Hettinga v. United States

United States Court of Appeals

FOR THE DISTRICT OF COLUMBIA CIRCUIT

Argued December 12, 2011 Decided April 13, 2012

No. 11-5065

HEIN HETTINGA, ET AL.,

APPELLANTS

v.

UNITED STATES OF AMERICA,

APPELLEE

Appeal from the United States District Court

for the District of Columbia

(No. 1:06-cv-01637)

Alfred W. Ricciardi argued the cause and filed the briefs

for appellants.

Kelsi Brown Corkran, Attorney, U.S. Department of

Justice, argued the cause for appellee. With her on the brief

were Tony West, Assistant U.S. Attorney, and Michael S.

Raab, Attorney.

R. Craig Lawrence, Assistant U.S. Attorney, entered an

appearance.

Charles M. English Jr. was on the brief for amici curiae

United Dairymen of Arizona, et al. in support of appellee.

2

Before: SENTELLE, Chief Judge, BROWN and GRIFFITH,

Circuit Judges.

Opinion for the Court filed PER CURIAM.

Concurring opinion filed by Circuit Judge BROWN, with

whom Chief Judge SENTELLE joins.

Concurring opinion filed by Circuit Judge GRIFFITH.

PER CURIAM:

Plaintiff-appellants Hein and Ellen Hettinga appeal the

dismissal of their constitutional challenges to two provisions

of the Milk Regulatory Equity Act of 2005 (“MREA”), Pub.

L. No. 109-215, 120 Stat. 328 (2006) (codified at 7 U.S.C. §

608c). The Hettingas alleged that the provisions, which

subjected certain large producer-handlers of milk to

contribution requirements applicable to all milk handlers,

constituted a bill of attainder and violated the Equal

Protection and Due Process Clauses. The district court

disagreed, and we affirm.

I

Milk markets in the United States are regulated by a

complex system of price controls dating back to the New

Deal. The Agricultural Marketing Agreement Act of 1937, 7

U.S.C. §§ 601–74 (“AMAA”), authorizes the Secretary of

Agriculture to issue regional milk marketing orders that

govern payments from milk processors and distributors

(“handlers”) to dairy farmers (“producers”). Id. § 608c(1).

Under a typical milk market order, a dairy farmer supplies

raw milk to a processor or distributor, and the handler pays

money into a centralized “producer settlement fund” at fixed

prices based on the intended use of the milk. Edaleen Dairy

3

LLC v. Johanns, 467 F.3d 778, 779–80 (D.C. Cir. 2006).

Handlers using their milk for “high value” uses, such as fluid

milk, pay higher prices than handlers that engage in “low-

value” uses, such as the processing of butter or cheese. Id.

The money that handlers pay into the producer settlement

fund is then proportionally redistributed to milk producers at a

uniform “blend price” based on quantity of milk sold. See 7

U.S.C. § 608c(5)(B)(ii). This system ensures that all dairy

farmers receive the same price for their raw milk regardless of

whether they sell to high-value or low-value handlers.

Firms that operate as both producers and handlers create

serious complications for this system. In such cases, there is

no opportunity for the producer-handler to pay into the

centralized producer settlement fund because there is no

intermediate sale of raw milk. Edaleen Dairy, 467 F.3d at

780. Until recently, the Secretary of Agriculture therefore

exempted producer-handlers from the pricing and pooling

requirements of federal milk marketing orders. Id. The

pricing and pooling requirements also did not apply to

handlers who sold milk in geographic areas that were not

regulated by federal milk marketing orders, even if the

handler itself was located in a federally-regulated area.

The Hettingas own two dairy operations that fell within

these exemptions. The first is Sarah Farms, an integrated

producer-handler located in Yuma, Arizona. Sarah Farms

processes and sells over three million pounds of its own milk

per month in the federally regulated Arizona Marketing Area.

The second is GH Dairy, an independent milk processing

plant which they own in partnership with their son. GH

Dairy, a handler located in Arizona, processes raw milk into

bottled milk and milk products that are sold exclusively in

California. Because California is not a federally regulated

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milk marketing area, GH Dairy was not subject to the federal

pricing and pooling requirements.

On February 24, 2006, the USDA adopted a Final Rule

that would have eliminated the producer-handler exemption

for firms that operate in the Arizona and Pacific Northwest

Marketing Areas and sell more than three million pounds of

their own milk per month—a group that includes Sarah

Farms. See Milk in the Pacific Northwest and Arizona-Las

Vegas Marketing Areas; Order Amending the Orders, 71 Fed.

Reg. 9,430 (Feb. 24, 2006) (“USDA Rule”). The decision to

eliminate the exemption for these large producer-handlers was

based on evidence of “disorderly marketing conditions”—

specifically, that large producer-handlers were obtaining a

“competitive sales advantage” over fully-regulated handlers,

and were causing a “measurabl[e] and significant[]” decrease

in the blend price being paid to regulated producers. Milk in

the Pacific Northwest and Arizona-Las Vegas Marketing

Areas; Final Decision on Proposed Amendments to

Marketing Agreement and to Orders, 70 Fed. Reg. 74,166,

74,186–88 (Dec. 14, 2005). The USDA Rule was scheduled

to go into effect on April 1, 2006. The Hettingas filed suit in

the U.S. District Court for the Northern District of Texas,

challenging the legality of the USDA Rule and seeking a

preliminary injunction. Oral argument was scheduled for

March 29, 2006.

On the day before the Texas district court heard

arguments in the Hettingas’ case, Congress amended the

AMAA by passing the MREA. 1 President Bush subsequently

signed the MREA into law on April 11, 2006. Subsection N

1

The Texas district court denied the Hettingas’ motion for a

preliminary injunction against the USDA Rule, and the Hettingas

voluntarily dismissed their case. See Compl. at ¶¶ 45–46.

5

of the MREA, 7 U.S.C. § 608c(5)(N), codified the USDA

Rule’s revocation of the exemption for large producer-

handlers in the Arizona Marketing Area, including Sarah

Farms. Unlike the USDA Rule, however, it applied neither to

Nevada, which Congress exempted from coverage by any

federal milk marketing orders, nor to the Pacific Northwest

Milk Marketing Area. Subsection M of the MREA, id. §

608c(5)(M), imposed the federal pricing and pooling

requirements on handlers, like GH Dairy, that were located in

a federally regulated area but sold packaged milk exclusively

in a state not covered by a federal milk marketing order, such

as California.

The Hettingas challenged the constitutionality of the

MREA in the U.S. District Court for the District of Columbia.

First, they alleged that Subsections M and N of the MREA

violate the Bill of Attainder Clause by singling them out for

legislative punishment. Compl. ¶¶ 53–57. Second, the

Hettingas claim the MREA denies them equal protection by

“singling them out for adverse treatment that is extended to no

other producer-handler in any other Milk Marketing Area.”

Id. ¶ 65. Finally, they claim the MREA denied them due

process of law by foreclosing judicial review of the USDA

Rule in the Northern District of Texas. Id. ¶ 60. The district

court initially dismissed the Hettingas’ claims for failure to

exhaust administrative remedies, but this Court reversed and

remanded, holding that the AMAA’s exhaustion requirements

do not apply to facial constitutional challenges. Hettinga v.

United States, 560 F.3d 498, 504–06 (D.C. Cir. 2009). On

remand, the district court dismissed the Hettingas’ complaint

for failure to state a claim under Fed. R. Civ. P. 12(b)(6) and

denied leave to file a supplemental complaint. Hettinga v.

United States, 770 F. Supp. 2d 51 (D.D.C. 2011).

6

We review de novo a district court’s dismissal of a claim

under Rule 12(b)(6). Atherton v. Dist. of Columbia Office of

the Mayor, 567 F.3d 671, 681 (D.C. Cir. 2009). To survive a

motion to dismiss, a complaint must have “facial plausibility,”

meaning it must “plead[] factual content that allows the court

to draw the reasonable inference that the defendant is liable

for the misconduct alleged.” Ashcroft v. Iqbal, 129 S. Ct.

1937, 1949 (2009). In evaluating a Rule 12(b)(6) motion, the

Court must construe the complaint “in favor of the plaintiff,

who must be granted the benefit of all inferences that can be

derived from the facts alleged.” Schuler v. United States, 617

F.2d 605, 608 (D.C. Cir. 1979). Factual allegations, although

assumed to be true, must still “be enough to raise a right to

relief above the speculative level.” Bell Atl. Corp. v.

Twombly, 550 U.S. 544, 555 (2007). But the Court need not

accept inferences drawn by plaintiff if those inferences are not

supported by the facts set out in the complaint, nor must the

court accept legal conclusions cast as factual allegations.

Kowal v. MCI Commc’ns Corp., 16 F.3d 1271, 1276 (D.C.

Cir. 1994).

II

Article I, Section 9, cl. 3 of the United States Constitution

states that “[n]o Bill of Attainder or ex post facto law shall be

passed.” A bill of attainder is “a law that legislatively

determines guilt and inflicts punishment upon an identifiable

individual without provision of the protections of a judicial

trial.” Foretich v. United States, 351 F.3d 1198, 1216 (D.C.

Cir. 2003). To constitute a bill of attainder, a statute must: (1)

apply with specificity to affected persons; (2) impose

punishment; and (3) assign guilt without a judicial trial. See

Selective Serv. Sys. v. Minn. Pub. Interest Research Grp., 468

U.S. 841, 846–47 (1984).

7

The element of specificity may be satisfied if the statute

singles out a person or class by name or applies to “easily

ascertainable members of a group.” Foretich, 351 F.3d at

1217. A bill of attainder need not expressly name its target;

some bills of attainder simply describe them. BellSouth Corp.

v. FCC, 144 F.3d 58, 62 (D.C. Cir. 1998). The “easily

ascertainable” requirement is only satisfied where the

challenged statute “describe[s] [the targeted class] in terms of

conduct which, because it is past conduct, operates only as a

designation of particular persons.” Communist Party of the

United States v. Subversive Activities Control Bd., 367 U.S. 1,

86 (1960) (emphasis added). Indeed, the Supreme Court has

recognized a “decisive distinction” between statutes that

impermissibly punish past actions and those that permissibly

address future conduct. Am. Commc’ns Ass’n, C.I.O. v.

Douds, 339 U.S. 382, 413–14 (1950).

The MREA does not identify Sarah Farms, GH Dairy, or

the Hettingas by name. Nonetheless, the Hettingas claim their

businesses constitute an “easily ascertainable” group because

they are currently the only producer-handlers being regulated

by the MREA. Specifically, Sarah Farms is currently the only

producer-handler that meets the three-million-pounds-per-

month threshold established by Subsection (N), and GH Dairy

is currently the only handler located within the Arizona

Marketing Area—but outside of Nevada—that sells

exclusively in the California market. See Appellant’s Br. at

20.

Longstanding Supreme Court precedent readily dispenses

with this argument. Applicability of the MREA does not turn

on the past conduct of producer-handlers, but rather regulates

these dairy operations’ future business decisions, such as the

volume of milk they will produce and the markets into which

they will sell their product. Moreover, the MREA would

8

apply to any producer-handler that meets its statutory

requirements, not only the Hettingas. A statute with open-

ended applicability, i.e., one that “attaches not to specified

organizations but to described activities in which an

organization may or may not engage,” does not single out a

particular person or group for punishment. Communist Party,

367 U.S. at 86.

The Hettingas also argue that because the MREA

currently applies only to their businesses, it must satisfy the

specificity requirement. They further note that the designated

category—producer-handlers that sell over 3 million gallons

of milk per month—is not a group susceptible to ready

enlargement, as it has taken the Hettingas many years to grow

their businesses to their current scope. See Appellant’s Br. at

24.

The Supreme Court has held, however, that even a statute

that affects only one person does not necessarily apply with

the requisite specificity to qualify as a bill of attainder. In

Nixon v. Administrator of General Services, for example, the

Supreme Court found no specificity in the Presidential

Recordings and Materials Preservation Act, Pub. L. No. 93-

526, 88 Stat. 1695 (1974), even though Title I referred to

President Nixon by name and dealt exclusively with his

papers. 433 U.S. 425, 471–72 (1977). Because Title II was

open-ended and could apply to future presidents, the statute

was not a bill of attainder. Id. The Court cautioned that the

President’s argument that “an individual or defined group is

attainted whenever he or it is compelled to bear burdens

which the individual or group dislikes” would “cripple the

very process of legislating, for any individual or group that is

made the subject of adverse legislation can complain that the

lawmakers could and should have defined the relevant

affected class at a greater level of generality.” Id. at 470.

9

Nixon makes clear that a current “class of one” does not

necessarily satisfy the specificity requirement, and the Court

has never suggested that the likelihood of future expansion of

the designated class should play any role in the specificity

analysis. Much like Title II of the Presidential Recordings

and Materials Preservation Act, the MREA can theoretically

apply to an unlimited number of handlers who meet its

statutory requirements. “Since virtually all legislation

operates by identifying the characteristics of the class

benefited or burdened,” BellSouth Corp., 144 F.3d at 63, the

mere fact that the “class” currently happens to contain only

one member does not transform an open-ended statute into a

bill of attainder.

The Hettingas also claim that the district court

procedurally erred by determining whether the Hettingas were

easily ascertainable as the target of the legislation. While the

Court is required to accept the truth of the plaintiffs’ factual

allegations and to draw inferences in their favor, it is not

required to accept the plaintiffs’ legal conclusions. See Iqbal,

129 S.Ct. at 1949. Whether or not the Hettingas’ “identity as

the target of the Congressional action is easily ascertainable,”

Compl. at ¶ 48, is a legal conclusion, not a factual allegation.

The sole factual allegations offered by the Hettingas establish

that Subsections M and N currently apply only to their

businesses, id., and that a few opponents of the legislation

believed passage of the MREA was driven by special interest

groups who wanted to remove the Hettingas’ competitive

advantage. See id. at ¶¶ 40–44. As explained above, these

factual allegations simply do not satisfy the legal definition of

an “easily ascertainable” group, as defined by the Supreme

Court and this Circuit.

10

Because we find the MREA does not apply with

specificity to affected persons, we need not decide whether it

satisfies either of the remaining elements of a bill of attainder.

We therefore affirm the district court’s dismissal of the

Hettingas’ bill of attainder claim.

III

We grant statutes involving economic policy a “strong

presumption of validity.” FCC v. Beach Commc’ns, Inc., 508

U.S. 307, 314 (1993). A statutory classification that “neither

proceeds along suspect lines nor infringes fundamental

constitutional rights must be upheld against equal protection

challenge if there is any reasonably conceivable state of facts

that could provide a rational basis for the classification.” Id.

at 313. “Where there are plausible reasons for Congress’

action, our inquiry is at an end.” Id. at 313–14. The

challenger bears the burden of showing that the statute is not a

rational means of advancing a legitimate government purpose.

See Bd. of Trs. of the Univ. of Ala. v. Garrett, 531 U.S. 356,

367 (2001).

The district court dismissed the Hettingas’ equal

protection claim because it found the MREA provides a

rational means of ensuring orderly milk markets by (1)

preventing handlers located in regulated regions from gaining

advantages over their competitors by exporting milk to

unregulated regions and (2) preventing large producer-

handlers in a federally-regulated region from undercutting

other handlers in that region with unregulated sales. On

appeal, the Hettingas claim the district court applied too

deferential a standard of review, arguing that rational basis

review is “not [] toothless.” Logan v. Zimmerman Brush Co.,

455 U.S. 422, 439 (1982) (Blackmun, J., concurring).

11

Regardless of how Justice Blackmun characterized

rational basis review, the Supreme Court’s subsequent

decisions in Beach makes clear that “not toothless” does not

mean “growling.” Here, the government provided a rational

explanation for its decision to close two loopholes in the

AMAA scheme—that large dairy businesses have used the

exemptions to gain a substantial—and ultimately disruptive—

competitive advantage over their regulated competitors.

Beach requires us to accept this explanation and end our

inquiry here. See Beach Commc’ns, 508 U.S. at 313–14.

Although the classification might indeed be unfair to the

Hettingas, mere disparity of treatment is not sufficient to state

an equal protection violation.

The Hettingas reprise the claim that the district court

erred by drawing factual conclusions at the pleading stage.

Because the district court must accept their well-pled facts as

true, the Hettingas argue, the only questions are whether (1)

plaintiffs have shown that there are separate groups subjected

to disparate treatment; and (2) there are facts suggesting this

disparate treatment “may not be rational, or is not for

legitimate purposes.” Appellant’s Br. at 47. In so arguing, the

Hettingas again misstate the relevant legal standard. Even at

the motion to dismiss stage, a plaintiff alleging an equal

protection violation must plead facts that establish that there

is not “any reasonable conceivable state of facts that could

provide a rational basis for the classification.” Dumaguin v.

Sec’y of Health and Human Servs., 28 F.3d 1218, 1222 (D.C.

Cir. 1994). Here, the government provided an explanation

that is not only rational on its face, but also has been

consistently recognized by the courts as legitimate. See, e.g.,

Nebbia v. New York, 291 U.S. 502, 529–37 (1934); Lamers

Dairy, Inc. v. Dep’t of Agric., 379 F.3d 466, 473 (7th Cir.

2004); Shamrock Farms Co. v. Veneman, 146 F.3d 1177,

1183 (9th Cir. 1988).

12

IV

The Hettingas claim that the MREA violated their

procedural rights under the Due Process Clause by foreclosing

judicial review of the USDA’s decision to implement the

Final Rule. Specifically, the Complaint alleges that the

MREA was passed in the House the night before oral

argument on the Hettingas’ motion for a preliminary

injunction in Hettinga v. Johanns; an attorney for the

government called the court’s attention to the passage of the

MREA at the hearing; and the court subsequently denied the

Hettingas’ motion for a preliminary injunction.

The Hettingas failed to plead the threshold requirement

of a due process claim: that the government has interfered

with a cognizable liberty or property interest. Kentucky Dep’t

of Corrs. v. Thompson, 490 U.S. 454, 460 (1989). The

Hettingas have no liberty or property interest in the regulatory

status quo. The MREA does not implicate the Hettingas’

liberty interest in practicing their profession because the

statute does not prevent them from operating their dairies; it

merely subjects them to certain regulations if they choose to

continue to operate under their current business model. The

statute also does not implicate the Hettingas’ property interest

in a cause of action, as the legislation did not actually

terminate their ongoing claim against the USDA. Rather, the

Hettingas themselves dismissed their still-nascent claim

because they believed the legislation rendered it moot. See

Compl. at ¶¶ 45–46. Moreover, Congress frequently enacts

legislation that moots pending cases, and such action has

never been found to raise any due process concerns.

V

13

Finally, we find that the district court did not abuse its

discretion by refusing to allow the Hettingas to file a

supplemental complaint. A district court may deny a motion

to amend a complaint as futile if the proposed claim would

not survive a motion to dismiss. James Madison Ltd. by

Hecht v. Ludwig, 82 F.3d 1085, 1099 (D.C. Cir. 1996). The

Hettingas requested leave to supplement their claim with new

allegations that arose from a political campaign commercial

of Nevada Senator Harry Reid. The proposed amendments

would have been futile, because Senator Reid’s alleged

support for the MREA does not support the Hettingas’ claims

that they are the “easily ascertainable” targets of the MREA,

that the statute inflicts legislative punishment without a trial,

or that the statute violates their Equal Protection or Due

Process rights.

For the foregoing reasons, the decision of the district

court is

Affirmed.

BROWN, Circuit Judge, with whom Chief Judge

SENTELLE joins, concurring: I agree fully with the court’s

opinion. Given the long-standing precedents in this area no

other result is possible. Our precedents forced the Hettingas to

make a difficult legal argument. No doubt they would have

preferred a simpler one—that the operation and production of

their enterprises had been impermissibly collectivized—but a

long line of constitutional adjudication precluded that claim.

The Hettingas’ sense of ill-usage is understandable. So is

their consternation at being confronted with the gap between

the rhetoric of free markets and the reality of ubiquitous

regulation. The Hettingas’ collision with the MREA—the

latest iteration of the venerable AMAA—reveals an ugly

truth: America’s cowboy capitalism was long ago disarmed

by a democratic process increasingly dominated by powerful

groups with economic interests antithetical to competitors and

consumers. And the courts, from which the victims of

burdensome regulation sought protection, have been

negotiating the terms of surrender since the 1930s.

First the Supreme Court allowed state and local

jurisdictions to regulate property, pursuant to their police

powers, in the public interest, and to “adopt whatever

economic policy may reasonably be deemed to promote

public welfare.” Nebbia v. New York, 291 U.S. 502, 516

(1934). Then the Court relegated economic liberty to a lower

echelon of constitutional protection than personal or political

liberty, according restrictions on property rights only minimal

review. United States v. Carolene Products Co., 304 U.S.

144, 152–53 (1938). Finally, the Court abdicated its

constitutional duty to protect economic rights completely,

acknowledging that the only recourse for aggrieved property

owners lies in the “democratic process.” Vance v. Bradley,

440 U.S. 93, 97 (1979). “The Constitution,” the Court said,

“presumes that, absent some reason to infer antipathy, even

2

improvident decisions will eventually be rectified by the

democratic process and that judicial intervention is generally

unwarranted no matter how unwisely we may think a political

branch has acted.” Id.

As the dissent predicted in Nebbia, the judiciary’s refusal

to consider the wisdom of legislative acts—at least to inquire

whether its purpose and the means proposed are “within

legislative power”—would lead to only one result: “[R]ights

guaranteed by the Constitution [would] exist only so long as

supposed public interest does not require their extinction.”

291 U.S. at 523. In short order that baleful prophecy

received the court’s imprimatur. In Carolene Products (yet

another case involving protectionist legislation), the court

ratified minimalist review of economic regulations, holding

that a rational basis for economic legislation would be

presumed and more searching inquiry would be reserved for

intrusions on political rights. 304 U.S. at 153 n.4.

Thus the Supreme Court decided economic liberty was

not a fundamental constitutional right, and decreed economic

legislation must be upheld against an equal protection

challenge “if there is any reasonably conceivable state of facts

that could provide a rational basis” for it. FCC v. Beach

Commc’ns, Inc., 508 U.S. 307, 313 (1993). See also Pac.

States Box & Basket Co. v. White, 296 U.S. 176, 185–86

(1935); Steffan v. Perry, 41 F.3d 677, 684–85 (D.C. Cir.

1994) (en banc).

This standard is particularly troubling in light of the

pessimistic view of human nature that animated the Framing

of the Constitution—a worldview that the American polity

and its political handmaidens have, unfortunately, shown to

be largely justified. See James Madison, Notes of Debates in

the Federal Convention of 1787, at 39, 42 (W. W. Norton &

3

Co. 1987). Moreover, what the Framers theorized about the

destructive potential of factions (now known as special or

group interests), experience has also shown to be true. The

Federalist No. 10, at 78, 81 (James Madison) (Clinton

Rossiter ed., 1961). The judiciary has worried incessantly

about the “countermajoritarian difficulty” when interpreting

the Constitution. But the better view may be that the

Constitution created the countermajoritarian difficulty in

order to thwart more potent threats to the Republic: the

political temptation to exploit the public appetite for other

people’s money—either by buying consent with broad-based

entitlements or selling subsidies, licensing restrictions, tariffs,

or price fixing regimes to benefit narrow special interests.

The Hettingas believe they are the victims of just such

shenanigans. Compl. ¶¶ 40–45. And press accounts during

the height of the controversy support the claim. See Dan

Morgan, Sarah Cohen, & Gilbert M. Gaul, “Dairy Industry

Crushed Innovator Who Bested Price-Control System,” Wash.

Post, Dec. 10, 2006, available at

http://www.washingtonpost.com/wp-

dyn/content/article/2006/12/09/AR2006120900925.html. The

Washington Post described Hein Hettinga as an American

success story. He emigrated to the U.S. after World War II

and started as a hired hand. By 1990, Hettinga owned half a

dozen dairies and decided to build his own bottling business.

A Costco vice president showed reporters copies of an e-mail

he sent to Senator Reid during the legislative debate,

explaining that Southern California purchasers of milk were

the victims of “a brazen case of price gouging and

profiteering by the strongest, largest market suppliers,” who

turned a deaf ear to the company’s call for lower prices. Hein

Hettinga changed all that. His arrangement with Costco

“lowered the average price of milk by 20 cents a gallon

4

overnight” until two senators, one from each party, pushed

through the milk legislation at issue in this case.

Very little seems to have changed since the Supreme

Court’s initial confrontation with the regulation of milk

pricing in Nebbia. The state of New York, responding to

falling prices caused by the Great Depression, created a Milk

Control Board, which proposed to remedy weak demand by

establishing a minimum price for milk, and making sale of

milk at any lower price a crime. 291 U.S. at 515, 519. Leo

Nebbia sold two quarts of milk and a five-cent loaf of bread

for eighteen cents, and was convicted of violating the board’s

order. Id. at 515.

Even Justice McReynolds saw the irony. The law, he

said, “impose[d] direct and arbitrary burdens upon those

already seriously impoverished” to give special benefits to

others. Id. at 557. “To him with less than 9 cents it says:

You cannot procure a quart of milk from the grocer although

he is anxious to accept what you can pay and the demands of

your household are urgent! A superabundance; but no child

can purchase from a willing storekeeper below the figure

appointed by three men at headquarters!” Id. at 557–58.

To be sure, the economic climate in which the New York

legislature enacted the law at issue in Nebbia was truly dire,

but 78 years later, the same tired trope about “disorderly

market conduct” is still extant. The Hettingas built their

business on an exemption—one that was profitable for them

and beneficial for consumers. The government acknowledged

that the decision to eliminate the exemption was based on

evidence that large producer-handlers were obtaining a

“decisive competitive advantage” over fully-regulated

handlers, Appellees’ Br. at 7, and were causing a measurable

and “significant[]” decrease in the blend prices being paid to

5

regulated handlers. See 70 Fed. Reg. 74,166, 74,186 (Dec.

14, 2005). As another court has noted, federal regulation of

milk pricing “is premised on dissatisfaction with the results of

competition.” Alto Dairy v. Veneman, 336 F.3d 560, 562 (7th

Cir. 2003). “[M]ilk price discrimination is intended to

redistribute wealth from consumers to producers of milk.” Id.

Once again, the government has thwarted the free market, and

ultimately hurt consumers, to protect the economic interests

of a powerful faction. Neither the legislators nor the lobbyists

broke any positive laws to accomplish this result. It just

seems like a crime.

The judiciary justifies its reluctance to intervene by

claiming incompetence—apparently, judges lack the acumen

to recognize corruption, self-interest, or arbitrariness in the

economic realm—or deferring to the majoritarian imperative.

But see The Federalist No. 78, at 467 (Alexander Hamilton)

(Clinton Rossiter ed., 1961). The practical effect of rational

basis review of economic regulation is the absence of any

check on the group interests that all too often control the

democratic process. It allows the legislature free rein to

subjugate the common good and individual liberty to the

electoral calculus of politicians, the whim of majorities, or the

self-interest of factions. See Randy E. Barnett, Restoring the

Lost Constitution: The Presumption of Liberty 260 (2004).

The hope of correction at the ballot box is purely illusory.

See generally Ilya Somin, Political Ignorance and the

Counter-Majoritarian Difficulty: A New Perspective on the

Central Obsession of Constitutional Theory, 89 Iowa L. Rev.

1287 (2004). In an earlier century, H. L. Mencken offered a

blunt assessment of that option: “[G]overnment is a broker in

pillage, and every election is a sort of advance auction sale of

stolen goods.” On Politics: A Carnival of Buncombe 331

(1996). And, as the Hettingas can attest, it’s no good hoping

6

the process will heal itself. Civil society, “once it grows

addicted to redistribution, changes its character and comes to

require the state to ‘feed its habit.’” Anthony De Jasay, The

State 226 (1998). The difficulty of assessing net benefits and

burdens makes the idea of public choice oxymoronic. See id.

at 248. Rational basis review means property is at the mercy

of the pillagers. The constitutional guarantee of liberty

deserves more respect—a lot more.

GRIFFITH, Circuit Judge, concurring: I, too, agree fully with

the per curiam opinion, but do not join my colleagues’

concurrence with its spirited criticism of the Supreme Court’s

long-standing approach to claims of economic liberty.

Although by no means unsympathetic to their criticism nor

critical of their choice to express their perspective, I am

reluctant to set forth my own views on the wisdom of such a

broad area of the Supreme Court’s settled jurisprudence that

was not challenged by the petitioner.