The Issue in a Nutshell:

Susan Roberts is an interior designer, but the state of Connecticut will not allow her to tell anyone that.  This is because Connecticut has a law that allows anyone to perform interior design services, but dictates that only those with government-issued licenses may call themselves “interior designers.”  Besides unconstitutionally censoring truthful commercial speech, “titling laws” like Connecticut’s serve as precursors to full-blown occupational licensure, which is the ultimate goal of a small faction within the interior design industry led by the American Society of Interior Designers (ASID).  

In November 2007, the Institute for Justice (IJ) released an updated case study, Designing Cartels, which documents a long-running campaign by ASID and its affiliates to increase regulation of interior designers in order to thwart competition and impose a one-size-fits-all set of credentials for the entire interior design industry.  Not surprisingly, the nationwide push for more regulation of interior designers has come not from the public or the government, but from a small cartel of industry insiders seeking government protection from competition.

 

Only three other states besides Connecticut license the use of the term “interior designer” without regulating the work itself.  The anti-competitive intent behind such title acts is clear:  anyone who goes looking for an “interior designer” on the Internet or in the Yellow Pages in those states will find only government-licensed cartel members, while overlooking scores of capable designers like Susan Roberts.

On September 9, 2008, the Institute for Justice, a national public interest law firm that defends free speech and the rights of entrepreneurs, filed suit in the U.S. District Court for the District of Connecticut in Hartford on behalf of three entrepreneurs challenging Connecticut’s “titling” law as a violation of free speech rights protected by the First Amendment.

Americans’ right to freely express themselves certainly includes the right to provide truthful information to potential customers and clients.  That right, enshrined in the First Amendment, cannot simply be brushed aside by states seeking to promote the anti-competitive interests of the interior design cartel.  Simply put, IJ’s lawsuit will demonstrate that the First Amendment is more than mere window dressing when it comes to interior designers.

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Introduction

 

Only Connecticut and three other states[2] license the term “interior designer” but not the practice of interior design, thereby granting certain favored members in the industry a monopoly on the use of that term in their business names, their advertising, their websites and so on.  The competitive advantages of such a speech monopoly are obvious:  anyone who goes looking for an “interior designer” on the Internet or in the Yellow Pages in Connecticut will find only government-licensed cartel members, while overlooking scores of highly capable designers who do not meet the state’s arbitrary requirements.

Thankfully, however, the Constitution does not allow such licensing of speech.  In a free nation like ours, the government has no business censoring truthful commercial speech the way Connecticut does.

Adding insult to injury, Connecticut’s interior design speech ban creates a degrading barrier to entry for entrepreneurs seeking their own piece of the American Dream.  Connecticut’s law relegates them to the status of second-class citizens—all to advance the anti-competitive agenda of a small faction within the interior design community.  Even worse, that same faction seeks to put those who refuse to bow to licensing demands out of business altogether by transforming Connecticut’s blatantly unconstitutional “title act” into an even more restrictive “practice act” that would dictate not only who may call themselves an interior designer, but who may work as one.[3]

Given this threat to the livelihoods of hundreds or even thousands of hard-working small businesspeople in Connecticut, the time is ripe for action.  That is why, on September 9, 2008, the Institute for Justice challenged Connecticut’s interior design censorship law as a violation of free speech rights protected by the First Amendment to the U.S. Constitution.

Interior Design Cartel Scores Early Success in Connecticut, Moves on to Other States

ASID’s attempt to cartelize the interior design industry began nearly thirty years ago with an unsuccessful push for a practice act in New York in 1979.[4]  Setting their sights lower, both substantively and geographically, members of the design cartel scored their first success with a title act in Alabama in 1982.[5]  Connecticut came next, imposing its title act in 1983.  Since then, twenty-two states have enacted some sort of interior design regulation, usually in the form of title acts that regulate the terms “licensed interior designer,” “registered interior designer,” or “certified interior designer”—rather than just “interior designer,” the way Connecticut does.[6]    

It is no accident that the push for regulation of interior designers has come from a small faction within the design industry itself, rather than citizens or politicians.  Because industry insiders who entered a field first benefit from decreased competition, they are often the ones pushing for increased regulation.  More and more occupations are falling under government regulation; in the early 1950s only about five percent of all occupations were subject to state-level licensing, but now about 20 percent of the workforce is subject to licensing requirements.[7]

The national trend towards greater regulation stands in sharp contrast to America’s entrepreneurial spirit and heritage, which recognize that citizens have the right to earn an honest living free from excessive or unreasonable government interference.[8]  The most common interference with this right occurs when newcomers to a vocation are required to secure permission from the government in the form of a license before they may work in their chosen field.  Oftentimes, these licensing schemes serve no genuine public purpose whatsoever; instead, they serve as barriers to entry into occupations to protect industry incumbents from competition.

In a case study released by the Institute for Justice in 2006 and updated in November 2007 titled, Designing Cartels:  How Industry Insiders Cut Out Competition, researcher Dick Carpenter documented a long-running campaign by the American Society of Interior Designers (ASID) to increase regulation of the interior design industry in order to “increase the stature of the industry” and put would-be competitors out of business.[9]  Carpenter’s meticulous research documented that the nationwide push for more regulation of interior designers has come not from the public or the government, but from members of the industry itself.  According to a detailed history in the trade journal Architecture, a small faction within the design industry, led by the American Society of Interior Designers, began lobbying legislatures in the late 1970s for restrictions on who could work as an interior designer.[10]  Those efforts were motivated by a desire to establish interior design as a profession that is distinct from and not subordinate to architects, and to suppress competition within the interior design industry by erecting substantial barriers to entry.

ASID views titling laws like the one in Connecticut as merely a first step, with the ultimate goal being a full-fledged practice restriction that dictates who may and may not work as an interior designer.[11]  Despite its zealous pursuit of additional licensing laws around the country, the ASID-led pro-regulation faction has thus far met with very limited success, particularly regarding “practice acts.”  Only three states—Florida, Louisiana and Nevada (plus the District of Columbia)—regulate who may perform interior design work, and those laws contain various gaps and loopholes.[12]  Florida, for example, exempts residential work, while other states exempt interior design work that does not implicate building codes or bona fide health and safety concerns.

The pro-regulation contingent’s lack of success nationally is due in large part to their consistent failure to produce any credible evidence of public harm resulting from the unregulated practice of interior design despite multiple opportunities (and strong incentives) to produce such evidence.  For example, in October 2000, Colorado’s Department of Regulatory Agencies conducted an exhaustive “sunrise review” in connection with a proposal to begin regulating interior designers.  As explained in the report, despite being given the opportunity, proponents of the regulation submitted no information “demonstrating that harm to the public has occurred, or that the public was endangered . . . from the unregulated practice of interior design.”[13]  The Department concluded that it was “difficult to see a benefit to the public in regulating interior designers.”[14]  At least eight additional states have reached the same conclusion in rejecting efforts by ASID and others to enact protectionist legislation designed to eliminate competition and maintain high barriers to entry into the interior design field.[15]

For the moment, anyone may perform interior design work in Connecticut, but the only people who are allowed to call themselves “interior designers” are those who have registered with the State Department of Consumer Protection, which is responsible for enforcing the title act.  The goals of the lawsuit filed by the Institute for Justice on behalf of three Connecticut interior design entrepreneurs are not only to strike down the current law, which bans the truthful exchange of information between interior designers and consumers, but also to prevent the pro-regulation cartel from taking the next step toward full-blown occupational licensure, as it has in several other states.

The Plaintiffs—Forbidden to Speak Truthfully

Susan Roberts knows firsthand what it is like to be censored by government officials determined to prevent her from advertising herself—accurately— as an interior designer.  After her first career as a bookkeeper for a variety of small businesses, Susan began taking classes at the Connecticut Institute of Art and Design.  It was supposed to be a two-year program, but Susan needed to make money to support her family, so she opened an antique store and interior design shop called the “Idea Factory” on Main Street in Old Saybrook.  Her business thrived, and Susan found herself doing interior design projects for residences, medical offices, hospitals and other businesses.   

It seems that Susan’s success as an interior designer may have made others jealous because in 1988, she received a visit from a representative of the Department of Consumer Protection, the agency that enforces Connecticut’s interior design title act.  Based on the timing, Susan believes that visit was most likely prompted by a complaint from a competitor who did not appreciate how successful her business had become.  Susan remembers that the woman from the Department of Consumer Protection threatened to shut down the Idea Factory if Susan did not stop using the words “interior designer” to identify herself and advertise her business.  With no choice but to submit, Susan stopped describing herself as an “interior designer,” and instead changed her business card to read: “Susan Roberts—Designer,” which appears to have satisfied the bureaucrats at the Department of Consumer Protection.  Susan felt violated by this act of censorship, which prohibited her from calling herself an interior designer even though she actually is an interior designer and performs all manner of interior design work, including residential spaces, commercial work, space plans, lighting plans, furniture and finish selection, etc.  She wants to make sure that the same thing does not happen to other hard-working entrepreneurs in Connecticut who perform interior design work but are forbidden by the state’s arbitrary and unconstitutional titling act from truthfully advertising their businesses to potential customers.

Lynne Herrmann is a working mother of three and grandmother who decided she wanted a change of pace from the high-pressure, high-turnover world of computer consulting and management, where she had risen to vice president of a computer software company.  Lynne comes from a long line of self-employed entrepreneurs and small businesspeople in Georgia, including a grandmother who ran a hotel.  She considers it the right of every citizen to pursue their own version of the American Dream through hard work, vision and—most importantly for this case—freedom from arbitrary and unreasonable government regulation. 

When she decided to get out of computer consulting, Lynne returned to her passion for decorating—something she had as a young woman.  She considered a variety of alternatives, but ultimately decided to open her own Decorating Den franchise in Newtown, Connecticut. Running her own business has not been easy; indeed, Lynne sometimes puts in 80 to 90 hours, seven days a week.  Still, Lynne loves the freedom and creativity that come with running her own interior design business, and she is following her American Dream.  But Lynne’s interior design business is significantly hampered by Connecticut’s titling law, which prevents her from describing herself—truthfully—as an “interior designer” in the Yellow Pages and on the Internet.  Lynne considers Connecticut’s title act particularly outrageous because in four years she has never been asked by any customer about her educational background or credentials; instead, customers want to see her portfolio and a list of references.  Lynne thinks it is extremely unjust that a handful of industry insiders have the power to prevent her from choosing how to advertise her services and from competing with them for the same business on a level playing field.   

Cynthia Hernandez, who goes by Cindy, is a Connecticut native with an MBA who spent most of her career working as a computer scientist in the reinsurance field.  With her son approaching school age, Cindy asked herself what she would really like to do for a living and decided that her lifelong interest in interior design—with its creativity, opportunities for entrepreneurship and emphasis on personal relationships—would perfectly suit her talents and interests. After researching various opportunities in the interior design industry, Cindy decided to open an Interiors by Decorating Den franchise.  Obtaining the franchise was not easy, and involved taking a round of aptitude tests (which she aced), and several weeks of rigorous hands-on training at Decorating Den’s headquarters in Maryland, with extensive follow-up study at home. Cindy’s interior design business, “Ideal Interiors,” focuses exclusively on residential services, featuring comprehensive space-planning that includes everything from brainstorming about how to use a space to furniture and finish selection. Cindy makes no bones about the fact that she considers herself to be a full-fledged “interior designer” and not merely an “interior decorator,” which is a term often used as a pejorative by members of the pro-regulation cartel.  Cindy believes she has a right to truthfully describe herself as an interior designer, and she believes she would be much more effective in advertising her business if not for Connecticut’s unconstitutional title act that forbids her from doing so.

Getting a License to Speak in Connecticut

Connecticut’s speech-licensing requirements for interior designers are not easy to meet.  First, a designer must apply for permission to take a government-mandated exam administered not by the state, but by a private, national credentialing body called the National Council for Interior Design Qualification (NCIDQ).  Not just anyone, however, may take the NCIDQ exam.  Just to sit for the exam, NCIDQ requires people to have six years combined college-level interior design education and work experience.[16]  NCIDQ require a minimum of two years of college-level education and a minimum of six months work experience under a licensed interior designer as part of that six-year combined total.[17]

And, by deliberate design, the education/experience requirement is becoming increasingly difficult to meet.  For instance, applicants who begin acquiring work experience after January 1, 2008, will have to gain all work experience under the direct supervision of someone already holding an NCIDQ Certificate.[18]  According to ASID, “[b]y the end of the decade, NCIDQ will require the Interior Design Experience Program”—the term for NCIDQ’s own internship program—“for all examination candidates.”[19]  So, within the next few years, applicants for the NCIDQ exam will not even have the individual choice of how best to get the required work experience that will be relevant to their future careers.

The exam and application process is expensive and time consuming.  The cost of the exam alone can reach about $1,000, and it takes two days to finish.[20]  If an aspiring designer passes the NCIDQ exam, he or she may then apply to the Commissioner of the Connecticut Department of Consumer Protection to register as an interior designer, but that requires an additional $150 fee,[21] which must be paid annually.[22]  All that just so people who lawfully practice interior design can get permission from the state to advertise themselves, truthfully, as “interior designers.”

Legal Challenge

The Institute for Justice’s legal challenge is straightforward:  prohibiting people from truthfully describing what they do—interior design—violates their First Amendment right to free expression.  With very narrow exceptions, all types of speech are protected by the Constitution, including so-called “commercial speech” that “does no more than propose a commercial transaction.”[23]  Thus, to regulate commercial advertising, like advertising oneself as an interior designer, the government must have a substantial reason for restricting speech.  Any limits must be carefully designed to actually achieve the government’s objectives while imposing only the narrowest infringement on speech.[24]

Connecticut’s titling law for interior designers falls woefully short of those stringent legal standards.  Instead of advancing any bona fide public purpose, titling laws are merely the first step in a carefully crafted strategy to suppress competition within the interior design industry.  As noted above, many other states have rejected similar efforts due in large part to the complete lack of evidence that there is any public harm from the unregulated practice of interior design.

Besides establishing a substantial government interest in censoring truthful speech by unlicensed interior designers—which it cannot do because no such interest exists—Connecticut will have to prove that its titling act directly advances the state’s asserted goals, whatever those might be, in a manner that is no broader than necessary to achieve them.  Connecticut will not be able to demonstrate that because there is simply no threat to the public from truthful communications from and advertising by interior designers—whether or not they hold a license to speak from the state of Connecticut.

Americans’ right to freely express themselves most certainly includes the right to truthfully provide information to potential customers and clients.  That right, enshrined in the First Amendment to the U.S. Constitution, cannot simply be brushed aside by states seeking to promote the anti-competitive agenda of the interior design cartel.  Simply put, this lawsuit will demonstrate that the First Amendment is more than mere window dressing when it comes to interior designers.

The Defendant

The defendant in this case is the Commissioner of the Connecticut Department of Consumer Protection, Jerry Farrell Jr., who is being sued in his official capacity.  The Department of Consumer Protection, located in Hartford, is responsible for registration and regulation of interior designers in Connecticut.

IJ:  A History of Protecting Free Speech & Economic Liberty

Founded in 1991, the Institute for Justice (IJ) has represented entrepreneurs nationwide who successfully fought arbitrary government regulation, opening up long-closed markets and securing free speech rights.  These include:

• Franzoy v. Templeman, et al.—The Institute for Justice represented two interior designers in challenging New Mexico’s titling law, which was nearly identical to Connecticut’s current law.  Rather than attempt to defend its blatantly unconstitutional speech restrictions, the New Mexico Interior Design Board chose to seek an amendment to the law through the legislative process, which the governor signed in April 2007.
• Swedenburg v. Kelly[25]—Representing Virginia and California vintners as well as New York wine consumers, the Institute for Justice persuaded the U.S. Supreme Court to declare unconstitutional New York State’s laws that barred the interstate direct shipment of wine to New York consumers.  IJ also persuaded the 2^nd U.S. Circuit of Court of Appeals to enforce the First Amendment by striking down a prohibition on advertisements and solicitation for alcoholic beverages by anyone other than licensed retailers.
• Taucher v. Born[26]—The Institute for Justice persuaded the U.S. District Court for the District of Columbia to enforce the First Amendment by striking down a regulation issued by the Commodity Futures Trading Commission that would have required publishers of financial newsletters and Internet websites to register as commodity trading advisors.
• Crockett v. Minnesota Department of Public Safety—The Institute for Justice Minnesota Chapter entered into a consent judgment with the U.S. District Court for the State of Minnesota that dictated the state could not constitutionally enforce a law that forbade wineries across the country from accepting online orders from Minnesotans.  The state also conceded that it could not constitutionally prohibit wineries from truthfully advertising or soliciting the direct sale and shipment of wine, and that it could not constitutionally discriminate between in-state and out-of-state wineries (or between wineries and liquor stores) when they exercise their First Amendment rights to communicate with Minnesota consumers.
• ForSaleByOwner.com Corp. v. Zinnemann[27]—The Institute for Justice persuaded the U.S. District Court for the Eastern District of California to enforce the First Amendment and strike down the State of California’s attempt to impose real estate broker licensing requirements on an informational website.
• Wexler v. City of New Orleans[28]—The Institute for Justice persuaded the U.S. District Court for the Eastern District of Louisiana to enforce the First Amendment by striking down an ordinance that prohibited booksellers from selling books on city sidewalks without a permit.
• Battaglieri v. Mackinac Center For Public Policy[29]—The Institute for Justice successfully defended on First Amendment grounds an invasion of privacy claim against a public policy research institute that accurately quoted a representative of the Michigan Educational Association in a letter to supporters.

• Rissmiller v. Arizona Structural Pest Control Commission­—The Institute’s Arizona Chapter filed suit in 2005 challenging the Structural Pest Control Commission’s requirement that gardeners and landscapers providing weed control services must first demonstrate 3,000 hours of experience spraying weeds.  As a result of the lawsuit, the Arizona Legislature passed, and the governor signed into law on May 8, 2006, an exemption for providers of weed control services using products available to the general public over the counter.

• Anderson v. Minnesota Board of Barber and Cosmetology Examiners—Filed in 2005 in the Hennepin County District Court, this case challenged Minnesota’s cosmetology regulations, which required African hairbraiders to enroll in 1,550 hours of government-mandated “training,” none of which included even one hour of instruction in braiding.  As a result of IJ’s litigation, hairbraiders in the state may now practice without obtaining a license.

• Armstrong v. Lunsford—Filed in 2004 in the U.S. District Court for the Southern District of Mississippi, this case challenged Mississippi’s cosmetology regulations, which barred braiders from practicing their craft.  Prior to receiving a ruling from the court, the Mississippi Legislature exempted braiders from the cosmetology licensing requirement in 2005.  This result allows IJ’s client to continue to practice without obtaining an irrelevant license.

• Diaw v. Washington State Cosmetology, Barbering, Esthetics, and Manicuring Advisory Board—After IJ’s Washington Chapter filed suit against Washington State’s Department of Licensing, the Department filed an “Interpretative Statement” exempting braiders from the state’s cosmetology licensing requirements.

• Christian Alf v. Arizona Structural Pest Control Commission—In 2004, based on the Institute for Justice Arizona Chapter’s work in the court of public opinion, the Commission changed its position on requiring teenage entrepreneur Christian Alf to obtain a license for his after-school handyman business helping local residents prevent roof rats.
• Farmer v. Arizona Board of Cosmetology—In 2004, as a result of a lawsuit brought by the Arizona Chapter of the Institute for Justice, the Arizona Legislature exempted hairbraiders from the state’s outdated cosmetology scheme.
• Craigmiles v. Giles[30]—This IJ suit led a federal court to strike down Tennessee’s casket-sales licensing scheme as unconstitutional, a decision that was upheld unanimously by the U.S. 6^th Circuit Court of Appeals and not appealed.  This marked the first federal appeals court victory for economic liberty since the New Deal.
• Clutter v. Transportation Services Authority—In 2001, IJ defeated Nevada’s Transportation Services Authority and its entrenched limousine cartel that had stifled competition in the Las Vegas limousine market.
• Ricketts v. City of New York—In 1999, IJ helped commuter vans fight a public bus monopoly that would not allow vans to provide their service in underserved metropolitan neighborhoods in New York City.
• Cornwell v. California Board of Barbering and Cosmetology[31]—In 1999, IJ defeated California’s arbitrary cosmetology licensing requirement for African braiders.
• Jones v. Temmer—In 1995, IJ helped three entrepreneurs overcome Colorado’s protectionist taxicab monopoly to open Denver’s first new cab company in nearly 50 years.  IJ also helped break open government-sanctioned taxicab monopolies in Indianapolis and Cincinnati.
• Uqdah v. D.C. Board of Cosmetology—In 1993, IJ’s work in court and the court of public opinion led the District of Columbia to eliminate a 1938 Jim Crow-era licensing law against African hairbraiders.

The Litigation Team

The lead attorney in this case is Institute for Justice Senior Attorney Clark Neily, who litigates First Amendment, economic liberty and school choice cases throughout the nation.  Most recently, Neily worked to free interior designers in New Mexico from that state’s titling law, allowing all designers in New Mexico to now truthfully advertise their services, and he is also leading the Institute’s ongoing challenge to Texas’ interior design title act.  Neily will be joined in the litigation by Jennifer Perkins, staff attorney at the Institute for Justice’s Arizona Chapter in Phoenix, Arizona.  Perkins litigates First Amendment and economic liberty cases in Arizona and other nearby states.  Assisting the Institute for Justice as local counsel is Scott Sawyer, of the Sawyer Law Firm, in New London.

For more information contact:

Bob Ewing
Assistant Director of Communications
Institute for Justice
901 N. Glebe Rd., Suite 900
Arlington, VA  22203
(703) 682-9320 office
(202) 494-2567 mobile
bewing@ij.org