## Facts

- Rhode Island enacted statutes prohibiting advertising the retail price of alcoholic beverages, except for price tags or signs inside licensed premises not visible from the street.
- A separate provision barred Rhode Island media from publishing advertisements that referenced alcohol prices, including advertisements for out-of-state liquor sales.
- The State defended the restrictions as a temperance measure, asserting that suppressing price advertising would reduce price competition, keep alcohol prices higher, and thereby reduce consumption.
- 44 Liquormart, Inc. (a Rhode Island liquor retailer) and Peoples Super Liquor Stores, Inc. (a Massachusetts retailer) filed suit seeking declaratory relief that the advertising bans violated the First Amendment.
- The district court held the bans unconstitutional, finding inadequate proof that the bans materially advanced temperance and concluding the restrictions were broader than necessary; it also rejected any claim that the Twenty-First Amendment lowered the State’s burden.
- The First Circuit reversed, crediting the State’s theory and treating the Twenty-First Amendment as providing added support for the regulation.
- The Supreme Court granted review.

## Issues

1. Whether a near-total ban on truthful, non-misleading liquor price advertising violates the First Amendment protection for commercial speech.
2. Whether the Twenty-First Amendment alters or reduces First Amendment scrutiny such that it can justify otherwise invalid restrictions on alcohol price advertising.

## Decision

- The Supreme Court unanimously held the advertising bans unconstitutional and reversed the First Circuit.
- The Court held that the Twenty-First Amendment does not qualify the First Amendment and cannot shield a speech restriction from constitutional review.
- Applying commercial speech doctrine, the Court accepted temperance as a substantial governmental interest but found the State failed to show the bans directly and materially advanced that interest.
- The Court further held the bans were excessively broad because the State had less speech-restrictive options to pursue temperance.

## Legal Principles

- Truthful, non-misleading commercial speech about lawful activity is protected by the First Amendment and may be restricted only if the government satisfies the Central Hudson test.
- The government bears the burden to show a commercial speech restriction materially advances a substantial interest; unsupported assumptions about consumer behavior are insufficient.
- A complete prohibition on disseminating truthful, non-misleading price information is highly suspect, particularly when justified by keeping consumers uninformed to influence their choices.
- The Twenty-First Amendment expands state authority over alcohol in some respects but does not exempt state alcohol regulations from compliance with other constitutional guarantees, including the First Amendment.
- When the government seeks to reduce consumption of a lawful product, it must ordinarily pursue that goal through direct regulation (e.g., taxation or pricing rules) rather than suppressing truthful information.

## Conclusion

Rhode Island’s broad ban on liquor price advertising violated the First Amendment because the State did not demonstrate that suppressing truthful price information materially advanced temperance and because less speech-restrictive regulatory tools were available; the Twenty-First Amendment did not alter that constitutional analysis.


44 Liquormart, Inc. v. Rhode Island, 517 U.S. 484 (1996)