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Judge’s Egg Ruling Impacts Virginia

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(Editor’s Note: Virginia has a large poultry industry and this article shows the impact of a judge’s ruling in California on that industry here in the Commonwealth.)

A U.S. District Court judge in California on October 2, 2014, told six Attorneys General they did not have a case when they challenged a California law which requires an increase in cage size for egg-laying hens in every state, not just California.

California produces about 5.5 billion eggs per year.

The entire United States produces approximately 93 billion eggs annually. Iowa is the # 1 producer at 14.5 billion and 2.15 billion are shipped to California. All other states ship another 7 billion eggs to California. The average U.S. consumer eats approximately 250 eggs per year.

Based on a proposition passed by voters and backed by animal rights groups such as HSUS, California legislators passed a bill in 2010 to require all farmers exporting eggs to California to meet California cage size standards. The “Cage Size Law” is effective January 1, 2015.

You would think with six Attorneys General involved in the case they would have enough experience and lawyers to know how to try such a case. The judge in this case threw out their law suit due to a lack of standing or lack of specific harm. The court did not consider the merits of the case.

The Attorneys General claimed California does not have the right to make laws that can affect another state’s agricultural policies or economy. On the law, the plaintiffs are correct but simply did not present their case correctly, according to the decision.

This case is critical for all agriculture. Can California now pass legislation saying it will no longer allow John Deere tractors to come into the state because said tractors do not meet some California requirement? Can one state tell another state how to produce an agriculture product? The answer is no.

The complaint in this case was defective from the very beginning according to the court because the Attorneys General did not have standing to sue. Plaintiffs argued that as Attorneys General, they could sue in their capacity because each state “has a quasi-sovereign interest in protecting its citizens’ economic health and constitutional rights as well as preserving its own rightful status within the federal system.”

The Humane Society of the United States and the Association of California Egg Farmers claimed that the complaint was limited to “…the economic harm that would allegedly befall some unspecified egg farmers within their borders who may intend to sell eggs in California after January 1, 2015….”

The court instructed the Attorneys General that they must allege “…injury in fact to the citizens they purport to represent…” The court told the AGs they failed to allege how the citizens of their states were in fact injured. As the court pointed out, even though egg farmers in each state might suffer a specific injury, this farmer injury does not affect the citizens the plaintiffs allegedly represent.

As first year law students know, generalized grievances and potential injuries are insufficient for a complaint. Apparently the Attorneys General did not set forth any affidavits or declarations showing how the bringing of their action would impact the economic health or well-being of each state’s citizens.

All is not lost. A proper complaint brought by producers can win. The Commerce Clause in the U.S. Constitution, Article I, Section 8, Clause 3 gives Congress the power “to regulate commerce with foreign nations, and among the several states and with Indian tribes.”

The purpose of the Commerce Clause is to keep states such as California from passing legislation which discriminates against or excessively burdens interstate commerce.
California’s law facially discriminates against out of state producers and has the effect of favoring in-state economic interests over out-of-state interests. In fact, the court discusses whether California’s cage size law is discriminatory and/or motivated by simple economic protectionism.

California justifies its law and burden it is putting on interstate commerce by claiming the Pew Commission and the World Health Organization claim that hens in small cages are stressed and therefore more likely to produce eggs with salmonella. (This issue is far from settled.)

An egg producer in any state shipping to California facing the requirements of California on raising hens cannot allow California to tell him or her how to produce his eggs. This case can be won, but it must be presented to a federal court properly showing the specific to harm’s to producers and the interstate burden California is imposing on other states’ producers and violating the dormant Commerce Clause.

Humpty Dumpty can be put back together again in this case.

(This article first ran in Farm Futures on October 6, 2014)
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