Supreme Court Will Hear Raisin Farmers' Property Rights Case

Original post from July 18, 2013 with original text below:

"They want us to pay for our own raisins that we grew," says Raisin Valley Farms owner Marvin Horne. "We have to buy them back!"

This is but one absurdity that Marvin and his wife Laura have faced during their decade-long legal battle with the United States Department of Agriculture (USDA). Every year, the Hornes plant seeds, tie vines, harvest fruit, and place grapes in paper trays to create sun-dried raisins. And every year, the federal government prevents them from bringing their full harvest to market.

It's called an agriculture marketing order. Depression-era regulations meant to stabilize crop prices endanger the livelihoods of small farmers across the country, but the raisin marketing order is particularly egregious. An elected board of bureaucrats known as the Raisin Administrative Committee decides what the proper yield should be in any given year in order to meet a previously decided-upon price. Once they can estimate the size of the year's harvest, they force every farmer to surrender a percentage of their crop to raisin packers. The packers then place the raisins in a "reserve pool," a special holding vat for raisins that cannot be sold in the U.S. Eventually, the packers can sell the reserve pool raisins overseas at highly discounted prices set by the government or funnel them into school lunch programs for next to nothing.

The farmers were always supposed to get a percentage of the money raised from the reserve pool raisins, but as profit margins dwindled over the years, so did the return to farmers. The tipping point came in 2003, when farmers received zero dollars in return for the 47 percent of the crop they had surrendered.

"You can't work for a whole year and then give 47 percent of what you made away and still keep that business afloat," says Laura Horne.

Frustrated and desperate, the Hornes started packing and selling their own raisins, which they believed would allow them to circumvent the marketing order. In doing so, they inadvertantly sparked a small revolution, as other independent raisin farmers saw their initial success and began to pack and sell, too. The government wasn't happy (neither was Sun-Maid).

The USDA saddled the Hornes with massive fines in addition to demanding payment for the raisins they had failed to surrender. Marvin Horne estimates his outstanding balance at close to a million dollars, a virtually insurmountable figure for a small, family-owned farm. The Hornes decided to fight back.

When the Hornes and a few other raisin farmers tried to challenge the USDA's seizure of their crop without payment as an unconstitutional taking of property in violation of the Fifth Amendment, the government balked and said that the issue should be heard in a Federal Claims court, as the case had nothing to do with the taking of property but instead was a matter of the Hornes violating farming regulations and being fined for doing so. Remarkably, the 9th Circuit Court of Appeals agreed with the USDA and declared that they had no jurisdiction in the case. Luckily for the Hornes, however, the Supreme Court took the case and ruled, in a 9-0 decision, that the 9th Circuit was mistaken and must consider the case on its constitutional merits.

And now, after nearly a decade of fighting, the Hornes must wait a little longer. This saga may well end in 9th Circuit Court of Appeals in the next few months, or the Hornes may one day soon find themselves before the Supreme Court once again. A favorable legal outcome is far from certain, but their raisins—and our property rights—depend on it.