The California raisins were back before the Supreme Court, and the justices sounded ready to rule in favor of a Fresno farmer in his long battle against a Depression-era law that allows the government to seize privately grown crops to reduce supply and prop up prices.
Marvin Horne was fined $695,000 after defying a demand by a government-backed board in California to hand over part of his raisin crop in 2003. He said the board’s action amounted to “stealing” and is now asking the high court for compensation.
Though the law in question is not currently used to seize raisins or most other crops, Horne’s claim won the sympathy of the court’s conservatives, who said the government regulation was more befitting of a socialist regime and denied farmers of their rights to private property. A majority appeared ready to strike part of the law as heavy-handed.
“Central planning was thought to work very well in 1937,” a skeptical Justice Antonin Scalia told a government lawyer defending the program at a court hearing Wednesday. “Russia tried it for a long time.”
Chief Justice John G. Roberts Jr. said he agreed that the government has the power to regulate farm production to some degree, but he questioned whether this law went too far.
“This is different because you come with the truck and you get the shovels and you take their raisins, probably in the dark of the night,” Roberts said.
A government lawyer said the board is run by raisin producers and has the support of most farmers. By controlling supply and keeping prices stable, farmers earned higher profits on their remaining crops, Deputy Solicitor Gen. Edwin Kneedler said.
The seizures are “not for the government’s benefit. It is for the producer’s benefit,” he said.
But Kneedler made little headway. Even the high court’s liberals described the board’s actions as outdated.
“This does seem a weird historical anomaly,” Justice Elena Kagan said. She and the other liberals were less certain over whether such cooperative marketing programs were unconstitutional.
At issue was part of Agricultural Marketing Agreement Act of 1937 in which the New Deal-era Congress authorized farmers to join together in government-backed boards with the aim of stabilizing product prices. They could do so by not planting some acres of their land.
Or, as in the case of the California raisin board, they could agree to put some portion of their crop into a so-called reserve pool to be sold later. The extra raisins were often used in the school lunch program or sold overseas.
California produces more than 99% of the nation’s raisins and 40% of the world’s supply, according to the U.S. Department of Agriculture. But since 2010, raisin production has fallen and the raisin board has not ordered a reserve set-aside in five years.
But in 2003 and 2004, when the raisin crop was more than double the expected demand, Horne refused to participate in the board’s reserve pool. He instead packed and sold raisins on his own.
He’s been fighting the fine in federal courts ever since. Conservative groups and private-property advocates view him as a symbol of the independent farmer standing up to government oppression.
The U.S. 9th Circuit Court of Appeals initially dismissed Horne’s case and said he should have taken his dispute to a special claims court. But the Supreme Court ruled unanimously in 2013 that he had a constitutional claim that could be decided in federal court.
Last year, the 9th Circuit ruled against him again and said the regulation did not take his private property, leading Horne to turn to the high court again.
Horne is not a hero among many of his fellow growers. The Sun-Maid Growers of California, representing 1,600 producers, joined with USDA in opposing Horne and his wife, Laura. They described the couple as disgruntled cheaters.
“Having been caught free riding on the market order at the expense of their competitors, the [Hornes] now seek refuge in high constitutional principle,” the growers told the court.
Although it appeared that the high court majority will side again with Horne, it is not clear what this will mean for other farm products, or even what compensation he would be due.
A government attorney noted that while reserve pools for farm commodities were once common, they have all but disappeared in the last decade. In their brief, they said only growers of tart cherries used a reserve pool in recent years.
Justice Stephen G. Breyer wondered whether Horne had suffered any loss at all. He said the reserve program lifted the price of raisins and put more money in the pocket of growers like Horne.
“It gives you money. It doesn’t take money,” he told the lawyer for Horne. “So there is no compensation due.”
Stanford law professor Michael McConnell, a former federal judge who is representing Horne, disagreed.
“The government literally takes possession of the raisins” from the growers, he said, and it sells them in an overseas market. He said growers like Horne rarely received much money for this part of the crop, and he denied that the program greatly lifted the price of free-market raisins.
But the Supreme Court is unlikely to resolve that issue in Horne vs. USDA. If the majority rules that the forced set-aside of raisins is an unconstitutional taking of private property, they are likely to send Horne’s case to a lower court to decide what compensation he is due.
This is not the court’s first encounter with government-backed marketing orders for farm products. Beginning in the mid-1990s, the court heard several free-speech challenges from growers who resisted paying for generic marketing campaigns to promote, for example, milk or beef.
One of the best-known campaigns featured the California raisins dancing to the tune, “I Heard It Through the Grapevine.” The court finally upheld the marketing campaigns in 2005.