SCOTUS sides with raisin farmers in just compensation case

The Supreme Court ruled Monday that the government must pay just compensation for personal property — as well as real property — it takes under the Fifth Amendment. 

The 8-1 ruling sided against a generations-old federal program that allows the government to take crops from farmers without pay to regulate supply and demand.

The case, Horne v. the U.S. Department of Agriculture, centered on Marvin and Laura Horne, the owners of Raisin Valley Farms in California. The Hornes refused to give up a portion of their crop in 2003 and 2004, and were subsequently fined $8,783.39 in overdue assessments and $483,843.53 for what the crop was worth.

{mosads}Under the Agriculture Department program, producers are required to relinquish a portion of their crops to ensure stable market decisions, but the percentage varies year to year based on how many raisins are produced.  

Because the federal government sells the raisins, typically in noncompetitive markets, the producers receive a pro-rated share of the proceeds after administrative costs have been taken out. In some years, this “equitable distribution” is significant, but in other years it’s nothing.

The Justices ruled in favor of the Hornes, who argued that USDA took their raisins for public use and violated the “takings clause” of the Fifth Amendment.

“The government has a categorical duty to pay just compensation when it takes your car, just as when it takes your home,” Chief Justice John Roberts said in the opinion of the court. “This principal, dating back as far as the Magna Carta, was codified in the Takings Clause in part because of property appropriations by both sides during the Revolutionary War.”

Roberts said nothing in history suggests personal property is subject to any less protection than real property.

The court also ruled that the taking in this case cannot be characterized as part of a voluntary exchange for a valuable government benefit.

“We hold that the Hornes cannot be fined for resisting the government’s attempts to take their raisins,” Roberts said.

Justice Sonia Sotomayor dissented from the court’s opinion. She said USDA only requires the Hornes to set aside a portion of their raisins to limit the quantity of raisins that can be sold on the market.

“The Hornes and the court both concede that a cap on the quantity of raisins that the Hornes can sell would not be a per se taking,” she said.