Jonathan Adler weighs in:
In an opinion by Judge Raymond Randolph (joined by Judge David Sentelle), the court concluded that compelled disclosures of commercial information are subject to the same level of First Amendment scrutiny as are other regulations of commercial speech (under the Central Hudson test), unless the disclosures are limited to “purely factual and uncontroversial information” and the mandatory disclosure is “reasonably related to the State’s interest in preventing deception of consumers.”
Because, as the SEC conceded, the conflict mineral disclosure requirements have nothing to do with preventing consumer deception, the court concluded the rules should be evaluated under Central Hudson. Under this test, the requirements must serve a substantial government interest, directly advance that interest, and be narrowly tailored. Whether or not the SEC could demonstrate that its conflict mineral disclosure rule satisfies a substantial government interest, the court found the SEC offered no evidence that its rule was narrowly tailored. On this basis the court struck down the requirement that companies declare that products “have not been found to be ‘DRC conflict free.’” Insofar as Dodd-Frank requires other disclosures, including reports to the SEC, such requirements were upheld.
Go read the whole thing.