Metropolitan News-Enterprise


Tuesday, April 7, 2015


Page 1


C.A. Rejects Constitutional Challenge to Grape Growers Tax




A California law compelling table grape growers to pay a state agency for generic advertising does not violate the state Constitution, the Fifth District Court of Appeal ruled yesterday.

The activities of the California Table Grape Commission, the panel reasoned, constitute government speech under Johanns v. Livestock Marketing Association (2005) 544 U.S. 550, rather than an abridgement of the growers’ free speech or other rights. The court upheld Fresno Superior Court Judge Donald S. Black’s grant of summary judgment to the commission.

The plaintiffs—Delano Farms Company, Four Star Fruit, Inc., Gerawan Farming, Inc., Bidart Bros. and Blanc Vineyards, LLC—alleged that the impost violated not only the “liberty of speech” guaranteed by the Constitution, but also its rights to free association, due process, liberty and privacy. Delano has been in litigation with the commission over the tax since 1996, and was among several growers who lost a federal constitutional challenge in the Ninth U.S. Circuit Court of Appeals in 2009.

Ketchum Act

Delano is one of a number of growers and producers who have challenged agricultural assessment programs on free speech grounds. The grape program is authorized in California by the 1967 Ketchum Act.

The act recites the importance of the industry to “the economy, welfare, standard of living and health of a large number of citizens residing in this state.” It includes a finding that a generic marketing and advertising program is needed because the “inability of individual producers to maintain or expand present markets or to develop new or larger markets for such grapes results in an unreasonable and unnecessary economic waste of the agricultural wealth of this state.”

The plaintiffs and other grape growers who oppose the program have claimed that the hundreds of thousands of dollars they pay each year do not return adequate value. They say the commission spends too much money on non-advertising costs, such as employee travel and scholarships, and that the advertising program gives the misimpression that all varieties of table grapes are of similar quality.

But Justice Herbert Levy, writing for the Court of Appeal, said Johanns is controlling, just as it was in Delano Farms Co. v. California Table Grape Comm’n (9th Cir. 2009) 586 F.3d 1219.

Johanns upheld a $1-a-head fee on cattle to provide funds for a marketing and research program under the Beef Promotion and Research Act of 1985.

Court’s Conclusion

The court concluded, 6-3, that the fee was used to promote government speech and not to compel ranchers to disseminate an unwanted message. The Ninth Circuit, which in 2003 had ruled the grape program unconstitutional on the basis of prior case law, then considered the government-speech issue and said the program was constitutional.

Levy said the Ninth Circuit’s reasoning was persuasive as to the state constitutional issue as well.

“The detailed parameters and requirements imposed by the Legislature on the Commission and its messaging, the Secretary [of the California Department of Food and Agriculture]’s power to appoint and remove Commission members, and the Secretary’s authority to review the Commission’s messages and to reverse Commission actions, lead us to conclude, based on the statutory scheme, that the Commission’s promotional activities are effectively controlled by the state and therefore are government speech,” Levy wrote.

Liberty Not Violated

The justice went on to say that the plaintiffs’ were not deprived of liberty or due process, under rational-basis review.

“An act promoting table grapes, one of the major crops produced in California, for the purpose of protecting and enhancing the reputation of California table grapes is reasonably related to the goal of protecting the state’s general welfare,” he wrote. “Appellants have not demonstrated otherwise.”

The case is Delano Farms Company v. California Table Grape Commission, 15 S.O.S. 1749.


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