Opinion ID: 2634656
Heading Depth: 3
Heading Rank: 3

Heading: United Foods

Text: The United States Supreme Court further clarified its Glickman decision in United Foods, supra, 533 U.S. 405, 121 S.Ct. 2334. In United Foods, the court considered the constitutional validity of a program authorized by the Mushroom Promotion, Research and Consumer Information Act (7 U.S.C. § 6101 et seq.). In practice, the program established pursuant to the act was almost exclusively for the purpose of subsidizing generic advertising. ( United Foods, supra, 533 U.S. at p. 415, 121 S.Ct. 2334.) In considering the constitutional validity of the program, the court acknowledged that the standards employed for determining the validity of restrictions on commercial speech were less exacting than for other forms of expression, citing the test found in Central Hudson, supra, 447 U.S. 557, 100 S.Ct. 2343, 65 L.Ed.2d 341, and recognized that the test had been subject to criticism by members of the court. ( United Foods, supra, 533 U.S. at pp. 409-410, 121 S.Ct. 2334.) The court declined to resolve that controversy, stating that even viewing commercial speech as entitled to lesser protection, we find no basis under either Glickman or our other precedents to sustain the compelled assessments sought in this case. ( Id. at p. 410, 121 S.Ct. 2334.) United Foods began its analysis by affirming the principle that the First Amendment may, under certain circumstances, prohibit compelling certain individuals to pay subsidies for speech to which they object, relying on Abood and Keller. ( United Foods, supra, 533 U.S. at p. 410, 121 S.Ct. 2334.) As the United Foods court further affirmed: The fact that the speech is in aid of a commercial purpose does not deprive respondent of all First Amendment protection. . . . ( Ibid. ) The court then turned to what it viewed as the key distinction between the case before it and Glickman. In Glickman, the compelled subsidy of speech was part of a detailed marketing order that had `displaced competition' to such an extent that [it was] `expressly exempted from the antitrust laws.' ( United Foods, supra, 533 U.S. at p. 412, 121 S.Ct. 2334.) Given that producers were bound together in [a] common venture, the imposition upon their First Amendment rights caused by using compelled contributions was, as in Abood and Keller, in furtherance of an otherwise legitimate program. ( United Foods, supra, 533 U.S. at pp. 414-415, 121 S.Ct. 2334.) The statutory mechanism as it relates to handlers of mushrooms is concededly different from the scheme in Glickman; here the statute does not require group action, save to generate the very speech to which some handlers object. In contrast to the program upheld in Glickman, . . . there is no broader regulatory system in place here. We have not upheld compelled subsidies for speech in the context of a program where the principal object is speech itself. . . . The only program the Government contends the compelled contributions serve is the very advertising scheme in question. Were it sufficient to say speech is germane to itself, the limits observed in Abood and Keller would be empty of meaning and significance. ( United Foods, supra, 533 U.S. at p. 415, 121 S.Ct. 2334.) The United Foods court rejected the government's argument that the Abood line of cases was concerned only with compelled subsidization of political speech or speech that violated the freedom of belief. ( United Foods, supra, 533 U.S. at p. 413, 121 S.Ct. 2334.) Before addressing whether a conflict with freedom of belief exists, a threshold inquiry must be whether there is some state imposed obligation which makes group membership less than voluntary; for it is only the overriding associational purpose which allows any compelled subsidy for speech in the first place. ( Ibid. ) Thus, although United Foods did not purport to overrule Glickman, and indeed took pains to distinguish Glickman, it appears to have modified Glickman's holding in this sense: United Foods holds that the compelled funding of commercial speech does not violate the First Amendment if it is part of a larger marketing program, such as was the case in Glickman, and if the speech is germane to the purpose of the program. But that being the case, compelled funding of commercial speech must be said to implicate the First Amendment, i.e., such compelled funding requires a particular constitutional inquiry along the lines of Abood and its progeny. In other words, the United States Supreme Court appears to have distanced itself from Glickman's conclusion that the generic advertising program does not implicate commercial speech because it does not engender any crisis of conscience. ( Glickman, supra, 521 U.S. at p. 472, 117 S.Ct. 2130.) On this point, the United States Supreme Court now seems to be in agreement with Gerawan I. Furthermore, because the United Foods court did not overrule Glickman, the latter case can now most sensibly be read as simply holding that Market Order No. 917 did not violate the First Amendment because it passed the Abood test. (See Glickman, supra, 521 U.S. at pp. 472-473, 117 S.Ct. 2130.) Gerawan contends that the California Plum Marketing Program does not pass the United Foods threshold. Gerawan made a very similar argument in its last appearance before this court in Gerawan I, which we rejected. Anticipating the distinction the high court recognized in United Foods, Gerawan quoted the Glickman majority's statement that Marketing Order No. 917 was a `detailed' `regulatory scheme' that had `displaced many aspects of independent business activity that characterize other portions of the economy in which competition is fully protected by the antitrust laws,' and accordingly `compelled' Gerawan and the rest `to fund the generic advertising at issue . . . as a part of a broader collective enterprise in which their freedom to act independently' was `already constrained.' [Citation.] Gerawan then maintain[ed] that the California Plum Marketing Program is not such a `detailed' `regulatory scheme.' ( Gerawan I, supra, 24 Cal.4th at p. 507, 101 Cal.Rptr.2d 470, 12 P.3d 720.) The Gerawan I court rejected this argument. Although plainly not identical, the California Plum Marketing Program and Marketing Order No. 917, so far as the Glickman majority's analysis is concerned, are not materially different. Marketing Order No. 917, among other things, provided for the undertaking, by the Plum Commodity Committee, of research and development projects, including advertising, and set out specific regulations regarding both fruit containers and packs and also fruit grades and sizes. The California Plum Marketing Program provides for the undertaking, by the California Plum Marketing Board, of research; advertising, specifically generic advertising, along with sales promotion and market development; and the institution and implementation of quality standards and inspections. It appears that a federal marketing order under the AMAA might have regulated more broadly and deeply than a state marketing order under the CMA. But Marketing Order No. 917 did not in fact regulate so much more broadly and deeply than the California Plum Marketing Program. At bottom, Gerawan would have us characterize Marketing Order No. 917 as a regulation of economic activity with an incidental effect on speech and the California Plum Marketing Program as a regulation of speech with an incidental effect on economic activity. We cannot do so. Contrary to Gerawan's assertion, the fact that the California Plum Marketing Program earmarks 55 percent of the funds assessed from producers for generic advertising along with sales promotion and market development, with only 35 percent for quality standards and inspections and only 10 percent for research, does not cause it to `stand[] alone . . . as a regulation of speech.' ( Gerawan I, supra, 24 Cal.4th at p. 508, 101 Cal.Rptr.2d 470, 12 P.3d 720, fn. omitted.) [2] In fact, Gerawan I explicitly distinguished the program in that case from the Mushroom Promotion, Research, and Consumer Information Act of 1990 at issue in United Foods, which, at the time Gerawan I issued, was pending before the United States Supreme Court: In apparent contrast to both the AMAA and the CMA is the Mushroom Promotion, Research, and Consumer Information Act of 1990 [citation], which has been characterized as `basically a commercial advertising statute designed to assess mushroom growers for the cost of advertising' ( United Foods, Inc. v. U.S. (6th Cir.1999) 197 F.3d 221, 222, fn. 1, cert. granted Nov. 27, 2000. . . . ( Gerawan I, supra, 24 Cal.4th at p. 507, fn. 9, 101 Cal.Rptr.2d 470, 12 P.3d 720; see also id., at p. 508, fn. 10, 101 Cal.Rptr.2d 470, 12 P.3d 720.) Gerawan continues to argue that the chief distinction between the marketing orders in Glickman and in this case is that the former orders displaced competition, whereas the latter does not. This assertion is incorrect. As Justice Breyer noted in his dissent in United Foods: Both then-existing federal regulations and Justice Souter's dissenting opinion make clear that, at least in respect to some of [ Glickman's ] marketing orders, price and output regulations, while `authorized,' were not, in fact, in place. See 7 CFR pts. 916, 917 (1997) (setting forth container, packaging, grade, and size regulations, but not price and output regulations); [ Glickman, supra, ] 521 U.S., at 500, n. 13 [117 S.Ct. 2130] (Souter, J., dissenting) (noting that `the extent to which the Act eliminates competition varies among different marketing orders'). ( United Foods, supra, 533 U.S. at p. 420, 121 S.Ct. 2334 (dis. opn. of Breyer, J.).) This point is not controverted by the United Foods majority, which, as noted, did not purport to overturn Glickman. We thus do not understand United Foods as holding that the cooperative regulatory activity displacing competition must take the form of price regulations or output regulations in the strict sense. Rather, the cooperative regulations may simply control the quality or size of the product, as was the case in Glickman but not in United Foods. The California Plum Marketing Program, according to Gerawan's pleadings, is involved in that sort of activity and spends a substantial portion of its assessment on developing and enforcing quality standards. Moreover, as we recognized in Gerawan I, CMA marketing orders implicitly exempt those participating in a marketing agreement from state antitrust laws ( Gerawan I, supra, 24 Cal.4th at p. 478, 101 Cal.Rptr.2d 470, 12 P.3d 720), a factor found significant in Glickman and United Foods. (See Glickman, supra, 521 U.S. at p. 461, 117 S.Ct. 2130; United Foods, supra, 533 U.S. at p. 412, 121 S.Ct. 2334.) Gerawan further argues that generic advertising is not necessary to the other parts of the marketing program, such as quality standards. What is required, however, is not necessity but germaneness. (See United Foods, supra, 533 U.S. at pp. 414-416, 121 S.Ct. 2334; Glickman, supra, 521 U.S. at p. 473, 117 S.Ct. 2130.) Here, as in Glickman, the generic advertising of California [plums] is unquestionably germane to the purposes of the marketing order ( Glickman, supra, at p. 473, 117 S.Ct. 2130), i.e., germane to the purpose of increasing the sale of particular California agricultural products. [3] In sum, as we concluded in Gerawan I, the program at issue in this case is not materially different from the one that passed constitutional muster in Glickman, which the United Foods majority expressly distinguished from the program it found constitutionally deficient. ( United Foods, supra, 533 U.S. at pp. 411-414, 121 S.Ct. 2334.) We therefore conclude the compelled funding of speech by the California Plum Marketing Program is part of a larger cooperative regulatory program with substantial nonexpressive elements (see United Foods, supra, 533 U.S. at p. 413, 121 S.Ct. 2334), and therefore crosses the United Foods threshold. Accordingly, we reaffirm our holding in Gerawan I that the generic advertising program at issue here does not violate the First Amendment.