No. 98-1338
In the Supreme Court of the United States
OCTOBER TERM, 1998
TEXAS ASSOCIATION OF DAIRYMEN, ET AL., PETITIONERS
v.
MINNESOTA MILK PRODUCERS ASSOCIATION
ON PETITION FOR A WRIT OF CERTIORARI
TO THE UNITED STATES COURT OF APPEALS
FOR THE EIGHTH CIRCUIT
BRIEF FOR THE FEDERAL RESPONDENT
IN OPPOSITION
SETH P. WAXMAN
Solicitor General
Counsel of Record
DAVID W. OGDEN
Acting Assistant Attorney
General
BARBARA C. BIDDLE
JEFFREY CLAIR
Attorneys
Department of Justice
Washington, D.C. 20530-0001
(202) 514-2217
QUESTIONS PRESENTED
1. Whether the district court abused its discretion in denying petitioners'
motion to intervene as untimely.
2. Whether dairy farmers have standing or a right of action under the Agricultural
Marketing Agreement Act of 1937, 7 U.S.C. 601 et seq., to challenge marketing
orders applicable outside their own marketing areas.
In the Supreme Court of the United States
OCTOBER TERM, 1998
No. 98-1338
TEXAS ASSOCIATION OF DAIRYMEN, ET AL., PETITIONERS
v.
MINNESOTA MILK PRODUCERS ASSOCIATION
ON PETITION FOR A WRIT OF CERTIORARI
TO THE UNITED STATES COURT OF APPEALS
FOR THE EIGHTH CIRCUIT
BRIEF FOR THE FEDERAL RESPONDENT
IN OPPOSITION
OPINIONS BELOW
The opinion of the court of appeals (Pet. App. A1-A26) is reported at 153
F.3d 632. The opinion of the district court granting summary judgment (Pet.
App. A42-A51) is reported at 981 F. Supp. 1224. The opinion of the district
court denying petitioners' motion to intervene after judgment (Pet. App.
A27-A41) is unreported.
JURISDICTION
The judgment of the court of appeals was entered on August 13, 1998. A petition
for rehearing was denied on November 20, 1998 (Pet. App. A61). The petition
for a writ of certiorari was filed on February 16, 1999. The jurisdiction
of this Court is invoked under 28 U.S.C. 1254(1).
STATEMENT
1. The Agricultural Marketing Agreement Act of 1937, 7 U.S.C. 601 et seq.,
authorizes the Secretary of Agriculture to issue marketing orders that set
the minimum prices that must be paid to dairy farmers for milk in defined
geographic areas. As the Court has recognized, "[t]he 'essential purpose
[of this milk market order scheme is] to raise producer prices,' and thereby
to ensure that the benefits and burdens of the milk market are fairly and
proportionately shared by all dairy farmers." Block v. Community Nutrition
Inst., 467 U.S. 340, 342 (1984) (quoting S. Rep. No. 1011, 74th Cong., 1st
Sess. 3 (1935)).
2. In 1990, respondent Minnesota Milk Producers Association (MMPA), an association
of Minnesota dairy farmers, commenced this action challenging the Secretary's
pricing scheme for fluid, or "Class I," milk. Pet. App. A6. MMPA
contended that the Secretary had set minimum prices for fluid milk too high
in most marketing areas outside the Upper Midwest, thereby encouraging excessive
milk production and harming the competitive position of dairy farmers, including
MMPA's members, in the Upper Midwest. Id. at A7. In particular, MMPA sought
to invalidate the "Class I price differentials" used in the milk
marketing orders. Id. at A5. The Class I price differential is a component
of the minimum price that dairy farmers are to receive for fluid milk. It
is intended to reflect the costs and competitive effects of transporting
the milk into a marketing area from sources of supply outside the marketing
area. The specific dollar amounts of the Class I price differentials at
issue in this case were fixed by Congress on an interim basis in 1985. Ibid.;
see 7 U.S.C. 608c(5)(A).
The district court initially dismissed the case on two grounds: that producers
such as MMPA do not have a right of action under the Agricultural Marketing
Agreement Act, or standing under Article III, to challenge provisions of
milk marketing orders applicable outside their own marketing areas. A divided
panel of the court of appeals reversed. Pet. App. A52-A60.
In the meantime, the Secretary had commenced a rulemaking on whether to
revise the Class I price differentials. The Secretary ultimately decided
that the Class I price differentials should be maintained at the levels
specified in 7 U.S.C. 608c(5)(A). Milk in the New England and Other Marketing
Areas, 58 Fed. Reg. 12,634 (1993); see Pet. App. A7.
In 1997, after twice remanding that decision to the Secretary for further
consideration, the district court granted summary judgment in favor of MMPA.
The court held that the Secretary had acted arbitrarily and capriciously
in not adjusting the Class I price differentials in most marketing areas
to take into account certain factors, such as local supply and demand conditions,
enumerated in 7 U.S.C. 608c(1). The court accordingly invalidated, and enjoined
the enforcement of, the Class I price differentials in those marketing areas.
Pet. App. A42-A51.
After the district court had entered final judgment, various associations
of dairy farmers outside the Upper Midwest, including petitioners here,
moved to intervene as defendants, pursuant to Federal Rule of Civil Procedure
24(a), for purposes of appealing the judgment. The court denied the motions
as untimely. The court rejected the associations' arguments that they had
not previously had notice of the case. The court observed that in response
to its earlier remand orders, the Secretary had issued two amplified decisions,
both of which were published in the Federal Register and specifically referred
to the case. The court deemed it "hard to believe" that the associations,
as "entities committed to furthering the interests of their respective
dairy clientele," would not have been aware of the Secretary's published
decisions. The court also concluded that MMPA would be prejudiced by the
association's intervention at that late stage, because the proceedings would
be delayed and new (and, the court believed, "meritless") arguments
would have to be addressed. Pet. App. A35-A38.
3. While the case was pending in the district court, Congress enacted legislation
directing the Secretary to undertake a comprehensive review and reform of
existing milk marketing orders. Agricultural Market Transition Act, Pub.
L. No. 104-127, Title I, § 143(a), 110 Stat. 915-916 (codified at 7
U.S.C. 7253 (Supp. III 1997)). That statute required the Secretary to consolidate
the 32 existing marketing orders into no more than 14 marketing orders (7
U.S.C. 7253(a)(1)), authorized the Secretary to consider new pricing methodologies
(7 U.S.C. 7253(a)(3)), and stated that the Secretary "may not consider,
or base any decision on" the statutory schedule of Class I price differentials
challenged by MMPA in this case (7 U.S.C. 7253(a)(4)). Congress instructed
the Secretary to propose consolidation and any pricing reform within two
years and to implement any pricing reform within three years, i.e., by April
4, 1999. 7 U.S.C. 7253(b)(2).1
The Secretary, in accordance with the statutory directive, issued for public
comment a proposed rule that would effect major changes in the milk marketing
program. See Milk in the New England and Other Marketing Areas, 63 Fed.
Reg. 4802 (1998). The Secretary proposed to consolidate the existing milk
marketing areas into 11 areas, establish a new basic formula price predicated
on the actual sales price of various milk components used in manufactured
products, and overhaul substantially the Class I price differentials. The
public comment period on the rule closed on April 30, 1998, and the Secretary
issued a final rule on April 2, 1999. Milk in the New England and Other
Marketing Areas, 64 Fed. Reg. 16,026.
4. The court of appeals meanwhile reversed the district court's judgment
and injunction against the Secretary and affirmed the denial of petitioners'
motion for intervention. Pet. App. A1-A26.
As a threshold matter, the court of appeals reaffirmed its earlier decision
that MMPA's claims were justiciable. It therefore rejected the Secretary's
contentions that MMPA lacked both standing under Article III and a cause
of action under the Agricultural Marketing Agreement Act. Pet. App. A9.
On the merits, the court of appeals held that "the Secretary's decision
to maintain the current system for pricing Class I milk was within his discretion."
Pet. App. A3. The court concluded that the Secretary's construction of the
complex milk pricing provisions of the Agricultural Marketing Agreement
Act was entitled to "especial deference." Id. at A13-A14 (citing
Chevron U.S.A. Inc. v. Natural Resources Defense Council, Inc., 467 U.S.
837 (1984), and Blair v. Freeman, 370 F.2d 229, 232 (D.C. Cir. 1996)). The
court explained that MMPA's challenge focused on the Class I price differentials
for fluid milk, the specific dollar amounts of which were fixed by Congress
in 7 U.S.C. 608c(5), and which must therefore be "presume[d]"
to be "lawful and effective to reach the statute's goals." Pet.
App. A13. The court accordingly held that the proper inquiry in such circumstances
"is not whether the Secretary established that the [Class I] differentials
should remain unchanged, but whether the MMPA established that they should
not." Id. at A14. The court then held that the Secretary had not acted
arbitrarily and capriciously in concluding that the existing Class I price
differentials continued to achieve the statutory goal of ensuring an adequate
supply of milk in each marketing area. Id. at A14-A19.
Finally, the court of appeals held that the district court had permissibly
exercised its discretion in determining that petitioners' motion to intervene
was untimely. The court of appeals concluded that the district court had
appropriately based its determination on an evaluation of the procedural
posture of the case, the prospective intervenors' prior knowledge of the
pendency the case, the reasons for their delay in moving to intervene, and
the potential for prejudice to the existing parties. Pet. App. A21-A22.
Judge Loken concurred in the judgment. Pet. App. A22-A25. He expressed concern
that "the existing Class I differentials do not reflect current supply/
demand conditions in the various local milk marketing areas." Id. at
A23. He noted, however, that Congress had recently directed the Secretary
to undertake an extensive review and reform of the national milk marketing
order program. He therefore believed it to be "time for the judiciary
to stay its hand." Id. at A25.
ARGUMENT
1. Petitioners contend that the court of appeals erred in affirming the
denial of their motion to intervene and in concluding that this case is
justiciable. But the court of appeals decided the case on the merits in
favor of the position that petitioners sought to advance. Petitioners therefore
are not adversely affected, in any concrete way, by the decision rendered
by the court of appeals.
Petitioners sought to intervene in this case in order to support the Secretary
of Agriculture's position that the existing marketing orders are valid.
Accordingly, in appealing from the district court's denial of their motion
to intervene, petitioners asked that the "case be reversed and remanded
to the district court for dismissal." Pet. C.A. Br. 49. The court of
appeals, in reversing the district court's judgment and injunction, granted
essentially that relief. Pet. App. A22. The Minnesota Milk Producers Association
(MMPA), the unsuccessful party in the court of appeals, has not sought review
of any aspect of that court's decision.
Petitioners would not have been entitled to any greater relief on the merits
if they had prevailed below on either the intervention issue or the justiciability
issue. Indeed, the court of appeals could not have reached the merits of
the case, and adopted the position favored by petitioners, if the court
had adopted petitioners' position on the threshold justiciability issue.
Neither issue presented by petitioners, therefore, is appropriate for the
Court's review. See Robert L. Stern et al., Supreme Court Practice 45 (7th
ed. 1993) (although "[t]he literal language of the [28 U.S.C. 1254(1)]
reference to 'any party' is broad enough to encompass the successful or
prevailing party before the court of appeals," "there appears
to be no recorded instance where the Court * * * has granted a petition
filed by a party who prevailed on the merits in the court of appeals").2
2. In any event, the court of appeals' affirmance of the denial of petitioners'
motion to intervene is correct, is consistent with the decisions of this
Court and other circuits, and turns on the particular facts of this case.
It therefore does not warrant further review.
Contrary to petitioners' suggestion (Pet. 9-10), the court of appeals did
not hold that a motion for intervention is untimely per se if not filed
until after judgment. Rather, the court held that a district court has the
discretion to determine whether such a motion is timely, taking into account
such factors as the stage of the case, the movant's reasons for not seeking
to intervene earlier, and the potential prejudice to the existing parties.
Pet. App. A21; accord NAACP v. New York, 413 U.S. 345, 366 (1973) ("Timeliness
[of a motion to intervene] is to be determined from all the circumstances.
And it is to be determined by the court in the exercise of its sound discretion.").
Nothing in the court of appeals' decision on the intervention issue conflicts
with any decision of this Court or any other court of appeals. In United
Airlines, Inc. v. McDonald, 432 U.S. 385, 394 (1977), for example, the Court
held that post-judgment intervention was proper because the intervenor had
sought to enter the case as soon it became clear that the named parties
could not adequately represent her interests. No such circumstances were
found to exist here. The district court determined that petitioners were
aware, or reasonably should have been aware, of the case and its potential
adverse effects on their interests well before judgment was entered. Nor
was there any suggestion that the Secretary could not adequately represent
his and petitioners' mutual interest in defending the existing milk pricing
system.
The other appellate decisions cited by petitioners (Pet. 10-11) applied
the same analysis as did the courts below in determining whether a motion
to intervene was timely. Those courts, like the courts below in this case,
considered such factors as "the point to which the suit has progressed,"
"the length of time preceding the application [to intervene] during
which the applicant knew or reasonably should have known of its interest
in the case," and "prejudice to the original parties due to the
failure of the applicant to apply promptly for intervention." Linton
v. Commissioner of Health & Env't, 973 F.2d 1311, 1317 (6th Cir. 1992);
see also Yniguez v. Arizona, 939 F.2d 727, 735 (9th Cir. 1991); Hodgson
v. United Mine Workers, 473 F.2d 118, 129-130 (D.C. Cir. 1972). Simply because
intervention was allowed in those cases, which involved very different facts
than those here, does not create a circuit conflict for purposes of this
Court's Rule 10(a). Cf. Izumi Seimitsu Kogyo Kabushiki Kaisha v. U.S. Philips
Corp., 510 U.S. 27, 33 (1993) (per curiam) (recognizing that "the decision
on any particular motion to intervene * * * is always to some extent bound
up in the facts of the particular case").
3. The second issue presented in the petition, whether producers have standing
or a right of action under the Agricultural Marketing Agreement Act of 1937,
7 U.S.C. 601 et seq., to challenge marketing orders outside their own marketing
areas, does not warrant review in the circumstances of this case.
We do not dispute that the issue, in an appropriate case, could be a significant
one. Dairy farmers have no express right of action under the Agricultural
Marketing Agreement Act. The recognition of a right of action (whether under
the Administrative Procedure Act, 5 U.S.C. 701 et seq., or implied from
some other source) to contest marketing orders applicable to other marketing
areas is inconsistent with the Agricultural Marketing Agreement Act, which
prescribes regional marketing orders that must be defined on a relatively
narrow geographic basis and approved by those who regularly engage in production
of milk for sale within the marketing area. See 7 U.S.C. 608c(9)(B), 608c(11)(A)
and (C); cf. Block v. Community Nutrition Inst., 467 U.S. 340 (1984) (consumers
have no right of action to challenge milk marketing orders).3 But the issue
is not suitable for the Court's review in this case for several reasons.
First, petitioners, having been denied leave to intervene below, do not
have standing to press this issue unless the Court grants certiorari and
reverses on the intervention issue. See Izumi, 510 U.S. at 34 ("Because
we decline to review the propriety of the Court of Appeals' denial of intervention,
petitioner lacks standing under § 1254(1) to seek review of the question
presented in the petition for certiorari."). But the intervention issue
does not warrant the Court's review for the reasons stated above.
Second, as previously noted, the court of appeals ruled in favor of the
Secretary on the merits of MMPA's challenge to Class I price differentials
in various milk marketing orders. Pet. App. A9-A21. MMPA has not petitioned
or cross-petitioned for a writ of certiorari on that aspect of the court
of appeals' decision. Any opinion from this Court on whether MMPA's challenge
was justiciable would thus be advisory at this point in the case.
Finally, since the court of appeals issued its decision in this case, the
Secretary, at the direction of Congress, has completed a nationwide rulemaking
designed to reform the entire milk marketing order regime. Milk in the New
England and Other Marketing Areas, 64 Fed. Reg. 16,026 (1999). Until the
new regime is fully implemented and its effects are felt in a concrete way,
questions concerning the scope of a dairy farmer's right to challenge marketing
orders in other marketing areas are premature. No need therefore exists
at this time for the Court again to "traverse the labyrinth of the
federal milk marketing regulation provisions." Zuber v. Allen, 396
U.S. 168, 172 (1969).
CONCLUSION
The petition for a writ of certiorari should be denied.
Respectfully submitted.
SETH P. WAXMAN
Solicitor General
DAVID W. OGDEN
Acting Assistant Attorney
General
BARBARA C. BIDDLE
JEFFREY CLAIR
Attorneys
APRIL 1999
1 Congress subsequently enacted legislation barring the Secretary from implementing
any new marketing order rules before October 1, 1999. Agriculture, Rural
Development, Food and Drug Administration, and Related Agencies Appropriations
Act, 1999, Pub. L. No. 105-277, § 738, 112 Stat. 2681-30.
2 In analogous circumstances, the Court has declined to entertain appeals
by parties who obtain a final judgment in their favor in the lower court.
See, e.g., Public Serv. Comm'n v. Brashear Freight Lines, Inc., 306 U.S.
204, 206 (1939); cf. Forney v. Apfel, 118 S. Ct. 1984, 1997 (1998) (a party
"ordinarily can appeal a decision 'granting in part and denying in
part the remedy requested'") (quoting United States v. Jose, 519 U.S.
54, 56 (1996)).
3 Neither this Court nor any other court of appeals has recognized in producers
a right of action to contest marketing orders outside their own marketing
areas. But producers have sometimes been allowed to challenge provisions
of marketing orders applicable to their own marketing areas. See Stark v.
Wickard, 321 U.S. 288 (1944); Farmers Union Milk Mktg. Coop. v. Yeutter,
930 F.2d 466 (6th Cir. 1991), cert. denied, 516 U.S. 806 (1995); Suntex
Dairy v. Bergland, 591 F.2d 1063 (5th Cir. 1979); cf. Pescosolido v. Block,
765 F.2d 827, 831-833 (9th Cir. 1985) (orange producers had no general cause
of action to challenge marketing orders).