Court Establishes Commercial Speech Test

1980

In Central Hudson Gas & Electric Corp. v. Public Service Commission, the U.S. Supreme Court decides that a state ban on promotional advertising by the electric utility is unconstitutional. The ruling sets up a four-part test to decide when commercial speech can or cannot be regulated: (1) It must not be misleading or involve illegal activity (2) The government interest advanced by the regulation must be significant (3) The regulation must directly advance the government interest (4) The regulation must be limited to serving the asserted government interest.