Federal court strikes down NC’s controversial “ag-gag” law

Surprise ruling validates the First Amendment rights of reporters, whistleblowers

In a stunning decision, a federal court judge has struck down North Carolina’s “ag-gag law,” ruling that several of its provisions are unconstitutional and violate the First Amendment.

Passed in 2015, the law was entitled the “Property Protection Act.” It allowed courts to assess civil penalties on employees who took videos or photos of a business’s non-public areas to document alleged wrongdoing, and then passed that information to anyone besides the employer or law enforcement.

While bill supporters argued that it protected businesses from the theft of trade secrets, its underlying intent was to thwart animal rights activists from getting hired at farms and research labs and then conducting undercover investigations.

However, the law was broad enough that it could have applied to any employee. For example:

• Law enforcement officers who documented abuses by fellow officers — but didn’t have faith in their supervisors to act — could have also been penalized had that information been passed to outside parties.
• Workers at nursing homes or meatpacking plants who wanted to document sanitation practices during COVID-19 and pass the photos or video to the media could have been penalized.

“Workers in the meat industry are heaving a big sigh of relief,” said David Muraskin, an attorney with Public Justice, which co-represented the plaintiffs. “For those workers who want to come forward, this is a good opinion to protect them.”

Reporters who asked workers to document alleged offenses were also subject to the law.

The civil penalties were steep: up to $5,000 per day, plus attorney’s fees.

Chief Justice Thomas Schroeder of the Middle District Court of North Carolina issued his 73-page decision late Friday.

There were several plaintiffs, including Farm Forward, PETA, Food and Water Watch and the ASPCA. The defendants were the State of North Carolina, represented by Attorney General Josh Stein, UNC-Chapel Hill and the NC Farm Bureau Federation, which had intervened in the case on behalf of the defense.

“It’s great win for the people of North Carolina,” said Jeremy Williams, an attorney with Whitfield Bryson in Raleigh, one of the firms representing the plaintiffs.

Laura Brewer, spokeswoman for the state Attorney General, said Stein’s office is reviewing the decision.

Two attorneys representing the Farm Bureau did not return messages seeking comment.

The plaintiffs had argued that the law had a chilling effect on their investigations. PETA, for example, had planned to conduct an undercover probe of UNC-Chapel Hill’s animal research facilities, but “has refrained from doing so out of fear,” according to court documents.

The ruling hinged on what activity the ag-gag law was targeting: trespassing or speech, in this case defined as the capturing and dissemination of the information.  Schroeder wrote that the law as enacted, “will always target speech and speech will always be the activity that triggers the liability” of the $5,000 daily civil penalty.

Nor did the defense show that it considered less intrusive ways of protecting private property, Schroeder wrote.

The North Carolina measure is modeled on legislation — the Animal and Ecological Terrorism Act — drafted in 2003 by the American Legislative Exchange Council.

ALEC has been widely derided as a “bill mill” and is funded largely by the conservative Koch Brothers and major corporations, such as ExxonMobil, Pfizer and Anheuser-Busch.

ALEC writes legislation that states can then adopt or amend. North Carolina’s law is similar to measures passed by state legislatures in Kansas, Iowa, Idaho, Wyoming and Utah. The courts have struck those down, ruling they are unconstitutional. (Arkansas lawmakers are considering an ag-gag bill that mirrors North Carolina’s.)

State and federal lawmakers can also join ALEC or attend its events. Of the North Carolina bill’s 18 co-sponsors in the House, four had ties to ALEC, including primary sponsor Rep. John Szoka of Cumberland County.

During a House debate on June 3, 2015, Szoka justified the bill by citing the ability of whistleblowers to take the information to “the proper authorities.”

“I think we can all agree the proper authorities are law enforcement and state and federal regulatory agencies and not the media and not special private interest organizations,” Szoka said.

But there are thousands of cases — including in health care, criminal justice, the environment, labor, politics and  government spending — in which investigative reporters and private groups have uncovered wrongdoing that “the proper authorities” had long ignored, dismissed or covered up outright.

During a House debate on April 22, 2015, Szoka claimed that weak private property laws prompted the bill. However, there are already multiple laws that criminalize trespass and the theft of trade secrets. And an employee who violated the law’s “duty of loyalty” for example, by stealing from a cash register could be fired and prosecuted under existing law.

Szoka and other bill sponsors also argued that whistleblower protections would shield government employees. However, such employee protections are weak, especially for private-sector workers, and can take years to litigate.

“We’re talking about employees and whistleblowers, and these are important things,” said Rep. Chuck McGrady, a Republican from Henderson. “but for me the property rights issue trumps the arguments on the other side.”

North Carolina’s law differed from other ag-gag statutes in that it assessed civil penalties, not criminal ones. “The thought [by ALEC] was by making the penalty civil and not criminal, it would keep the law on the books,” said David Muraskin, attorney with Public Justice, which also represented the plaintiffs.

That distinction was supposed to shield the law from First Amendment challenges because civil penalties aren’t “punishment.”

“But we argued that civil penalties,” especially those in the thousands of dollars, are even more chilling,” Muraskin said.

ALEC and state legislatures tried to sidestep constitutional challenges by broadening the targets beyond agriculture. During the April 2015 House debate Rep. Jimmy Dixon, a farmer and Republican from Duplin County, said agriculture “does not have anything to hide.  … The agriculture community is interested in our consumers knowing the truth, the whole truth and nothing but the truth.”

(This year, Dixon supported the Farm Bill, including a provision that makes confidential many documents related to hog farms that were previously public.)

Lawmakers also overrode then-Gov. Pat McCrory’s veto. In his veto message, McCrory echoed some of the points later argued by the plaintiffs, writing that “it does not adequately protect or give clear guidance to honest employees who uncover criminal activity. I am concerned subjecting these employees to potential civil penalties will create an environment that discourages them from reporting illegal activities.”

The law was challenged soon after the General Assembly passed it in a bipartisan vote in June 2015.

Schroeder originally dismissed the case, and sided with the defense, which argued and that their fears are “purely hypothetical, speculative, and conjectural, and do not rise to an injury-in-fact.” Schroeder ruled that the plaintiffs didn’t have standing because since they had yet launch an undercover investigation, they had yet to be penalized.

The plaintiffs appealed and won at the Fourth Circuit Court, which ruled they had a “reasonable apprehension of prosecution,” and sent the case back to the district level.

If the defendants appeal, the case will return to the Fourth Circuit.

Several media organizations also filed briefs supporting the plaintiffs, including the NC Press Association and the Society of Professional Journalists. Policy Watch is a member of the NCPA; Lisa Sorg is an SPJ member.