In the landmark U.S. Supreme Court case, Texas v. Johnson (not to be confused with Lawrence v. Texas), the U.S. Supreme Court ruled on the controversial nature of burning the U.S. Flag.
In the case, a group of communist protesters were showing their disdain for the Reagan administration, and other companies based in Dallas, Texas. Following marching and chanting in the street, the group ended at city hall, where one of the people (Johnson) took a U.S. flag and ignited it.
Johnson was charged with violating the Texas law that prohibits vandalizing respected objects, including the flag. Johnson was convicted, sentenced to 1 year in prison, and fined $2,000. While he lost his appeal at the state court of appeals, the Texas Supreme Court invalidated the conviction, stating that it was protected speech under the First Amendment. The Supreme Court ended up affirming.
The U.S. Supreme Court stated that, "Under the circumstances, Johnson's burning of the flag constituted expressive conduct, permitting him to invoke the First Amendment... Occurring as it did at the end of a demonstration coinciding with the Republican National Convention, the expressive, overtly political nature of the conduct was both intentional and overwhelmingly apparent."
Regarding the nature of his speech to inspire a breach of the peace, the court noted that Texas had the capability to punish that behavior separately, and also that no breach of the peace came to be.
It also stated that, "No reasonable onlooker would have regarded Johnson's generalized expression of dissatisfaction with the policies of the Federal Government as a direct personal insult or an invitation to exchange fisticuffs."
The Court thus did not impinge upon the state's ability to keep the peace, and concluded that,
The State need not worry that our holding will disable it from preserving the peace. We do not suggest that the First Amendment forbids a State to prevent "imminent lawless action." And, in fact, Texas already has a statute specifically prohibiting breaches of the peace, Tex.Penal Code Ann. § 42.01 (1989), which tends to confirm that Texas need not punish this flag desecration in order to keep the peace.  [citations omitted].
Therefor, flag burning that is used as a way of expressing one's Free Speech rights, and is not used as a call to "imminent lawless action," otherwise referred to as fight speech, is a constitutionally protected right.
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