Court wrestles with NRA’s free speech case against N.Y. official accused of coercing businesses

The Supreme Court appeared split Monday over the National Rifle Association’s claim that a New York official violated its First Amendment rights when she told companies to consider their reputations in doing business with the gun rights group.

The NRA brought the case against Maria Vullo, the former superintendent of the New York Department of Financial Services, saying she pushed financial firms to deny services because of its gun rights advocacy.

“She abused the coercive power of her office,” said David Cole, legal director for the American Civil Liberties Union, representing the NRA. “This was not about enforcing insurance law.”

But Neal Katyal, the lawyer representing Ms. Vullo, argued the NRA had been involved in illegal activity, so Ms. Vullo was acting within her duties — not out of political retaliation against the gun group. (The NRA was investigated for two years for its carry guard insurance program that has since been suspended.)

“We think it was an exercise of legitimate law enforcement,” Mr. Katyal said. “Their claims fall apart. They were doing massively illegal things.”

In the aftermath of the 2018 mass shooting at a high school in Parkland, Florida, Ms. Vullo said that financial services companies should consider whether they should serve pro-gun organizations like the National Rifle Association.

New York regulators opened investigations into certain insurance companies that were in business with NRA members, according to the gun advocacy group’s filing. The NRA sued, saying Ms. Vullo was exercising government authority against its free speech rights.

A unanimous three-judge panel of the 2nd U.S. Circuit Court of Appeals ruled in favor of Ms. Vullo, citing qualified immunity, and the NRA took the case to the Supreme Court.

Mr. Cole said Ms. Vullo was specifically targeting speech that was pro-gun or advocating for gun rights.

Ephraim McDowell, assistant to the solicitor general at the Department of Justice, argued on the side of the NRA before the high court on Monday, saying Ms. Vullo threatened enforcement actions if doing business with the NRA in one meeting.

“There’s a specifically coercive threat,” Mr. McDowell said.

The justices appeared split ideologically on the dispute.

Justice Elena Kagan, an Obama appointee, suggested that reputational risk was a legitimate concern Ms. Vullo could raise in doing business with the NRA.

“If reputational risk is a real thing … isn’t a bank regulator’s job to point that out?” Justice Kagan asked.

Justice Samuel A. Alito Jr., a Bush appointee, said Mr. Katyal was trying to shift the burden to the NRA in proving its case in bringing up problems with earlier pleadings and other allegations of illegalities.

“All they need to do is show that the desire to suppress speech was a motivating factor,” Justice Alito said.

The case is NRA v. Vullo. A decision is expected by the end of June.