IBANEZ v. FLORIDA DEPARTMENT OF BUSINESS AND PROFESSIONAL REGULATION, BOARD OF ACCOUNTANCY
No. 93-639
Supreme Court of the United States
Argued April 19, 1994-Decided June 13, 1994
512 U.S. 136
Silvia Safille Ibanez, pro se, argued the cause for petitioner. With her on the briefs were J. Lofton Westmoreland and Robert J. Shapiro.
Lisa S. Nelson argued the cause and filed a brief for respondent.*
*Briefs of amici curiae urging reversal were filed for the Alliance of Practicing Certified Public Accountants et al. by Donald B. Verrilli, Jr., David W. DeBruin, and Maureen F. Del Duca; for the American Association of Attorney-Certified Public Accountants, Inc., by David Ostrove,
Briefs of amici curiae urging affirmance were filed for the American Institute of Certified Public Accountants by Louis A. Craco, Richard I. Miller, Michael R. Young, and Kelly M. Hnatt; and for the Florida Institute of Certified Public Accountants by Kenneth R. Hart and Steven P. Seymoe.
JUSTICE GINSBURG delivered the opinion of the Court.
Petitioner Silvia Safille Ibanez, a member of the Florida Bar since 1983, practices law in Winter Haven, Florida. She is also a Certified Public Accountant (CPA), licensed by respondent Florida Board of Accountancy (Board)1 to “practice public accounting.” In addition, she is authorized by the Certified Financial Planner Board of Standards, a private organization, to use the trademarked designation “Certified Financial Planner” (CFP).
Ibanez referred to these credentials in her advertising and other communication with the public. She placed CPA and CFP next to her name in her yellow pages listing (under “Attorneys“) and on her business card. She also used those designations at the left side of her “Law Offices” stationery. Notwithstanding the apparently truthful nature of her communication-it is undisputed that neither her CPA license nor her CFP certification has been revoked-the Board reprimanded her for engaging in “false, deceptive, and misleading” advertising. Final Order of the Board of Accountancy (May 12, 1992) (hereinafter Final Order), App. 178, 194.
The record reveals that the Board has not shouldered the burden it must carry in matters of this order. It has not
I
Under Florida‘s Public Accountancy Act, only licensed CPA‘s may “[a]ttest as an expert in accountancy to the reliability or fairness of presentation of financial information,”
The Board learned of Ibanez’ use of the designations CPA and CFP when a copy of Ibanez’ yellow pages listing was mailed, anonymously, to the Board‘s offices; it thereupon commenced an investigation and, subsequently, issued a complaint against her. The Board charged Ibanez with (1)
At the ensuing disciplinary hearing, Ibanez argued that she was practicing law, not “public accounting,” and was therefore not subject to the Board‘s regulatory jurisdiction. Response to Amended Administrative Complaint (filed Aug. 26, 1991), ¶ 25, id., at 108.6 Her use of the CPA and CFP designations, she argued further, constituted “nonmisleading, truthful, commercial speech” for which she could not be sanctioned. ¶ 24, ibid. Prior to the close of proceedings before the hearing officer, the Board dropped the charge that Ibanez was practicing public accounting in an unlicensed firm. Order on Reconsideration (filed Aug. 22, 1991), ¶ 2, id., at 103-104. The hearing officer subsequently found in Ibanez’ favor on all counts, and recommended to the Board that,
The Board rejected the hearing officer‘s recommendation, and declared Ibanez guilty of “false, deceptive and misleading” advertising. Final Order, id., at 194. The Board reasoned, first, that Ibanez was “practicing public accounting” by virtue of her use of the CPA designation and was thus subject to the Board‘s disciplinary jurisdiction. Id., at 183. Because Ibanez had insisted that her law practice was outside the Board‘s regulatory jurisdiction, she had, in the Board‘s judgment, rendered her use of the CPA designation misleading:
“[Ibanez] advertises the fact that she is a CPA, while performing the same ‘accounting’ activities she performed when she worked for licensed CPA firms, but she does not concede that she is engaged in the practice of public accounting so as to bring herself within the jurisdiction of the Board of Accountancy for any negligence or errors [of which] she may be guilty when delivering her services to her clients.
“[Ibanez] is unwilling to acquiesce in the requirements of [the Public Accountancy Act] and [the Board‘s rules] by complying with those requirements. She does not license her firm as a CPA firm; forego certain forms of remuneration denied to individuals who are practicing public accountancy; or limit the ownership of her firm to other CPAs.... [She] has, in effect, told the public that she is subject to the provisions of [the Public Accountancy Act] and the jurisdiction of the Board of Accountancy when she believes and acts as though she is not.” Id., at 184-185.
Next, the Board addressed Ibanez’ use of the CFP designation. On that matter, the Board stated that any designation using the term “certified” to refer to a certifying orga-
II
A
The Board correctly acknowledged that Ibanez’ use of the CPA and CFP designations was “commercial speech.” Final Order, App. 186. Because “disclosure of truthful, relevant information is more likely to make a positive contribution to decisionmaking than is concealment of such information,” Peel v. Attorney Registration and Disciplinary Comm‘n of Ill., 496 U. S. 91, 108 (1990), only false, deceptive, or misleading commercial speech may be banned. Zauderer v. Office of Disciplinary Counsel of Supreme Court of Ohio, 471 U. S. 626, 638 (1985), citing Friedman v. Rogers, 440 U. S. 1 (1979); see also In re R. M. J., 455 U. S. 191, 203 (1982) (“Truthful advertising related to lawful activities is entitled to the protections of the First Amendment.... Misleading advertising may be prohibited entirely.“).
Commercial speech that is not false, deceptive, or misleading can be restricted, but only if the State shows that the restriction directly and materially advances a substantial state interest in a manner no more extensive than necessary to serve that interest.7 Central Hudson Gas & Elec. Corp. v. Public Serv. Comm‘n of N. Y., 447 U. S. 557, 566 (1980);
The State‘s burden is not slight; the “free flow of commercial information is valuable enough to justify imposing on would-be regulators the costs of distinguishing the truthful from the false, the helpful from the misleading, and the harmless from the harmful.” Zauderer, 471 U. S., at 646. “[M]ere speculation or conjecture” will not suffice; rather the State “must demonstrate that the harms it recites are real and that its restriction will in fact alleviate them to a material degree.” Edenfield, 507 U. S., at 770, 771; see also Zauderer, 471 U. S., at 648-649 (State‘s “unsupported assertions” insufficient to justify prohibition on attorney advertising; “broad prophylactic rules may not be so lightly justified if the protections afforded commercial speech are to retain their force“). Measured against these standards, the order reprimanding Ibanez cannot stand.
B
We turn first to Ibanez’ use of the CPA designation in her commercial communications. On that matter, the Board‘s position is entirely insubstantial. To reiterate, Ibanez holds a currently active CPA license which the Board has never sought to revoke. The Board asserts that her truthful communication is nonetheless misleading because it “[tells] the public that she is subject to the provisions of [the Accountancy Act] and the jurisdiction of the Board of Accountancy when she believes and acts as though she is not.” Final Order, App. 185; see also Brief for Respondent 20 (“[T]he use
Ibanez no longer contests the Board‘s assertion of jurisdiction, see Brief for Petitioner 28 (Ibanez “is, in fact, a licensee subject to the rules of the Board“), and in any event, what she “believes” regarding the reach of the Board‘s authority is not sanctionable. See Baird v. State Bar of Ariz., 401 U. S. 1, 6 (1971) (First Amendment “prohibits a State from excluding a person from a profession or punishing him solely because ... he holds certain beliefs“). Nor can the Board rest on a bare assertion that Ibanez is “unwilling to comply” with its regulation. To survive constitutional review, the Board must build its case on specific evidence of noncompliance. Ibanez has neither been charged with, nor found guilty of, any professional activity or practice out of compliance with the governing statutory or regulatory standards.8 And as long as Ibanez holds an active CPA license from the Board we cannot imagine how consumers can be misled by her truthful representation to that effect.
C
The Board‘s justifications for disciplining Ibanez for using the CFP designation are scarcely more persuasive. The Board concluded that the words used in the designation-particularly, the word “certified“-so closely resemble “the terms protected by state licensure itself, that their use, when not approved by the Board, inherently mislead[s] the public into believing that state approval and recognition exists.” Final Order, App. 193-194. This conclusion is difficult to maintain in light of Peel. We held in Peel that an attorney‘s use of the designation “Certified Civil Trial Specialist By the
The Board points to Rule 24.001(1)(j),
The concurring Justices, on whom the Board relies, did indeed find the “[NBTA] Certified Civil Trial Specialist” statement on a lawyer‘s letterhead “potentially misleading,” but they stated no categorical rule applicable to all specialty designations. Thus, they recognized that “[t]he potential for misunderstanding might be less if the NBTA were a commonly recognized organization and the public had a general understanding of its requirements.” Peel, 496 U. S., at 115. In this regard, we stress again the failure of the Board to back up its alleged concern that the designation CFP would mislead rather than inform.
The Board never adverted to the prospect that the public potentially in need of a civil trial specialist, see Peel, supra, is wider, and perhaps less sophisticated, than the public with financial resources warranting the services of a planner. Noteworthy in this connection, “Certified Financial Planner” and “CFP” are well-established, protected federal trademarks that have been described as “the most recognized designation[s] in the planning field.” Financial Planners: Report of Staff of United States Securities and Exchange Commission to the House Committee on Energy and Commerce‘s Subcommittee on Telecommunications and Finance 53 (1988), reprinted in Financial Planners and Investment Advisors, Hearing before the Subcommittee on Consumer Affairs of the Senate Committee on Banking, Housing and Urban Affairs, 100th Cong., 2d Sess., 78 (1988). Approxi-
Ibanez, it bears emphasis, is engaged in the practice of law and so represents her offices to the public. Indeed, she performs work reserved for lawyers but nothing that only CPA‘s may do. See supra, at 139, n. 3. It is therefore significant that her use of the designation CFP is considered in all respects appropriate by the Florida Bar. See Brief for Florida Bar as Amicus Curiae 9-10 (noting that Florida Bar, Rules of Professional Conduct, and particularly Rule 4-7.3, “specifically allo[w] Ibanez to disclose her CPA and CFP credentials [and] contemplate that Ibanez must provide this information to prospective clients (if relevant)“).
Beyond question, this case does not fall within the caveat noted in Peel covering certifications issued by organizations that “had made no inquiry into petitioner‘s fitness,” or had “issued certificates indiscriminately for a price“; statements made in such certifications, “even if true, could be misleading.” 496 U. S., at 102. We have never sustained restrictions on constitutionally protected speech based on a record so bare as the one on which the Board relies here. See Edenfield, 507 U. S., at 771 (striking down Florida ban on CPA solicitation where Board “presents no studies that suggest personal solicitation ... creates the dangers ... the Board claims to fear” nor even “anecdotal evidence ... that validates the Board‘s suppositions“); Zauderer, 471 U. S., at
Accordingly, the judgment of the Florida District Court of Appeal is reversed, and the case is remanded for proceedings not inconsistent with this opinion.
It is so ordered.
JUSTICE O‘CONNOR, with whom THE CHIEF JUSTICE joins, concurring in part and dissenting in part.
Once again, we are confronted with a First Amendment challenge to a state restriction on professional advertising. Petitioner, who has been licensed as an attorney and as a certified public accountant (CPA) by the State of Florida, and who also has been recognized as a “Certified Financial Planner” (CFP) by a private organization, identified herself in telephone listings under the “attorneys” heading as “IBANEZ SILVIA S CPA CFP.” App. 4. Respondent, the Florida Board of Accountancy, determined that petitioner‘s use of both the CPA and the CFP designations was inherently misleading, and sanctioned her for false advertising.
I
Because petitioner‘s use of the CFP designation is both inherently and potentially misleading, I would uphold the Board‘s sanction of petitioner. I therefore respectfully dissent from Parts II-A and II-C of the opinion of the Court.
States may prohibit inherently misleading speech entirely. In re R. M. J., 455 U. S. 191, 203 (1982). In Peel v. Attorney Registration and Disciplinary Comm‘n of Ill., 496 U. S. 91 (1990), we considered an attorney advertisement that proclaimed the lawyer to be a “‘Certified Civil Trial Specialist By the National Board of Trial Advocacy.‘” See id., at 96. A majority of the Court concluded that this statement was not inherently misleading, although the discussion of this issue was joined by only four Justices. See id., at 100-106 (plurality opinion); id., at 111 (Marshall, J., concurring in judgment). The plurality reasoned that the certification was a statement of verifiable fact; that the certification had been conferred by a reputable organization that had applied objectively clear standards to determining the attorney‘s qualifications; and that consumers would not confuse the attorney‘s claim of certification as a specialist with formal state recognition.
Although the Certified Financial Planner Board of Standards, Inc., appears to be a reputable organization that applies objectively clear standards before conferring the CFP designation on accountants, the other factors relied on by the Peel plurality are not present in this case. First, it was important in Peel that “[t]he facts stated on [the attorney‘s] letterhead are true and verifiable.” Id., at 100 (emphasis added); see also id., at 101 (“A lawyer‘s certification by [the recognizing organization] is a verifiable fact, as are the predicate requirements for that certification“). Of course, petitioner‘s recognition as a CFP can be verified-but only if the consumer knows where to call or write. Unlike the advertisement in Peel, petitioner‘s advertisements did not identify the organization that had conferred the certification. The average consumer has no way to verify the accuracy or value of petitioner‘s use of the CFP designation.
Related to this point is the fact that, in the absence of an identified conferring organization, the consumer is likely to
The Board of Accountancy has recognized this likelihood of consumer confusion: “[The term ‘certified‘] in conjunction with the term ‘CPA’ and the practice of public accounting, [is] so close to the terms protected by state licensure itself, that [its] use, when not approved by the Board, inherently mislead[s] the public into believing that state approval and recognition exists.” App. 193-194. For this reason, the Board‘s regulations provide that an advertisement will be deemed misleading if it “[s]tates a form of recognition by any entity other than the Board that uses the ter[m] ‘certified.‘”
B
But even if petitioner‘s use of “certified” was not inherently misleading, it seems clear beyond cavil that some con-
States may not completely ban potentially misleading commercial speech if narrower limitations can ensure that the information is presented in a nonmisleading manner. In re R. M. J., 455 U. S., at 203. But if a professional‘s certification claim has the potential to mislead, the State may “requir[e] a disclaimer about the certifying organization or the standards of a specialty.” Peel, 496 U. S., at 110 (plurality opinion); see also id., at 116-117 (Marshall, J., concurring in judgment); In re R. M. J., 455 U. S., at 203. The Board has done just that: An advertisement that “[s]tates or implies that the licensee has received formal recognition as a specialist in any aspect of the practice of public accounting” will be deemed false or misleading, “unless the statement contains a disclaimer stating that the recognizing agency is not affiliated with or sanctioned by the state or federal government.”
II
Petitioner is a certified public accountant, and her use of the CPA designation in advertising conveyed this truthful information to the public. I agree with the Court that the State of Florida may not prohibit petitioner‘s use of the CPA designation under the circumstances in which this case is presented to us, and I therefore join Part II-B of the Court‘s opinion. I would only point out that it is open to the Board to proceed against petitioner for practicing public accounting in violation of statutory or regulatory standards applicable to Florida accountants. See Brief for Petitioner 28 (“Petitioner is, in fact, a licensee subject to the rules of the Board of Accountancy“). And if petitioner‘s public accounting license is revoked, the State may constitutionally prohibit her from advertising herself as a CPA.