Oral Arguments in Horne v. USDA

A few weeks ago, I wrote about an interesting takings case the Supreme Court was set to hear this term, Horne v. USDA. The Court heard oral arguments in this case on April 22, so this is the promised update now that I’ve had time to go through the transcript.

The short version of the story is: things don’t look good for the government.

Orals got underway with arguments from Michael McConnell, a renowned constitutional law scholar, who represented the Hornes. McConnell laid out the basics of the Hornes’ position – which is, essentially, that taking raisins from farmers is still a taking as far as the Constitution is concerned, even though raisins are personal, as opposed to real, property.

Several justices questioned McConnell’s claim that this case should be considered a per se taking as opposed to a regulatory taking. Justice Kagan asked several pointed questions about the limits of the Hornes’ claim: that is, what other sorts of government requirements might a ruling in their favor affect? Kagan asks “So how about just programs where the government says, give us – produce records for us. I’m sure that there are a lot of programs like that in the world. And there is something intuitive about your saying, well, the government is asking us to turn over stuff. …How would that fare under your argument?”

McConnell responded by drawing attention to an important distinction: in records (Kagan’s example), the value is not in the documents themselves, but in the information they contain – and in most cases, the individual forced to turn those records over does not herself lose that value (i.e. she does not lose the information). Thus McConnell implicitly argues that it is not the deprivation of a possessory interest that makes a taking, but rather the deprivation of the value of that possessory interest. These sorts of arguments are common – and often quite strong – in the world of regulatory takings, but are less common in physical takings cases, like this one.

Deputy Solicitor General Edwin Kneedler argued for the government. Kneedler didn’t even get through his opening remarks before Justice Scalia interjected “These plaintiffs are ingrates, right? You’re – you’re – you’re really helping them?” And Kneedler barely defended the claim that raisin farmers benefit from the program. This seems a strange move, as Kneedler emphasized that there is no taking in this case because the premise of the program is to benefit those farmers. That is, he argued no taking occurred because the program was intended to benefit raisin farmers – but he did not argue that the program actually benefits those farmers. Several of the justices appeared to be quite skeptical of these claims.

The justices pointed out that even if the property owners do in fact benefit from the program, that does not change the reality that a taking has occurred in the first place. Justice Alito, for example, argued that the government’s logic suggests that no taking when government takes personal property for any purpose which might potentially benefit the owner in some (conceivable) way: Alito asked “Could the government say to a manufacturer of cellphones, you can sell cellphones; however, every fifth one you have to give to us? Or a manufacturer of cars, you can sell cars in the United States, but every third car you have to give to the ­­ to the United States.”

A few minutes later, Justice Sotomayor weighed in, stating that she wondered, “like Justice Alito, about his every fifth telephone or whatever. Every fifth car or every fifth telephone you have to give to the government. You – I don’t know you’ve answered that question. Is that a taking or isn’t it?” Kneedler continued to evade the direct question, and continued to irk the justices in so doing.

Parts of Kneedler’s arguments were – to me at least – almost comical. He repeatedly stated the government’s position that this was not a taking though he did “concede that the government gets legal title.” At another point, he argued this was not taking, but just part of a comprehensive regulatory scheme. He then argued that the regulatory scheme was not a historical anomaly (as Chief Justice Roberts and Justice Kagan suggested), but in the next breath acknowledged that no other programs actively “reserve” (i.e. take) commodities. [I’m not the only one who found some of Kneedler’s problems amusing — laughter at some of the government’s claims are noted in the transcript, and has been discussed by other Court watchers.]

Perhaps the oddest argument Kneedler made in defending the Raisin Administrative Committee, was that “this is not a taking to begin with because the – the grower voluntarily submits the total amount of raisins to the handler” and the handler then hands over the required portion to the government [emphasis mine]. But recall from my earlier post on this case – the Act requires growers to turn over their crop – there is nothing voluntary about the program.

All told, Justices Breyer, Kagan, and Sotomayor, along with the Court’s five more conservative members, expressed considerable concern with government’s arguments. (If I had to bet, I would say that the final vote on the case will be 8-1 in favor of the Hornes with Justice Ginsburg dissenting—though I admit a 9-0 decision would not surprise me). The Court would most likely hold that this was indeed a taking, and then remand the case to a lower court to determine how much compensation would be owed.

If I’m right, the case on remand would be interesting in its own right, as the government argued repeatedly that the (alleged) benefits of the program to farmers amount to in-kind compensation, which might reduce any eventual cash compensation found to be due.

For those interested, you can read the full transcript of the oral arguments here.