major business impact on companies such as IMS who analyze prescriber data and sell it to pharmaceutical companies to assist them with their sales and marketing strategy, so that they can identify which doctors are prescribing their products or those of a competitor. This helps them focus their sales detailing.
Similar laws in Maine and New Hampshire were upheld on appeal, but the United States Court of Appeals for the Second Circuit overturned the Vermont statute, resulting in a conflict between the circuit courts of appeal that the Supreme Court has decided to resolve.
I think the Supreme Court will decide this case narrowly and to the disappointment of many will not create expensive new rights protecting online data.
Post Wikileaks – rights to data are a controversial topic. Journalists would like access to as much information as possible, yet government wishes to be able to regulate this. This case is, however, not about the right to access information, but about the ability to use information that is already available.
I don’t think this case will be the one where the U.S. Supreme Court offers their opinion on the right to data privacy in an online era.
In my view, this case focuses on commercial speech and the First Amendment. As Ronald Dworkin states in Freedom’s Law, “The United States stands alone, even among democracies, in the extraordinary degree to which its Constitution protects the freedom of speech.”
The First Amendment of the United States Constitution states that “Congress shall make no law . . . abridging the freedom of speech.” The First Amendment, according to Justice Holmes, protects the right to express “speech that we loathe.” The fact that Vermont does not like the data mining of prescriber information does not mean they have the right to regulate this. Vermont argues that what they are trying to do is regulate conduct not speech.
A key question for the Supreme Court is whether Vermont’s PI data is commercial free speech that is protected by the First Amendment? The answer to me is “yes” and I think the Justices will focus on this question.
The second question that I think the Justices will focus in on at oral argument is, if you accept that prescriber data is commercial free speech, does Vermont’s Statute violate the intermediate scrutiny test for what is a permissible regulation as set forth in Central Hudson Gas & Electric Corp. v. Public Service Commission of New York, 447 U.S. 557, 561-66 (1980).
The challenge for Vermont will be the second prong of the Central Hudson test that the government has a substantial interest to be achieved by the regulation. The tangential leap from regulating PI information to drug price regulation is a hurdle that Vermont will have to overcome to prevail.
My prediction (for what it’s worth) is that the Court will follow the analysis of the U.S. Court of Appeals for the Second Circuit, and uphold their opinion that the Vermont statute is an improper restriction on commercial speech under the First Amendment.
Whatever the Supreme Court’s decision in IMS Health Inc. v. Sorrell, it will shed further insight into what constitutes commercial speech protected by the First Amendment. Interestingly, the Constitution makes no reference to the word “commercial” or implies that any free speech is less valued than others. I look forward to oral argument tomorrow.