Only in the twilight zone or California can a law that was passed to protect people from fraud be declared unconstitutional because "there is no evidence these lies hurt anyone".
A panel of the 9th U.S. Circuit Court of Appeals decided in a 2-1 decision that it's OK to lie about your military service. Their rational was that fibs about one's military service don't actually harm anyone. This ruling contradicts years of precedent where the Supreme Court has explicitly stated that false statements of fact are not entitled to First Amendment protection. The ruling also denies the obvious; fibbing about one's military service damages the people who have legitimately served and been honored for that service, and it fraudulently conveys to the liar an air of respect and honor.
This entire affair reminds one of the old television series "The Twilight Zone". What else can you say when a liar is exonerated for lieing about his military service, but a man was arrested for praying on a public street? If Rod Serling were alive today, his screenplays would come right out of news pages."