Ninth Circuit kills pork industry challenge to California confinement rules

(CN) — California’s voter-approved animal confinement standards for meat sold to Golden State consumers do not violate the Commerce Clause of the Constitution by forcing out-of-state producers to change their business operations, a Ninth Circuit panel ruled Wednesday.

The 24-page order penned by U.S. Circuit Judge Sandra S. Ikuta, a George W. Bush appointee, marks the latest blow to the meat industry’s attempt to kill standards enshrined in Proposition 12, a law approved by California voters in 2018 which regulates the production of veal, pork and eggs sold in the state.

The law, also known as the Farm Animal Confinement Initiative, forbids the sale of meat from hogs born of sows not housed in conformity with its “stand-up-turn-around requirements.” Pigs must be able to lie down, stand up, turn around and fully extend their limbs without touching the sides of their stalls or another animal.

For hogs housed in group pens, that means each pig must be allotted at least 24 square feet.

In April, Mayer Brown attorney Timothy Bishop, representing the National Pork Producers Council and American Farm Bureau Federation, told a Ninth Circuit panel California’s law had the practical effect of dictating meat production standards nationwide -- as nearly 99% of pork sold in California is produced outside the state.

He said U.S. District Judge Thomas Whelan’s dismissal of the trade groups’ claims Proposition 12 violates the Commerce Clause of the Constitution by regulating extraterritorially, or inflicting unconstitutional burdens on interstate commerce.

The law is “going to distort prices throughout the national market,” Bishop claimed during the virtual court hearing.

But Ikuta rejected that argument Wednesday, finding the extraterritoriality principle — according to Supreme Court precedent in Baldwin — should be narrowly interpreted as applying only to state laws that dictate the prices of products.

“It is undisputed that Proposition 12 is neither a price-control nor price-affirmation statute, as it neither dictates the price of pork products nor ties the price of pork products sold in California to out-of-state prices,” Ikuta wrote.

She added: “Even though the council’s complaint plausibly alleges that Proposition 12 has an indirect ‘practical effect’ on how pork is produced and sold outside California, we have rejected the argument that such upstream effects violate the dormant Commerce Clause. Under our precedent, state laws that regulate only conduct in the state, including the sale of products in the state, do not have impermissible extraterritorial effects.”

In a statement, a National Pork Producers Council spokesman said the group is "disappointed in the court’s decision and maintain our position on Prop 12: It is a clear violation of the U.S. Constitution’s Commerce Clause. We are evaluating the decision and our next steps.”

Ikuta compared the meat industry’s case to a similar challenge brought against California’s ban on the sale of foie gras. In that case, the Ninth Circuit upheld the ban, rejecting the argument it targeted out-of-state farmers by forcing them to comply with a California law.

Because both the foie gras ban and animal confinement standards laid out in Proposition 12 apply to both in-state and out-of-state food producers, Ikuta found they “merely impose a higher cost on production, rather than affect interstate commerce.”

The newly implemented regulations imposed by Proposition 12, including certifications and recordkeeping regarding compliance with the law, also do not have an impermissible extraterritorial effect, Ikuta found.

She also rejected the trade group’s assertion Proposition 12 violates the dormant Commerce Clause by making pork production more expensive nationwide due to capital costs pork producers will have to expend up front to comply with California’s animal confinement standards.

According to the groups, the infrastructure investments would result in an over 9% increase in production costs which would raise the price of pork sold to consumers.

“Even if producers will need to adopt a more costly method of production to comply with Proposition 12, such increased costs do not constitute a substantial burden on interstate commerce. Nor do higher costs to consumers qualify as a substantial burden on interstate commerce,” Ikuta wrote.

A spokesperson for California Attorney General Rob Bonta said their office is “pleased with the court’s decision.”

The state departments for Food and Agriculture and Public Health, also named defendants in the case, did not respond to requests for comment by press time.

Ikuta was joined by fellow Bush appointee U.S. Circuit Judge Milan Smith Jr. and U.S. District Judge John Steele, a Bill Clinton appointee sitting by designation from the Middle District of Florida.

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