SCOTUS Oral Arguments Set on Prop 12

LINCOLN, Neb. (DTN) -- The U.S. Supreme Court is scheduled to hear oral arguments on Oct. 11 in the National Pork Producers Council's and American Farm Bureau Federation's legal challenge to California's Proposition 12, the court announced this week.

The law, which took effect on Jan. 1, essentially bans the sale of pork from hogs that fail to meet the state's new production standards.

Also this week, the Pacific Legal Foundation and two other parties filed legal briefs in the case in support of the ag petition.

The ag groups' petition, filed in September 2021, followed a U.S. Court of Appeals for the Ninth Circuit July 2020 ruling that upheld a lower court ruling against the groups. The ag groups had asked the Ninth Circuit for an injunction to stop the law from taking effect.

The law requires hog producers to abide by certain regulations to sell pork in California. Voters in the state passed Proposition 12 in 2018 with nearly 63% of votes supporting it. The law forbids the sale of whole pork meat in California from hogs born of sows not housed in conformity with the law. Proposition 12 forbids sows from being confined in such a way that they cannot lie down, stand up, fully extend their limbs, or turn around without touching the sides of their stalls or other animals.

"If California is permitted to govern pig farming standards nationwide, requiring farms to either reduce herd sizes or build new facilities, the inevitable result is increased prices in transactions with no California connection, farms driven out of business, and higher costs at the supermarket," PLF said in its amicus brief filed this week.

"Fortunately, the framers of the Constitution were well aware of states' proclivity to diminish trade during the Articles of Confederation era, and multiple provisions of the Constitution ensure protection to individual tradespeople from overreaching state laws that extend beyond state borders."

PLF said the "overall structure" of the Constitution "values free trade" among the states.

"The Commerce Clause should be read in a manner consistent with other constitutional provisions designed to ensure interstate parity," PLF said.

"When states burden commerce outside their borders, they interfere in policy choices of other states, the federal government, or both," PLF said. "When this interference devolves into economic warfare, the producers and consumers in smaller and weaker states suffer most. The free-trade objectives incorporated in the dormant Commerce Clause further the efficient allocation of resources within American society, just as free trade among nations helps to further the efficient allocation of resources in the world."

In addition, two legal scholars filed a brief in support of the ag groups on Proposition 12. That includes Michael S. Knoll, co-director of the Center for Tax Law and Policy, University of Pennsylvania, and Ruth Mason, a professor of law and taxation at the University of Virginia School of Law.

The scholars said in an amicus brief that the district court erred when it concluded that because Proposition 12 applies only to in-state sales, it could not be extraterritorial.

"On the contrary, because California regulates pork production based on domestic, inbound, and outbound sales, its regulation is internally inconsistent and overbroad," they argue to the court.

"As an obligation of interstate comity, this court has understood extraterritoriality to require the basis of regulation to be internally consistent. A regulation is internally consistent when if every state regulated using the same nexus as the challenged state, cross-border commercial activity would not be regulated by more than one state. Proposition 12 cannot meet this basic requirement."

The Washington Legal Foundation filed a brief in support of the ag groups this week as well. The group likened Proposition 12 to differences in how states handle required license plates on vehicles.

"Some states require that cars have license plates on both the front and rear of vehicles," the group said. "Theory alone does not predict whether front license plates are worth the increased expense. This is the type of experimentation our Constitution encourages. But this does not mean that states can indirectly regulate out-of-state conduct with in-state regulations. The framers wanted to avoid this outcome. Learning from their mistakes with the Articles of Confederation, they baked horizontal federalism into our Constitution."

The Washington Legal Foundation said the dormant Commerce Clause ensures states could make their own policy decisions.

"This prevents states from enacting hegemonic statutes that interfere with other states' policy decisions," the group told the court.

"As usual, California has ignored these constitutional safeguards. It doesn't like some other states' animal-welfare laws. So, it imposes its animal-welfare laws on out-of-state farms by regulating what may be sold in California -- the state with the largest market for most products."

At the end of January, a California court halted the enforcement of Proposition 12, moving back enforcement of the animal-welfare law to six months after rules are finalized.

The California Department of Food and Agriculture is more than two years late in finalizing rules for the law that places animal-welfare restrictions on pork producers who sell products in the state.

The Commerce Clause grants Congress power to regulate trade among states and restricts states from regulating commerce outside their borders, except for matters related to public health and safety.

In July 2021, the U.S. Court of Appeals for the Ninth Circuit said in its ruling that although Proposition 12 would have "dramatic upstream effects and require pervasive changes to the pork industry nationwide," the court ruled its own precedent wouldn't allow the ag groups' case to continue.

As of Jan. 1, 2022, Proposition 12 prohibits the sale of pork not produced according to California's production standards. Proposition 12 applies to any uncooked pork sold in the state, regardless of whether it was raised in California.

Read more on DTN:

"Supreme Court to Consider Prop 12 Case," https://www.dtnpf.com/…

"Rabobank: Prop 12 Disrupts Hog Supply," https://www.dtnpf.com/…

Todd Neeley can be reached at todd.neeley@dtn.com

Follow him on Twitter @DTNeeley

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