Divided Second Circuit on Compelled Speech and Foreign Affiliates

In its opinion in Alliance for Open Society International v. United States Agency for International Development, the Second Circuit split in its application of the United States Supreme Court's 2013 opinion in the same case.

Recall that United States Agency for International Development v. Alliance for Open Society International involved a First Amendment challenge to a provision of a federal funding statute requiring some (but not other) organizations to have an explicit policy opposing sex work.  In the relative brief opinion by Chief Justice Roberts, the Court held the spending conditions of requiring an "anti-prostitution pledge" were unconstitutional because they were not limits of the government spending program itself that specified the activities that Congress wants to subsidize, but were "conditions that seek to leverage funding to regulate speech outside the contours of the program itself." 

The subsequent litigation revolved around the reach of this holding. For the district judge and the majority of the Second Circuit panel, the holding included the plaintiff organizations and their "foreign affiliates." For dissenting Judge Chester Straub, the "foreign affiliates" possess "no constitutional rights" and the United States government was free to deny them funding for failure to comply with an otherwise unconstitutional condition. For Judge Straub, the majority misconstrued the United States Supreme Court's opinion, extending it to some vague and ill-defined set of "closely aligned" ("whatever that may mean") foreign entities.  But the majority opinion, authored by Judge Barrington Parker, rejoined that it is not the First Amendment rights of the foreign entities that are violated, but the domestic organization's speech that is compelled.  For the majority, if the government — and by extension, the dissenting Judge — "is right, then Chief Justice Roberts was wrong."