Enter your e-mail to receive our bi-weekly FLASH newsletter:
Search CFAC
|
GERAWAN FARMING, INC., Plaintiff and Appellant,
v.
ANN M. VENEMAN, as Secretary etc. et al., Defendants
and Respondents.
No. F031142
In the Court of Appeal of the State of California
Fifth Appellate District
(Super. Ct. No. 94-167877)
APPEAL from a judgment of the Superior Court of Tulare County.
Howard R. Broadman and Patrick J. O' Hara, Judges.[FOOTNOTE *]
COUNSEL
Brian C. Leighton for Plaintiff and Appellant.
Bill Lockyer, Attorney General, Roderick E. Walston,
Chief Assistant Attorney General, Charles W. Getz IV, Assistant
Attorney General, Edna Walz and Tracy L. Winsor, Deputy Attorneys
General, for Defendants and Respondents.
Filed June 8, 1999
This is an appeal from a judgment on the pleadings rejecting
appellant' s attempt to enjoin as unconstitutional the administrative
order that established the Plum Marketing Board of California.
We affirm the judgment.
Facts and Procedural History
A. Statutory History
The agriculture industry, of course, produces necessary
products for human consumption. Farmers and ranchers were important
factors both in our new nation and as the United States expanded
to the west. (Padberg & Hall, The Economic Rationale for
Marketing Orders (1995) 5 San Joaquin Ag. L.Rev. 73, 73-75.)
Even now, one source reports the agriculture industry employs
a fourth of the American workforce in one way or another. (Looney,
The Changing Focus of Government Regulation of Agriculture in
the United States (Spring 1993) 44 Mercer L.Rev. 763, 763-765.)
Because of its health, sociopolitical and economic impact on
society, the agriculture industry has been the subject of regulatory
and protective legislation since the earliest days of our nation.
(Ibid.) Legislative attempts to regulate certain aspects
of agricultural marketing-though sometimes struck down by the
courts (see, e.g., Matter of Application of Foley (1916)
172 Cal. 744 [labeling requirement for imported eggs]; Ex
Parte Hayden (1905) 147 Cal. 649 [labeling requirements for
fresh and dried fruit])-were increasingly common in the early
part of this century. (Looney, supra, 44 Mercer L.Rev.
at p. 765.)
The direct economic regulation of agricultural production
involved in the present case was a later development, precipitated
by the economic crisis of the Great Depression. As an early part
of the New Deal, Congress enacted the Agricultural Adjustment
Act of 1933. (Act of May 12, 1933, ch. 25, 48 Stat. 31.) This
law authorized the Secretary of Agriculture to implement a series
of price supports for key commodities, funded by an assessment
on first-level processors of the commodities. The United States
Supreme Court held the act unconstitutional in United States
v. Butler (1936) 297 U.S. 1; even so, the court' s decision
impliedly recognized the broad scope of the states' police power
to impose such a program of price supports. (Id. at p. 68;
see Warehouse Co. v. Tobacco Growers (1928) 276 U.S. 71;
see generally Munn v. Illinois (1876) 94 U.S. 113,
125-130 [state police-power regulation of pricing in industries
"affected with a public interest" ].) Thus, the decision
was based on the limitations of federal power: "The
act invades the reserved rights of the states. It is a statutory
plan to regulate and control agricultural production, a matter
beyond the powers delegated to the federal government."
(United States v. Butler, supra, 297 U.S. at p. 68.)
As the New Deal moved forward, Congress enacted the
Agricultural Marketing Agreement Act of 1937. (Act of June 3,
1937, 50 Stat. 246 (hereafter AMAA).) The AMAA provides for voluntary
marketing agreements for all commodities and mandatory marketing
orders for milk and other specified commodities. The United States
Supreme Court upheld the AMAA in U. S. v. Rock Royal Co-op.
(1939) 307 U.S. 533. The court held that the act was within the
general police power and that Congress had the power to act under
the commerce clause of the United States Constitution. (Id.
at p. 571.)
The State of California adopted a similar statutory
mechanism for regulation of agricultural marketing, the California
Marketing Act of 1937 (Stats. 1937, ch. 404, § 1, p. 1329,
now codified as Food & Agr. Code, § § 58601 et
seq. (hereafter the Act).)[FOOTNOTE 1] In its declarations of
policy, the Act lists a number of structural problems in the
"marketing of agricultural commodities in this State,"
including "the inability of individual producers to maintain
present markets or to develop new or larger markets for California-grown
commodities." (Food & Agr. Code, § 58651.) The
Legislature declared: "These conditions vitally concern
the health, peace, safety and general welfare of the people of
this state." (Food & Agr. Code, § 58652.) "The
marketing of commodities within this state is hereby declared
to be affected with a public interest." (Food & Agr.
Code, § 58653.)
Under both the AMAA and the Act, producers of a particular
commodity can vote to band together to regulate some or all of
the aspects of production and marketing of the commodity, subject
to certain findings and approval by federal or state agriculture
officials. A board, composed of producers, administers the governmental
order implementing the regulations upon which the producers have
agreed. The so-called "marketing order" can cover ripeness
and size standards, grading and inspection, allocation of production
volume of each individual producer, industry-wide ("generic"
) advertising for the particular fruit, and price regulation.
(See Voss v. Superior Court (1996) 46 Cal.App.4th 900,
907-908, 911-920.)
B. Roots of the Present Litigation
From 1939 until 1991, plum production in California
was governed by federal marketing orders promulgated pursuant
to the AMAA. In 1987, the present appellant, Gerawan Farming,
Inc., and other producers challenged the constitutionality of
the federal tree fruit marketing orders through a federal administrative
proceeding and subsequent judicial appeals. The primary issue
appellant raised was "whether the requirement that [appellant]
finance , generic advertising [of plums by the marketing order
administrator] is a law ' abridging the freedom of speech' within
the meaning of the First Amendment." (Glickman v. Wileman
Bros. & Elliot (1997) 521 U.S. 457 [117 S.Ct. 2130, 2134]
[hereafter referred to as Wileman Bros.].)
While the 1987 challenge proceeded through the federal
courts, the federal marketing order for plums ended in 1991 "after
a majority of plum producers failed to vote for its continuation
., " (Wileman Bros., supra, 521 U.S. at p. ___, fn.
5 [117 S.Ct. at p. 2135, fn. 5].) For two years there was a voluntary
association of plum producers, but in 1993 a group of plum growers
proposed a mandatory California Plum Marketing Order Program
as authorized by the Act.
Pursuant to the Act, the Secretary of the California
Department of Food and Agriculture (hereafter Secretary) conducted
a referendum concerning the proposed marketing order. From among
the 1,371 plum growers reporting harvests in 1993 (and therefore
eligible to vote in the referendum), 780 growers voted. Slightly
over 70 percent of the growers, representing over 57 percent
of the fruit production from 1993, voted in favor of adoption
of the proposed marketing order. These percentages exceeded the
statutory minimums for adoption of a mandatory marketing order.
The California marketing order, establishing the California Plum
Marketing Board, became effective on April 20, 1994.[FOOTNOTE
2]
On October 31, 1994, appellant filed a complaint for
declaratory and injunctive relief challenging the California
marketing order. Appellant contended, as relevant here, that
the Secretary failed to comply with the Administrative Procedure
Act (Gov. Code, § 11346 et seq.) and that the marketing
order violated appellant' s free speech and association rights
under both the state and federal Constitutions.
The trial court granted partial summary judgment in
favor of the growers in an unrelated but parallel case (Tulare
Co. case No. 94-166231) raising the same issues as raised by
appellant in its complaint. The basis for the judgment was that
the Secretary had failed to comply with the Administrative Procedure
Act in adopting the marketing order. The Secretary appealed from
the grant of summary judgment. The present case was stayed during
that appeal.
While the parallel case was pending in this court, Gerawan
and the other producers prevailed in the Ninth Circuit Court
of Appeals. (See Wileman Bros. & Elliot, Inc. v. Espy
(9th Cir. 1995) 58 F.3d 1367, 1375-1376.)
In June of 1996, we issued an opinion in the parallel
case. (Voss v. Superior Court, supra, 46 Cal.App.4th at
p. 906.) This court dismissed the appeal because the partial
summary judgment was not an appealable judgment, but the court
treated the purported appeal as a petition for writ of mandate.
The court granted the writ of mandate, concluding that proceedings
to adopt a marketing order are not governed by the Administrative
Procedure Act. (Id. at pp. 911, 924.)
At about the same time, the United States Supreme Court
granted certiorari in the Ninth Circuit case challenging the
federal marketing order. Once again, the parties agreed to stay
the present case, this time until disposition of the Supreme
Court case.
In June of 1997, the Supreme Court issued its opinion
in Wileman Bros., upholding the generic-advertising provisions
of the federal marketing order against the growers' First Amendment
challenge. By a five-to-four majority vote, the court found "no
First Amendment right to be free of coerced subsidization of
commercial speech" in the regulatory environment established
by the AMAA. (Wileman Bros., supra, 521 U.S. ___ [117
S.Ct. at p. 2142], dis. opn. of Souter, J.; see id. pp.
____, [117 S.Ct. at pp. 2140, 2142, maj. opn.) While we find
persuasive some of the reasoning contained in Justice Souter'
s dissent, we of course must follow the majority opinion, which
carefully distinguishes the regulatory scheme there in issue
from instances where the court has found free speech protections
of the First Amendment abridged.
C. The Present Judgment
Shortly after the Supreme Court decided Wileman Bros.,
the Secretary filed her motion for judgment on the pleadings
in the present case. Appellant opposed that motion on the basis
that the California marketing order was materially different
from the federal order upheld by the Supreme Court and on the
basis that the California Constitution provided greater protections
for liberty of speech and association than did the federal Constitution
as construed in Wileman Bros.
The trial court granted the motion for judgment on the
pleadings, but allowed appellant leave to file an amended complaint.
Appellant filed its first amended complaint; the amended complaint
contains augmented allegations concerning appellant' s disagreement
with the philosophy and implementation of the plum marketing
order, and pares down the causes of action to include only California
Constitution free speech and association causes of action. Respondent
renewed its motion for judgment on the pleadings.
On March 11, 1998, the trial court granted respondent'
s motion; on April 17, 1998, the court entered judgment against
appellant. Appellant filed a timely notice of appeal.
D. The Facts Alleged in the First Amended Complaint
Because this is an appeal from a judgment on the pleadings,
we treat as true the allegations of the complaint.[FOOTNOTE 3]
(See Blank v. Kirwan (1985) 39 Cal.3d 311, 318.) After
recounting the procedural history of the California marketing
order and the duties of the Plum Board in administering the order,
the first amended complaint states appellant' s objections to
the California marketing order. The marketplace for plums is
extremely competitive. Appellant has made a decision not to mass-market
its plums to large grocery chains because appellant refuses to
"sell cheap." Appellant has a branded premium plum
that it advertises independently of the Plum Board. The members
of the Plum Board are appellant' s competitors. One element of
the Plum Board' s marketing campaign is lavishly entertaining
various buyers, including those to whom appellant does not sell;
such activities merely promote the plums packed and marketed
by the members of the Plum Board. In general, the advertising
messages of the Plum Board, "if they promote anything, either
promote average quality product, as though peaches, plums, and
nectarines are all simple commodities with no distinctions, or
promote the products being sold by the members" of the Plum
Board.
The buyers of California plums associate appellant with
the Plum Board, even though they know he disagrees with the Plum
Board' s "idealogy [sic], i.e., socialism and collectivism."
Further, appellant believes many of the advertising messages
of the Plum Board are "embarrassingly silly, idiotic and/or
totally ineffective" ; if appellant were in charge it would
fire the advertising agency. In sum, appellant "vehemently
disagrees with being associated with the Plum Board" and
"abhors being forced to associate with the Board' s messages
and messengers."
DISCUSSION
I. The First Amendment
Appellant contends the California marketing order violates
the First Amendment to the United States Constitution. It asserts
this despite the contrary holding in Wileman Bros. with
respect to the federal marketing order before that court.
A. The scope of the marketing order does not distinguish this
case from Wileman Bros.
Appellant argues that the California marketing order
is essentially different from the federal order because the California
marketing order is less comprehensive than the federal order.
Appellant says the California marketing order is more properly
characterized simply as a communal advertising program than as
a full-fledged program to replace competition with regulation,
as was the marketing order in Wileman Bros.[FOOTNOTE 4]
The Wileman Bros. opinion states: "In answering
[the question whether being compelled to fund generic advertising
raises a First Amendment issue] we stress the importance of the
statutory context in which it arises. California [treefruit is]
marketed pursuant to detailed marketing orders that have displaced
many aspects of independent business activity that characterize
other portions of the economy in which competition is fully protected
by the antitrust laws. The business entities that are compelled
to fund the generic advertising at issue in this litigation do
so as a part of a broader collective enterprise in which their
freedom to act independently is already constrained by the regulatory
scheme." (521 U.S. at p. ____ [117 S.Ct. at p. 2138].)
In a variation on Mies van der Rohe' s famous and paradoxical
architectural dictum that "less is more," appellant
argues the California marketing order regulates less than
the federal order did, and therefore constitutes more
of a burden on free speech: by providing more freedom of action
for the producer generally, the remaining restraint on speech
becomes more egregious.
As we see the matter, appellant misconstrues the nature
of the "replacement of competition" embodied in the
New-Deal-era agricultural marketing order laws. The point of
these programs is not simply to regulate the market; the point
is to preserve the agricultural industry. The laws reflect a
long-standing political judgment that "agriculture"
- unlike bicycle manufacturing or clothing production, for example
- cannot be allowed to disappear from the American economy because
of untrammeled market forces, such as those that characterize
the international free trade movement. (See Padberg & Hall,
supra, 5 San Joaquin Ag. L.Rev. at p. 74.)
In this context, it is worth repeating at length the
legislative findings that form the basis of the exercise of the
police power of the state in the Act: "It is hereby declared
that the marketing of commodities in this state in excess of
reasonable and normal market demands therefor; disorderly marketing
of such commodities; improper preparation for market and lack
of uniform grading and classification of commodities; unfair
methods of competition in marketing of commodities; and the inability
of individual producers to maintain present markets or to develop
new or larger markets for California-grown commodities, result
in an unreasonable and unnecessary economic waste of the agricultural
wealth of this state." (Food & Agr. Code, § 58651.)
The foregoing described the result of unrestrained competition
in the marketing of perishable commodities; the Legislature then
stated that "[t]hese conditions vitally concern the health,
peace, safety and general welfare of the people of this State."
(Food & Agr. Code, § 58652.)
By appellant' s own characterization, the California
marketing order "insure[s] maturity, grade and accurate
size labeling," in addition to providing mandatory funding
of generic advertising. Although appellant says this "is
not , economic regulation displacing competition," it is
apparent from the foregoing legislative findings that maturity,
grade and labeling standards directly displace the ability to
compete using the traditional methods of different ", preparation
for market and...[individualized] grading and classification
of agricultural commodities." The exercise of individualized
judgment that fruit is "ripe enough" to attract buyers
or "large enough" to bring a fair price is a classic
element of "unrestrained competition." In addition,
in appellant' s original administrative objection to the California
marketing order (letter of December 8, 1993, from Farmers for
Equitable Marketing to H.J. Voss, Director, Department of Food
and Agriculture), appellant' s representative expressly complained
that size and quality controls would affect supply and demand,
thereby increasing the price of plums.
Even granting that the foregoing provisions may minimally
displace competition, however, appellant' s complaint about the
California marketing order is that permissible "displacement
of competition" must necessarily involve more direct control
of production and pricing.[FOOTNOTE 5] Phrased differently, appellant
complains the California marketing order does not control the
supply of plums in the market, but only seeks to control
or stimulate consumers' demand for plums. This complaint
misses a fundamental point: supply and demand are the two sides
of a single coin.
It is rational to control prices as a way to ensure
both demand for the product and a supply of the product (Challenge
Cream etc. Assn. v. Parker (1943) 23 Cal.2d 137, 141-142);
it is rational to control supply to ensure a demand sufficient
to return a fair price (Agricultural Prorate Com. v. Superior
Ct., supra, 5 Cal.2d at p. 582); and it is rational to stimulate
demand so that the amount produced by suppliers brings a fair
price. In each case, the fundamental assumption of unrestrained
competition-that supply and demand together set the price in
a free market-is replaced with an assumption that regulatory
modification of the market-of supply and/or demand-is necessary
in the public interest.[FOOTNOTE 6]
This is the sense in which the Wileman Bros.
majority characterized the generic advertising campaign as not
violating free speech protections, but merely as one of a number
of available tools imbedded in a comprehensive regulatory program
"that impose[s] restraints on competition that arguably
disadvantage particular producers for the benefit of the entire
market." (521 U.S. at pp. ___ [117 S.Ct. at pp. 2140-2141],
fn. omitted.) The point of the Wileman Bros. discussion
of the whole range of regulatory tools is not that all or most
of them must be used in any given marketing order. Instead, the
point is that the advertising tool merely seeks to accomplish
the same goals as equally or more invasive tools, such as price,
quantity, quality and labeling restrictions; no greater weight
should be given to the fact that the advertising tool involves
an activity that, in other contexts, is "commercial speech"
protected by the First Amendment. (See ibid.)
At oral argument, we asked appellant' s counsel to specify
the ways in which the federal marketing order under consideration
in Wileman Bros. was different and more invasive than
the present California marketing order. As we understood counsel'
s response, appellant' s only claim is that the California marketing
order has a somewhat more relaxed quality standard than did the
federal order, which is hardly a significant lessening of the
"displacement of competition."
The federal marketing order was Marketing Order 917,
as modified from time to time. (Wileman Bros. & Elliott,
Inc. v. Espy, supra, 58 F.3d 1367, 1373, revd. sub nom.
Wileman Bros., supra, 521 U.S. ___ [117 S.Ct. 2130].) Our
own review of that marketing order, which was codified at 7 Code
of Federal Regulations part 917 (1989), indicates the order was
essentially the same as the California marketing order. That
is, the federal marketing order included: packing and sizing
restrictions (7 C.F.R. § 917.454), maturity standards (id.
at § 917.460), requirements for daily shipping reports (id.
at § 917.177), authorization for production and marketing
research as well as paid advertising (id. at § 917.39),
and authorization for assessments to pay for all of the programs
(id. at § 917.37). It does not appear the federal
marketing order included any direct price or quantity controls,
even though such controls are authorized under the AMAA, just
as they are in the Act for state marketing orders. (See Food
& Agr. Code, § § 58881-58887.)
While not determinative of our analysis, the actual
content of the federal marketing order reinforces our conclusion
that the United States Supreme Court in Wileman Bros.
did not hold that a compulsory generic advertising program is
only permissible as part of a marketing order that wholly or
substantially displaces competition in a particular market.
Finally, although we find it unlikely that respondent
could or would make the appropriate findings to adopt a marketing
order composed solely and entirely of a compulsory generic advertising
campaign, such an order is not before us in the present case.
(But see Gallo Cattle Co. v. California Milk Advisory Board
(9th Cir. 1999) 167 F.3d 1247 [marketing order for advertising
milk and cheese].) As alleged in appellant' s initial complaint,
the California marketing order "provided for quality control
standards to be established by the Plum Marketing Board to include
forced inspection regarding maturity, color, and other quality
factors." The research and quality control components of
the program are alleged to account for 48 percent of the assessment
against growers, while the advertising program (including supply
and demand surveys) accounts for 52 percent of the assessment.
This allocation of the assessment budget is approximately the
same as the allocation under the federal marketing order under
consideration in Wileman Bros.
Accordingly, we reject appellant' s argument that the
California marketing order can be distinguished for First Amendment
purposes from the federal marketing order under consideration
in Wileman Bros., either as a matter of law or as a matter
of fact. While respondent and the majority of California
plum growers apparently believe market stabilization can be achieved
without the price and quantity controls that are authorized under
the Act, such a conclusion does not render constitutionally invalid
an advertising program that would be constitutional when combined
with such price and quantity controls.
B. The nature of the litigant does not distinguish this case
from Wileman Bros.
Appellant also argues that it vehemently disagrees with
the message of the advertising program promulgated pursuant to
the marketing order, whereas the Supreme Court in Wileman
Bros. found that none of the growers there disagreed "with
the central message of the speech that is generated by the generic
program." (521 U.S. at p. ___ [117 S.Ct. at p. 2138].) This
argument is somewhat strange, since appellant is one
of the growers to which the Supreme Court referred in Wileman
Bros. (see 521 U.S. at p. ___, fns. 10, 11 [117 S.Ct. at
p. 2137, fns. 10, 11]) and appellant' s stated disagreements
with the California marketing order' s advertising campaign are
virtually identical to those dubbed "trivial" in Wileman
Bros. (See id. at p. ___ [117 S.Ct. at pp. 2139].) Indeed,
the first amended complaint specifically alleges that the state
Plum Board and the federal Treefruit Committee at issue in Wileman
Bros. act together in developing and implementing the advertising
and "schmoozing" practices to which appellant objects.
In any event, Wileman Bros. conclusively establishes
that, where association is legitimately compelled in the public
interest, "expressive activities" of the collective
entity do not violate the First Amendment rights of those compelled
to join the collective entity if those expressive activities
are germane to the purposes for which collectivization is compelled.
(521 U.S. at pp. ___ [117 S.Ct. at pp. 2139-2140].) Here, the
generic advertising is authorized solely to increase the overall
market for plums; augmentation of consumer demand as a method
of obtaining market stability is at the very core of the police-power
purpose for which the partial collectivization of the plum industry
is permitted. (See id. at p. ___ and fn. 16 [117 S.Ct.
at p. 2140 and fn. 16].) Accordingly, such advertising is germane,
within the meaning of Wileman Bros.
The issue, then, is not whether appellant disagrees
with the "socialistic" idea of "collectivist"
marketing of plums. And the issue is not whether those who participate
in the Plum Board have an "ideological bent, which is collectivizing
advertising in the industry." Those battles were fought,
and lost, by appellant' s ideological forebears in the 1930'
s under claims of economic liberty and freedom of contract. (Compare
Adkins v. Children' s Hospital (1923) 261 U.S. 525, 545;
Coppage v. Kansas (1915) 236 U.S. 1, 14; Ex parte Farb
(1918) 178 Cal. 592, 597-598; People v. Holder (1921)
53 Cal.App. 45, 52; with West Coast Hotel Co. v. Parrish
(1937) 300 U.S. 379, 391; Nebbia v. New York (1934) 291
U.S. 502, 537-538.) The issue instead, as framed by Wileman
Bros., is whether the otherwise legitimate power of the collective
entity is being abused by forcing the membership to fund espousal
of extraneous speech, that is, speech that is not "germane
to the purposes" of the organization and is ideological
in character. (521 U.S. at p. ___ [117 S.Ct. at p. 2140]; see
Smith v. Regents of University of California (1993) 4
Cal.4th 843, 854 [compelled speech must be germane to the purpose
for which compelled association was justified initially].) There
has been no showing in the present case that the marketing order
authorizes nongermane or ideological speech by the Plum Board.[FOOTNOTE
7]
We conclude the California marketing order does not
violate the First Amendment as interpreted in Wileman Bros.
II. The California Constitution
Article I, sections 2 and 3, of the California Constitution
provide protections for liberty of speech and freedom of association
independent of the First Amendment of the United States Constitution.[FOOTNOTE
8] Appellant contends these constitutional provisions should
be construed more broadly than the Supreme Court construed the
First Amendment in Wileman Bros., so as to afford an independent
basis for invalidation of the California marketing order. This
contention has no merit.
Numerous California courts have stated the general proposition
that the California Constitution' s liberty of speech clause
is "more definitive and inclusive than the First Amendment."
(Wilson v. Superior Court (1975) 13 Cal.3d 652, 658.)
The cases making such a statement often proceed to hold that
the restriction in question is invalid under both the First Amendment
and the state Constitution (see, e.g., Wilson v. Superior
Court, supra, 13 Cal.3d at p. 661; Macias v. Hartwell (1997)
55 Cal.App.4th 669, 674-675), or else to hold that the First
Amendment analysis adopted by the federal courts accurately reflects
the law under the state Constitution as well (see, e.g., California
Teachers Assn. v. Governing Board (1996) 45 Cal.App.4th 1383,
1391-1392).
Merely to say that the liberty of speech clause is broader
than the First Amendment, then, does not answer the question
whether the liberty of speech clause protects any particular
expressive activity that is not protected by the First Amendment.
We address first the standards that govern such a determination.
In 1974, the voters amended the California Constitution
to "ma[k]e explicit a preexisting fundamental principle
of constitutional jurisprudence." (Raven v. Deukmejian
(1990) 52 Cal.3d 336, 354.) Article I, section 24 was added to
the Constitution to provide: "Rights guaranteed by this
Constitution are not dependent on those guaranteed by the United
States Constitution." (Id. at p. 350.)
A long-standing corollary to the doctrine of independence
of the state' s guarantee of fundamental rights is the so-called
"principle of deference." "As early as 1938, we
stated that ' cogent reasons must exist before a state court
in construing a provision of the state Constitution will depart
from the construction placed by the Supreme Court of the United
States on a similar provision in the federal Constitution.' [Citations.]"
(Raven v. Deukmejian, supra, 52 Cal.3d at p. 353.) The
court summarized the policy as one of voluntary deference to
high court decisions unless there are "' cogent reasons,'
' independent state interests,' or ' strong countervailing circumstances'
that might lead our courts to construe similar state constitutional
language differently from the federal approach." (Ibid.;
see also Hubbart v. Superior Court (1999) 19 Cal.4th 1138,
1152, fn. 19.)
As relevant here, there have been only two occasions
on which the California courts have interpreted the liberty of
speech clause "differently from the federal approach."
We will consider each of these two departures from the federal
standard.
A. Commercial Speech
In the first example of a departure from First Amendment
standards, the California courts did not explicitly distinguish
the liberty of speech protections from the First Amendment guarantee
of free speech; nevertheless, the distinction was apparent. In
February of 1942, the California Supreme Court decided McKay
Jewelers, Inc. v. Bowron (1942) 19 Cal.2d 595. At issue in
that case was a city ordinance that, in relevant part, prohibited
soliciting potential customers to enter a business, or soliciting
the sale of merchandise, from any street or sidewalk or in any
doorway or entrance to any building opening onto a street or
sidewalk. (Id. at p. 597.) The court held that the restriction
was impermissible under the police power, as applied to "quiet,
dignified and peaceful" solicitation. (Id. at pp.
601-602.) In addition, rejecting the city' s contention "that
' regulations and prohibitions bearing upon solicitation of trade
are not to be measured by rules relating to freedom of speech'
" (id. at pp. 604-605), the court held that the solicitation
"prohibition in the instant case is in violation of the
constitutional guarantee of freedom of speech." (Id.
at p. 605.)
Two months later, in April of 1942, the United States
Supreme Court decided Valentine v. Chrestensen (1942)
316 U.S. 52. In that case, the court considered the constitutionality
of criminal sanctions imposed by the City of New York on a man
who attempted to distribute handbills advertising tours of a
decommissioned submarine.[FOOTNOTE 9] The court stated: "This
court has unequivocally held that the streets are proper places
for the exercise of the freedom of communicating information
and disseminating opinion and that, though the states and municipalities
may appropriately regulate the privilege in the public interest,
they may not unduly burden or proscribe its employment in the
public thoroughfares. We are equally clear that the Constitution
imposes no such restraint on government as respects purely commercial
advertising., The question is not whether the legislative body
may interfere with the harmless pursuit of a lawful business,
but whether it must permit such pursuit by what it deems an undesirable
invasion of, or interference with, the full and free use of the
highways by the people in fulfillment of the public use to which
streets are dedicated." (Id. at pp. 54-55.)
Despite the unequivocal holding in Valentine,
nearly 20 years later the California Court of Appeal stated categorically:
"The right to advertise also represents the exercise of
the right of free speech. (McKay Jewelers, Inc. v. Bowron
, .)" (Carlin v. City of Palm Springs (1971) 14 Cal.App.3d
706, 713.) The court did not mention Valentine or other
federal commercial speech precedent. Although the Carlin
court did not attempt to delineate the reach of the liberty of
speech clause in the context of commercial speech, it iterated
in detail the degree to which commercial speech is subject to
very broad police power regulation. (Id. at p. 712.)
In 1976, the United States Supreme Court abrogated the
holding of Valentine in Va. Pharmacy Bd. v. Va. Consumer
Council (1976) 425 U.S. 748, 758, 770. In that and subsequent
cases, the court held that commercial speech is protected by
the First Amendment but is subject to police power regulation.
(Id. at pp. 770-772 and fn. 24; see Central Hudson
Gas & Elec. v. Public Serv. Comm' n. (1980) 447 U.S.
557.)
Since the United States Supreme Court opinion in Va.
Pharmacy Bd., there has been no California appellate opinion
articulating a higher standard for protection of commercial speech
under the state Constitution' s liberty of speech clause. (See,
e.g., Metromedia, Inc. v. City of San Diego (1980) 26
Cal.3d 848, 866-871, revd. on other grounds in Metromedia,
Inc. v. San Diego (1981) 453 U.S. 490, on remand, Metromedia,
Inc. v. City of San Diego (1982) 32 Cal.3d 180.) Thus, the
current state of the law is that the measure of protection afforded
commercial speech under the California liberty of speech clause
is no greater than that provided by the federal First Amendment.
(People v. Superior Court (Olson) (1979) 96 Cal.App.3d
181, 195; see also In re Morse (1995) 11 Cal.4th 184,
200, fn. 4.)
B. Shopping Centers
The second relevant instance in which the courts have
recognized a distinction between the First Amendment and the
liberty of speech clause is in the context of expressive activity
on the premises of large private shopping centers. (Compare Robins
v. Pruneyard Shopping Center (1979) 23 Cal.3d 899, 907, with
Lloyd Corp. v. Tanner (1972) 407 U.S. 551, 569.) Appellant
places much of its reliance in the present case on Robins.
The disagreement between Robins and Lloyd Corp.
is not over the nature of the speech involved but, rather, over
the place where the speech will occur. Focusing on the fact that
the First and Fourteenth Amendments "safeguard the rights
of free speech and assembly by limitations on state action,
not on action by the owner of private property , " (Lloyd
Corp. v. Tanner, supra, 407 U.S. at p. 567), the United States
Supreme Court held that there is no right of free speech at a
private shopping center unless the owners of the center stand
"in the shoes of the State" through the "assumption
or exercise of municipal functions or power." (Id.
at p. 569.)
The state constitutional liberty of speech clause, by
contrast, is an affirmative guaranty of that liberty, not merely
a prohibition on governmental interference with it. Thus, the
state is entitled to use its police power to regulate the use
of private property so as to enforce the liberty of speech guarantee.
(Robins v. Pruneyard Shopping Center, supra, 23 Cal.3d
at pp. 905-906; see American Academy of Pediatrics v. Lungren
(1997) 16 Cal.4th 307, 326 [state right of privacy extends to
private action as well as state action].)[FOOTNOTE 10]
Two points may be gleaned from the Robins expansion
of free speech beyond the First Amendment guarantee. First, it
is not the nature of the speech itself but, rather, the nature
of the governmental guarantor-the limited-powers federal government
versus the plenary-powers state government-that results in a
broader protection for liberty of speech under the state Constitution.
(See Macias v. Hartwell (1997) 55 Cal.App.4th 669, 674-675.)
Second, despite the claim in Lloyd Corp. that the differences
between a large shopping center and a free-standing store "are
differences only of degree-not of principle" (Lloyd Corp.
v. Tanner, supra, 407 U.S. at pp. 565-566), the California
expansion of liberty of speech was indeed limited only to large
shopping centers that are "miniature downtowns." (Robins
v. Pruneyard Shopping Center, supra, 23 Cal.3d at p. 910,
fn. 5.) Thus, the California Supreme Court adopted Justice Mosk'
s statement of the limited reach of the liberty of speech expansion:
"By no means do we imply that those who wish to disseminate
ideas have free rein., ' It bears repeated emphasis that we do
not have under consideration the property or privacy rights of
an individual homeowner or the proprietor of a modest retail
establishment.' " That limitation has been implemented consistently
(see Bank of Stockton v. Church of Soldiers (1996) 44
Cal.App.4th 1623, 1629-1630), with the result that First Amendment
standards often have been applied to reject free speech claims
under the liberty of speech clause, when such claims arise from
activities at smaller private properties. (Id. at p. 1631.)
C. Analysis
We have discussed the commercial speech and private
shopping center cases at some length in order to determine whether
those cases suggest "' cogent reasons,' ' independent state
interests,' or ' strong countervailing circumstances' "
(Raven v. Deukmejian, supra, 52 Cal.3d at p. 353) that
might lead us to reject the analysis of the United States Supreme
Court in Wileman Bros. We conclude they do not. We have
seen, instead, that the California Constitution provides no additional
protection for commercial speech than that provided by the First
Amendment and that Robins only addresses the permissible
locations for protected political speech, not the nature of the
speech itself.[FOOTNOTE 11]
Further, we have seen from the history of constitutional
analysis of New Deal legislation that the state enjoys at
least as much police power authority as does the federal
government in the field of regulation of agriculture.
Accordingly, we conclude there are no independent state
interests or other cogent reasons that support a departure from
the Wileman Bros. analysis. The fact that generic advertising
is "speech" that may be protected in other contexts
does not distinguish advertising from the other aspects of economic
regulation in the context of agricultural marketing orders. (__
U.S. at p. ___ [117 S.Ct. at p. 2142].)[FOOTNOTE 12] Forced funding
of generic advertising under a valid market order does not violate
the California Constitution' s liberty of speech and freedom
of association provisions.
Disposition
The judgment is affirmed. Costs on appeal are awarded
to respondent.
Vartabedian, J.
WE CONCUR: Ardaiz, P. J., and Buckley, J.
::::::::::::::::::::::::::::: FOOTNOTE(S):::::::::::::::::::::::::::::
FN*. Judge Broadman granted the motion for judgment
on the pleadings with leave to amend; Judge O' Hara granted the
motion for judgment on the pleadings without leave to amend and
rendered the final judgment from which the appeal is taken.
FN1. California previously had adopted a law authorizing
limits on production by growers of perishable commodities. (See
Stats. 1933, ch. 754, p. 1969.) The constitutionality of that
law was upheld in Agricultural Prorate Com. v. Superior
Ct. (1936) 5 Cal.2d 550, 582.
FN2. As described in Voss v. Superior Court, supra,
46 Cal.App.4th at pages 905-906, the Plum Marketing Board consists
"of 13 plum growers and handlers, to assist the secretary
in administering the plum marketing program.... [T]he Board'
s authority would include, subject to the approval of the secretary:
(1) the pursuit of research and development studies pertaining
to the production and distribution of plums; (2) the conduct
of advertising and sales promotion programs relating to plums;
(3) the investigation of economic and marketing conditions affecting
plums; (4) the recommendation of grade and quality standards
for plums, provided such standards were not ' lower than any
existing State or Federal regulations' ; (5) the making of arrangements
for the inspection and certification of plums for compliance
with prevailing grade and quality standards; (6) the recommendation
of budgets for the administration and enforcement of the program;
and (7) the recommendation of assessment rates, ' sufficient
to provide adequate funds to defray the proposed expenditures
and reserves as set forth in the budgets.' The , order also set
minimum maturity standards for plums and directed how assessments
levied upon producers would be paid, collected and, if applicable,
refunded. In addition, the order prescribed the maximum assessment
levels for the component activities authorized by the proposed
order; for example, the assessment for sales promotion and marketing
development activities could not exceed 11 cents per 28-pound
box of plums." (Fn. omitted.)
FN3. The original complaint, which also included causes
of action alleging violations of the Administrative Procedure
Act, federal civil rights laws, and various other constitutional
provisions, contained many allegations no longer relevant to
the case. As to the First Amendment claims, the facts alleged
in the two complaints are essentially the same.
FN4. Appellant also characterizes the marketing order
as "a speech tax on everybody in the industry." Appellant
provides no argument or authorities in support of the idea that
such a characterization renders the program constitutionally
suspect. We note, to the contrary, that in one of the early cases
declaring unconstitutional a New Deal commodity price support
program funded by an assessment on first-level processors of
the commodity, the court concluded that, conceding the program
was a tax, it was unconstitutional not for that reason but because
it sought to accomplish a goal of economic regulation reserved
to the states. (United States v. Butler, supra, 297 U.S.
at pp. 69-70.)
FN5. Appellant implicitly acknowledges that the state
marketing order would be constitutional under Wileman Bros.
if it were more pervasive in its control of both supply and demand.
Appellant states: "One of the touchstones of displacing
competing [sic] is limiting the volume that can be sold.,
The true purpose of the Plum Committee in this case is to enforce
a speech tax ., That is not an economic regulation..."
FN6. Appellant is correct, of course, in contending
"there is no compelling state interest in advertising plums."
There is, however, a strong public interest in providing an adequate
and stable market for plums and other California fruits. (Agricultural
Prorate Com. v. Superior Ct., supra, 5 Cal.2d at p. 582.)
Advertising is simply a rational means to accomplish this important,
long-recognized public purpose.
FN7. Appellant contends, "After all, choices of
ideas and beliefs are no less important to the citizens of a
free society because they concern plums rather than politicians.,
All of the above are ' for sale' in their respective market places."
If the Plum Board launched an advertising campaign promoting
rotten plums as the "fruit of choice" to hurl at the
Mayor of San Francisco (see DelVecchio, Activist Says He Tried
To Feed Brown a Big Helping of Humble Pie, San Francisco
Chronicle (Nov. 9, 1998) p. A17), or even if the Plum Board urged
a boycott of Chilean plums because it disagreed with the North
American Free Trade Act, the advertisements might constitute
ideological speech even though they were in some sense germane
to the purpose of selling more California plums. (See Lehnert
v. Ferris Faculty Assn. (1991) 500 U.S. 507, 520-522.) Nevertheless,
the "ideological" content of the simple message "buy
more plums" is obviously and significantly different from
the ideological content of the message "buy more politicians."
(See Wileman Bros., supra, 521 U.S. at p. ___, fn. 16
[117 S.Ct. at p. 2140, fn. 16].
FN8. California Constitution, article I, sections 2
and 3 provide, in relevant part:
"Sec. 2. (a) Every person may freely speak, write
and publish his or her sentiments on all subjects, being responsible
for the abuse of this right. A law may not restrain or abridge
liberty of speech or press. [¶ ] , [¶ ] Sec. 3. The
people have the right to instruct their representatives, petition
government for redress of grievances, and assemble freely to
consult for the common good."
We will refer to these as the liberty of speech clause and
the freedom of association section, respectively. Appellant makes
no separate argument concerning the freedom of association section
and we perceive no distinguishing factors in that section that
require separate consideration. Accordingly, our discussion primarily
will address the issue as one of liberty of speech.
FN9. The Supreme Court earlier had held that the First
Amendment was applicable to the states through the Fourteenth
Amendment. (See Near v. Minnesota (1931) 283 U.S. 697,
707.)
FN10. A similar divergence of concerns may be seen
in People v. Martin (1955) 45 Cal.2d 755, 760, and Alderman
v. United States (1969) 394 U.S. 165, 174-175. Both
cases involved the doctrine of "vicarious standing"
for exclusionary rule purposes. The United States Supreme Court
held that Fourth Amendment rights were personal to one whose
rights were violated, and it was not a function of the federal
exclusionary rule to prevent police misconduct generally, but
only to vindicate the individual' s rights. In Martin,
by contrast, the California Supreme Court held that the purpose
of the exclusionary rule under the state Constitution was precisely
"' to secure compliance with the constitutional provisions
on the part of police officers,' " regardless of whose rights
were violated. (45 Cal.2d at p. 760.) Thus, the state court imposed
the broader exclusionary rule, permitting a defendant to exclude
from his trial evidence illegally seized from a third party.
(Kaplan v. Superior Court (1971) 6 Cal.3d 150, 156-157.)
Although declining to adopt it as part of the federal exclusionary
rule, the United States Supreme Court recognized the validity
of such state level policy decisions in Alderman. (See
394 U.S. at pp. 174-175.) The vicarious exclusionary rule was,
of course, vitiated by Proposition 8. (In re Lance W. (1985)
37 Cal.3d 873, 886-887.)
FN11. The expansion of the criminal law exclusionary
rule in People v. Martin, supra, 45 Cal.2d at page 760,
does not reflect the same concerns as present in this case. Even
though Martin restricted governmental activity in furtherance
of individual constitutional rights, the governmental conduct
there was itself illegal. Here, the governmental action of taking
steps to preserve the agriculture industry is not illegal and
serves a valid public purpose.
FN12. It avails appellant nothing to characterize the
Plum Board as dominated by appellant' s "competitors"
selling a "mediocre product" from which appellant wants
to distinguish its top-of-the-line plums. The same considerations
would be present to an even greater degree with a proration order
that limited appellant' s ability to out-sell its competitors
or a price-support system that allowed competitors to stay in
business even though they could not command the premium prices
appellant might obtain for its product. To the extent appellant
may be understood to claim that the generic advertising program
in some manner discriminates against appellant or otherwise conveys
a particular message that does not benefit appellant (but see
Padberg & Hall, supra, 5 San Joaquin Ag. L.Rev. at
p. 86 ["There may be situations where (advertising and research)
have been useless, but we are unaware of any situation where
serious harm was done to anyone through these programs."
]), these "are all essentially challenges to the administration
of the program that are more properly addressed to the Secretary"
in administrative proceedings. (Wileman Bros., supra,
521 U.S. at p. ___, fn. 11 [117 S.Ct. at p. 2138, fn. 11].)
|

Have a legal question?
Check out Asked & Answered first.
Chances are, we've already answered it. If
not, then proceed to CFAC's Legal
Hotline for help from top lawyers—free.
CFAC Archives:
Search CFAC
|