Opinion ID: 3014466
Heading Depth: 1
Heading Rank: 2

Heading: dairy industry's position in the

Text: marketplace . . . .” Id. § 4501(b). The Dairy Promotion Program set forth in the Dairy Act is one in a long The Dairy Act is a stand-alone series of federal “checkoff” programs for law that was not passed as part of any promoting agricultural commodities.4 other federal dairy regulatory scheme. It directs the Secretary to appoint a Dairy Board composed of private milk 4 Other stand-alone checkoff producers to administer the Dairy programs established by Congress which Promotion Program. Id. §§ 4504 (b) & have been subject to First Amendment (c). The Act provides that every milk challenges include: Beef Research and producer must pay a mandatory Information Act of 1976 (“Beef Act”), 7 assessment of 15 cents per U.S.C. § 2901 et seq. (invalidated by hundredweight of milk sold to finance Livestock Marketing Ass’n v. U.S. Dep’t the promotional programs and the Dairy of Agric., 335 F.3d 711 (8th Cir. 2003) Board’s administration of them. (reh’g den. Oct. 16, 2003)); Pork Pursuant to the authority provided Promotion, Research, and Consumer in 7 U.S.C. § 4503(a), the Secretary Information Act of 1985 (“Pork Act”), 7 issued an order in March 1984 U.S.C. § 4801 et seq. (invalidated by establishing the Dairy Board, 7 C.F.R § Michigan Pork Producers Ass’n, Inc. v. 1150.131, and the Board proceeded to Veneman, 348 F.3d 157 (6th Cir. 2003)); collect the mandatory assessments from Mushroom Act, 7 U.S.C. § 6101 et seq. all milk producers, 7 C.F.R § 1150.152. (invalidated in 2001 by United Foods, For the Cochrans, the compelled 533 U.S. at 405). Cf. Glickman, 521 assessments amount to roughly $3,500 to U.S. at 457 (upholding as constitutional $4,000 per year. marketing orders for California tree fruits promulgated pursuant to the AMAA, 7 U.S.C. § 608c et seq., which included compelled assessments to fund, among other things, generic advertising). 7 The Dairy Board is composed of Dairy Board and the DMI Board are commercial milk producers who are composed entirely of private milk nominated by “eligible associations,” producers and other private parties, and which are private associations of milk the Dairy Promotion Program is funded producers that engage in dairy promotion entirely by private milk producers at the state and regional level. Id. §§ through the compelled assessments. The 1150.133, 1150.273. The primary Dairy Promotion Program website consideration in determining an explains: “Checkoff programs are funded organization’s eligibility is “whether its by dairy producers – NOT membership consists primarily of milk TAXPAYERS. They are not producers who produce a substantial governmental programs; rather, they are volume of milk” and whose overriding businesses with governmental interests lay in the production and oversight.” 5 promotion of fluid milk and other dairy The Secretary’s oversight products. Id. § 1150.274(b). responsibilities pursuant to the Dairy Act In 1994, the Dairy Board created are conducted by the Agricultural Dairy Management, Inc. (“DMI”), a Marketing Service (“AMS”), a division District of Columbia corporation that of the USDA, and are limited to ensuring now oversees and administers the that the Dairy Promotion Program is in promotional activities of the Dairy Act. compliance with the Act. See, e.g., 7 DMI is a joint undertaking of the Dairy U.S.C. § 4507(a) (authorizing the Board and the United Dairy Industry Secretary to terminate an order issued Association (“UDIA”), which is an under the Act only when she determines association of state and regional dairy that it “obstructs or does not tend to promotional programs that are effectuate the declared policy of” the considered “Qualified Programs” under Act). AM S guidelines explain that “[i]t the Dairy Act. “Qualified Programs” are is the policy of AMS in carrying out the local promotional programs, many of oversight responsibility to ensure that which preexisted the Dairy Act, to which legislative, regulatory, and Department milk producers may contribute a portion policy requirements are met. It is not the of the money they would otherwise pay intent to impose constraints on board in assessments under the Act. See 7 operations beyond these requirements.” U.S.C. § 4504(g)(4), 7 C.F.R. §§ AMS, Guidelines for AMS Oversight of 1150.152(c), 1150.153. The Act thus Commodity Research and Promotion requires dairy farmers to pay either the full 15 cent per hundredweight assessment to the Dairy Program or part 5 Dairy checkoff Works! – How the to the Dairy Program and part to a Dairy Checkoff works, available at Qualified Program that engages in state http://www.dairycheckoff.com/howitworks. or regional generic advertising. The htm (last visited June 3, 2002 (J.A. at 231)). 8 Programs 1 (1994). The Secretary’s bound together and obligated by statute oversight functions for the Dairy to market their products according to Program are funded by the compelled some set of cooperative rules. The assessments. 7 U.S.C. § 4504(g)(2); 7 district court held that such a cooperative C.F.R. § 1150.151(b). Moreover, the arrangement exists for dairy producers, dairy producers, not the government, but we conclude otherwise. control whether the Dairy Promotion
Program continues via a referendum process. 7 U.S.C. § 4506(a). The AMAA, 7 U.S.C § 608c, permits the Secretary to issue marketing All advertising and promotional orders that regulate the handling and programs that are financed by the sales of various agricultural compelled assessments under the Dairy commodities, including milk, in different Act and created by the Dairy Board and regions of the country. For milk, the DM I promote milk as a generic product. marketing orders establish a 7 C.F.R. § 1150.114. Among classification system and set minimum advertising campaigns financed by the prices that handlers must pay in the Dairy Promotion Program are “Got milk? regions in which the orders apply. See 7 ®” and “Ahh, the power of cheese.” U.S.C. § 608c(5); 7 C.F.R. § 1000.1 et seq. The AM AA applies only to “handlers”6 of the covered commodities.