U.S. Court of Appeals Rules Beef Check-off Tax Unconstitutional
Published July 9, 2003
On July 8, a federal appeals court re-affirmed a lower court ruling that the U.S. governement-mandated beef check-off program is unconstitutional.
The beef check-off is a mandatory one-dollar tax ranchers pay on every head of cattle they sell for slaughter. More than 90% of check-off funds are given to the National Cattlemen's Beef Association (NCBA), a private industry group that uses the funds primarily to promote beef consumption.
Many ranchers objected to this both as "compulsory speech" and because the NCBA serves the interests of the largest corporations in the meat industry, often at the expense of independent businesses. They sued to overturn the federal law requiring the transfer of funds as a violation of their First Amendment rights.
Two of the plaintiffs in the case, Montana ranchers Steve and Jeanne Charter, refused to pay the check-off fee on 250 cattle, for which USDA fined them thousands of dollars. Ms. Charter objected to the NCBA using their money to "fund projects promoting corporate control of the beef industry," and uses "millions of check-off dollars to promote processed products for giant global companies like Sysco, Hormel, and Sara Lee." The Charters were joined by the Western Organization of Resource Councils, Livestock Marketing Association, and other ranchers in the lawsuit.
The Eighth Circuit Court of Appeals rejected an appeal of a June 2002 ruling by U.S. District Judge Charles Kornmann. The court rejected arguments by the federal government and Cattlemen's Beef Board that the beef check-off program is immune from a First Amendment challenge because it is "government speech." The court said that the government was not speaking through the beef checkoff; it held, rather, that the beef check-off compels individuals to pay for speech they disagree with, and therefore it violates the First Amendment.
The court also rejected arguments that only the portion of the program spent for advertising should be struck down, ruling that the "principal object" of the beef check-off is the unconstitutional speech, so "no remaining aspects of the [Beef Promotion] Act can survive."
After the original district court ruling found the beef check-off unconstitutional, the U.S. Department of Agriculture (USDA) was granted a stay of the decision pending appeal, meaning the forced collections continue today -- a tactic the Bush USDA likely will repeat.
Update: This ruling was appealed to the U.S. Supreme Court, which granted certiorari (meaning it accepted the appeal). Oral arguments will be heard in December of 2004 and a ruling issued in the first half of 2005.
For more background on this case, see Independent Ranchers Fight Corporate Control. To learn more about those most directly fighting the check-off, visit the website of the Northern Plains Resource Council, the primary source of background for this report.
Related features and documents:
*The appeals court ruling (pdf)
* Milk Checkoff Ruled Unconstitutional
*
Asserting Democratic Control Over Our Food and Agriculture (this
article does not directly address the check-off issue, but offers
a broader perspective on corporate power and its impact on our food
and farms).
Similar legal challenges have been waged with initial success in the grape, mushroom, dairy, and pork
industries .
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