California Raisins Beat Feds at U.S. Supreme Court

You may have heard it through the grapevine: the California raisin farmers who challenged the federal government’s power to seize a substantial portion of each year’s crop as part of a New Deal price-floor scheme had a very strong case under the Fifth Amendment’s takings clause. On Monday, the U.S. Supreme Court agreed, overturning the Ninth Circuit’s decision in Horne v. USDA, ruling the farmers could not be fined for keeping their crop, and that they were due fair compensation.

The issue was whether the Raisin Administrative Committee (RAC), under the Agricultural Marketing Agreement Act of 1937, could require farmers to set aside large percentage of the crop for the government to deal with as it wished without just compensation.

The government had argued that because it often sold the crop and returned profits to the farmers, that satisfied the Fifth Amendment. Marvin and Lorna Horne disagreed, barring the government’s truck from their property. The Court sided with the farmers. 

Chief Justice John Roberts wrote the decision for the 8-1 majority (which narrowed on certain issues). There were three main findings.

First, the Court found that the Fifth Amendment required the government to pay just compensation even if the property at issue was personal property and not “real” property (i.e. land or real estate).

Second, the Court ruled that the government had not satisfied the requirement to pay just compensation merely by reserving the farmers a potential percentage of the profits of selling their property at the government’s own discretion.

Third, the Court found that the government’s requirement that farmers reserve a portion of their crops as a condition of entering the raisin industry was indeed a “taking” of property.

The Court also found that the farmers did not have to pay the fine before suing.

Three justices dissented in part, saying the lower courts should have decided whether the Hornes would actually have been due any compensation for the particular years in which they resisted participation in the government’s reserve program.

Justice Sonia Sotomayor wrote the lone dissent, arguing that because the government’s taking “does not deprive the Hornes of all their property rights, it does not effect a per se taking.”

Justice Clarence Thomas added a pun in a concurring opinion, noting that if the government was not taking raisins for an actual “public use,” then calculating their value would be a “fruitless exercise.”