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NOTICE: This opinion is subject to formal revision before publication in the
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SUPREME COURT OF THE UNITED STATES
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No. 93-1631
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ROBERT E. RUBIN, SECRETARY OF THE
TREASURY, PETITIONER v. COORS
BREWING COMPANY
on writ of certiorari to the united states court
of appeals for the tenth circuit
[April 19, 1995]

  Justice Thomas delivered the opinion of the Court.
  Section 5(e)(2) of the Federal Alcohol Administration
Act of 1935 prohibits beer labels from displaying alcohol
content.  We granted certiorari in this case to review the
Tenth Circuit's holding that the labeling ban violates the
First Amendment because it fails to advance a govern-
mental interest in a direct and material way.  Because
5(e)(2) is inconsistent with the protections granted to
commercial speech by the First Amendment, we affirm.

                            I
  Respondent brews beer.  In 1987, respondent applied
to the Bureau of Alcohol, Tobacco and Firearms (BATF),
an agency of the Department of the Treasury, for
approval of proposed labels and advertisements that
disclosed the alcohol content of its beer.  BATF rejected
the application on the ground that the Federal Alcohol
Administration Act (FAAA or Act), 49 Stat. 977, 27
U. S. C. 201 et seq., prohibited disclosure of the alcohol
content of beer on labels or in advertising.  Respondent
then filed suit in the District Court for the District of
Colorado seeking a declaratory judgment that the
relevant provisions of the Act violated the First Amend-
ment; respondent also sought injunctive relief barring
enforcement of these provisions.  The Government took
the position that the ban was necessary to suppress the
threat of -strength wars- among brewers, who, without
the regulation, would seek to compete in the market-
place based on the potency of their beer.
  The District Court granted the relief sought, but a
panel of the Court of Appeals for the Tenth Circuit
reversed and remanded.  Adolph Coors Co. v. Brady, 944
F. 2d 1543 (1991).  Applying the framework set out in
Central Hudson Gas & Electric Corp. v. Public Serv.
Comm'n of N. Y., 447 U. S. 557 (1980), the Court of
Appeals found that the Government's interest in sup-
pressing alcoholic -strength wars- was -substantial.-
Brady, supra, at 1547-1549.  It further held, however,
that the record provided insufficient evidence to deter-
mine whether the FAAA's ban on disclosure -directly ad-
vanced- that interest.  Id., at 1549-1551.  The court
remanded for further proceedings to ascertain whether
a -`reasonable fit'- existed between the ban and the goal
of avoiding strength wars.  Id., at 1554.
  After further factfinding, the District Court upheld the
ban on the disclosure of alcohol content in advertising
but invalidated the ban as it applied to labels.  Al-
though the Government asked the Tenth Circuit to
review the invalidation of the labeling ban, respondent
did not appeal the court's decision sustaining the
advertising ban.  On the case's second appeal, the Court
of Appeals affirmed the District Court.  Adolph Coors
Co. v. Bentsen, 2 F. 3d 355 (1993).  Following our recent
decision in Edenfield v. Fane, 507 U. S. ___ (1993), the
Tenth Circuit asked whether the Government had shown
that the -`challenged regulation advances [the
government's] interests in a direct and material way.'-
2 F. 3d, at 357 (quoting Edenfield, supra, at ___ (slip
op., at 5-6).  After reviewing the record, the Court of
Appeals concluded that the Government had failed to
demonstrate that the prohibition in any way prevented
strength wars.  The court found that there was no
evidence of any relationship between the publication of
factual information regarding alcohol content and
competition on the basis of such content.  2 F. 3d, at
358-359.
  We granted certiorari, 512 U. S. ___ (1994), to review
the Tenth Circuit's decision that 205(e)(2) violates the
First Amendment.  We conclude that the ban infringes
respondent's freedom of speech, and we therefore affirm.

                           II

                            A
  Soon after the ratification of the Twenty-first Amend-
ment, which repealed the Eighteenth Amendment and
ended the Nation's experiment with Prohibition, Con-
gress enacted the FAAA.  The statute establishes
national rules governing the distribution, production, and
importation of alcohol and established a Federal Alcohol
Administration to implement these rules.  Section 5(e)(2)
of the Act prohibits any producer, importer, wholesaler,
or bottler of alcoholic beverages from selling, shipping,
or delivering in interstate or foreign commerce any malt
beverages, distilled spirits, or wines in bottles
-unless such products are bottled, packaged, and
labeled in conformity with such regulations, to be
prescribed by the Secretary of the Treasury, with
respect to packaging, marking, branding, and
labeling and size and fill of container . . . as will
provide the consumer with adequate information as
to the identity and quality of the products, the
alcoholic content thereof (except that statements of,
or statements likely to be considered as statements of,
alcoholic content of malt beverages are prohibited
unless required by State law and except that, in case
of wines, statements of alcoholic content shall be re-
quired only for wines containing more than 14 per
centum of alcohol by volume), the net contents of
the package, and the manufacturer or bottler or
importer of the product.- 27 U. S. C. 205(e)(2)
(emphasis added).
The Act defines -`malt beverage[s]'- in such a way as to
include all beers and ales.  211(a)(7).
  Implementing regulations promulgated by BATF
(under delegation of authority from the Secretary of the
Treasury) prohibit the disclosure of alcohol content on
beer labels.  27 CFR 7.26(a) (1994).  In addition to
prohibiting numerical indications of alcohol content, the
labeling regulations proscribe descriptive terms that
suggest high content, such as -strong,- -full strength,-
-extra strength,- -high test,- -high proof,- -pre-war
strength,- and -full oldtime alcoholic strength.-  7.29(f).
The prohibitions do not preclude labels from identifying
a beer as -low alcohol,- -reduced alcohol,- -non-alcoholic,-
or -alcohol-free.-  Ibid.; see also 7.26(b)-(d).  By statute
and by regulation, the labeling ban must give way if
state law requires disclosure of alcohol content.

                            B
  Both parties agree that the information on beer labels
constitutes commercial speech.  Though we once took the
position that the First Amendment does not protect
commercial speech, see Valentine v. Chrestensen, 316
U. S. 52 (1942), we repudiated that position in Virginia
State Bd. of Pharmacy v. Virginia Citizens Consumer
Council, Inc., 425 U. S. 748 (1976).  There we noted
that the free flow of commercial information is -indis-
pensable to the proper allocation of resources in a free
enterprise system- because it informs the numerous
private decisions that drive the system.  Id., at 765.
Indeed, we observed that a -particular consumer's
interest in the free flow of commercial information . . .
may be as keen, if not keener by far, than his interest
in the day's most urgent political debate.-  Id., at 763.
  Still, Virginia Board of Pharmacy suggested that
certain types of restrictions might be tolerated in the
commercial speech area because of the nature of such
speech.  See id., at 771-772, n. 24.  In later decisions
we gradually articulated a test based on -`the -common-
sense- distinction between speech proposing a commer-
cial transaction, which occurs in an area traditionally
subject to government regulation, and other varieties of
speech.'-  Central Hudson Gas & Electric Corp. v. Public
Serv. Comm'n of N. Y., 447 U. S. 557, 562 (1980)
(quoting Ohralik v. Ohio State Bar Assn., 436 U. S. 447,
455-456 (1978)).  Central Hudson identified several
factors that courts should consider in determining
whether a regulation of commercial speech survives First
Amendment scrutiny:
-For commercial speech to come within [the First
Amendment], it at least must concern lawful activity
and not be misleading.  Next, we ask whether the
asserted governmental interest is substantial.  If
both inquiries yield positive answers, we must
determine whether the regulation directly advances
the governmental interest asserted, and whether it
is not more extensive than is necessary to serve that
interest.-  447 U. S., at 566.
We now apply Central Hudson's test to 205(e)(2).

                           III
  Both the lower courts and the parties agree that
respondent seeks to disclose only truthful, verifiable, and
nonmisleading factual information about alcohol content
on its beer labels.  Thus, our analysis focuses on the
substantiality of the interest behind 205(e)(2) and on
whether the labeling ban bears an acceptable fit with
the Government's goal.  A careful consideration of these
factors indicates that 205(e)(2) violates the First
Amendment's protection of commercial speech.

                            A
  The Government identifies two interests it considers
sufficiently -substantial- to justify 205(e)(2)'s labeling
ban.  First, the Government contends that 205(e)(2)
advances Congress' goal of curbing -strength wars- by
beer brewers who might seek to compete for customers
on the basis of alcohol content.  According to the
Government, the FAAA's restriction prevents a particular
type of beer drinker-one who selects a beverage
because of its high potency-from choosing beers solely
for their alcohol content.  In the Government's view,
restricting disclosure of information regarding a particu-
lar product characteristic will decrease the extent to
which consumers will select the product on the basis of
that characteristic.
  Respondent counters that Congress actually intended
the FAAA to achieve the far different purpose of
preventing brewers from making inaccurate claims
concerning alcohol content.  According to respondent,
when Congress passed the FAAA in 1935, brewers did
not have the technology to produce beer with alcohol
levels within predictable tolerances-a skill that modern
beer producers now possess.  Further, respondent argues
that the true policy guiding federal alcohol regulation is
not aimed at suppressing strength wars.  If such were
the goal, the Government would not pursue the opposite
policy with respect to wines and distilled spirits.
Although 205(e)(2) requires BATF to promulgate
regulations barring the disclosure of alcohol content on
beer labels, it also orders BATF to require the disclosure
of alcohol content on the labels of wines and spirits.
See 27 CFR 4.36 (1994) (wines); 5.37 (distilled spirits).
  Rather than suppressing the free flow of factual
information in the wine and spirits markets, the Govern-
ment seeks to control competition on the basis of
strength by monitoring distillers' promotions and
marketing.  The respondent quite correctly notes that
the general thrust of federal alcohol policy appears to
favor greater disclosure of information, rather than less.
This also seems to be the trend in federal regulation of
other consumer products as well.  See, e.g., Nutrition
Labeling and Education Act of 1990, Pub. L. 101-535,
104 Stat. 2353, as amended (requiring labels of food
products sold in the United States to display nutritional
information).
  Respondent offers a plausible reading of the purpose
behind 205(e)(2), but the prevention of misleading
statements of alcohol content need not be the exclusive
government interest served by 205(e)(2).  In Posadas de
Puerto Rico Associates v. Tourism Co. of Puerto Rico, 478
U. S. 328, 341 (1986), we found that the Puerto Rico
Legislature's interest in promoting the health, safety,
and welfare of its citizens by reducing their demand for
gambling provided a sufficiently -substantial- govern-
mental interest to justify the regulation of gambling
advertising.  So too the Government here has a signifi-
cant interest in protecting the health, safety, and
welfare of its citizens by preventing brewers from
competing on the basis of alcohol strength, which could
lead to greater alcoholism and its attendant social costs.
Both panels of the Court of Appeals that heard this case
concluded that the goal of suppressing strength wars
constituted a substantial interest, and we cannot say
that their conclusion is erroneous.  We have no reason
to think that strength wars, if they were to occur, would
not produce the type of social harm that the Govern-
ment hopes to prevent.
  The Government attempts to bolster its position by
arguing that the labeling ban not only curbs strength
wars, but also -facilitates- state efforts to regulate
alcohol under the Twenty-first Amendment.  The
Solicitor General directs us to United States v. Edge
Broadcasting Co., 509 U. S. ___ (1993), in which we
upheld a federal law that prohibited lottery advertising
by radio stations located in States that did not operate
lotteries.  That case involved a station located in North
Carolina (a nonlottery state) that broadcast lottery
advertisements primarily into Virginia (a State with a
lottery).  We upheld the statute against First Amend-
ment challenge in part because it supported North
Carolina's antigambling policy without unduly interfering
with States that sponsored lotteries.  Id., at ___ (slip
op., at 12-15).  In this case, the Government claims that
the interest behind 205(e)(2) mirrors that of the statute
in Edge Broadcasting because it prohibits disclosure of
alcohol content only in States that do not affirmatively
require brewers to provide that information.  In the
Government's view, this saves States that might wish to
ban such labels the trouble of enacting their own legisla-
tion, and it discourages beer drinkers from crossing state
lines to buy beer they believe is stronger.
  We conclude that the Government's interest in pre-
serving state authority is not sufficiently substantial to
meet the requirements of Central Hudson.  Even if the
Federal Government possessed the broad authority to
facilitate state powers, in this case the Government has
offered nothing that suggests that States are in need of
federal assistance.  States clearly possess ample author-
ity to ban the disclosure of alcohol content-subject, of
course, to the same First Amendment restrictions that
apply to the Federal Government.  Unlike the situation
in Edge Broadcasting, the policies of some States do not
prevent neighboring States from pursuing their own
alcohol-related policies within their respective borders.
One State's decision to permit brewers to disclose alcohol
content on beer labels will not preclude neighboring
States from effectively banning such disclosure of that
information within their borders.

                            B
  The remaining Central Hudson factors require that a
valid restriction on commercial speech directly advance
the governmental interest and be no more extensive
than necessary to serve that interest.  We have said
that -[t]he last two steps of the Central Hudson analysis
basically involve a consideration of the `fit' between the
legislature's ends and the means chosen to accomplish
those ends.-  Posadas, supra, at 341.  The Tenth Circuit
found that 205(e)(2) failed to advance the interest in
suppressing strength wars sufficiently to justify the ban.
We agree.
  Just two Terms ago, in Edenfield v. Fane, 507 U. S.
___ (1993), we had occasion to explain the Central
Hudson factor concerning whether the regulation of
commercial speech -directly advances the governmental
interest asserted.-  In Edenfield, we decided that the
Government carries the burden of showing that the chal-
lenged regulation advances the Government's interest -in
a direct and material way.-  Id., at ___ (slip op., at 5).
That burden -is not satisfied by mere speculation and
conjecture; rather, a governmental body seeking to
sustain a restriction on commercial speech must demon-
strate that the harms it recites are real and that its
restriction will in fact alleviate them to a material
degree.-  Id., at ___ (slip op., at 9).  We cautioned that
this requirement was critical; otherwise, -a State could
with ease restrict commercial speech in the service of
other objectives that could not themselves justify a
burden on commercial expression.-  Ibid.
  The Government attempts to meet its burden by
pointing to current developments in the consumer
market.  It claims that beer producers are already
competing and advertising on the basis of alcohol
strength in the -malt liquor- segment of the beer
market.  The Government attempts to show that this
competition threatens to spread to the rest of the
market by directing our attention to respondent's
motives in bringing this litigation.  Respondent allegedly
suffers from consumer misperceptions that its beers
contain less alcohol than other brands.  According to the
Government, once respondent gains relief from
205(e)(2), it will use its labels to overcome this handi-
cap.
  Under the Government's theory, 205(e)(2) suppresses
the threat of such competition by preventing consumers
from choosing beers on the basis of alcohol content.  It
is assuredly a matter of -common sense,- Brief for
Petitioner 27, that a restriction on the advertising of a
product characteristic will decrease the extent to which
consumers select a product on the basis of that trait.  In
addition to common sense, the Government urges us to
turn to history as a guide.  According to the Govern-
ment, at the time Congress enacted the FAAA, the use
of labels displaying alcohol content had helped produce
a strength war.  Section 205(e)(2) allegedly relieved
competitive pressures to market beer on the basis of
alcohol content, resulting over the long term in beers
with lower alcohol levels.
  We conclude that 205(e)(2) cannot directly and
materially advance its asserted interest because of the
overall irrationality of the Government's regulatory
scheme.  While the laws governing labeling prohibit the
disclosure of alcohol content unless required by state
law, federal regulations apply a contrary policy to beer
advertising.  27 U. S. C. 205(f)(2); 27 CFR 7.50 (1994).
Like 205(e)(2), these restrictions prohibit statements of
alcohol content in advertising, but, unlike 205(e)(2),
they apply only in States that affirmatively prohibit
such advertisements.  As only 18 States at best prohibit
disclosure of content in advertisements, App. to Brief for
Respondent 1a-12a, brewers remain free to disclose
alcohol content in advertisements, but not on labels, in
much of the country.  The failure to prohibit the
disclosure of alcohol content in advertising, which would
seem to constitute a more influential weapon in any
strength war than labels, makes no rational sense if the
government's true aim is to suppress strength wars.
  Other provisions of the FAAA and its regulations
similarly undermine 205(e)(2)'s efforts to prevent
strength wars.  While 205(e)(2) bans the disclosure of
alcohol content on beer labels, it allows the exact
opposite in the case of wines and spirits.  Thus, distilled
spirits may contain statements of alcohol content, 27
CFR 5.37 (1994), and such disclosures are required for
wines with more than 14 percent alcohol, 27 CFR 4.36
(1994).  If combatting strength wars were the goal, we
would assume that Congress would regulate disclosure
of alcohol content for the strongest beverages as well as
for the weakest ones.  Further, the Government permits
brewers to signal high alcohol content through use of the
term -malt liquor.-  Although the Secretary has pro-
scribed the use of various colorful terms suggesting high
alcohol levels, 27 CFR 7.29(f) (1994), manufacturers
still can distinguish a class of stronger malt beverages
by identifying them as malt liquors.  One would think
that if the Government sought to suppress strength wars
by prohibiting numerical disclosures of alcohol content,
it also would preclude brewers from indicating higher
alcohol beverages by using descriptive terms.
  While we are mindful that respondent only appealed
the  constitutionality of 205(e)(2), these exemptions and
inconsistencies bring into question the purpose of the
labelling ban.  To be sure, the Government's interest in
combatting strength wars remains a valid goal.  But the
irrationality of this unique and puzzling regulatory
framework ensures that the labeling ban will fail to
achieve that end.  There is little chance that 205(e)(2)
can directly and materially advance its aim, while other
provisions of the same act directly undermine and
counteract its effects.
  This conclusion explains the findings of the courts
below.  Both the District Court and the Court of Appeals
found that the Government had failed to present any
credible evidence showing that the disclosure of alcohol
content would promote strength wars.  In the District
Court's words, -none of the witnesses, none of the
depositions that I have read, no credible evidence that
I have heard, lead[s] me to believe that giving alcoholic
content on labels will in any way promote . . . strength
wars.-  App. to Pet. for Cert. A-38.  See also Bentsen,
2 F. 3d, at 359.  Indeed, the District Court concluded
that -[p]rohibiting the alcoholic content disclosure of
malt beverages on labels has little, if anything, to do
with the type of advertising that promotes strength
wars.-  App. to Pet. for Cert. A-36.  As the FAAA's
exceptions and regulations would have counteracted any
effect the labeling ban had exerted, it is not surprising
that the lower courts did not find any evidence that
205(e)(2) had suppressed strength wars.
  The Government's brief submits anecdotal evidence
and educated guesses to suggest that competition on the
basis of alcohol content is occurring today and that
205(e)(2)'s ban has constrained strength wars that
otherwise would burst out of control.  These various
tidbits, however, cannot overcome the irrationality of the
regulatory scheme and the weight of the record.  The
Government did not offer any convincing evidence that
the labeling ban has inhibited strength wars.  Indeed, it
could not, in light of the effect of the FAAA's other
provisions.  The absence of strength wars over the past
six decades may have resulted from any number of
factors.
  Nor do we think that respondent's litigating positions
can be used against it as proof that the Government's
regulation is necessary.  That respondent wishes to
disseminate factual information concerning alcohol
content does not demonstrate that it intends to compete
on the basis of alcohol content.  Brewers may have
many different reasons-only one of which might be a
desire to wage a strength war-why they wish to
disclose the potency of their beverages.
  Even if 205(e)(2) did meet the Edenfield standard, it
would still not survive First Amendment scrutiny
because the Government's regulation of speech is not
sufficiently tailored to its goal.  The Government argues
that a sufficient -fit- exists here because the labeling
ban applies to only one product characteristic and
because the ban does not prohibit all disclosures of
alcohol content-it applies only to those involving
labeling and advertising.  In response, respondent
suggests several alternatives, such as directly limiting
the alcohol content of beers, prohibiting marketing
efforts emphasizing high alcohol strength (which is
apparently the policy in some other Western nations), or
limiting the labeling ban only to malt liquors, which is
the segment of the market that allegedly is threatened
with a strength war.  We agree that the availability of
these options, all of which could advance the Gov-
ernment's asserted interest in a manner less intrusive to
respondent's First Amendment rights, indicates that
205(e)(2) is more extensive than necessary.

                           IV
  In sum, although the Government may have a sub-
stantial interest in suppressing strength wars in the
beer market, the FAAA's countervailing provisions
prevent 205(e)(2) from furthering that purpose in a
direct and material fashion.  The FAAA's defects are
further highlighted by the availability of alternatives
that would prove less intrusive to the First Amend-
ment's protections for commercial speech.  Because we
find that 205(e)(2) fails the Central Hudson test, we
affirm the decision of the court below.

                                      It is so ordered.