A New York law requiring Door Dash, Grubhub and other companies to provide customer data to restaurants violates the First Amendment, a federal district court has ruled.
The law allows restaurants to demand customer data, which includes (1) name, (2) telephone number, (3) e-mail address, (4) order delivery address, and (5) order contents. The plaintiffs sued in federal district court in September 2021.
Plaintiffs argued the law violates the First Amendment by requiring them to furnish to restaurants data that they otherwise would not provide.
New York contended that the law did not implicate speech at all. However, the federal district court held that the First Amendment is implicated because the law regulates information. The court found that “when the Customer Data Law requires that Delivery Services send customer data to restaurants, it compels speech that falls within the First Amendment’s protection.”
The court then determined in DoorDash, Inc. v. City of New York that the compelled disclosure of this information should be classified as commercial speech. The court applied the familiar test for commercial speech under the Central Hudson test from Central Hudson Gas & Elec. Co. v. Public Service Commission (1980).
Under the Central Hudson test, the government can freely regulate commercial speech that concerns unlawful activity or is misleading. If the commercial speech concerns lawful activities and is not misleading, however, then courts must inquire (1) whether the asserted government interest is substantial, (2) whether the regulation directly advances the government interest asserted, and (3) whether the regulation is not more extensive than is necessary to serve that interest.
The city asserted that the law served the substantial state interest of helping restaurants during the Covid-19 period.
“The City may prefer that restaurants have access to customer data, but a mere preference for one industry over another is not a substantial state interest,” the federal district court wrote. “Even if the Court were to find that the City has a substantial interest in ensuring that restaurants obtain data about customers who order food, it has not demonstrated that the Customer Data Law is appropriately tailored to this goal.”
The court concluded: “Because the Customer Data Law regulates commercial speech but fails intermediate scrutiny, it violates the First Amendment.”
David L. Hudson Jr. teaches First Amendment law and constitutional law classes at Belmont University College of Law. He is the author, co-author, or co-editor of more than 50 books, including The Constitution Explained: A Guide for Every American (Visible Ink Press, 2022) and The First Amendment: Freedom of Speech (Thomson Reuters, 2012).
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