The Supreme Court will hear arguments Monday in an unusual First Amendment appeal from the National Rifle Association against a New York financial regulator who persuaded banks and insurance companies to sever ties with the gun rights group.
The NRA claims that Maria Vullo, the former superintendent of the New York Department of Financial Services, not only leaned on insurance companies to part ways with the gun lobby group but also threatened enforcement actions against those firms if they failed to comply – a point that Vullo disputes.
The appeal will test how far government regulators – liberal or conservative – may go in pressuring the companies they police to do business with controversial entities.
“The worry is we don’t necessarily want to allow state governments to start using this kind of regulatory force to engage in a kind of third-party pressuring,” said Caroline Fredrickson, a Georgetown Law professor.
The danger, she said, is that regulators in both red and blue states could start leaning on insurance companies and banks to drop coverage for disfavored advocacy groups or companies.
“On the other hand,” Fredrickson said, “you don’t want to restrict regulators from being able to have any impact on who an insurance company … is insuring.”
Vullo says her enforcement targeted an insurance product that is illegal in New York: third-party policies sold through the NRA that cover personal injury and criminal defense costs following the use of a firearm.
Critics dubbed the policies “murder insurance.”
If other insurance companies distanced themselves from the NRA, Vullo argues, it was because they no longer wanted to do business with the group. At least some of the entities split with the NRA after…
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