Yellow Pages vs. San Francisco: Excerpts from the Complaint

I was given a copy of the Local Search Assn’s lawsuit complaint against San Francisco over the “opt-in” print yellow pages ordinance. Yesterday I incorrectly tweeted that the ADP was part of the litigation; it is not, merely “supportive” of the action.

The main legal theories plead in the complaint are violations of the First and Fourteenth Amendments (Free Speech, Equal Protection) under the US and CA Constitutions. Another theory is that the City of San Francisco doesn’t have the authority to regulate activity that implicates the US Postal Service and delivery of the mail.

The free speech argument is obvious: restricting delivery of print directories burdens speech by publishers. (As an aside the notion that non-human corporations should have the same constitutional rights as humans is absurd but that was established long ago.) The Equal Protection argument asserts that print yellow pages are being irrationally and unfairly singled out in the ordinance and that print directories are no different than newspapers or other printed forms of advertising (i.e., FSIs/circulars) not being regulated:

The distinctions drawn by the Ordinance as to who may deliver unsolicited communications and who may not are irrational, arbitrary, and invidious in violation of the Equal Protection Clause of the Fourteenth Amendment. As a practical matter there is little or no meaningful distinction between speech delivered in the form of a bound volume—as prohibited by the Ordinance—and speech delivered in the form of a newspaper or advertising circulars, which the Ordinance allows . . .

Below are some interesting factual statements and excerpts from the complaint:

Although those persons may use the directories only a few times a year, for those tasks—finding a doctor, a lawyer, or a 24-hour plumber—the headings, concise business information, and local emphasis of the Yellow Pages provide benefits not provided by other media . . .

Some of this information is essential to the exercise of basic civil rights, including the comprehensive listings that provide access to all levels of government, to attorneys, to religious services, and to constitutionally protected reproductive medical services . . .

Although the Ordinance is not set to take effect until May 2012, news of its passage has already adversely affected sales of Yellow Pages advertising, and continues to do so with each passing day . . . Recognizing the imminent need to transfer their advertising expenditures to other advertising media, advertisers are reluctant to purchase advertising for the upcoming publication cycles, which may be the last with nearly universal distribution. The lost confidence in the continued coverage—and in the continued existence—of Yellow Pages directories constitutes an irreparable harm that is reflected not only in lost current and future sales but in the loss of customers who may never return.

Once the Ordinance is in effect, Yellow Pages publishers expect to lose millions of dollars in annual revenues.

San Francisco invites its poorest, oldest, and least English-proficient customers to surf the Internet on their iPads rather than thumbing through free phone books. That choice is not the City’s to make . . .

Because other local media cost about 2-5 times more per buyer influenced, San Francisco advertisers would have to spend between $22.8 million and $57 million annually to reach the same number of potential customers, numbers that can only increase with the government-forced exit of low-cost competition from Yellow Pages directories.

(emphasis mine.)

I do find many of the arguments in the complaint persuasive, including the arguments that not all communities and people can readily replace directories with the Internet. Yet I don’t have any sense of how viable the legal theories are.

My gut instinct is that the LSA will ultimately prevail if not at the US District (federal) Court level then on appeal. We’ll see however. It’s a major case for the industry because, as I’ve said before, if it stands other cities will copy it.