Raisin ruling has varied meaning
Sept. 1, 2015
Considering the great importance of decisions issued by the Supreme Court this year affecting matters like health care and marriage, among many, the lack of attention is almost expected for the one ruling having direct impact on food and agriculture. Indeed, that decision made in Horne v. U.S. Department of Agriculture is viewed as noteworthy because it was an 8-1 decision by a court that gained notoriety from numerous 5-4 rulings reflecting sharp divisions on outcomes that were viewed as political for conservative or liberal leanings. This nearly unanimous decision, defeating the government’s defense of a raisin marketing order authorized by a statute passed in 1937, focused on the government’s ability to seize private property without compensation. Called a “takings clause” case by legal authorities, the ruling was explained by Chief Justice John Roberts.
For grain-based foods, the nearly unanimous decision may have prompted memories of how long-ago price support programs for wheat involved marketing quotas limiting how many bushels a farmer could market. Farmers who disregarded wheat quotas were subject to stiff fines. The raisin regulations were based on the 1937 Agricultural Marketing Act, one of the key farm support laws of the administration of President Franklin D. Roosevelt.
For raisins and similar fruit, the act authorized a committee of growers that set the annual quota, which was divided among states and individual producers. The aim was to stabilize prices by limiting the quantity to expected demand. Any farm’s production in excess of its quota was subject to government seizure and was held in a reserve mainly disposed of as domestic and foreign aid.
The case was brought by the Marvin Horne family who are longtime raisin farmers in California’s Central Valley. It was their refusal to hand over excess production to the Agriculture Department that made them subject to a fine for non-compliance. The Hornes contended that the government’s seizure of the excess raisins violates the Fifth Amendment to the U.S. Constitution requiring the government to pay a fair price for any seized property. Justice Roberts ruled that taking the raisins comprised a seizure just like taking property. In regard to the defense that the Hornes would have retained a secondary interest in the seized raisins through the reserve, the chief justice said, “The Constitution does not allow the government to take your car without just compensation if it promises to return the quarters it finds in the seats.”
The final part of Justice Roberts’s ruling applied to a range of government initiatives aimed at spurring farmers to participate in withholding crops like wheat and raisins in order to bolster prices. The government’s defense citing these programs claimed that the Hornes voluntarily agreed to participate and thus benefited from how the quotas reduced the market supply, resulting in price strength. The government also claimed that the Hornes could have chosen to have their raisin-variety grapes used in making juice or wine. In rejecting these arguments, Justice Roberts said, “‘Let them sell wine’ is probably not much more comforting to the raisin growers than similar retorts have been to others throughout history.”
While many aspects of government price support programs have been subject to review by the Supreme Court, this is the case that at last said that growers could not be subjected to penalties for refusing to comply with marketing orders that include the right to seize excess production. “This is different,” the chief justice insisted during the oral arguments and then in amplifying on the 8-1 decision. That difference is the government’s assertion of a right to seize a farmer’s production being found in violation of the Fifth Amendment. Justice Roberts went to the Magna Carta to point out that this document signed 800 years ago by King John provides quite specifically that the King’s seizure of corn required compensation. Thus, it was long ago decided that the so-called “takings clause” includes private property, and very definitely grain.