In the 1987 case Hustler Magazine and Larry C. Flynt v. Jerry Falwell, the U.S Supreme Court ruled in favor of Hustler magazine, stating that public figures cannot recover damages for emotional distress caused by parodies unless they can prove that the publication contained a false statement made with actual malice. The case arose when an ad parody in Hustler depicted Reverend Jerry Falwell in an offensive manner involving his first sexual experience. Although it was clearly labeled as fiction, Falwell sued for libel and intentional infliction of emotional distress and won at trial level on the latter claim only. However, upon appeal to the Supreme Court, it was unanimously decided (8-0) that this ruling violated First Amendment rights to free speech because there had been no false statements presented as true facts about Falwell; rather it was obvious satire or parody which is protected under freedom of expression laws.

In the dissenting opinion for Hustler Magazine and Larry C. Flynt v. Jerry Falwell, Chief Justice William Rehnquist argued that the First Amendment does not protect obscene speech intended to inflict emotional distress on public figures. He contended that such a broad interpretation of free speech could lead to an erosion of personal dignity and contribute to a coarsening of society's moral standards. Rehnquist believed that there should be legal consequences for those who deliberately spread harmful lies about others, even if they are public figures or politicians. In his view, allowing this type of behavior would undermine respect for individuals' rights and potentially harm the democratic process by discouraging people from participating in public life due to fear of being subjected to malicious attacks.