State laws targeting the Boycott, Divestment, Sanctions (BDS) movement have required various lower courts to consider the constitutional status of boycotts.  Several states now limit the availability of government contracts for those who refuse to deal with Israeli businesses, prompting legal challenges claiming that certain types of boycotts are constitutionally protected speech.  Whether the government may restrict contracts for those who participate in BDS-type boycotts depends on whether refusals to deal, when part of a larger social boycott movement, are protected expressive conduct under the First Amendment.

The BDS movement seeks to impose, through protest activity, advocacy, and boycotts, economic costs on Israeli businesses, with the goal of affecting the relationship between Israel and Palestine.  This movement is controversial.   Its supporters contend they are working peacefully to end an apartheid regime.  Its detractors contend that the BDS movement is, at best, holding Israel to unworkable standards that seem to deny its right to exist or is, at worst, corrupted by antisemitism.  However, the moral righteousness of the BDS movement is irrelevant to whether its activities are protected speech.  Moreover, as an Eighth Circuit amicus brief for two Jewish organizations notes,  “censorship of those who question American or Israeli policy puts the intellectual integrity and future of the Jewish community at risk and threatens to further calcify opinions about the Israeli Palestinian conflict, making more remote the realization of a just and secure future for both Israelis and Palestinians.” (Note: this brief is co-authored by a friend who clerked for the same judge as I did.)

Recently, a federal judge in Arkansas upheld Act 710, which prohibits Arkansas state entities from contracting for greater than $1,000 with companies who are engaged in a “boycott of Israel,” defined as “engaging in refusals to deal, terminating business activities, or other actions that are intended to limit commercial relations with Israel, or persons or entities doing business in Israel or in Israeli-controlled territories, in a discriminatory manner.”  If a company refuses to provide a certification claiming it is not boycotting Israel, the state entity may still deal with the company, but only if the company offers a 20% discount.

According to the federal court, refusals to deal are not pure speech.   These refusals are also not expressive conduct (entitled to lesser constitutional protection, but still intermediate constitutional scrutiny) because they are not, on their face, expressive.  A viewer cannot tell simply from the refusal to deal that it is expressing a message.  Unlike a parade, which is inherently expressive and thus deserves protection as expressive conduct, a refusal to do business does not itself evince expression.  Thus, while companies in Arkansas may protest and engage in advocacy, as those are protected speech, their refusals to deal are not constitutionally protected as thus may be restricted by the government.  See Arkansas Times LP v. Waldrip, — F. Supp. 3d. —, No. 4:18-CV-00914 BSM, 2019 WL 580669 (E.D. Ark. Jan. 23, 2019).

Two district courts in other states have reached the opposite conclusion, issuing preliminary injunctions against similar laws restricting the ability of individuals and companies that contract with the government to boycott Israel.  See Jordahl v. Brnovich, 336 F. Supp. 3d 1016, 1040 (D. Ariz. 2018), appeal docketed No. 18-16896 (9th Cir. Oct. 3, 2018); Koontz v. Watson, 283 F. Supp. 3d 1007, 1024 (D. Kan. 2018).  The federal judge in Jordahl held that an Arizona law very similar to Arkansas’ Act 710 was likely an unconstitutional government condition because “collective boycotting activities undertaken to achieve social, political or economic ends is conduct that is protected by the First Amendment.”  The government is generally not permitted to condition benefits on the relinquishment of free speech rights, and the government may also not place broad restrictions on the speech of government employees if those restrictions are unrelated to the employment.  According to the court in Jordahl, the law at issue did not simply narrowly target commercial activity but limited “collective engagement” in political expression.  Although one refusal to deal may simply be an economic transaction, the BDS movement is a larger social and cultural protest that is inherently expressive.  A district court in Kansas agreed in Koontz v. Watson, issuing a preliminary injunction for a public school teacher who sought to contract with the state.

How these cases ultimately get decided on appeal will depend on whether the courts of appeals find these cases more analogous to NAACP v. Claiborne Hardware or to Rumsfeld v. FAIR.   In Claiborne Hardware, the Supreme Court deemed protected a civil rights boycott against white business owners, who sued the boycotters for economic losses.  The Court distinguished boycotts involving labor disputes or refusals to deal by competitors, which the state may legitimately regulate to promote competition and manage labor disputes.  The boycott at issue in Claiborne was a protest against discrimination, and many of the white business owners had ties to or powerful positions in the state.  According to the Court, “[t]he right of the States to regulate economic activity could not justify a complete prohibition against a nonviolent, politically motivated boycott designed to force governmental and economic change and to effectuate rights guaranteed by the Constitution itself.”

In many ways, Claiborne is on point.  The BDS movement is a political protest, not a labor dispute or an attempt by competitors to engage in activity that concerns antitrust issues.  That said, protesting of private international companies may be deemed distinguishable from an economic boycott that was so closely tied to our own Fourteenth Amendment right to Equal Protection.  The Supreme Court has also found that a union’s refusal to load and unload ships that trade with the Soviet Union, to protest the invasion of Afghanistan, was not protected speech.

Even if Claiborne is somewhat sui generis and boycotts generally are not protected, the BDS laws at issue here may be considered constitutionally protected expressive conduct, but only if the companies’ and teacher’s refusals to deal are inherently expressive.  In Rumsfeld v. FAIR, a unanimous Supreme Court upheld a law requiring law schools to allow military recruiters onto their campuses, despite the fact that the military violated the law schools’ nondiscrimination policies.  This federal law, the Solomon Amendment, did not infringe the law schools’ First Amendment rights because simply granting access to the military was not inherently expressive.  The military was not speaking for the law school.  According to the Court, “[n]othing about recruiting suggests that law schools agree with any speech by recruiters, and nothing in the Solomon Amendment restricts what the law schools may say about the military’s policies.”

Similarly, denying state contractors the ability to boycott Israeli companies does not restrict them from speaking out against Israel, and even urging others to boycott Israel.  Thus, if the courts of appeals find Rumsfeld v. FAIR controlling, state contractors can be prohibited from boycotting Israeli companies, although their actual speech about Israel cannot determine whether they are awarded contracts.

My preliminary view is that these state laws are unconstitutional restrictions on expressive conduct, because the BDS movement is an established collective protest movement that is inextricably intertwined with speech.  I would like to see the full appellate briefing before I come to a firmer conclusion, however.  Of note:  Those who argue that money is not speech, especially money collected via groups of individuals, may have those views tested here.