Free Speech Suit Against CFTC Has First Hearing, Publishers & Readers Try To Stop Licensing of Speech

John Kramer
John Kramer · March 11, 1998

Washington, D.C.-A battle over free speech in print, computer software and over the Internet will get its first court hearing on Thursday, March 12, 1998, in federal court in Washington, D.C.

The Commodity Futures Trading Commission (CFTC), the federal agency charged with regulating the commodity markets in the U.S., has sought to require anyone who publishes for compensation information or advice about commodity trading to “register” with the federal government. Selling a book or a piece of software or charging a newsletter subscription fee forces the publisher to register.

Represented by the Washington, D.C.-based Institute for Justice, a group of small newsletter publishers, software developers and Internet providers-and their readers-are challenging the CFTC’s campaign to license free speech. They filed their First Amendment challenge in U.S. District Court for the District of Columbia on July 30, 1997. The first hearing in that case will take place on March 12 at 10:30 a.m. in U.S. District Court, Courtroom #12-Fourth Floor before Judge Ricardo M. Urbina. The courthouse is located at Third Street & Constitution Ave., NW, in Washington D.C.

Two organizations-the Reporters Committee for Freedom of the Press and the Financial Publishers Association-have petitioned the court to file amicus curiae briefs in support of the publishers and consumers in this case.

“The CFTC’s registration scheme does not entail merely listing one’s name with the government,” said Scott Bullock, an attorney at the Institute for Justice, which represents ten publishers of and subscribers to commodity publications. “Registration is akin to licensing and would require publishers to, among other impositions, be fingerprinted, have a background check conducted on them, pay fees, be subject to on-demand audits and provide a list to the government of everyone who receives their information. Publishing without registration subjects one to fines of up to $500,000 and imprisonment of five years in jail-a felony offense.”

“Under the First Amendment, one needn’t receive permission from the government to publish his or her opinions, whether about buying car stereos or commodities,” Bullock said. “This case will ultimately determine who controls the flow of financial investment information: consumers and publishers-or the federal government.”

“The plaintiffs in this case do not invest customer funds nor do they give person-to-person trading advice,” Bullock stressed. “They only publish information and offer non-personal advice to their subscribers, yet the CFTC would require them to be licensed before they could speak.”

“If the CFTC has its way, it will patrol and regulate not only traditional publications and computer software but the Internet as well,” Bullock pointed out. “The CFTC has a proposal pending that would require registration of virtually anyone who writes about commodities on the Net, including those who establish web pages, links and user groups that discuss commodity trading.”

The CFTC seeks to have the plaintiffs’ suit dismissed, claiming that the court should not hear the case because these particular publishers have not yet been prosecuted. However, the CFTC ignores the chilling effect that its campaign has had on the free flow of information.

To assist those seeking more information on this lawsuit and the CFTC’s proposed Internet rules, the Institute has created a special homepage at

The Institute for Justice is a libertarian public interest law firm. Through strategic litigation, training, communications and outreach, the Institute for Justice advances a rule of law under which individuals can control their own destinies as free and responsible members of society. It litigates to secure economic liberty, school choice, private property rights, freedom of speech, and other vital individual liberties, and to restore constitutional limits on the power of government. Through these activities the Institute challenges the ideology of the welfare state and illustrate and extend the benefits of freedom to those whose full enjoyment of liberty is denied by government. The Institute was founded in September 1991 by William Mellor and Clint Bolick.