The Union-Tribune Publishing Co. was facing heat from its union employees back in the fall of 1998. Workers were alleging that the company, which owns the San Diego Union-Tribune, treated them unfairly, and the union staged a large-scale publicity campaign to raise awareness about their plight.
As part of the campaign, 30 to 40 union members descended upon Fashion Valley Mall, a San Diego
shopping center. Their plan was to distribute leaflets to customers entering and leaving the Robinsons-May department store. The leaflets informed shoppers that Robinsons-May advertised in the paper and listed grievances the employees had against the publishing company.
The activity attracted the attention of the mall's security, which informed the union members they had neglected to obtain a permit from the mall to engage in such activity. The union members then exited the mall and continued distributing leaflets on nearby public property.
A few days later, union members filed a complaint with the NLRB, petitioning that Fashion Valley's rules regarding expressive activity be struck down. The mall had adopted a rule that required protestors to agree to not impede, compete or interfere with the business of one or more of the stores or merchants in the shopping center. As the union saw it, such a rule violated the California Constitution's free speech clause.
The case wound its way to the state Supreme Court. In a 4-3 decision, the court decided December 2007 to support the union.
"At the end of the day, mall property owners' restrictions that bar groups from attacking a company that's doing business on the property aren't valid," says Michael Lotito, partner in Jackson Lewis' San Francisco office. "That's pretty profound."
To understand Fashion Valley Mall LLC v. National Labor Relations Board, it's important to understand the case the ruling was built upon.
In 1979 the California Supreme Court ruled in a landmark case, Pruneyard Shopping Center v. Robins. In Pruneyard a group of high school students wanted to protest a United Nations resolution. They collected signatures on a petition at the courtyard of the privately owned Pruneyard Shopping Center near San Jose.
As in Fashion Valley, mall authorities requested that the protestors leave the premises. Although the students complied, they soon after sued in California court, alleging mall owners violated their rights of free speech under the state constitution.
The state Supreme Court sided in favor of the students, ruling that the California Constitution protects speech and petitioning, reasonably exercised, in shopping centers, even when the center is privately owned. The U.S. Supreme Court upheld that decision in 1980.
"In Pruneyard the court took the position that, even though malls are private property, they're historically places where the public can gather, and the property owners want the public to be there," says Helene Wasserman, partner in Ford & Harrison's Los Angeles office. "So it is a very public environment on private property."
Fashion Valley takes the Pruneyard precedent and tips it even more in favor of public protestors. With Fashion Valley the court had to weigh the compelling interests of the property owners and those of the union members. For the property owners, the interest was obviously to maximize profits. For the unions, the interest was in exercising their rights of free speech under California law.
"As a mall property owner in California, you can still levy restrictions, such as barring protestors from convening on certain blackout dates, limiting the size of picket signs and banning bullhorns," Lotito says. "But if groups want to hand out fliers that say, 'Don't shop at ABC retailer,' despite the fact that [the retailer is] paying the mall owner rent, then they can go for it."
Not all the judges presiding over Fashion Valley shared these sentiments.
"The dissent in this case said the facts in Fashion Valley are a very different animal than those in Pruneyard," Wasserman says. "They felt there's a difference between signatures on a petition that will go to the government and the boycotting of a tenant."
The Fashion Valley decision will only affect mall owners in California, though a number of other states--including New Jersey, Colorado and Oregon--have adopted standards for free speech similar to those established in Pruneyard.
However, the ruling may have consequences that affect property owners outside the scope of what is traditionally thought of as a mall. This is because the California Supreme Court failed to make clear what qualities make a property a mall.
"The court looks at all the facts and circumstances to see if the property takes on the attribute of a town," Lotito says. "But I've had situations with clients where stand-alone entities with stores across the street and a variety of stores situated within several blocks of one another, and we asserted to the local police that these are shopping malls."
In addition, at a time when many properties are taking on multiple uses, from retail to office space to residential, the line between what's a mall and what's a conglomeration of stores and spaces might become blurred. Because of the ruling, this could lead to some interesting cases down the road.
"We as a society are evolving to use properties in different ways, and these cases have to evolve with us," Wasserman says. "I don't think people would want protestors picketing in front of their homes, because your home isn't open to the public."
Whether the courts will continue to expand Californians' free-speech rights remains to be seen. What is certain is that in California the right of individuals to express themselves freely outweighs the rights of property owners.
"Pruneyard is still alive and well," Wasserman says. "It just moved from San Jose to San Diego."