A recent move by the Federal Energy Regulatory Commission to not follow through with a Biden-proposed rule drew strong praise from a non-profit civil rights group.
The New Civil Liberties Alliance had opposed FERC’s 2022 proposed “Duty of Candor” rule which would have required anyone communicating with the commission or its staff about any topic to “submit accurate and factual information and not submit false or misleading information or omit material information.”
The Alliance argued that any speaker could have been penalized unless the Commission determined they had “exercised due diligence” to avoid making a “false” or “misleading” statement. Attorneys for the civil rights group contended the Commission could have decided what speech qualified as false or misleading.
The group also claimed the proposed Rule would have chilled constitutionally protected speech, as honest parties who otherwise might have communicated with the Commission would have faced the threat of punishment for even inadvertent or immaterial mistakes, undermining the very communications the Rule purported to promote.
Compounding the problem, said the NCLA, the Biden-era Commission failed to define or clarify to any meaningful degree what speech (or omission of speech) would qualify as breaking the rule, leaving regulated parties to guess what statements might be sanctioned—a plain violation of due process.
The proposed Rule also would have threatened attorney-client privilege by implicitly requiring lawyers to divulge undefined (and potentially privileged) “material information” in their communications with the Commission or a related authority. The Commission never identified the penalties or procedures to be followed in the case of a violation of the proposed Rule, further depriving the public of any meaningful opportunity to comment on its full implications, as the Administrative Procedure Act requires.
“NCLA commends the Commission for abandoning this dangerously vague and sweeping regulation that threatened to chill core First Amendment rights to speak freely and to petition the government,” stated the organization in response to the FERC’s decision.
The proposed Rule would have expanded an existing, substantially narrower duty of candor applicable only to wholesale electric power sellers, transforming it into a sweeping mandate covering every member of the public. By restricting speech based on its content, the proposed Rule triggered strict scrutiny under the First Amendment, yet the Commission never showed that it was “narrowly tailored to serve compelling state interests.” The government cannot strip speech of First Amendment protection merely by branding it “false” or “misleading.”
NCLA released the following statements:
“FERC’s proposed ‘duty of candor’ rule was a solution in search of a problem, and the cure was far worse than the purported disease. Members of the public have every right to freely discuss energy policy without looking over their shoulders, wondering whether the government will punish them for it.”
— Casey Norman, Litigation Counsel, NCLA
“The proposed duty of candor rule should have been called the ‘chill ordinary Americans from filing comments with a federal agency rule’ because that is what it would have done. Thankfully, NCLA’s comment and promise to sue FERC if this rule were ever promulgated stopped it in its tracks in 2022. NCLA is glad to see the Trump Administration formally scrapping the proposal.”
— Mark Chenoweth, President, NCLA
NCLA is a nonpartisan, nonprofit civil rights group founded by prominent legal scholar Philip Hamburger to protect constitutional freedoms from violations by the Administrative State. NCLA’s public-interest litigation and other pro bono advocacy strive to tame the unlawful power of state and federal agencies and to foster a new civil liberties movement that will help restore Americans’ fundamental rights.