Expressions Hair Design v. Schneiderman, 137 S. Ct. 1144

Background

New York Gen. Bus. Law §518 (1984) forbids a seller from "impos[ing] a surcharge" on customers who pay with credit cards; the statute does not define "surcharge."
Petitioners are five NY merchants who want to advertise a single (cash) sticker price plus a stated credit-card surcharge (e.g., "$10 (plus 3% if you pay by credit card)").
Merchants sued state officials claiming §518 (as applied to their single‑sticker scheme) violates the First Amendment (regulates speech) and is unconstitutionally vague. District Court sided with merchants; Second Circuit reversed and directed dismissal.
Second Circuit interpreted §518 (drawing on the expired federal surcharge ban) to prohibit posting a single sticker price and then charging credit‑card users more than that sticker price—i.e., it equates sticker/"regular" price with the displayed price.
Supreme Court accepted review, limited the challenge to the merchants’ as‑applied attack on the single‑sticker surcharge scheme, and concluded §518 regulates speech (how prices are communicated) rather than merely conduct/price.
The Court remanded to the Second Circuit to analyze §518 under the appropriate First Amendment framework; it also held §518 is not vague as applied to the petitioners’ asserted pricing scheme.

Issues

Issue	Plaintiff's Argument	Defendant's Argument	Held
Whether §518 prohibits the single‑sticker price plus disclosed credit‑card surcharge (the merchants’ proposed display)	Merchants: §518 does not clearly ban their speech and any restriction on describing price differences is a First Amendment violation	State: §518 forbids imposing a surcharge; in single‑sticker context the sticker is the "regular" price, so a surcharge (charging card users more than sticker) is banned	Court: Agreed with Second Circuit’s interpretation — §518 bars the single‑sticker + surcharge display and followed that interpretation (deference to lower federal court on state law)
Whether §518 is a regulation of speech or conduct	Merchants: §518 regulates communication about prices (speech) and must meet First Amendment scrutiny	State: §518 is a price regulation (relationship between two prices) and regulates conduct, not speech	Court: §518 regulates how sellers may communicate prices (not the amounts they may charge) and thus is a regulation of speech; remand required for First Amendment analysis
If speech, what standard of First Amendment review applies	Merchants: commercial speech doctrine or stricter protection for framing; statute is invalid as applied	State: statute is permissible as a price regulation; alternatively could be a valid disclosure/regulatory measure	Court: Did not decide the appropriate standard (Central Hudson vs. Zauderer vs. other); remanded for the Second Circuit to analyze in the first instance
Vagueness challenge	Merchants: §518 is vague because it depends on murky surcharge/discount distinction	State: statute is sufficiently definite as applied to the merchants’ intended display	Court: §518 is not unconstitutionally vague as applied — petitioners’ intended speech is clearly proscribed

Key Cases Cited

Pembaur v. Cincinnati, 475 U.S. 469 (1986) (deference to lower federal courts on state‑law interpretation)
Brockett v. Spokane Arcades, Inc., 472 U.S. 491 (1985) (requirement that lower court construction be “clearly wrong” to overturn)
44 Liquormart, Inc. v. Rhode Island, 517 U.S. 484 (1996) (price regulation generally addresses conduct, not speech)
Rumsfeld v. Forum for Academic & Institutional Rights, Inc., 547 U.S. 47 (2006) (incidental effects on speech do not alone make a conduct regulation a speech restriction)
Sorrell v. IMS Health Inc., 564 U.S. 552 (2011) (regulation of speech may warrant heightened scrutiny)
Central Hudson Gas & Electric Corp. v. Public Serv. Comm’n, 447 U.S. 557 (1980) (commercial speech intermediate scrutiny framework)
Zauderer v. Office of Disciplinary Counsel of Supreme Court of Ohio, 471 U.S. 626 (1985) (permissive standard for compelled disclosure of factual, uncontroversial commercial information)
Holder v. Humanitarian Law Project, 561 U.S. 1 (2010) (limitations on vagueness challenges where the plaintiff’s speech is clearly proscribed)
Railroad Comm’n of Texas v. Pullman Co., 312 U.S. 496 (1941) (Pullman abstention doctrine for federal courts confronting uncertain state‑law questions that may avoid constitutional ruling)
Virginia v. American Booksellers Assn., Inc., 484 U.S. 383 (1988) (use of certification to state court preferable to abstention in First Amendment cases)
United States v. O'Brien, 391 U.S. 367 (1968) (test for when a regulation of conduct implicates expressive conduct)
Giboney v. Empire Storage & Ice Co., 336 U.S. 490 (1949) (government may regulate conduct even if it uses language to effect that conduct)