Texas Department of Insurance and Cassie Brown, in Her Official Capacity as Commissioner of the Texas Department of Insurance v. Stonewater Roofing, Ltd. Co.
22-0427
Tex.Jun 7, 2024Background
- Stonewater Roofing challenged Texas statutes requiring insurance adjusters to be licensed and prohibiting dual roles as contractor and adjuster, arguing these provisions violated the First Amendment’s free speech clause.
- The case reached the Texas Supreme Court on petition for review, after lower court proceedings.
- Stonewater did not challenge the statutes under due process but raised arguments under free speech.
- The statutes at issue regulate (1) who can act as or hold out as a public insurance adjuster and (2) conflicts of interest in claims adjusting.
- The Texas Supreme Court applied a narrow reading of the statutes, treating the licensing and conflict-of-interest rules as targeting nonexpressive conduct rather than speech.
- The concurring opinion expressed concern about future, harder cases where regulations may more directly implicate protected speech.
Issues
| Issue | Stonewater's Argument | State's Argument | Held |
|---|---|---|---|
| Do licensure/conflict rules restrict protected speech? | License restrictions and dual-role bans burden speech protected by First Amendment. | Statutes regulate professional conduct, not speech; any speech affected is only incidental. | Statutes regulate nonexpressive conduct; incidental speech burden permitted. |
| Can the State broadly define "conduct" to escape First Amendment scrutiny? | The broad definition threatens to sweep in protected speech activity. | Defining activities as professional conduct is justified for licensing and public protection. | Court rejects overbroad "conduct" theory; regulation must target nonexpressive conduct. |
| Does acting in an agency/representative capacity lessen First Amendment protection? | Agency role does not diminish speech protection under the First Amendment. | Expressive conduct made for clients is regulable as professional conduct. | Agency/representative status irrelevant; expressive content is protected regardless of pay or role. |
| Are the challenged statutes constitutional as applied? | Challenged provisions impermissibly burden speech. | Statutes valid due to narrow construction and only incidental effect on speech. | Statutes, as construed, do not violate the First Amendment; challenge fails. |
Key Cases Cited
- Thomas v. Collins, 323 U.S. 516 (1945) (State may license professions to protect public from incompetence and fraud)
- Masterpiece Cakeshop, Ltd. v. Colo. Civil Rights Comm’n, 584 U.S. 617 (2018) (Expressive conduct in commercial activity protected by First Amendment)
- Texas v. Johnson, 491 U.S. 397 (1989) (Flag burning as protected expressive conduct)
- Riley v. Nat’l Fed’n of the Blind of N.C., Inc., 487 U.S. 781 (1988) (Paid speech is still protected speech under First Amendment)
- Cent. Hudson Gas & Elec. Corp. v. Pub. Serv. Comm’n of N.Y., 447 U.S. 557 (1980) (Commercial speech doctrine; false/misleading commercial speech not protected)
- United States v. O'Brien, 391 U.S. 367 (1968) (Regulation of conduct with incidental impact on speech sometimes subject to intermediate scrutiny)
- Washington v. Glucksberg, 521 U.S. 702 (1997) (Due process protects fundamental rights rooted in history and tradition)