A federal appeals court on Wednesday upheld an Arkansas law requiring state contractors to pledge not to boycott Israel, finding the restriction is not an unconstitutional violation of free speech.
The ruling from the Eighth Circuit was a defeat for the BDS movement, which stands for "boycott, divestment, sanctions" against Israel and it was a victory for pro-Israel activists.
The full 8th Circuit U.S. Court of Appeals reversed a 2-1 decision last year by a three-judge panel of the court that found the requirement to be unconstitutional. The Arkansas Times had sued to block the law, which requires contractors with the state to reduce their fees by 20% if they don't sign the pledge.
"(The law) only prohibits economic decisions that discriminate against Israel," Judge Jonathan Kobes wrote in the court's opinion. "Because those commercial decisions are invisible to observers unless explained, they are not inherently expressive and do not implicate the First Amendment."
A federal judge in 2019 dismissed the Times' lawsuit, ruling that the boycotts are not protected by the First Amendment. A three-judge panel of the appeals court reversed that ruling, and the state appealed to the full appeals court.
"Today is a resounding victory for Arkansas's anti-discrimination law and reinforces Arkansas's relationship with our long-time ally, Israel," Republican Attorney General Leslie Rutledge, whose office defended the law, said in a statement.
The Jerusalem Post reports that activists have pushed more than 30 states to adopt similar laws.
Republican legislators in Arkansas who drafted the 2017 law have said it wasn't prompted by a specific incident in the state. It followed similar restrictions enacted by other states in response to a movement promoting boycotts, divestment, and sanctions of Israeli institutions and businesses over the country's treatment of Palestinians.
Israeli officials say the campaign masks a deeper goal of delegitimizing and even destroying the country.
Similar measures in Arizona, Kansas, and Texas that were blocked were later allowed to be enforced after lawmakers narrowed the requirement so it applied only to larger contracts. Arkansas' law applies to contracts worth $1,000 or more.
But the legal battle isn't over yet. The case could be appealed to the U.S. Supreme Court, leading to a showdown on similar laws around the country.