Private Business/Enterprises

First Amendment Private Membership Associations

Background: Although not explicitly defined in the Constitution, the Supreme Court has recognized that certain implicit rights, such as association, privacy, and presumed innocence, share constitutional protection with explicit guarantees like free speech. The right to associate has been deemed inseparable from the right to free speech. During the 1950s and 1960s, the right of association under the Constitution underwent significant litigation, and the Court consistently upheld members' rights. This right became a cornerstone of the civil rights movement. Generally, members of an association are not subject to the jurisdiction of local, state, and federal governments and their corresponding laws, except when the association's activities pose a clear and present danger of substantive evil.

One interesting example of utilizing the right to associate to circumvent local laws is seen in drinking clubs. In certain states like Texas, where alcohol sales are restricted in some counties, joining a drinking club allows members to sell alcohol to each other despite local prohibitions. The right to associate is not limited to social or political activities; it can also be used for business purposes, such as the sale of alcohol. Members of private membership associations enjoy the right to private contracts under the due process liberty clause of the 5th and 14th Amendments, and states cannot pass laws that undermine the obligation of such contracts.

Legal Foundation: To understand the legal foundation of this approach, it is essential to examine potential challenges to it. Typically, there are two objections raised against this approach:

1. Substance over form argument: Critics argue that this approach exploits association rights to evade federal or state laws and regulations. However, the Supreme Court has established that a state cannot deny the exercise of constitutional rights merely based on labels. If the association's activities do not present a clear and present danger of substantive evil, governmental authorities cannot interfere with its activities.

2. Limitation of association rights to free speech and advocacy: Some claim that the 1st and 14th Amendment private association only protect free speech advocacy and not actions related to business activity. However, Supreme Court decisions have made it clear that private association rights extend beyond free speech advocacy to encompass private association actions and activities.

Freedom of Association Involves Freedom of Speech and Activities: The U.S. Supreme Court has affirmed that freedom of association includes the rights to free speech, free expression, and free assembly against state police power, except under special circumstances. The First and Fourteenth Amendments protect freedoms of speech, assembly, and association, not limited to any specific field of human interest.

Probable Benefits of Private Membership Associations:

1. Operate an advertising and marketing association outside the jurisdiction and authority of federal and state governments and agencies, allowing for greater privacy and security.
2. Enjoy increased profits due to unrestricted and beneficial structuring and strategies not available to regulated associations.
3. Operate under a legal exemption recognized by Supreme Court decisions interpreting the U.S. Constitution.

Successful Challenges and Defense of Attacks on First and Fourteenth Amendment Private Membership Associations: Several cases over the years have demonstrated the successful defense of First and Fourteenth Amendment private membership associations. These cases involved allegations of unauthorized practice of law and medicine, as well as other business-related activities. All such challenges were defeated, and private membership associations have been upheld by the courts.

In conclusion, the concept of First and Fourteenth Amendment private membership associations has been legally established and offers various benefits, particularly in terms of avoiding certain regulations and enjoying greater privacy. These associations have withstood legal challenges and are considered valid means for conducting business and other activities outside the scope of government regulation.