Opinion ID: 1977391
Heading Depth: 1
Heading Rank: 4

Heading: Excessive burden on interstate commerce.

Text: The difficulty with the provisions of ch. 212, Laws of 1971, which leads us to conclude that the enactment is unconstitutional is the excessive burden it places on interstate commerce. The trial court relied upon Dean Milk Co. v. Madison [13] for its conclusion that this statute is unconstitutional in this respect. At issue in that case was a Madison city ordinance which (1) prohibited the sale of pasteurized milk unless the milk was pasteurized at an approved plant within five miles of the central square, and (2) forbade the sale of milk without a permit, but imposed no duty upon city inspectors to go more than 25 miles from Madison in their inspections prior to issuing permits. The United States Supreme Court found that the practical effect of this ordinance was to exclude out-of-state milk, as well as milk produced in other areas of Wisconsin not in close proximity to Madison. The court concluded that the ordinance constituted a clear discrimination against interstate commerce, which the city of Madison was not free to impose if reasonable nondiscriminatory alternatives, adequate to conserve legitimate local interests, are available. [14] Reasonable alternatives did exist, in the opinion of the court, because the city could either send its inspectors to examine more remote plants, at the expense of the company that owned the plant, or rely upon the federal grading and inspection system, which was trustworthy and accurate. Pike v. Bruce Church, Inc . [15] is a more recent case which sets forth the factors appropriate to a determination of whether a state action unduly burdens interstate commerce. In that case an Arizona agricultural official had ordered a grower of cantaloupes to cease transporting uncrated cantaloupes from Arizona to California for processing. This authority derived from a law which prohibited the exportation of produce not packaged in standard containers. The purpose of the law was to prevent the exportation of inferior or deceptively packaged produce, and to protect the reputation of Arizona produce growers. In deciding that the order unduly burdened interstate commerce, the court announced the following test for such cases: Although the criteria for determining the validity of state statutes affecting interstate commerce have been variously stated, the general rule that emerges can be phrased as follows: Where the statute regulates evenhandedly to effectuate a legitimate local public interest, and its effects on interstate commerce are only incidental, it will be upheld unless the burden imposed on such commerce is clearly excessive in relation to the putative local benefits. . . . . If a legitimate local purpose is found, then the question becomes one of degree. And the extent of the burden that will be tolerated will of course depend on the nature of the local interest involved, and on whether it could be promoted as well with a lesser impact on interstate activities. (Emphasis ours.) [16] Thus Pike applied a balancing approach in deciding whether the particular state action or statute offended against the commerce clause. The nature and importance of the local benefit was weighed against the amount and extent of burden which it imposed upon interstate commerce. Additionally, the court balanced the presence or absence of other reasonable means of achieving the same objective with less impact on interstate commerce. In this case, the prevention of consumer deception is a legitimate state interest which is achieved by sec. 97.48 (4), Stats., by eliminating the misleading and fraudulent practice of substituting Coffee-Rich for cream without the knowledge or assent of the consumer, and then serving this concoction as coffee with cream. However, we conclude that the burden imposed upon interstate commerce is clearly excessive in relation to the putative local benefits. Sec. 97.48 (4) effectively cuts off restaurant sales by firms operating in interstate commerce like Coffee-Rich, Inc. In 1971, the last year for which complete figures are available, Coffee-Rich, Inc., had a total dollar volume of Wisconsin sales to public eating establishments and institutions of $201,000. This figure represents sales of Coffee-Rich in frozen form alone, and does not include Wisconsin sales in powdered form. However, since the figure of $201,000 does include institutional users like hospitals and schools, the total dollar volume for restaurants and public eating establishments is somewhat less. Yet, according to the stipulated facts, Coffee-Rich is one of only seven nondairy creamers sold to and served in Wisconsin restaurants. Fairmont Foods, Sealtest, Borden, and Carnation are among the major food companies which market nondairy creamers to public eating establishments and other institutions in Wisconsin. Thus, the total dollar volume of sales which would be completely cut off by enforcement of this statute is substantial. There are reasonable alternatives to this statute which would have considerably less impact on interstate commerce, and still fully prevent the deception with which the legislature is legitimately concerned. The statute is a total bar to restaurant sale or service of Coffee-Rich. But a customer who specifically requests a nondairy creamer would not be misled or deceived, and yet such a customer falls within the prohibition of the statute, no matter how justifiable his preference for nondairy creamers might be from a medical, dietary, or personal point of view. Moreover, it is undisputed that Coffee-Rich comes in half-ounce containers of liquid and three-gram packets of powder. Both the containers and packets bear a clear, legible label which reads: Non-Dairy Creamer (Product) Contains No Milk or Milk Fat. Yet the statute forbids placement of these containers on restaurant tables, and services to consumers, who could otherwise pick them up, read them, and make a conscious choice to use them. In effect, the statute, under the guise of consumer protection, actually limits the range of wholesome, nutritious foods which the restaurant consumer may consciously choose. In a similar fashion, the statute also prohibits restaurant sale or service even if a clip is attached to the menu, stating in reasonably prominent letters that the coffee whitener served in the restaurant is not a dairy product. The statute thus limits restaurant owners to service of cream or cream derivatives as coffee whiteners, even though a product like Coffee-Rich might be more desirable from the point of view of cost of restaurant management. The state seeks to avoid the impact of these reasonable alternatives by citing cases which contain statements undercutting the effectiveness of labeling as a means of informing the consumer. [17] These statements are unpersuasive in that they do not recognize the consumer's increased awareness of and interest in what he is consuming. They are also unpersuasive in the factual setting of this case. Sec. 97.48 (4), Stats., explicitly recognizes the effectiveness of labeling in the vending-machine exception to the law. How then can it be said that labeling is an unreasonable and unacceptable means of preventing deception in the restaurant setting? There is no difference in the situation of a consumer who reads a menu clip or a label on a container or packet on a restaurant table and the situation of a consumer who looks at a vending machine before making his choice. Labeling is incontrovertibly a reasonable and effective means of preventing the consumer deception in restaurants with which the legislature is rightfully concerned. On balance we conclude that the burden which sec. 97.48 (4), Stats., imposes upon interstate commerce is clearly excessive in relation to the putative local benefits to be derived from the statute, especially since those same benefits can be fully achieved by methods less burdensome to interstate commerce. By the Court. Order affirmed.