Seventh Circuit Takes Up Fight Over Butter Grading

CHICAGO (CN) – The Seventh Circuit heard oral arguments Thursday in an artisanal butter maker’s challenge to a Wisconsin law that requires all butter sold in the state to be graded on taste.

Ohio-based Minerva Dairy makes artisanal, small-batch Amish butter and cheeses, but its butter does not qualify for Wisconsin’s highest butter grade – AA – based on state-set standards for taste, color, uniformity and body.

“This is not just paternalism, it’s the worst kind of paternalism,” Minerva’s attorney Anastasia Boden told the Seventh Circuit panel Thursday. Boden is a staff attorney with the libertarian public interest law firm Pacific Legal Foundation.

Boden said it makes no sense that the big conglomerate Land O’Lakes’ butter scores AA, but the popular Irish butter Kerrygold, which many consumers prefer for its taste and is comparable to Minerva’s product, scores just an A.

“The government has no interest in informing consumers whether [a] product pleases the government,” Boden argued, noting that something like taste is necessarily subjective.

She analogized the artisanal butter maker’s plight to that of a craft brewer.

“Imagine if craft beer had to be labeled as to how well it tastes like Coors Light,” Boden told the judges.

Her point was that some consumers might prefer Coors Light, while some might prefer a craft beer, just like some consumers might prefer a more sour or a more yellow butter – but this decision should be left for consumers to decide for themselves.

A poor grade does not indicate the butter is unsafe for consumption. As U.S. Circuit Judge Daniel Manion noted, “Even if it gets a bad grade, you can still sell the butter [in Wisconsin].”

But Minerva’s products will not be available in Wisconsin, America’s dairy capital, if the 40-year-old law at issue, Wis. Stat. § 97.176, withstands its challenge. The dairy producer says the cost of hiring its own licensed grader, or paying a grader to inspect every batch of its butter, is prohibitive.

Boden told the panel that the law places a burden on small dairies “for the benefit, really, of the big producers.”

U.S. Circuit Judge Ilana Rovner asked questions Thursday that indicated skepticism of both parties’ arguments.

She wanted to know why grading butter was any different than grading eggs, and Boden explained that eggs are only graded for size, which is objective, not taste.

Judge Rovner also told Wisconsin Deputy Solicitor General Kevin LeRoy that the law “makes it difficult for Wisconsin consumers to purchase products that they wish to purchase.”

“Is that kind of paternalism rational?” she asked LeRoy.

LeRoy argued that the state has an interest in ensuring that butter sold in Wisconsin meets a minimum level of quality.

The U.S. Department of Agriculture sets nearly identical butter grading standards, but the grading process is voluntary, not mandatory as it is in the Badger State.

A federal judge ruled in favor of Wisconsin officials in February, rejecting Minerva Dairy’s claims that the state law amounts to a ban on artisanal butter and an unconstitutional restriction on interstate commerce.

“Because the statute is rationally related to Wisconsin’s legitimate interest in helping its citizens make informed butter purchases, the court will grant summary judgment to the state and dismiss Minerva Dairy’s claims,” U.S. District Judge James Peterson wrote in his Feb. 5 opinion, prompting the dairy producer’s appeal to the Seventh Circuit.

U.S. Circuit Judge Joel Flaum also served on Thursday’s panel.

It is unclear when the Chicago-based appeals court will issue a decision in the case.

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