United States Court of Appeals
FOR THE DISTRICT OF COLUMBIA CIRCUIT
Argued December 12, 2011 Decided April 13, 2012
No. 11-5065
HEIN HETTINGA, ET AL.,
APPELLANTS
v.
UNITED STATES OF AMERICA,
APPELLEE
Appeal from the United States District Court
for the District of Columbia
(No. 1:06-cv-01637)
Alfred W. Ricciardi argued the cause and filed the briefs
for appellants.
Kelsi Brown Corkran, Attorney, U.S. Department of
Justice, argued the cause for appellee. With her on the brief
were Tony West, Assistant U.S. Attorney, and Michael S.
Raab, Attorney.
R. Craig Lawrence, Assistant U.S. Attorney, entered an
appearance.
Charles M. English Jr. was on the brief for amici curiae
United Dairymen of Arizona, et al. in support of appellee.
2
Before: SENTELLE, Chief Judge, BROWN and GRIFFITH,
Circuit Judges.
Opinion for the Court filed PER CURIAM.
Concurring opinion filed by Circuit Judge BROWN, with
whom Chief Judge SENTELLE joins.
Concurring opinion filed by Circuit Judge GRIFFITH.
PER CURIAM:
Plaintiff-appellants Hein and Ellen Hettinga appeal the
dismissal of their constitutional challenges to two provisions
of the Milk Regulatory Equity Act of 2005 (“MREA”), Pub.
L. No. 109-215, 120 Stat. 328 (2006) (codified at 7 U.S.C. §
608c). The Hettingas alleged that the provisions, which
subjected certain large producer-handlers of milk to
contribution requirements applicable to all milk handlers,
constituted a bill of attainder and violated the Equal
Protection and Due Process Clauses. The district court
disagreed, and we affirm.
I
Milk markets in the United States are regulated by a
complex system of price controls dating back to the New
Deal. The Agricultural Marketing Agreement Act of 1937, 7
U.S.C. §§ 601–74 (“AMAA”), authorizes the Secretary of
Agriculture to issue regional milk marketing orders that
govern payments from milk processors and distributors
(“handlers”) to dairy farmers (“producers”). Id. § 608c(1).
Under a typical milk market order, a dairy farmer supplies
raw milk to a processor or distributor, and the handler pays
money into a centralized “producer settlement fund” at fixed
prices based on the intended use of the milk. Edaleen Dairy
3
LLC v. Johanns, 467 F.3d 778, 779–80 (D.C. Cir. 2006).
Handlers using their milk for “high value” uses, such as fluid
milk, pay higher prices than handlers that engage in “low-
value” uses, such as the processing of butter or cheese. Id.
The money that handlers pay into the producer settlement
fund is then proportionally redistributed to milk producers at a
uniform “blend price” based on quantity of milk sold. See 7
U.S.C. § 608c(5)(B)(ii). This system ensures that all dairy
farmers receive the same price for their raw milk regardless of
whether they sell to high-value or low-value handlers.
Firms that operate as both producers and handlers create
serious complications for this system. In such cases, there is
no opportunity for the producer-handler to pay into the
centralized producer settlement fund because there is no
intermediate sale of raw milk. Edaleen Dairy, 467 F.3d at
780. Until recently, the Secretary of Agriculture therefore
exempted producer-handlers from the pricing and pooling
requirements of federal milk marketing orders. Id. The
pricing and pooling requirements also did not apply to
handlers who sold milk in geographic areas that were not
regulated by federal milk marketing orders, even if the
handler itself was located in a federally-regulated area.
The Hettingas own two dairy operations that fell within
these exemptions. The first is Sarah Farms, an integrated
producer-handler located in Yuma, Arizona. Sarah Farms
processes and sells over three million pounds of its own milk
per month in the federally regulated Arizona Marketing Area.
The second is GH Dairy, an independent milk processing
plant which they own in partnership with their son. GH
Dairy, a handler located in Arizona, processes raw milk into
bottled milk and milk products that are sold exclusively in
California. Because California is not a federally regulated
4
milk marketing area, GH Dairy was not subject to the federal
pricing and pooling requirements.
On February 24, 2006, the USDA adopted a Final Rule
that would have eliminated the producer-handler exemption
for firms that operate in the Arizona and Pacific Northwest
Marketing Areas and sell more than three million pounds of
their own milk per month—a group that includes Sarah
Farms. See Milk in the Pacific Northwest and Arizona-Las
Vegas Marketing Areas; Order Amending the Orders, 71 Fed.
Reg. 9,430 (Feb. 24, 2006) (“USDA Rule”). The decision to
eliminate the exemption for these large producer-handlers was
based on evidence of “disorderly marketing conditions”—
specifically, that large producer-handlers were obtaining a
“competitive sales advantage” over fully-regulated handlers,
and were causing a “measurabl[e] and significant[]” decrease
in the blend price being paid to regulated producers. Milk in
the Pacific Northwest and Arizona-Las Vegas Marketing
Areas; Final Decision on Proposed Amendments to
Marketing Agreement and to Orders, 70 Fed. Reg. 74,166,
74,186–88 (Dec. 14, 2005). The USDA Rule was scheduled
to go into effect on April 1, 2006. The Hettingas filed suit in
the U.S. District Court for the Northern District of Texas,
challenging the legality of the USDA Rule and seeking a
preliminary injunction. Oral argument was scheduled for
March 29, 2006.
On the day before the Texas district court heard
arguments in the Hettingas’ case, Congress amended the
AMAA by passing the MREA. 1 President Bush subsequently
signed the MREA into law on April 11, 2006. Subsection N
1
The Texas district court denied the Hettingas’ motion for a
preliminary injunction against the USDA Rule, and the Hettingas
voluntarily dismissed their case. See Compl. at ¶¶ 45–46.
5
of the MREA, 7 U.S.C. § 608c(5)(N), codified the USDA
Rule’s revocation of the exemption for large producer-
handlers in the Arizona Marketing Area, including Sarah
Farms. Unlike the USDA Rule, however, it applied neither to
Nevada, which Congress exempted from coverage by any
federal milk marketing orders, nor to the Pacific Northwest
Milk Marketing Area. Subsection M of the MREA, id. §
608c(5)(M), imposed the federal pricing and pooling
requirements on handlers, like GH Dairy, that were located in
a federally regulated area but sold packaged milk exclusively
in a state not covered by a federal milk marketing order, such
as California.
The Hettingas challenged the constitutionality of the
MREA in the U.S. District Court for the District of Columbia.
First, they alleged that Subsections M and N of the MREA
violate the Bill of Attainder Clause by singling them out for
legislative punishment. Compl. ¶¶ 53–57. Second, the
Hettingas claim the MREA denies them equal protection by
“singling them out for adverse treatment that is extended to no
other producer-handler in any other Milk Marketing Area.”
Id. ¶ 65. Finally, they claim the MREA denied them due
process of law by foreclosing judicial review of the USDA
Rule in the Northern District of Texas. Id. ¶ 60. The district
court initially dismissed the Hettingas’ claims for failure to
exhaust administrative remedies, but this Court reversed and
remanded, holding that the AMAA’s exhaustion requirements
do not apply to facial constitutional challenges. Hettinga v.
United States, 560 F.3d 498, 504–06 (D.C. Cir. 2009). On
remand, the district court dismissed the Hettingas’ complaint
for failure to state a claim under Fed. R. Civ. P. 12(b)(6) and
denied leave to file a supplemental complaint. Hettinga v.
United States, 770 F. Supp. 2d 51 (D.D.C. 2011).
6
We review de novo a district court’s dismissal of a claim
under Rule 12(b)(6). Atherton v. Dist. of Columbia Office of
the Mayor, 567 F.3d 671, 681 (D.C. Cir. 2009). To survive a
motion to dismiss, a complaint must have “facial plausibility,”
meaning it must “plead[] factual content that allows the court
to draw the reasonable inference that the defendant is liable
for the misconduct alleged.” Ashcroft v. Iqbal, 129 S. Ct.
1937, 1949 (2009). In evaluating a Rule 12(b)(6) motion, the
Court must construe the complaint “in favor of the plaintiff,
who must be granted the benefit of all inferences that can be
derived from the facts alleged.” Schuler v. United States, 617
F.2d 605, 608 (D.C. Cir. 1979). Factual allegations, although
assumed to be true, must still “be enough to raise a right to
relief above the speculative level.” Bell Atl. Corp. v.
Twombly, 550 U.S. 544, 555 (2007). But the Court need not
accept inferences drawn by plaintiff if those inferences are not
supported by the facts set out in the complaint, nor must the
court accept legal conclusions cast as factual allegations.
Kowal v. MCI Commc’ns Corp., 16 F.3d 1271, 1276 (D.C.
Cir. 1994).
II
Article I, Section 9, cl. 3 of the United States Constitution
states that “[n]o Bill of Attainder or ex post facto law shall be
passed.” A bill of attainder is “a law that legislatively
determines guilt and inflicts punishment upon an identifiable
individual without provision of the protections of a judicial
trial.” Foretich v. United States, 351 F.3d 1198, 1216 (D.C.
Cir. 2003). To constitute a bill of attainder, a statute must: (1)
apply with specificity to affected persons; (2) impose
punishment; and (3) assign guilt without a judicial trial. See
Selective Serv. Sys. v. Minn. Pub. Interest Research Grp., 468
U.S. 841, 846–47 (1984).
7
The element of specificity may be satisfied if the statute
singles out a person or class by name or applies to “easily
ascertainable members of a group.” Foretich, 351 F.3d at
1217. A bill of attainder need not expressly name its target;
some bills of attainder simply describe them. BellSouth Corp.
v. FCC, 144 F.3d 58, 62 (D.C. Cir. 1998). The “easily
ascertainable” requirement is only satisfied where the
challenged statute “describe[s] [the targeted class] in terms of
conduct which, because it is past conduct, operates only as a
designation of particular persons.” Communist Party of the
United States v. Subversive Activities Control Bd., 367 U.S. 1,
86 (1960) (emphasis added). Indeed, the Supreme Court has
recognized a “decisive distinction” between statutes that
impermissibly punish past actions and those that permissibly
address future conduct. Am. Commc’ns Ass’n, C.I.O. v.
Douds, 339 U.S. 382, 413–14 (1950).
The MREA does not identify Sarah Farms, GH Dairy, or
the Hettingas by name. Nonetheless, the Hettingas claim their
businesses constitute an “easily ascertainable” group because
they are currently the only producer-handlers being regulated
by the MREA. Specifically, Sarah Farms is currently the only
producer-handler that meets the three-million-pounds-per-
month threshold established by Subsection (N), and GH Dairy
is currently the only handler located within the Arizona
Marketing Area—but outside of Nevada—that sells
exclusively in the California market. See Appellant’s Br. at
20.
Longstanding Supreme Court precedent readily dispenses
with this argument. Applicability of the MREA does not turn
on the past conduct of producer-handlers, but rather regulates
these dairy operations’ future business decisions, such as the
volume of milk they will produce and the markets into which
they will sell their product. Moreover, the MREA would
8
apply to any producer-handler that meets its statutory
requirements, not only the Hettingas. A statute with open-
ended applicability, i.e., one that “attaches not to specified
organizations but to described activities in which an
organization may or may not engage,” does not single out a
particular person or group for punishment. Communist Party,
367 U.S. at 86.
The Hettingas also argue that because the MREA
currently applies only to their businesses, it must satisfy the
specificity requirement. They further note that the designated
category—producer-handlers that sell over 3 million gallons
of milk per month—is not a group susceptible to ready
enlargement, as it has taken the Hettingas many years to grow
their businesses to their current scope. See Appellant’s Br. at
24.
The Supreme Court has held, however, that even a statute
that affects only one person does not necessarily apply with
the requisite specificity to qualify as a bill of attainder. In
Nixon v. Administrator of General Services, for example, the
Supreme Court found no specificity in the Presidential
Recordings and Materials Preservation Act, Pub. L. No. 93-
526, 88 Stat. 1695 (1974), even though Title I referred to
President Nixon by name and dealt exclusively with his
papers. 433 U.S. 425, 471–72 (1977). Because Title II was
open-ended and could apply to future presidents, the statute
was not a bill of attainder. Id. The Court cautioned that the
President’s argument that “an individual or defined group is
attainted whenever he or it is compelled to bear burdens
which the individual or group dislikes” would “cripple the
very process of legislating, for any individual or group that is
made the subject of adverse legislation can complain that the
lawmakers could and should have defined the relevant
affected class at a greater level of generality.” Id. at 470.
9
Nixon makes clear that a current “class of one” does not
necessarily satisfy the specificity requirement, and the Court
has never suggested that the likelihood of future expansion of
the designated class should play any role in the specificity
analysis. Much like Title II of the Presidential Recordings
and Materials Preservation Act, the MREA can theoretically
apply to an unlimited number of handlers who meet its
statutory requirements. “Since virtually all legislation
operates by identifying the characteristics of the class
benefited or burdened,” BellSouth Corp., 144 F.3d at 63, the
mere fact that the “class” currently happens to contain only
one member does not transform an open-ended statute into a
bill of attainder.
The Hettingas also claim that the district court
procedurally erred by determining whether the Hettingas were
easily ascertainable as the target of the legislation. While the
Court is required to accept the truth of the plaintiffs’ factual
allegations and to draw inferences in their favor, it is not
required to accept the plaintiffs’ legal conclusions. See Iqbal,
129 S.Ct. at 1949. Whether or not the Hettingas’ “identity as
the target of the Congressional action is easily ascertainable,”
Compl. at ¶ 48, is a legal conclusion, not a factual allegation.
The sole factual allegations offered by the Hettingas establish
that Subsections M and N currently apply only to their
businesses, id., and that a few opponents of the legislation
believed passage of the MREA was driven by special interest
groups who wanted to remove the Hettingas’ competitive
advantage. See id. at ¶¶ 40–44. As explained above, these
factual allegations simply do not satisfy the legal definition of
an “easily ascertainable” group, as defined by the Supreme
Court and this Circuit.
10
Because we find the MREA does not apply with
specificity to affected persons, we need not decide whether it
satisfies either of the remaining elements of a bill of attainder.
We therefore affirm the district court’s dismissal of the
Hettingas’ bill of attainder claim.
III
We grant statutes involving economic policy a “strong
presumption of validity.” FCC v. Beach Commc’ns, Inc., 508
U.S. 307, 314 (1993). A statutory classification that “neither
proceeds along suspect lines nor infringes fundamental
constitutional rights must be upheld against equal protection
challenge if there is any reasonably conceivable state of facts
that could provide a rational basis for the classification.” Id.
at 313. “Where there are plausible reasons for Congress’
action, our inquiry is at an end.” Id. at 313–14. The
challenger bears the burden of showing that the statute is not a
rational means of advancing a legitimate government purpose.
See Bd. of Trs. of the Univ. of Ala. v. Garrett, 531 U.S. 356,
367 (2001).
The district court dismissed the Hettingas’ equal
protection claim because it found the MREA provides a
rational means of ensuring orderly milk markets by (1)
preventing handlers located in regulated regions from gaining
advantages over their competitors by exporting milk to
unregulated regions and (2) preventing large producer-
handlers in a federally-regulated region from undercutting
other handlers in that region with unregulated sales. On
appeal, the Hettingas claim the district court applied too
deferential a standard of review, arguing that rational basis
review is “not [] toothless.” Logan v. Zimmerman Brush Co.,
455 U.S. 422, 439 (1982) (Blackmun, J., concurring).
11
Regardless of how Justice Blackmun characterized
rational basis review, the Supreme Court’s subsequent
decisions in Beach makes clear that “not toothless” does not
mean “growling.” Here, the government provided a rational
explanation for its decision to close two loopholes in the
AMAA scheme—that large dairy businesses have used the
exemptions to gain a substantial—and ultimately disruptive—
competitive advantage over their regulated competitors.
Beach requires us to accept this explanation and end our
inquiry here. See Beach Commc’ns, 508 U.S. at 313–14.
Although the classification might indeed be unfair to the
Hettingas, mere disparity of treatment is not sufficient to state
an equal protection violation.
The Hettingas reprise the claim that the district court
erred by drawing factual conclusions at the pleading stage.
Because the district court must accept their well-pled facts as
true, the Hettingas argue, the only questions are whether (1)
plaintiffs have shown that there are separate groups subjected
to disparate treatment; and (2) there are facts suggesting this
disparate treatment “may not be rational, or is not for
legitimate purposes.” Appellant’s Br. at 47. In so arguing, the
Hettingas again misstate the relevant legal standard. Even at
the motion to dismiss stage, a plaintiff alleging an equal
protection violation must plead facts that establish that there
is not “any reasonable conceivable state of facts that could
provide a rational basis for the classification.” Dumaguin v.
Sec’y of Health and Human Servs., 28 F.3d 1218, 1222 (D.C.
Cir. 1994). Here, the government provided an explanation
that is not only rational on its face, but also has been
consistently recognized by the courts as legitimate. See, e.g.,
Nebbia v. New York, 291 U.S. 502, 529–37 (1934); Lamers
Dairy, Inc. v. Dep’t of Agric., 379 F.3d 466, 473 (7th Cir.
2004); Shamrock Farms Co. v. Veneman, 146 F.3d 1177,
1183 (9th Cir. 1988).
12
IV
The Hettingas claim that the MREA violated their
procedural rights under the Due Process Clause by foreclosing
judicial review of the USDA’s decision to implement the
Final Rule. Specifically, the Complaint alleges that the
MREA was passed in the House the night before oral
argument on the Hettingas’ motion for a preliminary
injunction in Hettinga v. Johanns; an attorney for the
government called the court’s attention to the passage of the
MREA at the hearing; and the court subsequently denied the
Hettingas’ motion for a preliminary injunction.
The Hettingas failed to plead the threshold requirement
of a due process claim: that the government has interfered
with a cognizable liberty or property interest. Kentucky Dep’t
of Corrs. v. Thompson, 490 U.S. 454, 460 (1989). The
Hettingas have no liberty or property interest in the regulatory
status quo. The MREA does not implicate the Hettingas’
liberty interest in practicing their profession because the
statute does not prevent them from operating their dairies; it
merely subjects them to certain regulations if they choose to
continue to operate under their current business model. The
statute also does not implicate the Hettingas’ property interest
in a cause of action, as the legislation did not actually
terminate their ongoing claim against the USDA. Rather, the
Hettingas themselves dismissed their still-nascent claim
because they believed the legislation rendered it moot. See
Compl. at ¶¶ 45–46. Moreover, Congress frequently enacts
legislation that moots pending cases, and such action has
never been found to raise any due process concerns.
V
13
Finally, we find that the district court did not abuse its
discretion by refusing to allow the Hettingas to file a
supplemental complaint. A district court may deny a motion
to amend a complaint as futile if the proposed claim would
not survive a motion to dismiss. James Madison Ltd. by
Hecht v. Ludwig, 82 F.3d 1085, 1099 (D.C. Cir. 1996). The
Hettingas requested leave to supplement their claim with new
allegations that arose from a political campaign commercial
of Nevada Senator Harry Reid. The proposed amendments
would have been futile, because Senator Reid’s alleged
support for the MREA does not support the Hettingas’ claims
that they are the “easily ascertainable” targets of the MREA,
that the statute inflicts legislative punishment without a trial,
or that the statute violates their Equal Protection or Due
Process rights.
For the foregoing reasons, the decision of the district
court is
Affirmed.
BROWN, Circuit Judge, with whom Chief Judge
SENTELLE joins, concurring: I agree fully with the court’s
opinion. Given the long-standing precedents in this area no
other result is possible. Our precedents forced the Hettingas to
make a difficult legal argument. No doubt they would have
preferred a simpler one—that the operation and production of
their enterprises had been impermissibly collectivized—but a
long line of constitutional adjudication precluded that claim.
The Hettingas’ sense of ill-usage is understandable. So is
their consternation at being confronted with the gap between
the rhetoric of free markets and the reality of ubiquitous
regulation. The Hettingas’ collision with the MREA—the
latest iteration of the venerable AMAA—reveals an ugly
truth: America’s cowboy capitalism was long ago disarmed
by a democratic process increasingly dominated by powerful
groups with economic interests antithetical to competitors and
consumers. And the courts, from which the victims of
burdensome regulation sought protection, have been
negotiating the terms of surrender since the 1930s.
First the Supreme Court allowed state and local
jurisdictions to regulate property, pursuant to their police
powers, in the public interest, and to “adopt whatever
economic policy may reasonably be deemed to promote
public welfare.” Nebbia v. New York, 291 U.S. 502, 516
(1934). Then the Court relegated economic liberty to a lower
echelon of constitutional protection than personal or political
liberty, according restrictions on property rights only minimal
review. United States v. Carolene Products Co., 304 U.S.
144, 152–53 (1938). Finally, the Court abdicated its
constitutional duty to protect economic rights completely,
acknowledging that the only recourse for aggrieved property
owners lies in the “democratic process.” Vance v. Bradley,
440 U.S. 93, 97 (1979). “The Constitution,” the Court said,
“presumes that, absent some reason to infer antipathy, even
2
improvident decisions will eventually be rectified by the
democratic process and that judicial intervention is generally
unwarranted no matter how unwisely we may think a political
branch has acted.” Id.
As the dissent predicted in Nebbia, the judiciary’s refusal
to consider the wisdom of legislative acts—at least to inquire
whether its purpose and the means proposed are “within
legislative power”—would lead to only one result: “[R]ights
guaranteed by the Constitution [would] exist only so long as
supposed public interest does not require their extinction.”
291 U.S. at 523. In short order that baleful prophecy
received the court’s imprimatur. In Carolene Products (yet
another case involving protectionist legislation), the court
ratified minimalist review of economic regulations, holding
that a rational basis for economic legislation would be
presumed and more searching inquiry would be reserved for
intrusions on political rights. 304 U.S. at 153 n.4.
Thus the Supreme Court decided economic liberty was
not a fundamental constitutional right, and decreed economic
legislation must be upheld against an equal protection
challenge “if there is any reasonably conceivable state of facts
that could provide a rational basis” for it. FCC v. Beach
Commc’ns, Inc., 508 U.S. 307, 313 (1993). See also Pac.
States Box & Basket Co. v. White, 296 U.S. 176, 185–86
(1935); Steffan v. Perry, 41 F.3d 677, 684–85 (D.C. Cir.
1994) (en banc).
This standard is particularly troubling in light of the
pessimistic view of human nature that animated the Framing
of the Constitution—a worldview that the American polity
and its political handmaidens have, unfortunately, shown to
be largely justified. See James Madison, Notes of Debates in
the Federal Convention of 1787, at 39, 42 (W. W. Norton &
3
Co. 1987). Moreover, what the Framers theorized about the
destructive potential of factions (now known as special or
group interests), experience has also shown to be true. The
Federalist No. 10, at 78, 81 (James Madison) (Clinton
Rossiter ed., 1961). The judiciary has worried incessantly
about the “countermajoritarian difficulty” when interpreting
the Constitution. But the better view may be that the
Constitution created the countermajoritarian difficulty in
order to thwart more potent threats to the Republic: the
political temptation to exploit the public appetite for other
people’s money—either by buying consent with broad-based
entitlements or selling subsidies, licensing restrictions, tariffs,
or price fixing regimes to benefit narrow special interests.
The Hettingas believe they are the victims of just such
shenanigans. Compl. ¶¶ 40–45. And press accounts during
the height of the controversy support the claim. See Dan
Morgan, Sarah Cohen, & Gilbert M. Gaul, “Dairy Industry
Crushed Innovator Who Bested Price-Control System,” Wash.
Post, Dec. 10, 2006, available at
http://www.washingtonpost.com/wp-
dyn/content/article/2006/12/09/AR2006120900925.html. The
Washington Post described Hein Hettinga as an American
success story. He emigrated to the U.S. after World War II
and started as a hired hand. By 1990, Hettinga owned half a
dozen dairies and decided to build his own bottling business.
A Costco vice president showed reporters copies of an e-mail
he sent to Senator Reid during the legislative debate,
explaining that Southern California purchasers of milk were
the victims of “a brazen case of price gouging and
profiteering by the strongest, largest market suppliers,” who
turned a deaf ear to the company’s call for lower prices. Hein
Hettinga changed all that. His arrangement with Costco
“lowered the average price of milk by 20 cents a gallon
4
overnight” until two senators, one from each party, pushed
through the milk legislation at issue in this case.
Very little seems to have changed since the Supreme
Court’s initial confrontation with the regulation of milk
pricing in Nebbia. The state of New York, responding to
falling prices caused by the Great Depression, created a Milk
Control Board, which proposed to remedy weak demand by
establishing a minimum price for milk, and making sale of
milk at any lower price a crime. 291 U.S. at 515, 519. Leo
Nebbia sold two quarts of milk and a five-cent loaf of bread
for eighteen cents, and was convicted of violating the board’s
order. Id. at 515.
Even Justice McReynolds saw the irony. The law, he
said, “impose[d] direct and arbitrary burdens upon those
already seriously impoverished” to give special benefits to
others. Id. at 557. “To him with less than 9 cents it says:
You cannot procure a quart of milk from the grocer although
he is anxious to accept what you can pay and the demands of
your household are urgent! A superabundance; but no child
can purchase from a willing storekeeper below the figure
appointed by three men at headquarters!” Id. at 557–58.
To be sure, the economic climate in which the New York
legislature enacted the law at issue in Nebbia was truly dire,
but 78 years later, the same tired trope about “disorderly
market conduct” is still extant. The Hettingas built their
business on an exemption—one that was profitable for them
and beneficial for consumers. The government acknowledged
that the decision to eliminate the exemption was based on
evidence that large producer-handlers were obtaining a
“decisive competitive advantage” over fully-regulated
handlers, Appellees’ Br. at 7, and were causing a measurable
and “significant[]” decrease in the blend prices being paid to
5
regulated handlers. See 70 Fed. Reg. 74,166, 74,186 (Dec.
14, 2005). As another court has noted, federal regulation of
milk pricing “is premised on dissatisfaction with the results of
competition.” Alto Dairy v. Veneman, 336 F.3d 560, 562 (7th
Cir. 2003). “[M]ilk price discrimination is intended to
redistribute wealth from consumers to producers of milk.” Id.
Once again, the government has thwarted the free market, and
ultimately hurt consumers, to protect the economic interests
of a powerful faction. Neither the legislators nor the lobbyists
broke any positive laws to accomplish this result. It just
seems like a crime.
The judiciary justifies its reluctance to intervene by
claiming incompetence—apparently, judges lack the acumen
to recognize corruption, self-interest, or arbitrariness in the
economic realm—or deferring to the majoritarian imperative.
But see The Federalist No. 78, at 467 (Alexander Hamilton)
(Clinton Rossiter ed., 1961). The practical effect of rational
basis review of economic regulation is the absence of any
check on the group interests that all too often control the
democratic process. It allows the legislature free rein to
subjugate the common good and individual liberty to the
electoral calculus of politicians, the whim of majorities, or the
self-interest of factions. See Randy E. Barnett, Restoring the
Lost Constitution: The Presumption of Liberty 260 (2004).
The hope of correction at the ballot box is purely illusory.
See generally Ilya Somin, Political Ignorance and the
Counter-Majoritarian Difficulty: A New Perspective on the
Central Obsession of Constitutional Theory, 89 Iowa L. Rev.
1287 (2004). In an earlier century, H. L. Mencken offered a
blunt assessment of that option: “[G]overnment is a broker in
pillage, and every election is a sort of advance auction sale of
stolen goods.” On Politics: A Carnival of Buncombe 331
(1996). And, as the Hettingas can attest, it’s no good hoping
6
the process will heal itself. Civil society, “once it grows
addicted to redistribution, changes its character and comes to
require the state to ‘feed its habit.’” Anthony De Jasay, The
State 226 (1998). The difficulty of assessing net benefits and
burdens makes the idea of public choice oxymoronic. See id.
at 248. Rational basis review means property is at the mercy
of the pillagers. The constitutional guarantee of liberty
deserves more respect—a lot more.
GRIFFITH, Circuit Judge, concurring: I, too, agree fully with
the per curiam opinion, but do not join my colleagues’
concurrence with its spirited criticism of the Supreme Court’s
long-standing approach to claims of economic liberty.
Although by no means unsympathetic to their criticism nor
critical of their choice to express their perspective, I am
reluctant to set forth my own views on the wisdom of such a
broad area of the Supreme Court’s settled jurisprudence that
was not challenged by the petitioner.