GLICKMAN v. WILEMAN BROTHERS & ELLIOTT
In 1937, Congress passed the Agricultural Marketing Agreement Act (AMAA) to promote fair pricing and uniform marketing conditions in the agriculture business. Exempted from antitrust laws, the AMAA mandated uniform prices, product standards, and other conditions; all of which had to be approved by at least two-thirds of the affected producers and implemented by producer committees appointed by the Secretary of Agriculture. The AMAA's administrative expenses were to be covered by assessments imposed on activities such as product advertising and promotion. After suffering adverse rulings at the administrative, District, and Circuit Court levels, a group of California tree fruit growers, handlers, and processors appealed their constitutional challenge of the AMAA to the Supreme Court - which granted certiorari.
Did the AMAA's assessments on product advertising and promotion violate of the First Amendment's freedom of speech protections?
Legal provision: Amendment 1: Speech, Press, and Assembly
No. Exempting its financial regulations from the heightened review standard appropriate in most First Amendment issues, the Court's 5-to-4 decision held that just because the AMAA's economic regulations may indirectly result in the reduction of the complaining parties' advertising budgets, they did not violate their free speech. The relevant assessments did not force the growers, handlers, or processors to repeat unsuccessful ads, to respond to negative ads when they preferred to remain silent, or to be publicly identified with messages other than their own. All the AMAA required of these parties were contributions for ad campaigns which were ultimately aimed at promoting their own welfare by encouraging customers to buy their products.
Argument of Alan Jenkins
Chief Justice Rehnquist: We'll hear argument now in Number 95-1184, Dan Glickman, Secretary of Agriculture v. Wileman Brothers and Elliott, Inc.--
Mr. Jenkins: Mr. Chief Justice, and may it please the Court:
In this case, respondents' challenge on First Amendment grounds, payments toward advertising designed to promote the products that they offer for sale, whether they're measured under the integrated bar and union line of cases that we believe is appropriate, or under the Central Hudson test for restrictions on commercial speech, the generic advertising programs pass constitutional muster.
In our view, the regulatory framework at issue here is most analogous to the integrated bar and union context.
This Court has applied the Central Hudson test where Government has restricted or prohibited the dissemination of truthful commercial information, but the marketing order provisions at issue here do not ban, suppress, or restrict respondents' speech in any way.
Unknown Speaker: May I ask a question at an early stage, Mr. Jenkins?
I think you take the position here that you didn't... that the Government didn't argue that the Abood line or the union line cases wasn't argued in the Ninth Circuit because of the Cal-Almond decision in that court, but the administrative law judge suggests that the Government at least in that forum said that the Abood line didn't apply, and I'm just wondering if the Government has waived that, if we can't just assume that the Central Hudson test applies--
Mr. Jenkins: Well, I don't--
Unknown Speaker: --in light of the posture taken below.
Mr. Jenkins: --I don't think so, Justice O'Connor.
In fact, the Government has argued throughout this litigation that these programs satisfy both Central Hudson and the Abood line of cases.
We... pardon me.
Unknown Speaker: But it does appear that the Government below chose not to urge the Abood line, took that tactic, and I don't know why we should address that here.
Mr. Jenkins: Well, Your Honor, I disagree with that characterization of our position below.
I believe that in our briefs in the district court in particular we argued expressly that the Abood standard was satisfied and that the Central Hudson test was satisfied.
It is true that we did not argue in the district court or in the court of appeals that that was the only appropriate test, but I do think that we've argued consistently that both tests are satisfied.
In the court of appeals, as you've said, it's true that we were laboring under the adverse precedent in Cal-Almond, where the Central Hudson test was applied, but we did refer to the Frame case from the Third Circuit, which did rely in part on Abood, so I think that argument is preserved.
Unknown Speaker: And both of those lines of cases, of course, deal with the First Amendment, don't they?
Mr. Jenkins: Quite so, Mr. Chief Justice.
That's certainly the case.
Unknown Speaker: Mr. Jenkins, assuming that we apply one or the other test in a way that requires us to determine the value of the Government's interest, do you claim that the value of the Government's interest depends on a Government concern over and above that of the growers whose products they are advertising, or, on the other hand, do you claim that the Government's interest is essentially derivative, that it's important simply because the growers themselves want to do this, and that desire, that vote in fact on their part establishes its importance?
Which is it?
Mr. Jenkins: Well, I think it's the latter, Justice Souter, but I think it's even broader than that.
The Agricultural Marketing Agreement Act expressly sets out the goals of that statute and of the marketing orders, which include establishing orderly market conditions for the covered commodities.
Congress, as in the integrated bar context and as in the union context, has chose to leave in the first instance to the regulated industry the determination whether, in a particular region, as for a particular commodity, that interest is threatened, but we think that both the overwhelming support by the industry and the record in this case indicate that that interest was certainly implicated here.
Unknown Speaker: But the growers, as I understand it, do not vote in any narrow or specific sense as to whether the interest is threatened.
They simply vote as to whether they want the advertising program or not, isn't that it?
Mr. Jenkins: Well, I think that's correct, Justice Souter, but that just is at the core of the Government's interest.
Where private industry and, I would add, the Secretary has to make a determination that private... that generic advertising would further... tend to further the interest of the act, that is because in a particular region, under a particular marketing order, the need exists.
Unknown Speaker: Is that how you would explain the... what struck me, at least, as the peculiarity in this case that apparently there are, I guess, peach-growers, for example, in some 30 States, but the only ones who seem to have expressed a need for this advertising scheme are California peach-growers.
Is the explanation for that that there simply has not been a demonstrated instability in markets elsewhere?
Mr. Jenkins: I think that's true, Justice Souter, but I'd also like--
Unknown Speaker: Does the record support that?
Mr. Jenkins: --It does not, and let me make clear the way in which this act operates.
Unknown Speaker: Mr. Jenkins, before you do that may I ask you, I think a question that is of a similar basic kind?
You latch onto the Abood and Keller cases.
What is the Government interest here that compares to the labor peace or the regulation of the bar?
That's what I don't understand.
Why is it so important that we have these orders?
What purpose that compares with collective bargaining underlies all of this?
Mr. Jenkins: Justice Ginsburg, as I've said, first the broader interest is in orderly market conditions.
I think the legislative history of the Agricultural Marketing Agreement Act, the 1954 legislative history of the adoption of promotional programs, and the record of the formal rulemaking that gave birth to the advertising provisions of the marketing orders indicate the economic hardship that results and the economic instability in the Nation as a whole that results when there's wide fluctuation of market prices, when particularly farmers but other elements of the industry--
Unknown Speaker: Well, I could understand that if this was across the board, if you said there this compelling need, and so we do it for all agricultural commodities, but it seems to be rather haphazard.
Mr. Jenkins: --Well, I think that relates to my answer to Justice Souter's previous question, which is that taking, for example, that one of the proposed disparities is between California-grown peaches and Georgia-grown peaches... and I think it's important to look at the regulatory framework here, which is commodity-specific, and region-specific.
Taking peaches as an example, first, California is responsible for the majority of peaches that wind up on people's shelves, but more importantly, between two different regions there are vast disparities in labor costs, in quality.
The length of the season in California is much longer.
California-grown peaches have a Nationwide market, whereas Georgia-grown peaches are basically locally grown and consumed along the Eastern seaboard.
There are transportation costs that are different.
There are investment costs that are different.
But I think the particularized nature, commodity-specific nature and region-specific nature of these marketing orders reflects narrow tailoring rather than arbitrariness, but Justice--
Unknown Speaker: How can it be narrow tailoring when the... when in effect the tailoring is done by a nongovernmental entity?
I mean, the tailoring to which you are referring, market-specific, region-specific, is simply done by a vote of the people who are growing the peaches.
Mr. Jenkins: --Well, that's not entirely true, Justice Souter, insofar as the marketing... the Agricultural Marketing Agreement Act treats different commodities in different regions differently, but you're certainly correct that it's the industry in the first instance, a supermajority, two-thirds majority producers, that caused the marketing order to come into being.
That's because Congress I think reasonably has determined that people in the industry, operating day-to-day, are the best measure of need.
Unknown Speaker: Mr. Jenkins--
Mr. Jenkins: Pardon me.
Unknown Speaker: --do we have to believe... this argument sounds like something time-warped out of the 1920's.
Or the thirties.
And this is a remnant of the National Industrial Recovery Act when this kind of an argument was made for every industry in the country, and indeed, they tried to have marketing, the equivalent of marketing orders for every industry in the country.
It was found not to be true and not to be effective.
Now, do we have to believe it, that somehow it is effective for agricultural marketing orders, but having the Government in cooperation with the industry, the corporate State, it is called, in Italy, as an efficient mechanism for producing economic prosperity?
Mr. Jenkins: I think so, Justice Scalia, for two reasons.
First, as we've indicated in our brief at footnote 3, Congress since the court of appeals decision in this case has reaffirmed the importance of these programs and, in fact, expanded them and made significant factual findings regarding their importance, but... pardon me.
Unknown Speaker: Just for agriculture.
I mean, Congress hasn't done it for everything else.
Mr. Jenkins: Has not done it for every commodity, that's true.
Unknown Speaker: I mean, it seems to express the belief that elsewhere that isn't true.
Mr. Jenkins: Well, I don't think so.
Again, if I can--
Unknown Speaker: That market disorder is okay.
Indeed, it's what drives the market.
Mr. Jenkins: --Well, no, Justice Scalia.
I think the determination first is that there may not be significant market disorder and fluctuation in those industries where... private industry where producers have not felt a need to invoke the Government's aid, but if I can analogize--
Unknown Speaker: They will invoke the Government's aid anywhere.
Where have they not felt the need to invoke the Government's aid?
Mr. Jenkins: --Well--
Unknown Speaker: They'll take the Government's aid wherever they can get it.
Mr. Jenkins: --Well, I don't think so.
For example, there are a number of commodities for which marketing orders are authorized, but where the industry has not chosen to use them, to ask for them.
In plums, for example, in 1991 the California... the aspects of the marketing order that relate to plums were terminated because there was an industry-wide referendum and plum producers found that it was no longer important.
But if I could again analogize to the union context, not every workplace is unionized.
It's only where a majority of workers feel that a union will effectuate their interest and therefore Congress' interest in labor peace.
Unknown Speaker: Well, isn't it at least, or couldn't Congress find as a fact that in agriculture, at least since after the First World War, there's always been a problem.
If there's a good crop the prices are low, and if the prices are good, there's virtually no crop.
It's a totally different situation from most other kinds of marketed goods.
Mr. Jenkins: We think so, Mr. Chief Justice, and I think particularly as to these commodities that is true.
Unknown Speaker: But that... that could justify the marketing orders, but it certainly doesn't support with any necessity the advertising.
You could have marketing orders and try to organize the market without any Government advertising.
Mr. Jenkins: That's certainly true as a technical matter, Your Honor, but it's also true that in adopting both... in adopting promotional programs Congress found, and in adopting these particular marketing order provisions the Secretary found that these... the ability to invoke generic advertising activities has a beneficial effect, and in fact directly advances--
Unknown Speaker: What is the test that you say we must apply to determine the validity of this provision requiring advertising?
Do we have to find that there is a real, substantial harm, and that this is a provision that's narrowly tailored to eliminate it, or is the standard that's applied something far more deferential?
Mr. Jenkins: --Well, Justice Kennedy, I think it is more deferential, but if I could set back for a moment, I think that if certainly this Court were to conclude that regulating these commodities and establishing orderly market conditions in terms of its effect on the national economy was a trivial interest, then the Government would lose in this case.
I think there's no--
Unknown Speaker: Because speech is involved?
Mr. Jenkins: --I'm sorry, I--
Unknown Speaker: Because speech is involved?
Mr. Jenkins: --Well, insofar as the First Amendment rights of handlers are affected, then there must be, I suppose, more than an irrational governmental interest, but I think there's no question that the interest here is substantial.
If... insofar as your question about what test should apply, we do think it's more deferential.
Unknown Speaker: Mr. Jenkins--
--Well, in a commercial speech context it seems to me that you don't have to establish a very clear governmental interest in order to prevail.
If it's simply commercial speech necessary to move a line of goods, isn't that the end of it?
Mr. Jenkins: Well, yes.
The Court has--
Unknown Speaker: What is the case, the closest case that you have to suggest the proper standard that we should use here?
Which case, Turner Broadcasting, or--
Mr. Jenkins: --No, Your Honor,--
Unknown Speaker: --Or the Zauderer case?
Mr. Jenkins: --Zauderer, insofar as the Central Hudson test commercial speech analysis is applicable, Zauderer would probably be the closest case insofar as it involved the aspect of compelled disclosure of information, as distinguished from restrictions on speech, but we think that the speech interests in this case are attenuated in several respects, first because it's commercial speech, second because there's no restriction on respondent's ability to advertise in any respect, third because--
Unknown Speaker: --Well, let me ask you about that.
One of respondents' complaints is that the 1989 advertising guide promoted a proprietary variety of nectarine, the Red Jim, which is grown exclusively by one of the growers, and a grower who does not want to lease or sell a royalty to that, so Red Jim is grown only by one grower.
Now, do you defend that practice under the... under any test?
Mr. Jenkins: --Your Honor, we do, but let me first say that I think--
Unknown Speaker: That's amazing, that the Government could take money from everybody in the industry, every grower of peaches and nectarines, and advertise one grower's exclusive use to a patented fruit.
Mr. Jenkins: --Well, Justice O'Connor, if that were the dominant or even perhaps a plurality of--
Unknown Speaker: Well--
Mr. Jenkins: --Pardon me.
Unknown Speaker: --do you defend the right of the Government to do that?
Mr. Jenkins: Justice O'Connor, we would--
Unknown Speaker: Just answer that isolated question... under any test.
Mr. Jenkins: --I suppose my answer is no.
Unknown Speaker: No.
Mr. Jenkins: We do not defend an overarching governmental goal of advertising a particular competitor's--
Unknown Speaker: But you say, if it happens once in a while it's okay.
We can overlook that.
Mr. Jenkins: --Well, Justice O'Connor, I think it's important to look... in our, in the Joint Appendix in Volume 2, at page 531, this is the varieties chart to which respondents were referring, and among the list of many, many varieties, there is included the Red Jim which, as you pointed out, is a proprietary variety--
Unknown Speaker: Right.
Mr. Jenkins: --shipped by only one handler.
Unknown Speaker: Right.
Mr. Jenkins: Now, we think that this is an infinitesimal aspect of this program.
Unknown Speaker: So you say if there are violations, they're de minimis, and so we can ignore them.
Is that in a nutshell what you say there?
Mr. Jenkins: That's part of our argument.
Unknown Speaker: Would you clarify one more thing for me?
Assessments under this program run against the handlers, is that right?
Mr. Jenkins: That's correct.
Unknown Speaker: Not the growers.
Mr. Jenkins: That's correct.
Unknown Speaker: Do the handlers pass it on to the growers?
Mr. Jenkins: That's the expectation of the way in which this program operates, and I--
Unknown Speaker: And who has to vote to terminate the program, the growers or the handlers?
Mr. Jenkins: --The growers vote in the first instance to terminate.
I would note, however, that in adopting the advertising provisions of this marketing order handlers also--
Unknown Speaker: As well as the growers.
Mr. Jenkins: --That's correct.
Unknown Speaker: To set it in place in the first place, handlers and growers vote.
Mr. Jenkins: That's correct.
Unknown Speaker: But to terminate it only growers vote.
Mr. Jenkins: That's correct, and let me--
Unknown Speaker: Have any of the growers asked for a vote on peaches and nectarines in California?
Mr. Jenkins: --Well, in fact, Your Honor, there are periodic referenda, I believe every 4 years, and in the last referenda there was overwhelming support for this program, I believe between 75 and 83 percent.
Unknown Speaker: Mr. Jenkins, this relates to Justice O'Connor's question about the Big Jim, and--
Red Jim, I'm sorry.
I don't know how I could have made that mistake.
And ties it in to the Government's assertion that Abood governs here.
Let me read you what I wrote in an opinion joined by Justices O'Connor, Souter, and Kennedy in a case called Lehnert v. Ferris Faculty Association:
What is distinctive, the opinion said, about the free riders who are nonunion members of the union's own bargaining unit, is that in some respects they are free riders whom the law requires the union to go out of its way to benefit even at the expense of its other interests.
In the labor union context, the union has a fiduciary obligation to every one of the employees, whether they're union members or not, and sometimes has to sacrifice its own interest to those obligations.
That is not the case as I understand this program.
It can be the case that advertising will benefit a mere majority of the handlers and severely impair the interests of a minority of members.
You don't assert that there is a fiduciary obligation here on the part of the organization, as there is with unions, do you?
Mr. Jenkins: We don't, Justice Scalia, assert that there's something comparable to the duty of fair representation in this context, although that is similarly true in the integrated bar context, that there is no concomitant duty of fair representation.
Unknown Speaker: Well, I think the bar is a special situation, and have always felt that, but as far as unions go, you have the distinctive fiduciary obligation.
I just don't see how you can take Abood and apply it to this situation, where a majority can harm a minority's interests.
Mr. Jenkins: Well, Justice Scalia, I also think that the majority cannot, as an overwhelming, either as a goal or as the effect harm the minority's interest.
There are significant safeguards in place, both regulatory and statutory, to ensure that there is not overwhelming harm or even significant harm to handlers as individuals.
I'd also point out in the integrated--
Unknown Speaker: Some of them here say they're being harmed.
Mr. Jenkins: --I'm sorry, I didn't hear you.
Unknown Speaker: Some of them here say they're being harmed, that the mere advertising of, generically, peaches harms them because they are trying to convince the public that all peaches are not fungible, that some kind of peaches are really good peaches, and their interests are harmed by any generic peach advertising.
Mr. Jenkins: But Justice Scalia, I don't see how that removes this from the Abood line of cases.
It's similarly true that if I'm an employee and I'm opposed to maternity leave, and the union nonetheless negotiates a maternity leave clause in our contract, I have no First Amendment right to prevent that.
Although I feel that I'm being harmed and my, both my First Amendment interests, I feel, and my practical interests are being harmed, there's no violation of the duty of fair representation, nor is there a violation of the First Amendment.
Unknown Speaker: Mr. Jenkins, supposing there's such a thing as the Beer Institute, which is a private organization devoted to generic advertising for beer, and supposing some of its members feel that some of the micro breweries who aren't members are kind of free-riding on the generic, could the Beer Institute go to Congress and say, look, we want to have a kind of a marketing agreement and some generic advertising.
We want to bring these freeloaders on board, so let's assess everybody who produces any beer.
Mr. Jenkins: Well, Mr. Chief Justice, I think if it were, in fact, an important governmental interest--
Unknown Speaker: Well, I'm sure the beer people would think it was. [Laughter]
Mr. Jenkins: --Well, I--
Unknown Speaker: You think beer is less important than peaches?
Mr. Jenkins: --No comment on that, but I do think that... of course, it's up to this Court to determine as a matter of law whether the interest that Congress in this case seeks to achieve is an important or a substantial one.
Unknown Speaker: Mr. Jenkins, on that point, I understand the portion of these marketing orders that deals with inspection quality controls, and nobody is contesting that everybody can be required to pay for the cost of inspecting and assuring health and safety standards.
But the... whatever importance that interest has, does that spill over to, that advertising is an important interest?
Aren't these quite discrete, so one could say yes, the Government's got a very important interest to making sure that health requirements are met, but the advertising, the promotional interest doesn't have the same strength, does it?
Mr. Jenkins: Well, Justice Ginsburg, I just have a two-part answer to that.
First, I think that the other things that these marketing orders allow have to do with increasing consumption.
They're not safety and health regulations.
Those are regulated through a different set of programs.
So the question is, if there's an adequate justification for those aspects, does the availability of generic marketing, generic advertising, also help to achieve that goal?
The question... pardon me.
Unknown Speaker: It may also help, but does it have the same importance as maturity standards and the inspection controls?
Mr. Jenkins: Well, I think, Justice Ginsburg, under this Court's cases the question has not been, is the means toward the end as important, is one means as important as another, but first is the end important and then, secondly, does the means chosen advance the end, and so I think the record in this case does demonstrate that the end of orderly market conditions and sustained demand for these products is significantly advanced by the means that's chosen, including generic advertising.
Unknown Speaker: But your argument is on that, as I understand it, that we have generally accepted the proposition that advertising induces people to buy what is advertised.
I mean, do you... there's kind of an assumption as a matter of law that advertising works to some degree, and I will grant you that, but is that enough in a case like this, because it seems to me, number one, that advertise... the assumption that advertising works doesn't tell us very much about whether the advertising is creating or advancing an orderly market as opposed to a less orderly one, and it doesn't tell us very much about what the difference is between the effect of advertising either on consumption or orderly markets in California and the failure of advertising with respect to markets everywhere else.
I guess to put the... my question in a nutshell, are the peach growers in the other, whatever it is, 29 States making less of a profit in a chaotic market as opposed to the California growers who, as a result of this advertising program, are making measurably more money in an orderly market?
Do... does the record indicate that?
Mr. Jenkins: Justice Souter, let me answer the second part of your question first.
You asked earlier about the record.
I think it's important to note that here the Government was defending a particular program, and so the record doesn't reflect, for example, why Georgia peaches are not regulated.
As I've indicated, there are reasons why different markets are treated differently, but the record doesn't reflect it because in our view our burden is to demonstrate that this program satisfies constitutional requirements, and we think that the evidence amply demonstrates first that advertising, generic advertising programs advance the interest of consumer demand for these products, and in fact--
Unknown Speaker: It makes consumers buy them, is what you mean.
Mr. Jenkins: --That's correct.
Unknown Speaker: Yes.
Mr. Jenkins: And both of the courts below found that, and that secondly, viewed in the context of this act, it provides the Secretary and the commodity committees with a tool for influencing consumer preferences, and I think it's the inevitable... the conclusion is inevitable that that aids in regulating market conditions.
If the Secretary... insofar as the Secretary--
Unknown Speaker: Well, I... it regulates only in the sense that it... we will assume that it creates some demand that would not have been there otherwise.
But when we're faced with a situation in which there are in fact contrasting markets, and we want to know, even under a comparatively relaxed standard, what the causal connection is between the advertising and orderly markets, it seems to me sensible to look at the markets where the advertising isn't going on to see if they are depressed or disorderly, and I take it we cannot do that in this case, because the record just doesn't tell us anything about it.
Mr. Jenkins: --I think that's generally correct, but I would also note--
Unknown Speaker: Isn't it fair to say... and I'm sorry, I didn't mean to cut you off.
Mr. Jenkins: --Well, I was just going to say it's also the case that these markets are very different, so that if there is sufficient demand--
Unknown Speaker: But how do we know that?
Mr. Jenkins: --We don't, Justice Souter, but as I've said, I don't think we need to know that in order to answer the question that's at issue here.
Unknown Speaker: Mr. Jenkins--
--So you're saying... I'm sorry.
To take a specific case, in this record there's nothing like there was in the case before the Third Circuit, the meat case, where the Court said, well, we can understand... the Government has made a case that this industry is in disastrous shape, but there's nothing of that kind here, that the peach and nectarine industry is about to fall apart, is there?
Mr. Jenkins: Well, Justice Ginsburg, I think the record in the Frame case was quite similar, but the program was somewhat different.
The beef program focuses almost exclusively on promotional programs and advertising, and so insofar as Congress perceived a problem and the only thing it did about it was to create promotional advertising programs, the Third Circuit concluded correctly, we think, that there was a problem existing that Congress sought to address.
Here, Congress has used a larger number of tools, but--
Unknown Speaker: Am I wrong in having the impression that Congress made a determination with respect to the state of the meat market and said we have to respond to that terrible situation, and there were no such findings by the legislature here?
Mr. Jenkins: --I think with respect, Justice Ginsburg, that's incorrect.
I think the district court in particular made findings as to the type of problem that Congress was trying to get at, and in fact cites the Congressional Record indicating that there were in fact gluts of supply, that there was suppressed demand--
Unknown Speaker: But the question is whether Congress made the findings, not whether the district court did.
Did Congress make the findings?
Mr. Jenkins: --Congress was citing... pardon me.
The district court was citing Congress' findings, but let me be clear--
Unknown Speaker: Citing the findings, or--
Mr. Jenkins: --Was citing the Congressional Record reports, and--
Unknown Speaker: --Statements by... not the whole Congress, but by some individual Members of Congress?
Mr. Jenkins: --Some were from reports--
Unknown Speaker: Committee reports?
Mr. Jenkins: --That's correct.
Unknown Speaker: But there was no congressional finding?
Mr. Jenkins: Well, Your Honor, I think in the act itself there's a congressional finding that programs are necessary, that--
Unknown Speaker: Programs, but is there anything... are you telling me that the record from Congress is comparable, that there was no more that Congress said about the meat industry than it said about the fruit industry?
Mr. Jenkins: --I think it is comparable, but I want to be specific, because I don't want to mislead the Court.
Congress made findings both in 1937, when it adopted the act, and then in 1954, when it added promotional programs, not advertising specifically.
It... Congress subsequently added advertising as among the promotional programs, and we think Congress was not required to make additional findings, as when it had already indicated what it found promotional programs to accomplish.
It's also true that in the formal rulemaking by the Secretary the record, when the advertising specifically was adopted, their extensive findings... in fact, even the court of appeals found that there were extensive findings in rejecting respondent's APA challenge, that this type of advertising did effectuate the goals of the act.
That's a statutory requirement.
If I could, I'd like to reserve the remainder of my time.
Unknown Speaker: Very well, Mr. Jenkins.
Mr. Campagne, we'll hear from you.
Argument of Thomas E. Campagne
Mr. Campagne: Mr. Chief Justice, and may it please the Court:
I think there's one thing everybody's missing, and that is, what is the problem?
What is the problem with peaches, plums, and nectarines in California that's any different than the other 32 States that grow these commodities?
Unknown Speaker: Disorderly markets are the problem.
Mr. Campagne: Well, Justice Scalia, the Solicitor, in answering your question in that regard, I believe misspoke.
He indicated that there was a finding that there was disorderly markets--
Unknown Speaker: So--
Mr. Campagne: --and he cites the 1954 act, which doesn't deal with that subject whatsoever.
The way the promulgation records show here... because we have an unusual situation that Justice O'Connor spoke about in the Community Nutrition case, where we file a 15(a) petition.
We sue before an ALJ employed by the Secretary of Agriculture.
She gave the Government every opportunity possible... as a matter of fact, they stipulated that Exhibit 297, and they made that stipulation at Stipulation Number 57... I'm sorry, 59, that that was the exclusive rulemaking record.
When the district court relied on--
Unknown Speaker: --Just a minute, Mr. Campagne.
Mr. Campagne: --Yes.
Unknown Speaker: That isn't terribly helpful to simply hold up a brief and say that Stipulation Number 59... we don't know what... if you want to make a point, make it so that we can all understand it.
Mr. Campagne: Very well, Your Honor.
In that stipulation the administrative law judge said, I've got a problem.
I don't understand what some of you are expressing in your questions.
I want to give you every opportunity to show me that there's disorderly marketing going on in California but not in the other 32 States, and the stipulation that was entered into is that the USDA relies on Exhibit 297.
Unknown Speaker: Where is that?
Can we find it in something that we have before us?
Mr. Campagne: Yes.
It's page 134a of our appendix to our opposition to the petition, Your Honor.
In there, they actually stipulate that the Government relies solely and exclusively on Exhibit 297, and I'm paraphrasing, as being the entire rulemaking record regarding the implementation of the advertising program.
Unknown Speaker: It doesn't say exclusively in what I'm reading.
Mr. Campagne: It says, as being the entire rulemaking record--
Unknown Speaker: Oh, okay.
Mr. Campagne: --on the third line, Your Honor, regarding the implementation of the advertising record with respect to peaches, plums, and nectarines which occurred approximately 6 years after the act was amended.
Unknown Speaker: Mr. Campagne, can I ask you a question?
Mr. Campagne: --Yes.
Unknown Speaker: We basically have a constitutional question here, and there are an awful lot of details floating around.
Would it make any difference, as a matter of constitutional law, if Congress had made a finding that this particular market had particular problems that justified this kind of group advertising program?
Would you still have the same constitutional argument?
Mr. Campagne: It would make a huge difference, Your Honor.
Unknown Speaker: You do.
Mr. Campagne: They would have an easier time with Central Hudson.
Unknown Speaker: So you're not saying this sort of program is always unconstitutional.
Mr. Campagne: No, Your Honor.
Despite what the Wall Street Journal said last week, we're not saying that the beef program has to be thrown out or the milk program has to be--
Unknown Speaker: Why can't Congress leave those findings to be made by the Secretary?
Congress does that all the time.
Mr. Campagne: --But in this case--
Unknown Speaker: Establishes a basic framework for a program and says if an executive officer finds a certain situation to exist, he can take certain actions.
They do that all the time.
Mr. Campagne: --In this case, Your Honor, I don't need to address that issue, although--
Unknown Speaker: Sure you do.
I just asked you about it.
Mr. Campagne: --Oh, I'm sorry.
Of course Congress can delegate its legislative authority, despite Carter v. Cole, because of the subsequent cases, to the Secretary of Agriculture, but he didn't do that in this case, Your Honor.
The 1954 act that the Solicitor was referring to was the post Korea act.
It didn't have anything to do with advertising.
The advertising act, that's 608(c)(6)(I), was a... came into existence in 1965.
Unknown Speaker: Well, in connection with that, Mr. Campagne, you don't have to attack here the various health inspection provisions, the pro rata provisions, that sort of thing, and I take it you're not challenging the basic congressional authority to enact something like that.
You're simply trying to separate out the advertising provision.
Mr. Campagne: Yes, Your Honor.
We're assessed on average 19 cents a carton.
Nine cents goes for quality control and inspection.
We have no problem with that.
Fifty-three percent... that is, 10 percent... goes to generic advertising.
Unknown Speaker: Well, what is the difference between... you say what is the problem.
There's a regulatory problem.
If you think this program is unjustified I guess you can go to the courts and say, it's arbitrary, capricious, abuse of discretion, and get it thrown out, right?
We're talking about the First Amendment.
Mr. Campagne: Yes, Your Honor.
Unknown Speaker: So what is the First Amendment problem that your client has that wouldn't be shared by anybody who used to fly on the airlines and had to pay money in part for messages that they might have disagreed with that would have been spent by the Air Transport Association required by the Civil Aeronautics Board, or exactly the same thing in the utilities industry, or the trucking industry, or any taxpayer who pays taxes which then is spent by the Government on messages they disagree with?
In other words, what's the First Amendment interest here that isn't shared in thousands of regulatory situations by millions of members of the public whose money the Government often takes to spend, or have other private people spend, on messages that they might not want to pay for?
Mr. Campagne: Your Honor, we would have no objection whatsoever if the Secretary of Agriculture was taking money out of the General Treasury and--
Unknown Speaker: No, no, they didn't... I'm saying the Civil Aeronautics Board, the Interstate Commerce Commission... I mean, I thought the Constitution would permit the public, mistaken or not, to have regulatory systems to regulate every industry, perhaps, if they wanted to, to have a nonfree enterprise system perhaps if they didn't want to.
I don't know.
I thought those were basically democratic questions.
But if we have a system where the industry is regulated, I'm asking what is the First Amendment interest that is different from the same First Amendment interest of every flier, every customer of a trucker, every customer of a utility... I'm just repeating myself, but it seems to me that there are vast numbers of consumers who used to have to spend lots of money they didn't want to spend for messages that regulators would either permit or require.
Mr. Campagne: --The First Amendment issue, Your Honor, is two-pronged.
First of all, they're forcing us to associate with our competitors, and it's not like the milk board, where milk is white and wet, and so the milk board doesn't have much opportunity to prefer one product over another.
When you buy milk, you don't know if it's a Jersey or a Guernsey milk you're drinking, whereas in our commodity, we have over 100 varieties of plums.
My clients happen to grow some green plums.
If I tell you today--
Unknown Speaker: Well then, you would point out, I suppose, that you're not objecting to expenditure of money for advertising or for any other purpose by the Government.
The United States doesn't contend in this case that these are Government expenditures, does it?
Mr. Campagne: --No.
In their footnote, Your Honor, they admit this is not Government speech, although one of their--
Unknown Speaker: So it's not Government speech, which would pose a different issue, so we can get rid of a whole lot of those regulatory programs that Justice Breyer was referring to, and only limit ourselves to those in which a privately run organization spends money that is assessed against competitors.
Namely, all of the programs.
Mr. Campagne: --But the point I was trying to make, Your Honor, here we have absolutely no studies whatsoever.
When the act was amended in 1965 it was done by one letter, one letter from the Secretary to Congress that said, I would like to implement advertising because--
Unknown Speaker: It seems to me your argument is they did a lousy job here, but if they'd done a good job, it would be constitutional.
Mr. Campagne: --If they could meet the Central Hudson test, which was the test they stipulated to before the Ninth Circuit in Cal-Almond--
Unknown Speaker: Yes, but we're not bound by that.
Why a Central Hudson test, where in fact in Central Hudson and the other speech cases that seem relevant there was a problem with a person having attributed to him a view that he really didn't hold, and moreover an important view, and a political view, and a view of conscience.
Is there anything like a political view, a view of conscience, an important, critical view that the public would think that your client held because of these messages?
Mr. Campagne: --Yes, Your Honor.
Unknown Speaker: What?
Mr. Campagne: Some of our clients testified they don't sponsor lying.
Unknown Speaker: They don't sponsor what?
Mr. Campagne: --Lying.
Misleading the public.
The generic advertising program is that a California peach is better than a Georgia peach or a South Carolina peach, which together add up to the same amount of volume we have.
We say that's not true.
There's over 100 varieties, and if you grow that variety in South Carolina it's going to taste the same as that variety tastes in California.
It's a lie.
Another one of our clients testified that he really resents the sexual subliminal messages of the advertising board.
He happens to be on a hospital board that deals with abuse of children.
Unknown Speaker: Is that the picture of this little girl running in a sprinkler eating a nectarine?
Mr. Campagne: --And the radio that says so juicy, so sweet, a radio advertisement right afterwards that says eating a peach reminds you of your first kiss in the back seat of your car.
He has an ideological problem with that, but more importantly, they're sending a subliminal message that red is better.
Now, if I ask each one of you to buy some--
Unknown Speaker: Well, there's nothing in words to that effect in the ads, is there?
Mr. Campagne: --No, Your Honor.
It's the depiction, the subliminal message that red is better, and some of these varieties, not only the Red Jim that you mentioned--
Unknown Speaker: Well, would you be here at all if the advertising were in fact generic advertising for California fruit?
Mr. Campagne: --Well, first of all they'd have to define to me, Your Honor, in some--
Unknown Speaker: Or is there some problem here?
Mr. Campagne: --what the problem... that's the point, exactly.
Unknown Speaker: Well, what?
Mr. Campagne: I don't know--
Unknown Speaker: I'm trying to understand what it is you say causes or results in a First Amendment violation here.
It is not clear to me.
Mr. Campagne: --They take almost a million dollars a year, give it to my competitors to advertise 15 varieties of fruit we don't grow, and force us to associate with our competitors in a manner--
Unknown Speaker: Don't you represent handlers?
Mr. Campagne: --I represent handlers/shippers, but there's a big distinction, Your Honor.
My handlers are growers who handle their own fruit.
The handlers that run the committee are growers who... are handlers who primarily ship fruit grown by other people.
Unknown Speaker: Well, of course, you're forced to associate, using your term, by the terms of the marketing order anyway.
If there were no promotional advertising you'd be "forced to associate".
So what we have here is a program that I think, insofar as its regulatory mechanisms other than promotion, is clearly lawful and valid and constitutional, and it seems to me that you're building on that base.
Once you have in place a marketing order, a marketing system, it seems to me logical that that marketing entity engage in generic advertising.
I don't see why the advertising suddenly causes a forced association problem.
Mr. Campagne: Because what--
Unknown Speaker: You're already associated, whether you like it or not.
Mr. Campagne: --In 1959, when they promulgated marketing orders for quality control there was no problem.
We had no objection to that.
But when they moved in 1971 for a legislative amendment and in 1975 and 1976 actually adopted it, with no rulemaking record of Congress at all, and then made it discretionary so that annually the Secretary of Agriculture annually is supposed to be deciding whether to advertise, how much money to advertise, is there a problem in California that's different in other States... he didn't do any of that.
Actually, no notice and comment through 1986 harvest, a few months before my trial started.
Unknown Speaker: I didn't know you were here on some APA claim.
I thought what we had before us was a First Amendment claim, and I haven't heard a response yet as to what specific problem you have that triggers the First Amendment.
Are you relying on the fact that there are assessments made, and you have less money to advertise on your own?
Is that part of your argument?
Mr. Campagne: That's absolutely what I was trying to express, Your Honor.
Unknown Speaker: Well, that's odd, because I thought that there isn't much difference between an assessment or any other fee or tax that Government might take, which necessarily, of course, limits your funds for advertising.
You have less money.
Mr. Campagne: Yes, but, Your Honor--
Unknown Speaker: Do you cite a case from this Court to support you on that?
Mr. Campagne: --Yes, PG&E, and that is that you're taking our money--
Unknown Speaker: PG&E.
Mr. Campagne: --Yes.
Unknown Speaker: Do you have a citation for that?
Mr. Campagne: Yes, Your Honor.
PG&E v. PUC of California, cited in our merits brief.
That's the case, Your Honor, where you struck a rule that required PG&E to promulgate the messages in their own envelopes to others, and the reason this Court struck it is that it stated it would require PG&E to respond when they might not otherwise want to speak, and that's exactly what goes on here.
We give almost a million dollars a year, of which 53 percent is devoted to generic collective advertising, to our competitors who grow fruit we don't grow, primarily, and then when we do have a little bit of money left over and try to advertise our own brands, we have to spend a lot of it trying to change the minds of the consumer--
Unknown Speaker: Do you say that your growers do not... that your clients do not grow peaches or nectarines?
Mr. Campagne: --Our clients grow peaches, plums, and nectarines, but there's over 100 varieties of each peach, plum, and nectarine, unlike beef and unlike milk, where--
Unknown Speaker: You don't believe that all California peaches are the same.
Mr. Campagne: --Absolutely not.
Unknown Speaker: And that is the message that this advertising conveys to the public.
Mr. Campagne: Absolutely, Your Honor.
Unknown Speaker: So they're conveying precisely the message that you want to counter.
Mr. Campagne: They're conveying... exactly, Your Honor.
Unknown Speaker: And your associational objection, as I take it, is not an objection to simply being regulated with everybody else, associated on that basis, but rather the objection of being presented to the public as in league with everybody else: All us California peach-growers are the same.
California peaches are California peaches, and California peach-growers are California peach-growers.
Mr. Campagne: Exactly, Your Honor.
Unknown Speaker: You don't like some of these other peach-growers, do you?
Mr. Campagne: We want you to buy our yellow nectarines and not their red nectarines.
They taste better.
Unknown Speaker: Mr. Campagne--
--May I ask you, if this were a homogenous product, you then would not have a problem?
Mr. Campagne: It would be... that's correct, Your Honor.
It would be much--
Unknown Speaker: And if the advertising was limited to those features of the California peaches that were, in fact, common to all California peaches, you would not have a problem.
Mr. Campagne: --If they could establish that California had a problem which the Government had an interest in solving, but there is no record whatsoever--
Unknown Speaker: Well, assume they could do that.
Assume they could establish that the Secretary of Agriculture is convinced that we ought to sell more California peaches, and that therefore they ought to have a program that advertises the features of California peaches that all California peaches share.
Would that be permissible?
Mr. Campagne: --I believe, Your Honor, that the answer would be yes if there was only one variety of peaches and it was grown in 33 States, and for some reason California's economic environment was in imminent danger of collapse, and no other States--
Unknown Speaker: Well, it doesn't have to be in collapse, does it?
Mr. Campagne: --Well, in Frame they stipulated--
Unknown Speaker: --I mean, they've got all sorts of marketing orders where the--
Mr. Campagne: --that the meat industry was in imminent danger of collapse and they assessed--
Unknown Speaker: --Are you saying that that's the bottom line that they must show?
It's a question I asked Mr. Jenkins about and he said no, that Frame is just like this case, but I couldn't grasp from your brief whether you were saying this... none of this forced advertising can be justified unless there's some compelling need shown in the particular industry.
That was one argument that you made.
And then you sort of had another argument that said, well, they don't give us credit for our own advertising, and they're advertising some varieties that belong to particular members of the committee.
So which is it?
Are you saying none of this is any good, or some of it may be good but some isn't?
Mr. Campagne: --We're saying both, Your Honor.
We're saying first, if you want to force me to associate with my competitors when we're head-on competing, that I want you to buy my yellow nectarines and not your red nectarines, and you're giving my money to the person who grows those red nectarines, you've got to show a problem that requires a governmental compelling interest to solve under association rights.
Unknown Speaker: But may I interrupt again, Mr. Campagne?
Supposing that you agree that if the advertising were restricted to common features of California peaches, and there was an adequate justification... the industry is having all sorts of troubles.
People are buying bananas instead of peaches... and the advertising was restricted, I think you'd say that would be okay, but you're complaining because they advertise features of the peaches that are unique to some varieties and not shared by all the others.
Now, supposing 97 percent of the advertising concentrates on common features, and 3 percent is bad under your analysis.
Is the whole program bad, or just the 3 percent?
Mr. Campagne: Under that hypothetical of course, Your Honor, if there was a compelling governmental interest to solve some serious problem--
Unknown Speaker: Right.
Mr. Campagne: --and we only grew one variety in all the States, the answer would be that 3 percent would be bad.
However, that's not the facts of this case, Your Honor.
A peach is not a peach.
A plum is not a plum.
Unknown Speaker: Yes, but what if the Secretary of Agriculture made a lot of findings saying a peach is a peach, to add--
Mr. Campagne: They haven't made any such findings, Your Honor.
As a matter of fact, the record of this trial where ALJ Baker said bring in all the rulemaking record and produce all your witnesses, prove that there's over 100 varieties of peach, and they're completely different, and I can prove it to you--
Unknown Speaker: --With reference to the marketing--
--But the question, the basic question I have is whether you're really attacking a program as a program, or maladministration of the program.
Mr. Campagne: --I'm sorry, I couldn't hear the end of--
Unknown Speaker: I'm trying to figure out whether the program is just sort of per se bad, or has it just been poorly administered.
You make a very persuasive case that they've made some bad decisions along the way, but does that taint the entire program?
That's the basic question I see.
Mr. Campagne: --This particular program on this particular 19 days of trial record, it was tainted from the very beginning.
They went to Congress on one letter, and all they said is, the majority of the growers want it.
Unknown Speaker: But this is not an APA problem.
I thought your point was that the First Amendment requires that you be careful and do it right.
Mr. Campagne: Just like Turner.
Unknown Speaker: As is not required in some other areas.
Mr. Campagne: Exactly.
Unknown Speaker: You must demonstrate the compelling interest.
Mr. Campagne: For over 20 years they didn't produce any studies or any reports showing that California--
Unknown Speaker: We keep drifting away from the First Amendment, and it does get to sound like an Administrative Procedure Act problem, but that is not your point.
Your point is that these I's have to be dotted and the T's have to be crossed because the First Amendment is at stake.
Mr. Campagne: --That's right, Your Honor.
Unknown Speaker: Of course, to the extent that the marketing order without the promotional aspects of it helps everybody to market their peaches, I suppose you're helping to market Red Jim through the marketing order.
Mr. Campagne: Yes.
Unknown Speaker: And given the fact that you are therefore in a common marketing entity anyway, it seems to me to much diminish your First Amendment claim.
Mr. Campagne: I don't believe so.
Unknown Speaker: Whether you like it or not, big growers may be helping smaller growers to market their products, and maybe that's not cost-effective for you and you'd rather have something else, but you begin with the premise that this is a valid program.
Mr. Campagne: But you're forgetting a very key important point, Your Honor.
At least we're playing on a level playing field when the agency says you can't sell a nectarine, whether it's a Red Jim nectarine or a Tom Gran yellow nectarine, if it has a worm in it.
We're not going to advertise to people and change our message that we want you to eat worms.
But when 50 percent of this advertising dollar goes to spending, as their own testimony indicates, towards varieties that are controlled by 40 to 60 percent of... single varieties controlled by 40 to 60 percent of the handlers that aren't us, we're not playing on a level playing field.
Unknown Speaker: Well, don't you also distinguish between regulations which don't have any speech import to them, like quality and so on, plus some sort of regulation that forces you to spend money for speech?
Mr. Campagne: Exactly, Your Honor.
Unknown Speaker: I agree with you that a peach is not a peach.
I really do.
I mean, absolutely.
I love those juicy peaches which you can hardly ever get.
I understand that.
But I'm also concerned about turning First Amendment district courts into regulatory agencies, and therefore I'm worried about this problem of the Air... I promise you I disagreed a lot with what the Air Transport Association might have advertised.
In the rate base the customer pays, and I pay for it a flyer.
That's what I'm worried about.
Now, you brought up PG&E as a precedent, but then I look at PG&E and I look at it and think, my goodness, that was a case where there was a more clear First Amendment problem, because it was the company's property.
The company had to put the message in the envelope.
It was absolutely clear that the company was underwriting this message with which it disagreed, rather than analogize it to like a public forum.
So I'd like you to talk a little bit more about that case, because as I looked at that plurality opinion quickly, it seemed to me that yours was a more attenuated interest by a long shot than the interest there, but I raise that so you can discuss it.
Mr. Campagne: Yes, Your Honor.
I can give you a good example.
When Mr. Gerawan testified that in 1987 they took 675,000 from him and gave it to his competitors of a committee of nectarine growers that was run by his competitor, Mr. Jimmy Ito, whose proprietary variety is the Red Jim nectarine that Mr. Gerawan can neither grow nor buy, nor handle, because all the fruit has to be handled by Mr. Ito, that he... he respects Mr. Ito, but he just doesn't want his money to go to him, because they have a marketing window and they're producing the same... he produces... and competes with--
Unknown Speaker: Well, that may well have been an error, as the Government conceded in its argument, but you don't overturn the whole program, I suppose.
You would overturn that.
Mr. Campagne: --But it's inherent to the entire system, Your Honor.
Unknown Speaker: Well, are there other examples where in these advertisements a single proprietary item that no one else could acquire was advertised by name, and if so, what, and where?
Mr. Campagne: The May Belle nectarine, Your Honor.
Unknown Speaker: Excuse me?
Mr. Campagne: The May Belle nectarine.
Unknown Speaker: And it was specifically referred to in the ad?
Mr. Campagne: Yes.
Unknown Speaker: Where?
Mr. Campagne: I believe in the very same exhibit.
Unknown Speaker: Weren't these peaches--
Mr. Campagne: It's in that same section.
I can't remember the exact--
Unknown Speaker: --Weren't the peaches selected because of the volume?
Doesn't the chart which lists all the peaches reflect the volume of peaches that were sold through the marketing entity?
Wasn't that the criteria for inclusion?
Mr. Campagne: --Yes.
Mr. Field, the chief employee of the committee, testified that they tried to advertise the top 15 producing varieties and to leave the other 100 minor varieties behind, but Your Honor--
Unknown Speaker: So it was based on volume.
Mr. Campagne: --They're spending all of their TV and radio advertising money on eat California peaches because they're all the same before July 4, 80 percent of the money.
They're reserving 20 percent of it to--
Unknown Speaker: Was there a finding to that effect, that that's the necessary purport of those ads, or can we just tell it from the... from reading the ads?
Mr. Campagne: --There's a finding to that effect in Judge Baker's decision, Your Honor.
Unknown Speaker: Mr.--
--To what effect?
To the effect that the advertising goes primarily or overwhelmingly to support the proposition that all California peaches are desirable?
Mr. Campagne: Are the same.
Unknown Speaker: Are the same?
Mr. Campagne: Yes.
Unknown Speaker: And--
--Mr.... I'm sorry.
Mr. Campagne: And she further--
Unknown Speaker: And you object to that.
You'd be here even if they weren't pushing the Red Jim or whatever this nectarine is.
Mr. Campagne: --Absolutely, because that's not truthful.
I want to tell--
Unknown Speaker: Well, that... but isn't there another reason--
Mr. Campagne: --that you ought to buy green plums and give them to your wife, and you're thinking to yourself right now you don't want to give your wife diarrhea, but green plums--
Unknown Speaker: --Green plums?
I would never give my wife a green plum.
--I've never even seen a green plum.
I thought plums--
Plums aren't regulated any more, so why are we talking about those?
Mr. Campagne: --Because, Your Honor, we have almost $6 million in trust--
Unknown Speaker: Greengage.
Mr. Campagne: --and the Ninth Circuit ordered that there would be a determination as to whether or not those moneys that we related to plums from 1987 through 1991, so plums are still relevant.
Unknown Speaker: Mr.--
Mr. Campagne: And we grow green plums.
Unknown Speaker: --Well, the only ads--
I thought the only ad programs once plums were out of it were for peaches and nectarines.
Mr. Campagne: --That's true, Your Honor, but it's not moot because the regulation never changed that required the Secretary to annually decide whether or not to advertise, if so, where, how much money, and Mr. Chief Justice raised a very interesting question to the Solicitor, and that is, doesn't this all kind of follow the law of supply and demand, but one thing we notice here is that as the crop goes down, the assessments change, versus go up.
In other words, the promulgation record we have in existence here is not tied to solving any problem.
Unknown Speaker: Well, Mr. Campagne, that raises something I wanted to get back to you on.
As I understand it, even if the advertising were truthful, and even if the advertising were truly generic, you would still claim that there was a First Amendment violation, wouldn't you?
Mr. Campagne: Absolutely.
Unknown Speaker: Because there is no justification in the first place.
There is no necessity.
Mr. Campagne: There's no problem--
Unknown Speaker: All right.
Mr. Campagne: --and because there's no problem--
Unknown Speaker: All right.
Let me ask you--
Mr. Campagne: --there's no governmental interest in solving a problem that doesn't exist.
Unknown Speaker: --Let me ask you a final question.
If that is so, why do you concede that you have no First Amendment objection to the... in effect, to the forced association with the growers for nonspeech purposes?
Mr. Campagne: Because in that sense, when they pass a quality control rule that says that all growers of all 100 different varieties, green and red, can't sell anything that's got a worm in it, that doesn't impinge on my First Amendment rights.
Unknown Speaker: You're saying that really is not an association within the meaning of the First Amendment, aren't you?
Mr. Campagne: No.
That's just pure regulation.
Unknown Speaker: So there really isn't an association component here to the regulatory... to the regulatory scheme, which is exclusive of the speech problem that you raise.
Mr. Campagne: Exactly.
Unknown Speaker: Is that your position?
Mr. Campagne: We're not here, Your Honor, trying to vitiate the entire marketing order.
We don't... we accept the 9 cents that goes to the quality control.
We're only speaking to the 10 cents per carton that goes to the forced association with our competitors who grow different varieties and, basically, in some varieties take over $200 an acre, which is more than our profit margin in some varieties, and force us in the limited amount of time we have--
Unknown Speaker: Thank you--
Mr. Campagne: --to--
Unknown Speaker: --Mr. Campagne.
Mr. Jenkins, you have 2 minutes remaining.
Rebuttal of Alan Jenkins
Mr. Jenkins: Thank you, Mr. Chief Justice.
I'd like to begin just very briefly by stating that as to the administration of this program most of the factual findings that respondent's cite come from the ALJ's findings on the APA claim against these programs.
Those were overturned by the judicial officer, who found those findings as to bias, as to red is better, and what-have-you, to be clearly erroneous.
Both of the courts below affirmed that holding, the APA holding, and so I think those findings are simply out of the case.
The Court need not necessarily ignore them completely, but no final adjudication has been made upholding these findings of bias.
If I could turn to the question of the Government interest here, I think we have demonstrated that there's a free rider problem that's important and comparable to the union and integrated bar context, that in agriculture, and particularly as to these commodities, there are many small producers who could not engage in the kind of economies of scale that's available under this program.
That's not necessarily true in some other industries.
The record does speak, for instance, to the California almond industry, and this Court has repeatedly held that where Congress finds a problem and deals with it in a way that is constitutionally justifiable, the fact, at least outside of the strict scrutiny context, that it has not chosen to employ those remedies elsewhere does not render unconstitutional its action where it has done so.
Unknown Speaker: Does anything in the law prevent bias?
Does anything in the law... let's assume that 51 percent of the California growers grow red peaches, or red nectarines, or whatever color red things we were talking about.
Anything in the law would prevent this money from being spent with advertisements showing only the red fruit?
Mr. Jenkins: I think so, Justice Scalia, as a practical matter.
Unknown Speaker: What provision is that?
Mr. Jenkins: May I complete my answer?
Unknown Speaker: Yes.
Mr. Jenkins: The AMAA provides that the Secretary must find that particular activities are... tend to effectuate the goals of the act.
The Agricultural Marketing Service has guidelines which, for instance, prevent the criticism of other commodities or products, so I think both as a practical matter and as a legal matter there are checks on misuse of this system.
Chief Justice Rehnquist: Thank you, Mr. Jenkins.
The case is submitted.