Agency for Int'l Development v. Alliance for Open Society Int'l, Inc.

Whether the First Amendment bars enforcement of the directive issued by Congress that certain recipients of federal funds have a policy of explicitly opposing prostitution and sex trafficking as a condition of accepting such federal funds, with respect to legally distinct foreign entities operating overseas that are affiliated with a domestic entity.

Respondents receive federal funds to fight HIV/AIDS abroad. In 2005, they filed suit to enjoin enforcement of the statutory directive requiring respondents to establish explicit policy against  prostitution and sex trafficking as a condition of acceptance of those funds. The Supreme Court ultimately found that such a directive sought to leverage funding to regulate free speech outside the parameters of funding program itself and the government cannot demand that federal fund recipients adopt the government’s view as their own. Respondent then sought a permanent injunction barring enforcement of the directive against them and their legally distinct foreign affiliates. The district court granted the injunction, holding that applying the directive to Respondent’s foreign affiliates would violate Respondent’s own First Amendment rights. The court of appeals affirmed, finding that requiring the foreign affiliates to abide by the directive would force Respondents to be seen as asserting two conflicting messages because of their close relation to the foreign affiliates. Petitioner argues that the holding of the court of appeals is not supported by any constitutional principle, and that the court erred in its application of the First Amendment upon the conditions of federal funds acceptance by foreign recipients because an affiliated entity in the United States objects to the conditions. Petitioner argues that foreign recipients of federal funds have no First Amendment right to object to conditions, and do not attain the right by affiliating with a U.S. entity.