Posted June 23, 2015
In a 8-1 vote, the Supreme Court denied a raisin price-support program that dates back to the New Deal, ruling it unconstitutionally requires growers to surrender their crop to the government for future sale, according to The Wall Street Journal article available here. USA Today also published an article available hereand Reuters here.
The federal program violates the Fifth Amendment prohibition of taking private property “for public use without just compensation,” according to Chief Justice John Roberts.
While the government can regulate production in order to keep goods off the market, the chief justice said it cannot seize that property without compensation, according to USA Today.
“Selling produce in interstate commerce … (is) n ot a special governmental benefit that the government may hold hostage, to be ransomed by the waiver of constitutional protection,” Roberts said. “Raisins are not dangerous pesticides; they are a healthy snack.”
The raisin program was defended by the Obama administration as a win-win proposition. Prices remain high for farmers, and their excess raisins can be donated to school lunch programs or sold overseas. If profits exceed administrative costs, the farmers share in the excess.
Justice Sonia Sotomayor, the sole dissenter, said a court precedent requires that “each and every property right be destroyed by governmental action” before a taking has occurred. The program, she added, “does not deprive the Hornes of all their property rights,” according to Reuters.
The Hornes came up with a plan to circumvent the program by packing and marketing their own raisins in a move they said would make them exempt from it. The government disagreed and sanctioned the Hornes for the 2002-2003 and 2003-2004 seasons.
Chief Justice John Roberts said the government should pay the Hornes the market value of the raisins and relieve them of the fine that was imposed. The total value is around $700,000.
The Hornes’ constitutional challenge to the program has lasted a decade and previously led to another Supreme Court case they won in 2013.
For more information on marketing orders, please visit the National Agricultural Law Center’s website here.