Academic journal article Harvard Journal of Law & Public Policy

"Your Raisins or Your Life": The Harrowing of the Takings Clause in Horne V. U.S. Department of Agriculture

Academic journal article Harvard Journal of Law & Public Policy

"Your Raisins or Your Life": The Harrowing of the Takings Clause in Horne V. U.S. Department of Agriculture

Article excerpt

There are few areas of law that fuel as much passion and debate as government takings. To understand the importance Americans place on property rights, one need only look at the outrage generated in the wake of Kelo v. City of New London (1) and the resulting political reaction at both the state and federal levels. (2) If property rights are indeed "the most basic of human rights," (3) it is the charge of the courts to defend them vigilantly. In Horne v. U.S. Department of Agriculture, (4) the Ninth Circuit failed to fulfill this duty when it determined that a New Dealera program requiring raisin farmers to hand over significant portions of their crops--sometimes over half--with little or no compensation (5) did not violate the Takings Clause. (6)

First, the court inappropriately applied a regulatory takings analysis (7) to what was best understood as a simple physical taking. Second, in finding that the Secretary of Agriculture was free to demand from farmers the (dried) fruits of their labor, the court made the troubling pronouncement that "the Takings Clause affords less protection to personal than to real property." (8) Third, the court unconvincingly argued that because the Hornes were free to choose a new profession other than raisin farming, thereby avoiding the regulatory program entirely, the Department of Agriculture's demand for raisins did not place an unconstitutional condition on the Hornes' right to possess their property. (9) Thus, in refusing to recognize that the Department of Agriculture's Marketing Order results in a de facto seizure--a physical taking--of private property, and instead applying the more lenient regulatory takings approach, the Ninth Circuit weakened property rights by creating a precedent that, if uncorrected, stands as the most troubling development in Takings Clause jurisprudence in years.

I. THE FACTS

During the 1930s, the price of raisins, along with other crops, fell dramatically as supply outpaced demand. (10) In the spirit of the New Deal, Congress took action, passing the Agricultural Marketing Agreement Act of 1937. (11) The Act granted the Secretary of Agriculture the authority "to establish and maintain such orderly marketing conditions for agricultural commodities in interstate commerce." (12) The Secretary was to accomplish this through the Marketing Order Regulating the Handling of Raisins Produced from Grapes Grown in California. (13) Responsibility for implementing the order lies with the Raisin Administrative Committee (RAC), (14) which sets an annual "reserve tonnage requirement," (15) a percentage of a farmer's crop that can reach up to 62.5%. (16) Title to the reserve tonnage raisins transfers to the RAC, which sells the raisins in secondary, noncompetitive markets, (17) often to be used in animal feed, school lunch programs, and distilleries. (18) Though producers are entitled "to an equitable distribution of the net proceeds from the RAC's disposition of the 'reserve tonnage' raisins," (19) some years the "equitable distribution" is zero. (20)

The Marketing Order was designed to benefit producers and consumers by "smoothing the raisin supply curve and thus bringing predictability to the market." (21) In practice, the program disproportionately benefits big players in the industry while harming small farmers who cannot afford to forfeit half their yields. (22) Raisin farmers Marvin and Laura Horne, tired of losing large percentages of their harvests to the RAC with little or no compensation, ceased contributing. (23) After the Department of Agriculture assessed the couple a fine of $695,226.92 for their failure to submit to the Marketing Order, the Hornes challenged the reserve requirement, arguing that it constituted a violation of the Fifth Amendment and that the program deprived them of personal property without just compensation. (24) Following a lengthy journey through administrative proceedings and the federal court system, the Hornes finally found themselves before a Ninth Circuit panel with the opportunity to argue their claim on the merits. …

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