BEAVERTON, OR: Nike said today that although it has settled the suit brought against it by California consumer activist Mark Kasky, it still intends to curtail its corporate PR efforts, including the continued suspension of its social-responsibility reporting initiative.Despite the settlement, which was announced this morning, Nike said it does not plan to ramp up the PR activities that had been curtailed because of the pending lawsuit. Specifically, because of what the company regards as the California Supreme Court's unfavorable interpretation of a state law regarding transparency, Nike has also decided not to issue its corporate-responsibility report for fiscal year 2002. Kirk Stewart, the company's VP for corporate communications, told PRWeek that Nike "will exercise restraint in when and how we communicate in California." He added, "We continue to be chilled by the statute and the interpretation." The suit was originally provoked by a Nike PR campaign that discussed the labor conditions in its overseas manufacturing facilities. However, it eventually evolved into a dispute over whether the US Constitution's First Amendment protections extend to PR efforts. The settlement follows a June decision by the US Supreme Court not to rule on the speech issue. Kasky's lawyers argued among other points that the words of the company's spokespeople should be considered "commercial speech," like advertising, and are therefore not protected by free-speech rights. Nike's legal team asked the court to dismiss the suit on the grounds that the PR campaign enjoyed free-speech protection under the First Amendment. The high court declined to rule on the suit, allowing the case to proceed through the California trial courts. The case was born out of an attempt by Nike to defend itself against accusations that its footwear is manufactured in sweatshops in Asia. The company began a PR campaign to quash those accusations in 1998. Kasky disputed the assertions made in that campaign, and launched his suit on those grounds. The settlement sees Nike admit no liability, but agree to spend $1.5 million on workplace-related issues over the next three years above what it usually spends on such initiatives. The money will go to the Washington, DC-based Fair Labor Association, a workers' rights group.