An ambivalent appeals court has upheld a law backed by the California dairy industry and authored by Rep. Devin Nunes, R-Calif., that forcibly folded a large Arizona dairy into a web of government regulations.
In a ruling awaited by industry leaders, the D.C. Circuit Court of Appeals rejected claims by influential dairyman Hein Hettinga that the 2006 law violated the Constitution by targeting him in particular. The law did not specifically name Hettinga’s company, Sarah Farms, though its provisions governing milk marketing were drawn narrowly enough to have the same effect.
“The (law) would apply to any producer-handler that meets its statutory requirements, not only the Hettingas,” the appellate court reasoned, adding that “a statute with open-ended applicabilitydoes not single out a particular person or group for punishment.”
The Constitution prohibits what are called “bills of attainder,” which single out individuals for legislative punishment without a trial. In 2010, for instance, a judge cited this prohibition in striking down a new Republican-authored law that stripped federal funding from the advocacy group ACORN; that decision was later reversed.
“We’re just pleased the court did the right thing,” Nunes’s chief of staff, Johnny Amaral, said Monday.
The law, called the Milk Regulatory Equity Act, was passed in response to dairy industry complaints about Hettinga’s operations. Sarah Farms would buy low-cost milk in California, bottle it in Yuma, Ariz., and then ship it back to California, typically for sale to big retailers like Costco or Sam’s Club. Because it was characterized as coming from out-of-state, it didn’t have to abide by California’s milk marketing order governing prices, nor was it subject to separate federal milk-marketing order requirements.
“The Hettingas pose challenges to the large dairy companies because of their independent spirit,” the company’s attorney wrote in a legal brief.
In part, the Hettingas had been able to slip through the regulatory cracks as a so-called producer-handler, bottling milk from their own California-based cows rather than buying it from others. The 2006 law closed this loophole.
The 2006 law ensured that marketing order requirements covering prices and payments extend to combined dairy producer-handlers that sell more than 3 million gallons of milk each month, a threshold that covers the Hettinga operation. This means Hettinga must now pay into a federal milk-marketing “pool” that guarantees other producers a minimum price.
There were no dissents in the unsigned appellate court opinion issued Friday, but conservative judges voiced their unhappiness with the outcome in their own concurring opinion. Saying their hands were tied by precedent, two judges nonetheless used the case to speak against what they say is the heavy-handed way Congress regulates farms.
“America’s cowboy capitalism was long ago disarmed by a democratic process increasingly dominated by powerful groups with economic interests antithetical to competitors and consumers,” Judge Janice Rogers Brown wrote. “And the courtshave been negotiating the terms of surrender since the 1930s.”
Rogers and Judge David Sentelle further implicitly praised the Dutch-born Hettinga as an “American success story” whose business was being undermined by “political shenanigans” that have resulted in consumers paying higher prices for milk. The two judges’ concurring opinion does not set a precedent, though it does help frame a coming debate, as Congress prepares this year to write another farm bill.