Humane Soc'y of the United States v. Perdue

United States Court of Appeals

FOR THE DISTRICT OF COLUMBIA CIRCUIT

Argued May 9, 2019 Decided August 23, 2019

No. 18-5188

HUMANE SOCIETY OF THE UNITED STATES, ET AL.,

APPELLEES/CROSS-APPELLANTS

v.

SONNY PERDUE, SECRETARY OF THE UNITED STATES

DEPARTMENT OF AGRICULTURE,

APPELLANT/CROSS-APPELLEE

NATIONAL PORK PRODUCERS COUNCIL,

APPELLANT/CROSS-APPELLEE

Consolidated with 18-5197, 18-5201

Appeals from the United States District Court

for the District of Columbia

(No. 1:12-cv-01582)

Lewis S. Yelin, Attorney, U.S. Department of Justice,

argued the cause for appellant/cross-appellee Sonny Perdue.

With him on the briefs were Scott R. McIntosh, Attorney, and

Stephen A. Vaden, General Counsel, U.S. Department of

Agriculture.

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Rebecca E. Bazan argued the cause for appellant/cross-

appellee National Pork Producers Council. With her on the

briefs was John M. Simpson. Michelle C. Pardo entered an

appearance.

Matthew E. Penzer argued the cause and filed the briefs

for appellees/cross-appellants. Ralph E. Henry and Peter A.

Brandt entered appearances.

Before: GRIFFITH, KATSAS, and RAO, Circuit Judges.

Opinion for the Court filed by Circuit Judge KATSAS.

KATSAS, Circuit Judge: In this case, a pork farmer

contends that the government unlawfully has permitted funds

for promoting the pork industry to be used instead for lobbying

on the industry’s behalf. We consider whether, on summary

judgment, the farmer has proven his constitutional standing to

maintain this lawsuit.

I

The Pork Promotion, Research, and Consumer

Information Act requires the federal government to promote

the American pork industry. The Act authorizes the

government to collect assessments (often called “checkoffs”)

from pork producers to finance efforts to “strengthen the

position of the pork industry in the marketplace,” 7 U.S.C.

§ 4801(b)(1)(A), and “maintain, develop, and expand markets

for pork and pork products,” id. § 4801(b)(1)(B). These

assessments are paid to the National Pork Board, an entity

established to “develop … proposals for promotion, research,

and consumer information plans and projects.” Id.

§ 4808(b)(1)(A). The Department of Agriculture must approve

the Board’s promotional efforts and its annual expenses. Id.

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§ 4808(b)(1)–(3). The Board may contract with private entities

to carry out those efforts, again with USDA’s approval. Id.

§ 4808(b)(4)(A). The Act prohibits using checkoff funds “for

the purpose of influencing legislation.” Id. § 4809(e).

In 2006, the Board purchased four trademarks from the

National Pork Producers Council, a private lobbying

organization for the pork industry. The trademarks were

associated with the slogan “Pork: The Other White Meat.” The

agreement required the Board to pay $3 million per year for

twenty years, but permitted the Board, with advance notice, to

cancel the contract for any reason. In 2011, the Board adopted

a new marketing campaign and stopped using three of the four

trademarks, but it declined to end the contract and continued to

make the annual payments.

In 2012, the Humane Society of the United States, Iowa

Citizens for Community Improvement, and Harvey Dillenburg

filed this lawsuit against the Secretary of Agriculture. The

Humane Society is an animal-protection organization; Iowa

Citizens is an organization of farmers; and Dillenburg is an

individual pork farmer. They sought to challenge both

USDA’s initial approval of the contract and its later approvals

of the annual payments. They contend that the contract

impermissibly funds the Council’s lobbying activities, which

has become more apparent as the Board continues to pay for

trademarks that it no longer uses. The complaint alleges that

this misuse of checkoff funds “diminishes the resources

available for promotions or other legitimate programs” under

the Act, thus “diminishing Mr. Dillenburg’s return on his

compelled checkoff investment.” J.A. 51. The complaint

further alleges that Dillenburg is harmed by the payment of

funds to the Council, “a lobbying organization that pushes for

policies” he opposes. Id.

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On a motion to dismiss, the district court held that none of

the plaintiffs adequately alleged standing. Humane Soc’y v.

Vilsack, 19 F. Supp. 3d 24 (D.D.C. 2013) (Humane Society I).

In part, the court reasoned that Dillenburg’s “claimed reduced

return on investment” was “unsupported by facts,” because

studies showed that the checkoff program yielded increasing

returns to farmers over the periods at issue. Id. at 35–36.

This Court reversed. Humane Soc’y v. Vilsack, 797 F.3d

4 (D.C. Cir. 2015) (Humane Society II). We held that

Dillenburg’s first alleged injury—reduced “return on his

investment” from the misuse of checkoff funds—described a

“classic form of concrete and particularized harm: actual

economic loss.” Id. at 8–9. We credited allegations that the

Board was paying too much for the trademarks and that other

advertising would have better propped up demand for pork.

See id. We therefore assumed that “the price at which pork

producers can sell their hogs is lower than it would be if the

Board were spending those funds on legitimate promotions.”

Id. at 9. After concluding that Dillenburg thus adequately had

alleged standing, we declined to consider whether the Humane

Society or Iowa Citizens had done so. Id. at 10.

On remand, the parties entered a joint stipulation. USDA

agreed, in deciding whether to approve the 2016 and future

contract payments, to re-value the trademarks and to consider

evidence submitted by the plaintiffs. At the same time, the

plaintiffs agreed to dismiss their claims for recoupment of

funds already spent. The Council intervened as a defendant

shortly thereafter. After completing its review, USDA decided

to authorize future contract payments.

The parties then filed cross-motions for summary

judgment. In support of standing, Dillenburg submitted a

declaration stating that the contested payments prevented

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checkoff funds “from being used for promotions and other

legitimate demand-enhancement activities” required by the

Pork Act, thus depriving him “of the direct economic benefit

of the lawful and effective promotions to which [he is] entitled

as a statutory beneficiary.” J.A. 147. Dillenburg further stated

that he opposed using checkoff funds to lobby for “policy

activities that [he] believe[s] are harmful to [him].” Id. Neither

the Humane Society nor Iowa Citizens filed standing affidavits.

The district court held that Dillenburg adequately proved

standing. Humane Soc’y v. Perdue, 290 F. Supp. 3d 5, 15–18

(D.D.C. 2018) (Humane Society III). The court reasoned that

Dillenburg, as a pork farmer, “is affected by the market price

for pork.” Id. at 16. Moreover, it concluded that the alleged

diversion of “millions of checkoff dollars” from legitimate

pork promotion was enough to show “economic loss.” Id. at

17. After finding standing, the court rejected challenges to

approvals made by USDA before 2016 as either untimely or

moot, but it held that the 2016 decision to continue paying for

the trademarks was arbitrary and capricious. See id. at 18–30.

All parties have appealed. Our review is de novo. Trudel

v. SunTrust Bank, 924 F.3d 1281, 1285 (D.C. Cir. 2019).

II

The Constitution limits the “judicial Power of the United

States” to “Cases” or “Controversies.” U.S. Const. art. III,

§§ 1–2. “To state a case or controversy under Article III, a

plaintiff must establish standing.” Ariz. Christian Sch. Tuition

Org. v. Winn, 563 U.S. 125, 133 (2011). The test for standing

is settled: a plaintiff must have “(1) suffered an injury in fact,

(2) that is fairly traceable to the challenged conduct of the

defendant, and (3) that is likely to be redressed by a favorable

judicial decision.” Spokeo, Inc. v. Robins, 136 S. Ct. 1540,

1547 (2016).

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In Lujan v. Defenders of Wildlife, 504 U.S. 555 (1992), the

Supreme Court addressed the plaintiff’s burden to prove

standing. The Court explained that “each element must be

supported in the same way as any other matter on which the

plaintiff bears the burden of proof, i.e., with the manner and

degree of evidence required at the successive stages of the

litigation.” Id. at 561. Thus, at the pleading stage, the

complaint must “‘state a plausible claim’ that each element of

standing is satisfied.” Hancock v. Urban Outfitters, Inc., 830

F.3d 511, 513 (D.C. Cir. 2016) (quoting Ashcroft v. Iqbal, 556

U.S. 662, 678–79 (2009)). But on summary judgment, “the

plaintiff can no longer rest on such mere allegations.” Defs. of

Wildlife, 504 U.S. at 561 (quotation marks omitted); see

Chamber of Commerce v. EPA, 642 F.3d 192, 201–02 (D.C.

Cir. 2011). Parties must support factual assertions by “citing

to particular parts of materials in the record.” Fed. R. Civ. P.

56(c)(1)(A). So the plaintiff “must set forth by affidavit or

other evidence specific facts” that prove standing. Defs. of

Wildlife, 504 U.S. at 561 (quotation marks omitted); see Scenic

Am., Inc. v. DOT, 836 F.3d 42, 49 n.3 (D.C. Cir. 2016) (“the

plaintiff has the burden to establish the evidentiary basis for its

standing at the summary judgment stage”).

The prior appeal in this case arose from USDA’s motion

to dismiss. In that context, we held that Dillenburg “alleged a

plausible claim to Article III standing” because injury to his

“bottom line” constituted a sufficient injury in fact, and

allegations that we were bound to credit “plausibly” showed

such an injury. Humane Society II, 797 F.3d at 8–10.

Now, on summary judgment, the plaintiffs must prove

injury in fact with “specific facts” in the record. Defs. of

Wildlife, 504 U.S. at 561. But while the plaintiffs’ burden has

grown, their allegations have shrunk. Dillenburg’s declaration

nowhere asserts a diminished return on investment, a reduced

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bottom line, or any similar economic injury. Nor does it

provide evidence that the Board’s alleged misadventures have

reduced the price of pork. Rather, Dillenburg declares that the

misuse of checkoff funds robs him of the “direct economic

benefit of the lawful and effective promotions to which [he is]

entitled as a statutory beneficiary.” J.A. 147. The briefing

doubles down on this point, in contending that a bottom-line,

pocketbook injury is unnecessary: “All that is needed to

establish standing here is evidence that Mr. Dillenburg is a

paying member of the checkoff program, who is therefore

entitled to the statutorily required promotional benefit for his

contributions.” Humane Soc’y Br. at 30; see also id. at 31

(“Unlawful uses of checkoff funds cause injury to …

assessment-paying producers by denying them lawful

promotional programming.”). The plaintiffs also pressed this

theory of injury during oral argument. See, e.g., Oral Arg. at

49:42–47 (“he’s not getting the effective promotional services

that the law requires”), 52:41–48 (“producers … are not getting

the lawful and effective promotional services”).

Dillenburg’s declaration does not prove an injury in fact.

Rather than show harm to his bottom line, Dillenburg instead

complains that he has been deprived of a statutory entitlement

to lawful promotions. But “Article III standing requires a

concrete injury even in the context of a statutory violation.”

Spokeo, 136 S. Ct. at 1549. The plaintiffs must show that the

statute protected “a right to be free of a harm capable of

satisfying Article III.” Jeffries v. Volume Servs. Am., Inc., 928

F.3d 1059, 1064 (D.C. Cir. 2019). On that score, Dillenburg’s

declaration says little. Without elaboration, it speaks of a

“direct economic benefit” that other promotions would have

provided. J.A. 147. But on summary judgment, a party cannot

establish standing with “conclusory allegations of an affidavit.”

Lujan v. Nat’l Wildlife Fed’n, 497 U.S. 871, 888 (1990). For

that reason, in Swanson Group Manufacturing LLC v. Jewell,

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790 F.3d 235 (D.C. Cir. 2015), we held that a declaration

asserting only “economic loss and hardship,” which “told

nothing about the nature” of the loss, was insufficient to defeat

a motion for summary judgment. Id. at 242–43 (quotation

marks omitted). The same is true here—Dillenburg fails to

elaborate on the “direct economic benefit” that he allegedly has

lost because of the Board’s misdeeds.

In concluding that Dillenburg proved standing, the district

court reasoned that Dillenburg, as a pork producer, “is affected

by the market price for pork.” Humane Society III, 290 F.

Supp. 3d at 16. Perhaps so, but Dillenburg’s declaration lacks

any indication that the “price for pork” was “affected” by the

alleged misuse of checkoff funds. The court assumed this

critical fact based on Carpenters Industrial Council v. Zinke,

854 F.3d 1 (D.C. Cir. 2017). See Humane Society III, 290 F.

Supp. 3d at 16–17. Yet Carpenters did not displace settled law

that courts cannot “presume the missing facts necessary to

establish an element of standing.” Swanson, 790 F.3d at 240

(cleaned up). To the contrary, our decision carefully combed

“the complaint and declarations to assess whether the

plaintiff’s assertions suffice to show the elements of standing.”

Carpenters, 854 F.3d at 5. We explained that the declarations

in that case identified specific “harms ranging from lost sales

and diminished production to closures and layoffs.” Id. at 9.

As discussed above, Dillenburg’s one-page declaration makes

no similar showing.

The declaration suggests a second injury: Dillenburg

“oppose[s] the misuse of checkoff funds … for the purpose of

influencing legislation,” because he “believe[s]” those efforts

are “harmful to [him] and other independent farmers.” J.A.

147. This theory of injury also falls short. Plaintiffs cannot

predicate Article III standing on a “mere interest in a problem

or an ideological injury.” PETA v. USDA, 797 F.3d 1087, 1094

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(D.C. Cir. 2015) (cleaned up). An “interest in the proper

administration of the laws” is canonically “nonconcrete.”

Summers v. Earth Island Inst., 555 U.S. 488, 497 (2009)

(quotation marks omitted). Here, Dillenburg does not explain

how his pork business is harmed by lobbying to promote the

pork industry, let alone identify a specific lobbying activity that

causes him a concrete injury. Instead, Dillenburg highlights

his general opposition to the Council’s lobbying and the

government’s funding of it. This declares “only a generally

available grievance about government,” which “does not state

an Article III case or controversy.” Defs. of Wildlife, 504 U.S.

at 573–74.

Finally, the plaintiffs cannot salvage this case based on the

possible standing of the Humane Society or Iowa Citizens. On

summary judgment, neither organization filed any standing

declarations or affidavits. And now in this Court, the plaintiffs

do not assert the standing of these organizations as an

alternative ground for reaching the merits. The plaintiffs thus

have twice forfeited any claim that these organizations have

standing. See Scenic Am., 836 F.3d at 53 n.4 (“Although a

party cannot forfeit a claim that we lack jurisdiction, it can

forfeit a claim that we possess jurisdiction.”).

* * * *

Because the plaintiffs offer no evidence that the Board’s

alleged misuse of checkoff funds caused them to suffer an

injury in fact, we vacate the district court’s order and remand

with instructions to dismiss the case for lack of standing.

So ordered.