“the allegations of direct and implied threats to insurers and financial institutions because of these entities’ links with the NRA … are sufficient to make out plausible First Amendment freedom-of-speech claims.”

The NRA appears likely to get its day in Court against New York Governor Andrew Cuomo and his administration.

We covered the lawsuit and the NRA’s longstanding dispute with Cuomo in May 2018, NRA sues NY Gov. Andrew Cuomo for using financial regulator to “blacklist” NRA:

There is a long history of conflict between the NRA and New York Governor Cuomo relating to New York’s SAFE Act, the extreme gun control bill he signed into law. That legislation had to be partially rewritten because, among other things, it would have exposed police to criminal liability and effectively banned most pistols because of the limitation of magazines to 7 bullets. The SAFE Act is hated and a big electoral issue throughout upstate NY, the vast flyover country north and west of New York City. The SAFE Act has been rejected by the county legislatures in almost every upstate county. The NRA has run ads against Cuomo over the SAFE Act…. According to a lawsuit just filed by the NRA in the U.S. District Court for the Northern District of New York (based in Syracuse), after the Parkland shooting Cuomo enlisted his Department of Financial Services, which is part of the Executive Branch under Cuomo’s control (unlike the Attorney General, which is a separately elected constitutional provision), to “blacklist” the NRA…. The Complaint (pdf.) … summarizes the case in a Preliminary Statement: This case is necessitated by an overt viewpoint-based discrimination campaign against the NRA and the millions of law-abiding gun owners that it represents. Directed by Governor Andrew Cuomo, this campaign involves selective prosecution, backroom exhortations, and public threats with a singular goal – to deprive the NRA and its constituents of their First Amendment right to speak freely about gun-related issues and defend the Second Amendment.

Here is one of the ads the NRA ran against Cuomo in 2014:

Cuomo scoffed at the lawsuit, tweeting:

“If the NRA is suing you, you know you’re doing something right.”

The Defendants filed a motion to dismiss in early July, but before the NRA was required to respond, on July 20, 2018, the NRA filed a First Amended Complaint (pdf.). A Motion to Dismiss (pdf.) was then filed by the NY Attorney General on behalf of the state defendants.

When there was media coverage that Cuomo’s actions along with other activist attacks on the NRA was putting the NRA under financial pressure, Cuomo bragged that he did want to put the NRA out of business, NY Gov. Andrew Cuomo on claim he may put NRA out of business: “I would like to believe it’s true”:

In a press release and tweet, Cuomo made clear his goal is to put the NRA out of business:

I’ve been tracking the motion to dismiss since then, periodically checking the PACER electronic docket. In the mania of the midterms, I missed that on Election Day, November 6, 2018, the Court ruled on the motion to dismiss, granting it in part, and denying it in part. Significantly, the court refused to dismiss the key First Amendment claims asserted by the NRA. The Judge did, however, dismiss tortuous interference, breach of contract and conspiracy claims.

The Court’s Decision and Order (pdf.) is fully embedded at the bottom of this post.

Jacob Sollum at Reason explained the important First Amendment part of the ruling:

Last night a federal judge said the National Rifle Association may proceed with a lawsuit that claims New York Gov. Andrew Cuomo is violating the First Amendment by pressuring banks and insurers to shun the NRA and “similar gun promotion organizations.” U.S. District Judge Thomas McAvoy questioned Cuomo’s claim that his messages about the wisdom and propriety of providing financial services to the NRA amount to nothing but legitimate regulatory oversight and protected government speech. As I explained in my column today, and as McAvoy describes in his decision, there is strong evidence that Cuomo and Maria Vullo, superintendent of the New York State Department of Financial Services (DFS), are in fact threatening banks and insurers that dare to do business with organizations that oppose the governor’s gun control agenda…. “The temporal proximity between the Cuomo Press Release, the Guidance Letters, and the Consent Orders plausibly suggests that the timing was intended to reinforce the message that insurers and financial institutions that do not sever ties with the NRA will be subject to retaliatory action by the state,” McAvoy notes. “The allegations in the Amended Complaint are sufficient to create a plausible inference that the Guidance Letters and Cuomo Press Release, when read together and in the context of the alleged backroom exhortations and the public announcements of the Consent Orders, constituted implicit threats of adverse action against financial institutions and insurers that did not disassociate from the NRA.”

Among the many statements cited by the Court to support maintaining the NRA’s First Amendment claim was an April tweet by Cuomo [Decision, at 8]:

On April 20, 2018, Gov. Cuomo publicly tweeted: “The NRA is an extremist organization. I urge companies in New York State to revisit any ties they have to the NRA and consider their reputations, and responsibility to the public.” Am. Compl. ¶ 51.

The Court summarized the two Counts in the Amended Complaint regarding Cuomo’s attempts to restrict the NRA’s speech [Decision, at 14-15]:

Count One alleges that “Defendants’ actions—including but not limited to the issuance of the April 2018 [Guidance] Letters and the accompanying backroom exhortations, the imposition of the Consent Orders upon Chubb and Lockton, and the issuance of the Cuomo Press Release—established a ‘system of informal censorship’ designed to suppress the NRA’s speech.” Am. Compl. ¶ 75 (quoting Bantam Books, Inc. v. Sullivan, 372 U.S. 58, 71 (1963)). Plaintiff asserts that Defendants took these actions “with the intent to obstruct, chill, deter, and retaliate against the NRA’s core political speech.” Id. ¶76…. * * * Count Two alleges that these same actions by Defendants “were in response to and substantially caused by the NRA’s political speech regarding the right to keep and bear arms. Defendants’ actions were for the purpose of suppressing the NRA’s pro-Second Amendment viewpoint. Defendants undertook such unlawful conduct with the intent to obstruct, chill, deter, and retaliate against the NRA’s core political speech.” Id. ¶ 86…. * * * Because the alleged “censorship campaign” challenged in Count One, and the alleged illegal retaliation asserted in Count Two, are based upon the same conduct, caused the same response from regulated entities doing business with the NRA, and resulted in the same damages, and because the lion’s share of the parties’ First Amendment freedom-of-speech arguments are addressed to both causes of action, see e.g. Def. Mem. L. pp. 17-30; Pl. Mem. L. pp. 6-21; Pl. Mem. L. p. 9 (“Taken together, Defendants’ threatened and actual regulatory reprisals constitute a cohesive censorship-and-retaliation campaign.”), the Court addresses these counts together.

The court ruled that the allegations were sufficient to assert a First Amendment violation [Decision, starting at 16]:

The Guidance Letters and the Cuomo Press Release indisputably are directed at the NRA and similar groups based on their “gun promotion” advocacy. However controversial it may be, “gun promotion” advocacy is core political speech entitled to constitutional protection. The Guidance Letters and Cuomo Press Release’s comments directed to this protected speech provides a sufficient basis to invoke the First Amendment on these claims. Defendants argue that the Guidance Letters and Cuomo Press Release are merely government advocacy protected under the government-speech doctrine. The government speech doctrine provides that the government does not need to be viewpoint-neutral when it chooses to express its own viewpoint on a topic of public interest. Matal v. Tam, 137 S. Ct. 1744, 1758 (2017). But while “the government-speech doctrine is important—indeed, essential—it is a doctrine that is susceptible to dangerous misuse.” Matal, 137 S. Ct. at 1758. If read to allow not only government advocacy, but also government action, it could be used to “silence or muffle the expression of disfavored viewpoints.” Id. For this reason, courts “must exercise great caution” in applying this doctrine. Id. The Guidance Letters and Cuomo Press Release, read in isolation, clearly fit into the government-speech doctrine as they address matters of public importance on which New York State has a significant interest…. Yet Plaintiff does not cite the Guidance Letters and Cuomo Press Release in isolation, but rather contends that these documents, when read in the context in which they were issued, amount to “threats that deliberately invoked DFS’s ‘risk management’ authority to warn of adverse action if institutions failed to support Defendants’ efforts to stifle the NRA’s speech and to retaliate against the NRA based on its viewpoint.” Am. Compl. ¶ 48. For the reasons that follow, the Court finds that Plaintiff has stated plausible First Amendment freedom of speech claims. * * * When Defendants’ statements and alleged conduct is examined in its totality, there are sufficient allegations to state plausible freedom-of-speech claims…. * * * The allegations in the Amended Complaint are sufficient to create a plausible inference that the Guidance Letters and Cuomo Press Release, when read together and in the context of the alleged backroom exhortations and the public announcements of the Consent Orders, constituted implicit threats of adverse action against financial institutions and insurers that did not disassociate from the NRA. * * * In the end, the allegations of direct and implied threats to insurers and financial institutions because of these entities’ links with the NRA, and the allegations of resulting harm to the NRA’s operations, are sufficient to make out plausible First Amendment freedom-of-speech claims. While the NRA may not be able to establish the factual predicates for these claims, it has presented sufficient allegations to allow them to go forward. Accordingly, those portions of Defendants’ motion directed to Counts One and Two are denied.

The Court dismissed Count III, Freedom of Association, though it almost invited an amended, more specific, pleading [Decision, at 33]:

The allegations in the Amended Complaint are, at most, that the Defendants’ actions “make it more difficult” for the NRA “to exercise [its] freedom of association” through NRA activities, but “did not prevent [the NRA] . . . from associating [with its members] nor burden in any significant manner [its] ability to do so.” Fighting Finest, 95 F.3d at 228. This fails to state plausible freedom-of-association claims. Accordingly, Defendants’ motion directed to Count Three is granted. If Plaintiff seeks leave to amend this claim, it should be done through a formal Rule 15 motion….

The Court dismissed Count IV, Equal Protection, to the extent it sought injunctive relief against future enforcement actions, but allowed the Equal Protection claim for money damages to go forward [Decision, starting at 43]

For the reasons discussed above, the Court finds that Plaintiff lacks standing for the injunctive relief requested in paragraph 113. Therefore, Defendants’ motion to dismiss the equal protection selective enforcement claims is granted to the extent Plaintiff seeks an order enjoining Gov. Cuomo, Supt. Vullo, and DFS from requiring Lockton and Chubb to abide by their respective Consent Orders…. Accordingly, Defendants’ motion to dismiss the equal protection selective enforcement claims is granted to the extent Plaintiff seeks an order enjoining Defendants from requiring Lockton and Chubb to abide by their respective Consent Orders, and enjoining Defendants from future New York Insurance Law enforcement actions. The motion is denied to the extent Plaintiff seeks to recover monetary damages for alleged past selective enforcement actions.

This is a big victory for the NRA.

The NRA now gets discovery as to what took place behind the scenes in Cuomo’s effort to punish and destroy the NRA. The facts learned may give rise to a second amended complaint that will restore some of the dismissed claims, or give rise to new claims.

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NRA v. Cuomo – Decision and Order Granting in Part, Denying in Part, Motion to Dismiss by Legal Insurrection on Scribd



