Amicus Curiae Brief — Johanns v. Livestock Marketing Assn.

-—

Nos. 03-1164 & 03-1165

In The

Supreme Court of the United States —

¢

ANN VENEMAN, SECRETARY, UNITED STATES

DEPARTMENT OF AGRICULTURE, ET AL.,

Petitioners,

7

LIVESTOCK MARKETING ASSOCIATION, ET AL.,

Respondents.

v

NEBRASKA CATTLEMEN, INC., ET AL.,

Petitioners,

Vv.

LIVESTOCK MARKETING ASSOCIATION, ET AL.,

Respondents.

° one

On Writ Of Certiorari To The

United States Court Of Appeals

For The Eighth Circuit

¢

BRIEF OF ROSE ACRE FARMS, INC. AS AMICUS

CURIAE IN SUPPORT OF RESPONDENTS

¢

CORINNE R. FINNERTY

McCoNNELL & FINNERTY

Post Office Box 90

North Vernon, LN 47265

(812) 346-5201

Counsel of Record for

Amicus Curtae

LOREN D. REUTER

3750 State Road 135 North

Nashville, IN 47448

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(812) 9Y8SS8-757]

COCKLE LAW BRIFF PRINTING. CO 8 H'n4

OR CALL COLLECT (402) dae cat

1

MOTION FOR LEAVE TO FILE BRIEF

AMICUS CURIAE AND STATEMENT OF INTEREST

Rose Acre Farms, Inc. hereby respectfully moves for

leave to file the attached brief amicus curiae in this case.

The consent of the attorneys for the petitioners, Ann

Veneman, Secretary, United States Department of Agricul-

ture, Nebraska Cattlemen, Inc., Gary Sharp, and Ralph

Jones, has been obtained. The consent of the attorneys for

the respondents, Livestock Marketing Association, et al.,

was requested but refused.

The interest of Rose Acre Farms, Inc. in these cases

arises from the fact that it is the nation’s second largest

egg producer and the American egg industry is subject to

statutes and regulations which are similar to those at

issue in these cases. 7 U.S.C. §§2701, et seq.; implemented

by the Egg Research and Promotion Order appearing at 7

C.F.R. §§1250, et seg. Rose Acre Farms, Inc. does business

throughout the U.S. and paid in excess of $1.2 million

dollars in assessments during its last fiscal year which

were used by the American Egg Board to fund generic egg

advertising with which Rose Acres disagrees. “The In-

credible, Edible Egg” campaign is one example. The

American Egg Board spent at least 57% of its revenues of

$19.993 million dollars in the 2003 calendar year on

advertising and promotional activities.

Rose Acre Farms, Inc. produces specialty eggs which

have enhanced nutritional value due to the use of special

chicken feeds and also produces cage free eggs, neither of

which types of eggs are advertised by the American Egg

Board. Rose Acre Farms, Inc. is also participating in the

United Egg Producers’ Animal Care Certified Program which

certifies that chickens producing eggs are treated in a

humane manner. This program includes minimum stan-

dards for cage space, air quality, molting practices, and beak

2

trimming practices. The generic advertising engaged in by

the American Egg Board promotes the consumption of eggs

which do not meet these high quality standards. It conveys a

message that eggs are a generic product that bear no distinc-

tion based on where and how they are produced.

Maintenance of the Animal Care Certified Program

quality standards increases the cost of producing eggs.

Therefore, generic advertising which fails to differentiate

between eggs produced by Animal Care Certified Program

participants and non-participants has the effect of imposing

a competitive disadvantage on program participants. Thus,

generic advertising by the American Egg Board has the

added negative effect of reducing or eliminating any incen-

tive on the part of egg producers to participate in the Animal

Care Certified Program which is intended to improve the

conditions under which chickens producing eggs live.

The American Egg Board generic advertising also

promotes the consumption of eggs produced outside the

U.S. with which Rose Acre Farms, Inc. disagrees.

Respectfully submitted,

CORINNE R. FINNERTY

MCCONNELL AND FINNERTY

Counsel for Rose Acre Farms, Inc.

Post Office Box 90

North Vernon, IN 47265

(812) 346-5201

Of Counsel:

LOREN D. REUTER

Counsel for Rose Acre Farms, Inc.

3750 State Road 135 North

Nashville, IN 47448

(812) 988-7571

a

QUESTION PRESENTED

Whether the Beef Promotion and Research Act of 1985

(Beef Act), 7 U.S.C. §§2901 et seq., and the implementing

Beef Promotion and Research Order (Beef Order), 7 C.F.R.

Part 1260, violate the First Amendment insofar as they

require cattle producers to pay assessments to fund

generic advertising with which they disagree.

ii

- TABLE OF CONTENTS

Page

Motion for Leave to File Brief Amicus Curiae and

ee 1

Grrsstians Presembe’ 2occ.cccccceveccccscsssescosessescoshocoesMesssescosss i

ye Ci sccenctrcnecnssisnnnenseerncniissciieiciaiitiiaiigiaiiaiiaiaisainiata il

ey Ee I iiccttcsccccnncsncitnsirinnnaitiniiiiintamiemmnanenate ili

Summary of the Argument aes ciiiiieeblaiateee ee

I. The Beef Act Violates The First Amendment

Because It Compels Cattle Producers And Im-

porters To Pay Assessments To Fund Generic

Advertising With Which They Disagree............ 1

II. Compelled Generic Advertising Under The

Beef Act Is Not A Permissible Regulation Of

eee 3

II]. Generic Advertising Under The Beef Act

Cannot Survive First Amendment Scrutiny As

Part Of A Broad Regulatory Scheme................. 3

I. The Beef Act Violates The First Amendment

Because It Compels Cattle Producers And Im-

porters To Pay Assessments To Fund Generic

Advertising With Which They Disagree............ 4

Il. Compelled Generic Advertising Under The

Beef Act Is Not A Permissible Regulation Of

Caommemenelad TGGER nccceccccesscsccessevsnssvssncsetonsenssens 18

III. Generic Advertising Under The Beef Act

Cannot Survive First Amendment Scrutiny As

Part Of A Broad Regulatory Scheme................. 20

LTT STEIN NT eR 25

ill

TABLE OF AUTHORITIES

Page

CASES:

Abood v. Detroit Bd. of Ed., 431 U.S. 209 (1977).......... 8, 23

Central Hudson Gas and Electric Corp. v. Public

Serv. Comm'n of N.Y., 447 U.S. 557 (1980)......... 3, 16, 19

Charter v. USDA, 230 F. Supp. 1121 (D.C. Mont.

even ne ene A a TN OO 10

Glickman v. Wileman Brothers & Elliott, Inc., 521

FEET ETRE e ED On Re Sop passim

In re Washington State Apple Advertising Comm'n,

257 F. Supp.2d 1290 (E.D. Wash. 2003)...... 18, 19, 20, 21

Keller v. State Bar of California, 496 U.S. 1 (1990)...... 9, 23

Legal Services Corporation v. Velazquez, 531 US.

EE CEE iccnassnnstnnennnstniscnminedinenniaipmpinniniiiieidatiinidinaiamsis 9

Livestock Marketing Ass’n, et al. v. U.S. Dept. of

Agric., et al., 207 F. Supp.2d 992 (D.S.D. 2002)

a eel cnrinesinnenienimiientiniesiinhiaieniundbesinbsessiaiinmaseeciliticiiataliidiaadiail 6, 24

Michigan Pork Producers Ass’n, Inc. v. Veneman,

348 F.3d 157 (6th Cir. 2003)..........................000. 12, 13, 14

Pelts & Skins, LLC v. Landreneau, 365 F.3d 423

Ne Cee tininutniiinitscisiataitainstinaiiicsiatianatainiaininies 8,9, 15

Roberts v. United States Jaycees, 468 U.S. 609

Sarai cerssscncsinestaestecerniiladiainainemiaiiiemaiaiainbtitielidaataitaaciasiatiiiieiareii 7,16

Rust v. Sullivan, 500 U.S. 173 (1991)............cecccceeeeeeeees 11

Sante Fe Indep. Sch. Dist. v. Doe, 530 U.S. 290

See iccsersesectenceineiniadestinieitinnantaiaiiaiiininiinlminainahiisinasiath iii asia 11

iv

TABLE OF AUTHORITIES — Continued

Page

United States v. Frame, 885 F.2d 1119 (3rd Cir. 1989),

cert. denied, 493 U.S. 1094 (1990)..................... 6, 7, 16, 17

United States v. United Foods, 533 U.S. 405 (2001).....passim

Virginia Bd. of Pharmacy v. Virginia Citizens

Consumer Council, Inc., 425 U.S. 748 (1976) ............... 22

West Virginia State Bd. of Education v. Barnette,

ee ee ED tecseceierentcssnnsssncnsscsesmmstsenetenatmnianenn 7

Wooley v. Maynard, 430 U.S. 705 (1977).........:cccccccceeeeeeeees 7

Zauderer v. Office of Disciplinary Counsel, 471 U.S.

STE cciccirsiicisivcuivinieibsioniapinatinesinteniciddiednitiibegascinbaindediaitiie 19, 20

CONSTITUTION, STATUTES AND REGULATIONS:

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Fs eA cicinrnsicinsstanevcinsiieieubcivisnaiisiiasiainniiiabasabindaiidi 13, 15

ae 6

SF CEG, CIITA onsesnticeetisiseseiisiasinaeppncaninsiineninintaiidaiminbnnsinaieiaaideiian 5, 16

SIE STII icincnieneicnenniniienseneiiietuiiiieapmiapesianenddimiapeanindi 10

BF ee: Se ccicssicinsantisiinnennsnnencenenietannnilapininiuate 10, 15

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i eee 17

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F Ges SE OED, cercnssnassenesenenssersensscsemmmsmennesens 18, 21

7 C.F.R.:

Pt. 1260

IIT TT cniienstrhasialecnerpinenneieidiimassiienemianmenseinebaumenanniamieiel 6

1

SUMMARY OF THE ARGUMENT"

I. THE BEEF ACT VIOLATES THE FIRST

AMENDMENT BECAUSE IT COMPELS CAT-

TLE PRODUCERS AND IMPORTERS TO PAY

ASSESSMENTS TO FUND GENERIC ADVER-

TISING WITH WHICH THEY DISAGREE

“Beef. It’s What’s For Dinner.” is a message intended

to promote the beef industry throughout the U.S. However,

this message is anathema to some beef producers who

object to it because it promotes the consumption of beef

produced outside the U.S. It is objectionable to other beef

producers because it lumps all beef producers together

without regard to their method of production. This case

presents the question of whether a beef industry trade

group operated under the limited supervision of the U.S.

Department of Agriculture can compel dissenting beef

producers to contribute to generic advertising with which

they disagree.

The Beef Promotion and Research Act of 1985 (Beef

Act), 7 U.S.C. §§2901 et seg. and its accompanying regula-

tions set up organizations composed of private individuals

from the beef industry whose purpose is to promote the

industry. The Secretary of Agriculture appoints members

' Ann Veneman, Secretary, United States Department of Agricul-

ture, Nebraska Cattlemen, Inc., Gary Sharp, and Ralph Jones, have

consented to the filing of this brief. Letters of consent have been filed

separately with the Clerk of the Court.

The consent of the respondents, Livestock Marketing Association,

et al., was requested but refused.

This brief was authored in its entirety by counsel for the Amicus.

No person or entity, other than the Amicus and its counsel, made a

monetary contribution to the preparation or submission of this brief.

2

to the Beef Board, but they must be industry representa-

tives generally nominated by eligible state beef councils.

The Beef Act requires beef producers and importers to pay

a $1.00 per head assessment for each head of cattle sold to

fand promotional activities, primarily generic advertising.

The Beef Promotion Operating Committee (Committee)

has the responsibility to develop plans and projects for this

promotional activity. The Secretary appoints ten of twenty

members of the Committee, who must be members of the

Beef Board, i.e., industry representatives. The remaining

ten members of the Committee are producers elected by a

federation that includes as its members qualified state

beef councils, again industry repr*sentatives.

The Secretary does have authority to remove members

of the Beef Board, approve budgets, and approve specific

advertising campaigns, but rarely vetoes a proposed

advertising campaign. The principal object of the Beef

Program is the generic commercial speech that it funds. At

least one half of the assessments paid to the Beef Board

are used for advertising. Certain producers object to

paying the assessments because the generic advertising it

funds promotes beef consumption in general, which in-

cludes the consumption of beef produced outside the U.S.

Some producers object to paying for the advertising

because it does not differentiate among beef products.

The Committee is an organization composed of private

individuals representing one segment of the population

with certain common interests. The commercial speech

that it funds is compelled private speech, not government

speech. Not all government-facilitated speech is govern-

ment speech. The Secretary’s supervisory responsibilities

are not sufficient to transform the beef industry’s self help

program into government speech. As such, it is subject to

First Amendment analysis. The Beef Program violates the

3

First Amendment because it impinges on the producers’

free speech and association rights.

Il. COMPELLED GENERIC ADVERTISING UN.

DER THE BEEF ACT IS NOT A PERMISSIBLE

REGULATION OF COMMERCIAL SPEECH

Advertising is commercial speech which is entitled to

less First Amendment protection than other constitution-

ally guaranteed expression. When a private party engages

in advertising, the government is free to regulate it to

prevent it from being false, deceptive, or misleading. This

includes a right to compel an advertiser to make certain

disclosures to prevent its commercial speech from being

false, deceptive, or misleading. No one is claiming that

voluntary advertising placed by beef producers is false,

deceptive, or misleading. Therefore, the compelled generic

advertising done by the Committee cannot be upheld as a

form of compelled advertising disclosure under applicable

law.

It is not appropriate to apply the Central Hudson test

for restrictions on speech to analyze the First Amendment

issues presented by this case. The Central Hudson test

applies to cases involving restrictions on speech. The Beef

Program's assessments do not restrict speech, they compel

producers to pay for private speech with which they

disagree.

III. GENERIC ADVERTISING UNDER THE BEEF

ACT CANNOT SURVIVE FIRST AMENDMENT

SCRUTINY AS PART OF A BROAD REGULA-

TORY SCHEME

The Court has not upheld compelled subsidies for

speech in the context of programs where the principal

object of the program is the speech that it funds. An

overriding associational purpose independent from the

speech itself may permit compelled speech subsidies. The

Court has found such overriding associational purposes to

permit compelled speech in cases involving union shops,

state-mandated integrated bar associations, and heavily

regulated agricultural cooperatives.

The beef industry is not a heavily regulated agricul-

tural cooperative. While it is subject to certain government

regulations, beef producers are not bound together and are

not required to market their products as members of an

agricultural cooperative according to cooperative rules.

They remain free to make independent marketing deci-

sions. There are no marketing orders that regulate how

beef may be produced and sold. The beef producers remain

free to engage in independent market activity. As such,

some beef producers should not be permitted, with the

government's help, to compel dissenting producers to pay

for generic advertising with which they disagree.

7

ARGUMENT

I. THE BEEF ACT VIOLATES THE FIRST

AMENDMENT BECAUSE IT COMPELS CAT-

TLE PRODUCERS AND IMPORTERS TO PAY

ASSESSMENTS TO FUND GENERIC ADVER-

TISING WITH WHICH THEY DISAGREE

Beef may be what's for dinner, but not all beef produc-

ers wish to serve the same type of beef or associate with

each other in the generic promotion of beef. The beef

industry in the U.S. is a large and diverse industry.

5

Thirty-one states have at least 10,000 beef cattle opera-

tions. See pp. 5-6, Brief of Texas, 32 Other States and

Puerto Rico as Amici Curiae in Support of Petitioners.

Congress passed the Beef Promotion and Research Act of

1985 (Beef Act), 7 U.S.C. §§2901 et seqg., to promote the

beef industry due to its importance to the U.S. economy.

The Beef Act and the order implementing it creates a

structure of beef industry organizations whose principal

object is the funding and expression of the generic com-

mercial speech which is the subject of this case. All beef

producers and importers are compelled to pay the assess-

ments provided for by the Beef Program to fund this

generic commercial speech. Certain industry representa-

tives serve on the various state beef councils and the Beef

Operating Committee and are empowered to spend the

$82.7 million dollars generated by the beef checkoff

program in 2003 to promote the industry. See p. 7, Brief of

Federal Petitioners. At the federal level, twenty beef

industry representatives on the Committee are charged

with developing and overseeing the Beef Board’s promo-

tion program subject to the Secretary of Agriculture’s

“veto” power.

The Beef Board is composed of private individuals

who are appointed by the Secretary of Agriculture. 7

U.S.C. §2904(1). Members of the Beef Board must be cattle

producers and importers appointed by the Secretary from

nominations submitted by eligible state beef councils, or if

there is none for a particular state, in a different manner.

Importers are nominated in a manner determined by the

Secretary. Jd. The Secretary does not enjoy plenary discre-

tion to appoint anyone whom he or she pleases to the Beef

Board. The number of Beef Board representatives is

determined by the inventory of cattle in a particular unit.

Id. The composition of the Beef Board has been carefully

6

controlled to ensure that it represents private industry

interests in proportion to the inventory of cattle in a

particular geographic unit. The Beef Act has been de-

scribed as a “self help” measure that enables the beef

industry to employ its own resources and devise its own

strategies to increase beef sales, while avoiding the intru-

siveness of government regulation. The Beef Promotion

and Research Program receives no direct funding from the

federal government. General tax revenues are not used to

fund the program. United States v. Frame, 885 F.2d 1119,

1121 (3rd Cir. 1989), cert. denied, 493 U.S. 1094 (1990).

The Beef Act requires beef producers and importers to

pay an assessment of $1.00 per head for zach head of

cattle sold to fund promotional activities, primarily generic

advertising. Livestock Marketing Ass'n, et al. v. U.S. Dept.

of Agric., et al., 207 F. Supp.2d 992, 997-998 (D.S.D. 2002)

(LMA II). At least 50% of the assessments imposed on

cattle producers and importers paid to the Beef Board are

used for advertising. Jd. at 997-998, 1002. The District

Court found that the principal object of the beef checkoff

program is the commercial speech that it funds. Jd. at 997-

998, 1002. At least some of the beef producers disagree

with the type of advertising done by the Beef Board as it

implies that beef is all the same and promotes all beef

products, rather than only American beef products. Jd. at

996-997. Forty-five states have established qualified state

beef councils which may retain up to half of the checkoff

assessments they collect to fund in-state promotion and

other programs. 7 C.F.R. §1260.172; Trial Tr. 206-07, 316.

Congress has granted beef councils very broad powers to

promote the image and desirability of beef and beef prod-

ucts. 7 U.S.C. §2902(13), (14). Thus, an organization

composed of private individuals representing private

interests receives funding compelled by the government

and uses that funding to promote beef products in a

manner which the private individuals determine. Individ-

ual producers and importers have no right to control the

content of the advertising, nor may they opt out of sup-

porting it, even though the generic advertising may, in

their view, actually injure rather than promote their

particular operations.

Even speech which is clearly government speech

coming directly from the government and whose content is

explicitly dictated by the government can violate the First

Amendment when individual citizens are compelled to

become a courier for it. Wooley v. Maynard, 430 U.S. 705,

715-16 (1977). This right was first announced in West

Virginia State Bd. of Education v. Barnette, 319 U.S. 624

(1943) “in which the Court held that school children with

religious objections to the flag saluting ceremony have the

constitutional right to be free from compulsion ... to

declare a belief.” [internal citations omitted] Frame, p.

1130.

The First Amendment protects not only the right of

freedom of expressive association, but also a right not to

associate. Roberts v. United States Jaycees, 468 U.S. 609,

618, 623 (1984). Likewise, the First Amendment protects

not only the right to speak, but also the right to “refrain

from speaking”. Wooley, supra. “Compelled contributions to

private groups engaging in first amendment activities

have been held to implicate these two aspects of first

amendment liberty”. Frame, supra, p. 1130.

“The reason for permitting the government to compel

the payment of taxes and to spend money is that the

government is the representative of the people. The same

\

8

cannot be said of a union, which is representative only of

one segment of the population, with certain common

interests.” Abood v. Detroit Bd. of Ed., 431 U.S. 209, 259

(1977), Justice Powell concurring. The Beef Board is an

entity representative of one segment of the population

with common interests, rather than the representative of

the people, therefore its speech is private speech and the

generic advertising done with beef checkoff funds is

compelled private speech, not government speech.

“First Amendment values are at serious risk if the

government can compel a... discrete group of citizens, to

pay special subsidies for speech on the side that it favors

_..” United States v. United Foods, 533 U.S. 405, 411

(2001). United Foods did not consider the question of

whether advertising funded by mandatory assessments

similar to those at issue in this case is government speech

immune from the scrutiny applied to other compelled

speech because that argument was not raised in the Court

of Appeals. Jd. at 416. That issue is now squarely before

this Court.

The Third, Fifth, Sixth, and Eighth Circuits have

addressed the application of the government speech

doctrine to generic marketing programs and concluded

that this type of producer-funded marketing is not gov-

ernment speech. Pelts & Skins, LLC v. Landreneau, 365

F.3d 423, 429 fn. 13 (5th Cir. 2004). The Fifth Circuit has

explained that, “The fact that the government has an

interest in facilitating private speech does not convert that

speech into a governmental message.” It rejected the

government's argument that alligator marketing is gov-

ernment speech because the applicable council's governing

statutes lay out specific goals and articulate the state’s

interest in the promotion of the alligator industry. Jd. at

9

430 fn. 14. The government’s argument invites the conclu-

sion that all commercial advertising could be considered

government speech and funding for it compelled by the

government through a plethora of industry trade organiza-

tions as the government could be said to have an interest

in all forms of economic activity which create jobs and

outlets for the consumption of products produced in the

U.S. or by U.S.-based companies.

“Not all government-facilitated speech is government

speech. The government speech doctrine does not apply if

a program is ‘designed to facilitate private speech, not to

promote a governmental message.’ Velazquez, 531 U.S. at

542, 121 S.Ct. 1043”. Pelts & Skins, LLC v. Landreneau,

365 F.3d 423, 429 (5th Cir. 2004).

The Beef Board and the individual state beef councils

are not governmental entities whose activities are pro-

tected by the government speech doctrine. The following

facts distinguish a private entity from a government entity

for the purpose of determining whether an organization’s

speech is private speech or government speech:

1. Private funding from dues levied on mem-

bers;

2. Membership restricted to persons engaged in

a certain profession who are required to join

the organization;

3. Regulatory functions reserved to a govern-

mental entity.

Keller v. State Bar of California, 496 U.S. 1, 11-13 (1990).

The Beef Board meets all of the above tests for a

private entity:

10

1. Private funding from assessments levied on

the sale and importation of beef;

2. Membership is composed of beef producers

and importers;

3. The enforcement of the Beef Program is re-

served to the Secretary of Agriculture and ju-

risdiction is vested in the district courts of

the United States to enforce, and to prevent

and restrain a person from violating, an or-

der or regulation made or issued under it. 7

U.S.C. §2908.

The powers of the Beef Board are limited to those set

forth in 7 U.S.C. §2904(2). It is the Beef Promotion Oper-

ating Committee provided for by 7 U.S.C. §2904(4)(A)

which has the responsibility to “develop plans or projects

of promotion and advertising, research, consumer informa-

tion, and industry information which shall be paid for with

assessments collected by the Board.” 7 U.S.C. §2904(4)(C).

The Operating Committee is composed of ten members

elected from the membership of the Beef Board and ten

producers elected by a federation that includes as its mem-

bers the qualified state beef councils. 7 U.S.C. §2904(4)(A).

Thus, a majority of the members of the Operating Committee

are not appointed by the Secretary of Agriculture and all of

the members of the Operating Committee are beef indus-

try producers and/or importers.

It has been held, however, that advertising funded

under the Beef Act is government speech, and, therefore,

not subject to First Amendment analysis. Charter v.

USDA, 230 F. Supp. 1121 (D.C. Mont. 2002). Charter held

that through the Beef Act, Congress and the USDA use

private speakers to disseminate a government message

which is a recognized form of government speech. Id. at

11

1138. This result was reached primarily in reliance on

Rust v. Sullivan, 500 U.S. 173 (1991); and Santa Fe Indep.

Sch. Dist. v. Doe, 530 U.S. 290 (2000). Rust is easily

distinguishable from this case as it involved a challenge to

the funding of family planning programs. Congress and

the Department of Health and Human Services created a

program that funded family planning but required that

funds not be distributed to programs where abortion was

used as a method of family planning. Those challenging

the legislation as unconstitutional argued that withhold-

ing funding from programs that discussed abortion was

unconstitutional because it discriminated against a

particular viewpoint. The Court held that choosing not to

fund speech does not constitute suppression of speech and

that a decision not to fund the exercise of a fundamental

right does not infringe that right. Rust v. Sullivan, at 772.

The Court noted that “[t]here is a basic difference between

direct state interference with a protected activity and state

encouragement of an alternative activity. . .” Jd.

This case does not involve a claim that the Beef

Board, or the Secretary, should fund alternative types of

beef advertising expressing different viewpoints. There-

fore, the Rust analysis does not fit the facts of this case.

Santa Fe Indep. Sch. Dist. v. Doe, 530 U.S. 290 (2000)

is a school prayer Establishment Clause case in which a

high school adopted a policy that permitted, but did not

require, a student-led prayer before home football games.

The prayer or invocation was authorized by a government

policy, and took place on government property at govern-

ment sponsored events. The school did not create an open

forum for the student body at the games, but allowed only

one student to give the invocation for the entire season

and created specific regulations that defined the content

12

and topic of the message. The Court held that the invoca-

tion was government speech endorsing religion which the

Establishment Clause forbids. Jd. at 2275. The Court

explained that the delivery of a school sponsored religious

message over the school’s public address system by a

speaker representing the student body under the supervi-

sion of school faculty and pursuant to a school policy that

encourages public prayer is not properly characterized as

private speech. Jd. at 2279.

Establishment Clause cases have developed their own

particular analytical rules which are not as useful in

analyzing compelled speech cases such as this one. How-

ever, it should be noted that the generic advertising at

issue in this case is not targeted for display on government

property at government sponsored events to a “captive

audience” of attendees. The advertising appears in a wide

variety of private commercial media where it competes

with other food advertising seeking to influence consum-

ers’ food choices and spending habits.

The Sixth Circuit has held that compelled generic

advertising for pork products under the Pork Promotion,

Research and Consumer Information Act, 7 U.S.C. §§4801

et seq. (the “Pork Act”), is private speech due to the pork

industry’s extensive control over the promotional activities

funded by the pork checkoff program. Michigan Pork

Producers Ass'n, Inc. v. Veneman, 348 F.3d 157, 161 (6th

Cir. 2003). The Sixth Circuit held the foilowing facts

supported its conclusion:

1. The primary purpose of the Pork Act is to

strengthen the pork industry’s market posi-

tion and increase domestic markets for pork

products;

13

2. The funding for the generic advertising does

not come from general tax revenues; and,

3. The government exercises only limited over-

sight over the programs. /d., 161-162.

The generic advertising purchased with beef checkoff

assessments is private speech for the same reasons:

1.. The primary purpose of the Beef Act is to

strengthen the beef industry’s position in the

marketplace and to maintain and expand

domestic and foreign markets and uses for

beef and beef products. 7 U.S.C. §2901(b).

2. The funding for the generic advertising does

not come from general tax revenues, but from

assessments on all cattle sold and imported

into the U.S. Id.

3. The government exercises only limited over-

sight over the programs.”

* The following facts were found to have established only limited

government oversight of the Pork Program in Michigan Pork Producers

Ass'n, Inc. v. Veneman, 348 F.3d 157, 162 (6th Cir. 2003):

“Only one USDA staff member is responsible for over-

seeing all of the duties relating to the Pork Checkoff Pro-

gram, including attending all meetings of the Pork Board

and reviewing all advertisements and communications it

develops. The government itself does not propose or draft

any of the advertisements. ... The Pork Board itself is com-

prised only of private pork producers, appointed by the Sec-

retary based on nominations made by private state pork

producers associations — which themselves are run entirely

by industry officials.”

Further details about the organizational structure and operations of

the Pork Program are set forth in the District Court opinion in the case:

“Under the Pork Act, the Pork Board’s planning and op-

erations are to be overseen and approved by the Secretary of

(Continued on following page)

14

The Fifth Circuit has identified three factors which it

held establish that compelled generic alligator advertising

by the Louisiana Fur and Alligator Advisory Council (the

“Council”) is government-facilitated private speech of fur

and alligator harvesters:

1. Funds used by the Council for generic adver-

tising do not come from general state reve-

nues, but from fees levied on harvesters of

furs and alligators.

2. An organization that represents private in-

terests, the Council, is responsible for the

generic marketing campaign.

3. The composition of the council demonstrates

that it represents primarily private inter-

ests.”

Agriculture. 7 U.S.C. §4808(b\(1). The Secretary also has

administrative authority to fire Board members when con-

tinued service would be ‘detrimental’ to the purposes of the

Pork Act. 7 C.F.R. §1230.55.... Pork Board members are

selected on a representational! basis from nominees made by

the National Pork Producers Delegate Body, 7 U.S.C.

§$4806'g) and 4808'a).... [T]he Department of Agriculture

regularly reviews the advertising and other project budgets

of the Pork Board.... Similarly, the Department reviews

each Pork Act advertisement before airing. ... This kind of

review results in amendments of only approximately four

percent of the ads shown to the Department.” Michigan

Pork Producers Ass'n, Inc., et al. v. Campaign for Family

Farmers, et al., 229 F. Supp.2d 772, 786-787 (W.D. Mich.

2002).

The Beef Program operates in a virtually identical manner. See pp.

4-7, Brief for the Federal Petitioners.

* The Louisiana Fur and Alligator Council is a government

creation. The Louisiana Secretary of Agriculture (or his designate)

serves ex officio along with eleven other appointed members. The

(Continued on following page)

15

Pelts & Skins, LLC v. Landreneau, 365 F.3d 423, 429-430

(5th Cir. 2004).

The same three considerations compel the conclusion

that Beef Program compelled generic advertising is gov-

ernment-facilitated private speech:

1. Funds used by the Beef Operating Commit-

tee for generic advertising do not come from

general government revenues, but from as-

sessments imposed on beef producers and

importers engaged in the sale and importa-

tion of beef and beef products. 7 U.S.C.

§2901(b).

2. An organization that represents private inter-

ests, the Beef Operating Committee, is re-

sponsible for the generic marketing campaign.

3. The composition of the Beef Operating Com-

mittee demonstrates that it represents pri-

marily private interests.‘

speaker of the House and the president of the Senate each appoint one

member. The remaining nine members are appointed by the Secretary,

however, they must represent “a cross section of trappers, alligator

hunters, coastal landowners, and alligator farmers”. Two of the nine

members must represent a private organization, the Louisiana Alliga-

tor Farmers and Ranchers Association. The Secretary appoints the

remaining seven members based on nominations from the Louisiana

Trappers and Alligator Hunters Association. Pelts & Skins, LLC v.

Landreneau, 365 F.3d 423, 430 (5th Cir. 2004).

* The Beef Promotion Operating Committee consists of ten

members of the Beef Board and ten producers elected by a federation

that includes as members the qualified state beef councils. The

producers el: cted by the federation must be certified by the Secretary of

Agriculture as producers that are directors of a qualified state beef

council. 7 U.S.C. §2904(4)(A). The Beef Board from which ten members

of the Beef Promotion Operating Committee must be selected consists

(Continued on following page)

16

The Third Circuit has twice held that generic adver-

tising financed with assessments imposed on agricultural

producers is not government speech: Cochran v. Veneman,

et al., 359 F.3d 263, 268 (3rd Cir. 2004); United States v.

Frame, 885 F.2d 1119, 1132 (3rd Cir. 1989), cert. denied,

493 U.S. 1094 (1990); however, it has modified its analysis

of the issues presented by the cases as a result of United

Foods and Glickman v. Wileman Brothers & Elliott, Inc.,

521 U.S. 457 (1997).

The Frame court did not have the benefit of the

guidance of either United Foods or Glickman, but did

determine that the Beef Act implicated the producers’

First Amendment free speech and association rights.

However, the Frame court ultimately upheld the Beef Act,

applying a Central Hudson Gas and Electric Corp. v.

Public Serv. Comm'n of N.Y., 447 U.S. 557 (1980) analysis

to the free speech claim and a Roberts v. United States

Jaycees, 468 U.S. 609 (1984) analysis to the association

claim. Frame, pp. 1133-1134. The Frame court’s strictest

scrutiny was brought to bear on the association claim. The

court stated that it would sustain the constitutionality of

the Beef Act only if the government could demonstrate

that it was adopted to serve compelling state interests that

are ideologically neutral and that cannot be achieved

of cattle producers and importers nominated by eligible state organiza-

tions and importers. 7 U.S.C. §2904(1). ‘-hus, while the Secretary of

Agriculture retains authority to appoint members of the Beef Board,

her possible selections are limited to beef industry representatives

nominated by private parties. Likewise, ten members of the Beef

Promotion Operating Committee, one half of its membership, are

elected by a private federation. Clearly all of the members of the Beef

Board and the Beef Promotion Operating Committee represent beef

industry private interests.

17

through means significantly less restrictive of free speech

or associational freedoms. The court concluded that the

importance of the government’s interest justified the slight

incursion on Frame’s associational and free speech rights.

Frame, p. 1134.

The Third Circuit recognized that the Frame analysis

had been abrogated by United Foods and Glickman in

Cochran v. Veneman, et al., 359 F.3d 263, 274 (3rd Cir.

2004), cert. pending. Cochran involved a challenge to The

Diary Promotion Stabilization Act of 1983, 7 U.S.C. §§4501

et seq. and its accompanying compelled assessments for

advertising. Under the Dairy Act, producers of fluid milk

are assessed .15 per hundredweight of milk for commercial

use. Cochran, at 266, fn. 1. The court held that the Dairy

Act violated the Cochrans’ First Amendment free speech

and association rights by compelling them to subsidize

speech with which they disagree. Jd. at 268. In reaching

this conclusion, the court held that the generic advertising

purchased with compelled assessments under the Dairy

Act is private speech. Jd. at 274. It reached this result in

reliance on the Beef Act analysis contained in the Frame

case which held that the Beef Promotion Program was not

government speech because it required only beef producers

to fund it and it attributed the advertising under the

program to them. Jd. at 273-274. The court quoted from

Frame: “the Secretary's extensive supervision . . . does not

transform this self-help program for the beef industry into

‘government speech’” and explained that “The Cattlemen’s

Board seems to be an entity ‘representative of one segment

of the population, with certain common interests’” and

went on to point out that the members of the Beef Board

and Operating Committee are all private individuals

involved in the beef industry. Jd. at 274 [internal citations

‘

18

omitted]. Finding that the government’s role in the Dairy

Promotion Program is in all material respects the same as

it was in the Beef Promotion Program, the court held that

the Secretary's supervisory responsibilities under the

Dairy Program are not sufficient to transform the dairy

industry's self-help program into government speech. Jd.

In re Washington State Apple Advertising Comm'n,

257 F. Supp.2d 1290, 1296-1298 (E.D. Wash. 2003) held

that the Washington State Apple Commission’s promo-

tional advertising funded by assessments imposed on each

box of apples packed for the fresh market is not govern-

ment speech.° The Court applied the United Foods analy-

sis to the Washington apple industry and found that the

Commission is not part of a comprehensive regulatory

structure collectivizing the market. Jd. at 1302.

II. COMPELLED GENERIC ADVERTISING UN-

DER THE BEEF ACT iS NOT A PERMISSIBLE

REGULATION OF COMMERCIAL SPEECH

In United States v. United Foods, Inc., 533 U.S. 405,

411 (2001), the Court refused to consider whether or not

the government's interest in compelled generic advertis-

ing under the Mushroom Promotion Research and Con-

sumer Information Act, 7 U.S.C. §§6101 et seqg., could be

* The Washington State Apple Commission's structure was created

by an act of the state legislature. The Commission has been in existence

since 1937 as a creature of state law and does not have the same

similarities to the Beef Program that the Pork Program and the

Mushroom Program do. In fact, neither the State of Washington nor

any political subdivision has authority to edit, change, or censor the

Commission's speech. Jn re Washington State Apple Adveriising

Comm'n, 257 F. Supp.2d 1290, 1294-1297 (E.D. Wash. 2003).

19

considered substantial for purposes of applying the test

articulated in Central Hudson Gas and Electric Corp. v.

Public Serv. Comm’n of N.Y. 447 U.S. 557 (1980) to

analyze government imposed restrictions on commercial

speech because the government did not rely upon Central

Hudson to challenge the Court of Appeals decision in that

case. United Foods, at 410.

Commercial speech is expression related solely to the

economic interests of the speaker and its audience. Central

Hudson, at 561. It not only serves the economic interests

of the speaker, “but also assists consumers and furthers

the societal interest in the fullest possible dissemination of

information.” Jd. at 561-562. Commercial speech is ac-

corded lesser protection under the Constitution than other

constitutionally guaranteed expression. The protection

available for particular commercial speech turns on the

nature of the expression and of the governmental interests

served by its regulation. Jd. at 563.

The Beef Program’s compelled assessments do not

restrict the beef producers’ speech at all, they compel

private speech. Because the Program’s assessments do not

restrict speech, it is inappropriate to apply the Central

Hudson test for restrictions on speech to analyze the First

Amendment issue in this case. In re Washington State

Apple Advertising Comm’n, 257 F. Supp.2d 1290, 1303

(E.D. Wash. 2003).

When a private party chooses to engage in commercial

speech, i.e., advertising, the government is free to regulate

it to prevent it from being false, deceptive, or misleading.

This right to regulate includes a right to compel an adver-

tiser to make certain disclosures to prevent its commercial

speech from being false, deceptive or misleading. Zauderer

20

v. Office of Disciplinary Counsel, 471 U.S. 626, 638 (1985).

Such disclosure requirements must be reasonably related

to the government’s interest in preventing deception of

consumers. /d. at 651.

The Central Hudson and Zauderer analyses are

inapplicable to this case because there is no suggestion or

evidence that the compelled generic advertising at issue is

necessary to prevent voluntary advertising placed by the

beef producers from being misleading. United Foods, at

416; In re Washington State Apple Advertising Comm'n, at

1303. Since no one claims that the beef producers are

privately engaged in false, deceptive, or misleading adver-

tising, the government has no right to compel the generic

advertising in question to prevent consumer deception.

III. GENERIC ADVERTISING UNDER THE BEEF

ACT CANNOT SURVIVE FIRST AMENDMENT

SCRUTINY AS PART OF A BROAD REGULA-

TORY SCHEME

Beef producers are not bound together and required to

market their products as members of a large agricultural

cooperative according to cooperative rules. There is noth-

ing preventing individual beef producers and importers

from making their own marketing decisions. Beyond the

collection and disbursement of beef checkoff funds which

are primarily used for advertising, there are no marketing

orders that regulate how beef may be produced and sold.

These crucial distinctions between the beef industry and

the California fruit farmers described in Glickman uv.

Wileman Brothers & Elliott, Inc., 521 U.S. 457 (1997)

compel a different outcome in this case.

21

In Glickman, California fruit farmers were subject to

a series of agricultural orders promulgated by the USDA.

Id. at 460. The or'ers exempted the fruit farmers from

antitrust laws, collectivized fruit sales, set prices, set rules

for marketing, and compelled fruit farmers to contribute to

generic advertising. Jd. at 469. In analyzing the constitu-

tionality of the compelled contributions for generic adver-

tising, the Court first reviewed the operation of the

agricultural orders in their entirety and concluded that

the orders reflected a policy of displacing unrestrained

competition with government supervised cooperative

marketing. Jd. at 475. The Court decided that to avoid

First Amendment scrutiny, an agricultural marketing

program must compel speech that is: 1) unquestionably

germane to the purposes of the marketing orders that

collectivized the industry; and 2) non-ideological. Jd. at

473. This analysis has been described as a determination

that the compelled advertising assessments are a species

of economic regulation that should enjoy the same strong

presumption of validity that the Court accords to other

policy judgments made by Congress, rather than speech

restrictions subject to First Amendment analysis. Jn re

Washington State Apple Advertising Comm’n, 257

F. Supp.2d 1290, 1299 (E.D. Wash. 2003).

In contrast, the Court struck down compelled assess-

ments for generic advertising imposed on mushroom

handlers on First Amendment grounds in United States v.

United Foods, Inc., 533 U.S. 405, 411 (2001). The Court

distinguished Glickman from the facts presented by the

United Foods challenge to compelled assessments charged

to promote generic advertising under the Mushroom

Promotion, Research, and Consumer Information Act, 7

U.S.C. §§6101 et seg., by reviewing the entire regulatory

22

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rogram in order to resolve the case. The Court noted that

Pf Glickman, the California tree fruits were marketed

pursuant to detailed marketing orders that had displaced

many aspects of independent business activity. United

Foods, at 412. The tree fruit market in Glickman was

described as “characterized by collective action rather than

the aggregate consequences of independent competitive

choices.” Jd. [internal citations omitted]. The United Foods

opinion explained that the Glickman opinion and analysis

“proceeded upon the premise that the producers were

bound together and required by the statute to market

their products according to cooperative rules.” Jd.

The Court distinguished the mushroom handlers in

United Foods from the California tree fruit growers in

Glickman as follows: “Beyond the collection and disburse-

ment of advertising funds, there are no marketing orders

that regulate how mushrooms may be produced and sold,

no exemption from the antitrust laws, and nothing pre-

venting individual producers from making their own

marketing decisions.” Jd. As the mushroom growers were

not required by statute to market their products atcording

to cooperative rules as part of a valid scheme of economic

regulation, the Court applied a First Amendment compelled

speech analysis to strike down the assessment program.

Id. at 410-411.

More than a quarter century ago, the Court held that

commercial speech, usually defined as speech that pro-

poses a commercial transaction, is entitled to First

Amendment protection. Virginia Bd. of Pharmacy uv.

Virginia Citizens Consumer Council, Inc., 425 U.S. 748,

762, (1976). The United Foods opinion recognized the

continuing vitality of this doctrine. United Foods, at 409.

23

The Court noted that it has not upheld compelled subsi-

dies for speech in the context of programs where the

principal object of the program is speech itself. Jd. at 415.

The Court stated that it is only an overriding associa-

tional purpose independent ‘from the speech itself which

allows any compelled subsidy for speech in the first place

and that such an overriding associational purpose did not

exist in the case of the mushroom handlers. Jd. at 413-416.

The following required associations have been found

to have overriding associational purposes independent

from speech which have been held sufficient to support

some form of compelled speech: union shop arrangements,

Abood v. Detroit Bd. of Ed., 431 U.S. 209 (1977); state-

mandated integrated bar asSociations, Keller v. State Bar

of Cal., 496 U.S. 1 (1990) and heavily regulated agricul-

tural cooperatives, Glickman, supra. Even where the

Court has upheld compelled speech subsidies imposed by

government required associations, objecting members are

not required to provide speech subsidies for matters not

germane to the larger regulatory purposes which justified

the required association. United Foods, at 414.

If no overriding associational purpose independent

from speech exists to justify the required association of

agricultural producers, then there is no basis on which to

compel speech subsidies and they must be struck down as

violative of the First Amendment. /d. at 415-416.

The district court in this case made the following

findings which supported its ultimate conclusion that the

beef checkoff is, in all material respects, identical to the

mushroom checkoff:

24

The principal object of the beef checkoff pro-

gram is the commercial speech itself;

25

CONCLUSION

The judgment of the court of appeals should be af-

2. Beef producers and sellers make all market- firmed.

ing decisions;

Respectfully submitted,

3. Beef is not marketed pursuant to some statu- -

tory scheme requiring an antitrust exemp- CORINNE R. FINNERTY

tien: Counsel of Record

Post Office Box 90

4. The beef assessments are not germane to a North Vernon, IN 47265

larger regulatory purpose; (812) 346-5201

5. Beef producers and sellers are not regulated Loken D. REUTER

to the extent that the California tree fruit in- 3750 State Road 135 North

dustry is. Nashville, IN 47448

att pn (812) 988-7571

AnEA 5 Ob Se September 2004 Counsel for Amicus Curiae

Since no overriding associational purpose independent

from speech exists to justify the required association of

beef producers and importers, there is no basis on which to

compel speech subsidies imposed by the beef checkoff

program and they must be struck down as violative of the

First Amendment.

. ¢