The California Raisins are back…in the U.S. Supreme Court! After a 2013 decision resolved a jurisdictional dispute (Horne v. USDA, 81 U.S.L.W. 4367, 2013 BL 151486 (U.S. 2013) (81 U.S.L.W. 1725)), California raisin producers are back at it with the U.S. Department of Agriculture.
The issue this time is whether a New Deal-era program intended to support raisin prices violates the takings clause of the Fifth Amendment. Under the program, raisin handlers are required to set aside for the government a certain tonnage of the raisins they handle. In recent years this “reserve” amount has been 0, but in 2002-03 it was 47 percent of the crop, and in 2003-04 it was 30 percent. The government may sell or dispose of the raisins, but the handlers are entitled to any proceeds, less the cost of running the program.
The Hornes are family farmers and raisin handlers who object to the program, and argue that the government may not take the raisins without paying just compensation. In an attempt to evade the program they organized their handling business in a way that they believed made them not subject to the requirement. They then sold the raisins that made up what should have been their reserve amounts, making nearly $500,000 on the sale.
The USDA disagreed that their business model insulated them from the program, and filed an enforcement action that eventually led to a $202,000 penalty on top of requiring the proceeds from the sale.
The Hornes argue this is an uncompensated taking, pure and simple. The USDA argues that it’s market participant regulation, and not a taking at all because the handlers retain the rights to the proceeds from sales of the reserve. Conservative economists and government minimalists, as amici for the Hornes, argue that it’s a basic issue of economic liberty, while major raisin producer Sun-Maid argues that the price supports only work if everyone participates.
Jessie Kamens and Nicholas Datlowe preview the case and potential implications in a U.S. Law Week Supreme Court Preview podcast.
Oral arguments are April 22.
To keep up with the latest expert perspectives and detailed analysis of Supreme Court actions, take a free trial to United States Law Week.
by Nicholas Datlowe
All Bloomberg BNA treatises are available on standing order, which ensures you will always receive the most current edition of the book or supplement of the title you have ordered from Bloomberg BNA’s book division. As soon as a new supplement or edition is published (usually annually) for a title you’ve previously purchased and requested to be placed on standing order, we’ll ship it to you to review for 30 days without any obligation. During this period, you can either (a) honor the invoice and receive a 5% discount (in addition to any other discounts you may qualify for) off the then-current price of the update, plus shipping and handling or (b) return the book(s), in which case, your invoice will be cancelled upon receipt of the book(s). Call us for a prepaid UPS label for your return. It’s as simple and easy as that. Most importantly, standing orders mean you will never have to worry about the timeliness of the information you’re relying on. And, you may discontinue standing orders at any time by contacting us at 1.800.960.1220 or by sending an email to email@example.com.
Put me on standing order at a 5% discount off list price of all future updates, in addition to any other discounts I may quality for. (Returnable within 30 days.)
Notify me when updates are available (No standing order will be created).
This Bloomberg BNA report is available on standing order, which ensures you will all receive the latest edition. This report is updated annually and we will send you the latest edition once it has been published. By signing up for standing order you will never have to worry about the timeliness of the information you need. And, you may discontinue standing orders at any time by contacting us at 1.800.372.1033, option 5, or by sending us an email to firstname.lastname@example.org.
Put me on standing order
Notify me when new releases are available (no standing order will be created)