Opinion ID: 78216
Heading Depth: 1
Heading Rank: 8

Heading: Whether the Obligation to Pay Assessments under the Act Violates Swisher's Due Process Rights

Text: Having determined that a takings analysis is not appropriate in this case, we turn to Swisher's argument that the Act violates its right to due process because it imposes retroactive liability that is disproportionate to Swisher's participation in the price support program. Economic legislation come[s] to the Court with a presumption of constitutionality. Usery v. Turner Elkhorn Mining Co., 428 U.S. 1, 15, 96 S.Ct. 2882, 2892, 49 L.Ed.2d 752 (1976). To prove that a statute violates its due process rights, the aggrieved party must demonstrate that the legislature has acted arbitrarily and irrationally. Id. at 15, 96 S.Ct. at 2892. However, if the government can show that the statute has a legitimate legislative purpose furthered by rational means, due process is satisfied. Gen. Motors Corp. v. Romein, 503 U.S. 181, 191, 112 S.Ct. 1105, 1112, 117 L.Ed.2d 328 (1992). When a statute has a retroactive effect, the government must also prove that the statute's retroactive application furthers a legitimate legislative purpose. Pension Benefit Guar. Corp. v. R.A. Gray & Co., 467 U.S. 717, 730, 104 S.Ct. 2709, 2718, 81 L.Ed.2d 601 (1984). As is apparent from our discussion above summarizing Justice Kennedy's substantive due process analysis in Eastern Enterprises, the primary factor which led to the holding that the Coal Act was unconstitutional was the fact that the Coal Act imposed upon Eastern Enterprises a retroactive obligation of unprecedented scope. 524 U.S. at 549, 118 S.Ct. at 2159. The crucial difference between the instant case and Eastern Enterprises is that the obligation imposed upon Swisher in the instant case is not retroactive. The Act provides: The Secretary, acting through the Commodity Credit Corporation, shall impose quarterly assessments during each of fiscal years 2005 through 2014, calculated in accordance with this section, on each tobacco product manufacturer and tobacco product importer that sells tobacco products in domestic commerce in the United States during that fiscal year. 7 U.S.C. § 518d(b)(1). Under the plain meaning of the language of the statute, every tobacco manufacturer and importer currently participating in the domestic tobacco market is subject to the assessments. Accordingly, a new manufacturer or importer would be subject to an assessment under the statute as a cost of doing business in the industry. Contrary to Swisher's argument, the plain language of the statute clearly indicates that the assessments are not based upon the past conduct of tobacco manufacturers or importers. [10] Quite the contrary, the assessment is based upon current participation in the market, such that new entrants are assessed, as well as those who participated in the past. Stripped of its argument that the Act is retroactive, Swisher's due process challenge is readily disposed of as being wholly without merit. We note again that congressional legislation adjusting the burdens and benefits of economic life come to the Court with a presumption of constitutionality, and ... the burden is on one complaining of a due process violation to establish that the legislature has acted in an arbitrary and irrational way. Turner Elkhorn, 428 U.S. at 15, 96 S.Ct. at 2892. Statutes may be invalidated on due process grounds only under the most egregious of circumstances. Eastern Enterprises, 524 U.S. at 550, 118 S.Ct. at 2159 (Kennedy, J., concurring in the judgment and dissenting in part). So long as congressional legislation is supported by a legitimate legislative purpose furthered by rational means, judgments about the wisdom of such legislation remain within the exclusive province of the legislative and executive branches. R.A. Gray, 467 U.S. at 729, 104 S.Ct. at 2717-18. Applying that deferential standard, we readily conclude that the Act easily passes constitutional muster. The legitimate legislative purpose is apparent. Congress obviously perceived problems in the industry, perceived a need to eliminate the old subsidy system, and decided to move to a free market system. However, Congress recognized that tobacco farmers and quota holders should be provided some cushion for the transition. Seeing these economic problems in the industry, Congress exercised its legitimate legislative powers to address same. We also readily conclude that the means Congress chose to address these industry problems were rational. Congress recognized that such a transition to a free market system would benefit all current and future tobacco manufacturers and importers, and thus devised a system of assessments to fund the transition to the free market systemi.e., assessing all current tobacco manufacturers and importers, all of whom would benefit from the transition to the free market system. Moreover, tobacco manufacturers and importers currently engaged in the domestic market are entities that are not only likely to benefit from the deregulation, but also are entities best suited to pass such increased costs along to the ultimate consumers. [11] We conclude that Congress exercised its powers to serve legitimate legislative purposes. We also conclude that Congress chose rational means. Thus, we conclude that Swisher has failed to show that the Act is arbitrary and irrational, and has failed to demonstrate that the Act is unconstitutional as applied to Swisher. [12]