Supreme Court hears raisin case

Sun-Star Washington BureauMarch 23, 2013 

WASHINGTON -- Nearly a dozen burly California raisin growers watched intently Wednesday as Supreme Court justices struggled to figure out how their industry works.

During an hourlong oral argument, the justices peppered lawyers with questions that increasingly suggested some sympathy for the growers, who are protesting a big Agriculture Department penalty.

The federal government fined Fresno County growers Marvin and Laura Horne and others hundreds of thousands of dollars for refusing to turn over raisins as part of a New Deal-era supply control program.

"Part of that penalty was, you know, 'Your raisins or your life,' " Justice Antonin Scalia said, producing courtroom chuckles.

At issue is a federal order that requires "handlers" who process and pack raisins to place part of their product in reserve during certain years, with the industry-run Raisin Administrative Committee deciding how much handlers will be paid for this set-aside tonnage. Raisin handlers set aside 47 percent of their crop during the 2002-03 season and 30 percent for 2003-04, but they were paid for only part of what they surrendered.

The Hornes didn't like the program and helped organize growers into the Raisin Valley Farms Marketing Association, which took care of the packing. By identifying themselves as producers rather than as handlers, the group's members reasoned that they were exempt from the set-aside requirement imposed on handlers.

The Obama administration, however, termed this a "scheme" designed to avoid legal requirements. The USDA subsequently ordered the Hornes and their coalition to pay more than $650,000 in fees and penalties.

"They adopted a business model that was an intentional, willful attempt to evade regulatory requirements in order to secure an unfair competitive advantage," said Assistant Solicitor General Joseph R. Palmore.

The dissident growers, in turn, call the raisin set-aside, as well as the fees and penalties, a "taking," or seizure, of property. Under the Fifth Amendment, takings require just compensation by the government.

The technicalities of the case seemed to fog the court for a while Wednesday, with farmers' attorney Michael W. McConnell joking sardonically at one point about the "jurisdictional holding that is producing so much enjoyment for us this morning."

The case, called Horne v. Department of Agriculture, could prove important in the long run, though, as a steppingstone for dissident farmers to avoid and potentially undermine at least parts of the so-called raisin "marketing order" established to smooth out prices and supplies.

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