UNITED STATES COURT OF APPEALS FOR THE NINTH CIRCUIT

PACIFIC COAST HORSESHOEING No. 18-15840 SCHOOL, INC.; BOB SMITH; ESTEBAN NAREZ, D.C. No. Plaintiffs-Appellants, 2:17-cv-02217- JAM-GGH v. KIMBERLY KIRCHMEYER, in her OPINION Official Capacity as Director of Consumer Affairs; MICHAEL MARION, in his Official Capacity as Chief of the Bureau for Private and Postsecondary Education, Defendants-Appellees.

Appeal from the United States District Court for the Eastern District of California John A. Mendez, District Judge, Presiding

Argued and Submitted October 24, 2019 San Francisco, California

Filed June 10, 2020 2 PACIFIC COAST HORSESHOEING SCHOOL V. KIRCHMEYER

Before: Michael J. Melloy,* Jay S. Bybee, and N. Randy Smith, Circuit Judges.

Opinion by Judge Bybee

SUMMARY**

Civil Rights

The panel reversed the district court’s dismissal for failure to state a claim of an action challenging, on First Amendment grounds, aspects of California’s Private Postsecondary Education Act of 2009, which prohibit plaintiff, Esteban Narez, from enrolling in plaintiff Bob Smith’s horseshoeing class unless he first passes an examination prescribed by the U.S. Department of Education.

The Act requires that any student without a high school certificate or its equivalent who wishes enroll in a private postsecondary school must execute an enrollment agreement with an authorized employee of the school which confirms that the prospective student has the ability to benefit from the proposed course of instruction. In order to execute the ability-to-benefit agreement, the school shall have the student take an independently administrated examination prescribed by the United States Department of Education. The Act

* The Honorable Michael J. Melloy, United States Circuit Judge for the U.S. Court of Appeals for the Eighth Circuit, sitting by designation. ** This summary constitutes no part of the opinion of the court. It has been prepared by court staff for the convenience of the reader. PACIFIC COAST HORSESHOEING SCHOOL V. KIRCHMEYER 3 exempts certain courses and a number of private institutions from these requirements. The district court determined that the Act regulates only conduct—the forming of an enrollment agreement—and any burdens on speech were incidental, resulting from the government’s regulation of commercial transactions. The district court thus concluded that plaintiffs failed to allege a First Amendment claim.

The panel held that the Act regulates speech and therefore rejected the assertion that only conduct was at issue. The panel determined that, when viewed in its entirety, the Act controls more than contractual relations. It also regulates what kind of educational programs different institutions can offer to different students. The panel held that the Act implicates the First Amendment by restricting the rights of both speakers (Smith) and would-be listeners (Narez).

The panel determined that the Act implicated heightened First Amendment scrutiny by differentiating between speech or speakers. The panel noted that the Act is riddled with exceptions to the examination requirement and the exceptions turned on one of two things: (1) the content of what is being taught, or (2) the identity of the speaker. Together these exceptions demonstrated that the Act did more than merely impose an incidental burden on speech: it targeted speech based on its communicative content.

The panel held that the statutory scheme here not only implicated speech, but also engaged in content discrimination. Moreover, the panel held that because content discrimination was apparent, the dist