Court Opinion

ID: 6999193
Source: CourtListenerOpinion
Date Created: 2022-07-24 03:38:56.747972+00
Date Added: 2024-06-11T16:09:51.853339
License: Public Domain

TROTT, Circuit Judge,
Dissenting:
I respectfully dissent. Basically, I accept and agree with the Secretary of Agriculture’s comment made in a preamble to a related 1996 regulation. The Secretary said,
*1110Restaurants traditionally have not been considered subject to the PACA by USDA or Congress unless the buying arm of the restaurant is a separate legal entity, and is buying for and/or reselling the product to another entity.
61 F.R. 13385, 13386 (March 27, 1996). Because the Secretary and the United States Department of Agriculture administer this statute, I think it appropriate to consider seriously what the Secretary says, not wave it off.
Second, I am persuaded that the district court’s careful and discerning analysis of the issue has merit. The district court did not allow its reasoning to become trapped in a series of misleading premises, interpretative tools, and syllogisms that lead one to a conclusion never intended by Congress. On rare occasion, we can be so right with our legalistic approach and labels that we are wrong. With all deference to my colleagues, I believe that is what is happening here: the trees are obscuring the forest. This case provides an example of how plain language divorced from context can be very misleading. We call a table implement used for spreading butter a butter “knife,” but plain language notwithstanding, it is not a “knife” at all. It has no sharp blade for cutting, no point for stabbing, and a handle thoroughly unsuitable for use as a weapon. Would we prosecute for possession of a deadly weapon a high school senior who brings onto campus a butter knife to make a sandwich for lunch? I would hope not. And why not? Because a butter knife is not that kind of a knife; and a restaurant is not this kind of a dealer. Justice Cardozo warned against this variety of misinterpretation in Snyder v. Massachusetts, when he spoke of the “tyranny of labels.” 291 U.S. 97, 114, 54 S.Ct. 330, 78 L.Ed. 674 (1934), overruled on other grounds by Malloy v. Hogan, 378 U.S. 1, 2 n. 1, 84 S.Ct. 1489, 12 L.Ed.2d 653 (1964). He counseled caution before rendering a holding that a situation not responsible for the creation of the rule under interpretation be brought under that rule just because it is “fitted to the words.” Id. The discriminating Secretary responsible for this arena understands and has correctly applied this principle.
The purpose and reach of the rule we are construing was illuminated in the House Report concerning a 1995 Amendment that defined the term “retailer.” The House Report said,
Approximately 4,000 retailers are currently estimated to be licensed under PACA.... It is not the intent of the [House Committee on Agriculture] that the definition of retailer be construed to include food service establishments such as restaurants, or schools, hospitals and other institutional cafeterias.
H.R. Rep. 104-207, 104th Cong., 1st Sess. (1995), 1995 U.S.C.C.A.N. 453; In re The Italian Oven, Inc., 207 B.R. 839, 844 (Bkrtcy.W.D.Pa.1997). Given this strong clue as to the cutoff point of PACA’s coverage, the bankruptcy court which took note of this Report concluded that because the restaurant-defendant did not have a separate buying arm and did not resell the commodities to another entity, but instead prepared menu items to prepare meals for diners, the restaurant was not subject to PACA, and no PACA trust could be impressed. I agree.
Moreover, as the district court recognized, PACA goes to great lengths to exclude from its reach perishable fruits and vegetables which have been manufactured into articles of food. See 7 C.F.R. § 46.2(u) (“Fresh fruits and fresh vegetables include all produce in fresh form generally considered as perishable fruits and vegetables, whether or not packed in ice or held in common or cold storage, but do not include those vegetables which have been manufactured into articles of food of a *1111different kind or character.”)- The activity of a restaurant in this regard seems clearly to be beyond this careful line of demarcation. Bluntly put, restaurants do not buy agriculture commodities for resale, but rather use them to create a wholly new and distinct product — meals.
In summary, I conclude as did dissenting Judge Rendell in In re Magic Restaurants, Inc., 205 F.3d 108, 117-18 (3d Cir.2000), that as internally seductive as the majority’s well written opinion is, it simply comes up with the wrong answer. I believe on this record that the controlling statute is silent as to restaurants — it neither expressly includes nor excludes them — because Congress never contemplated that such eating establishments could be regarded for this purpose as jobbers, distributors, dealers, or wholesalers. “Restaurants are engaged in the business of preparing and selling meals to customers. Not only is buying and selling perishables in large quantities not their primary business, it is not their business at all.” In re Magic Restaurants, Inc., 205 F.3d at 117 (Rendell, J., dissenting) (emphasis in original). Whatever the technical and interpretative ways are that we can find to discount the Secretary of Agriculture’s longstanding practice and persuasive opinion on this subject, the Secretary appears to be correct. The majority’s opinion is right, of course, to notice that the Secretary’s published views appear in a context not connected to formal adjudication or notice-and-comment rule-making, but this is because both Congress and the Secretary considered this a nonissue. Under these circumstances, therefore, the fact that the Secretary’s opinion does not arise in the context of formal administrative procedures is no reason to dismiss it.
Because restaurants are a step beyond PACA’s concern, as evidenced by the House Report and the Secretary’s understanding, I respectfully dissent. The majority plows new ground neither addressed by Congress nor contemplated by it. I believe this issue under our Constitution is for the policy makers on the Hill to decide, not for us.