Home  »  Ag Sectors

Challenge of federal rules is about more than price of milk


By TIMOTHY SANDEFUR


For the Capital Press


Arizona dairyman Hein Hettinga wants to provide wholesome milk at low prices. Sadly, that's generally against federal law. Since the 1930s, Washington bureaucrats have imposed a set of rules that prohibit dairy farmers from reducing milk prices below levels set by government. As the U.S. Supreme Court has acknowledged, this cartel arrangement was created, not to protect consumers, but to protect dairies from having to compete economically.


Until recently, however, Hettinga's business model -- as a producer-handler -- kept the bureaucrats at bay. At his Yuma dairy, he would bottle milk produced by his own cows kept at his dairy in California. If he then sold it in California, he was legally exempt from both federal price regulations and that state's milk marketing order on prices.


Others in the dairy industry weren't happy about competition from a dairyman who was operating free of government micromanagement. In 2006, their lobbying led Congress to pass a law that targeted just Hettinga's operations, and forced him to comply with the minimum price requirement.


Hettinga fought back. He filed a federal lawsuit, contending that Congress had violated his constitutional rights by singling him out for disfavored treatment and infringing on his right to earn a living.


But before he could even present evidence that the law was unfairly designed to target him, the trial court dismissed his complaint. Disturbingly, the judge did so simply because the government asserted -- merely asserted -- that the law was "rational."


To be sure, suing over an economic regulation is an uphill battle, because Supreme Court precedents have said that business regulations are subject to a lenient standard of review by the courts, called the "rational basis" test. Challengers are required to prove that the law is "unreasonable." That's not an easy thing to do -- but it's not impossible, if the regulation were clearly enacted to serve some special interest's self-motivated purposes, instead of the public interest.


But the judge in Hettinga's case went even further. He ruled that when the government says its laws are reasonable, even without any proof, a case should be thrown out without allowing the plaintiff any chance to gather evidence or testimony. Unfortunately, a federal court of appeals agreed, holding, in effect, that courts can reject any challenge to economic regulations when government lawyers say, "Trust us, the law is reasonable."


This ruling expanded and transformed the already lenient "rational basis" test into a set of magic words that government can use to make virtually any lawsuit go away.


Now Hettinga is asking the U.S. Supreme Court to take the case, arguing that the "rational basis" test must be more than a rubber stamp of government actions, and that he should at least have an opportunity to introduce to the courts some evidence against the price-fixing statute.


Hein Hettinga's case is about far more than the regulation of dairies. It's about the right to a fair hearing before the judiciary. If the government can checkmate a challenger simply by asserting that the targeted law is reasonable, without having to back up that claim with proof, then it will be practically impossible for entrepreneurs, property owners, employees, or consumers, to defend their constitutional rights against regulatory edicts.


Timothy Sandefur is a principal attorney with Pacific Legal Foundation and represents Hein Hettinga.



User Comments

blog comments powered by Disqus