U.S. v. National Broiler Marketing Ass'n

• Decision Date: 22 April 1977
• Docket Number: No. 76-2115,76-2115
• Parties: 1977-1 Trade Cases 61,384 UNITED STATES of America, Plaintiff-Appellant, v. NATIONAL BROILER MARKETING ASSOCIATION, Defendant-Appellee.
• Court: U.S. Court of Appeals — Fifth Circuit

Page 1380

550 F.2d 1380

1977-1 Trade Cases 61,384

UNITED STATES of America, Plaintiff-Appellant, v. NATIONAL BROILER MARKETING ASSOCIATION, Defendant-Appellee.

No. 76-2115.

United States Court of Appeals Fifth Circuit.

April 22, 1977.

Barry Grossman, John J. Powers, III, Thomas E. Kauper, Asst. Attys. Gen., Antitrust Div., U. S. Dept. of Justice, Washington, D.C., John W. Stokes, U. S. Atty., Atlanta, Ga., for plaintiff-appellant.

Joel B. Kleinman, Washington, D.C., amicus curiae, for Alabama, and others.

Sidney O. Smith, Michael A. Doyle, Frederick H. Von Unwerth, Atlanta, Ga., for defendant-appellee.

Appeal from the United States District Court for the Northern District of Georgia.

Before MORGAN and HILL, Circuit Judges, and NOEL, ^* District Judge.

LEWIS R. MORGAN, Circuit Judge:

We must decide whether broiler industry companies that neither own nor operate farms can be "farmers" within the meaning of a 1922 federal statute called the Capper-Volstead Act, ¹ which gives farmers' cooperatives some measure of protection from the antitrust laws. The question is a novel one. After careful study of the Act and its legislative history, we are convinced that Congress's purpose in enacting Capper-Volstead does not mandate or permit protection of these broiler industry companies from the proscriptions of the antitrust laws. The district court held otherwise, and we reverse.

I. FACTS

A. The Broiler Industry

Broilers are young chickens that are slaughtered when seven-to-nine weeks old, then processed and offered for sale ready-to-cook. The broiler industry comprises generally two types of entities integrator companies and contract growers. The defendant National Broiler Marketing Association (NBMA) is composed of integrator companies.

"Integrators" have that name because over the years they have accomplished what is called the vertical integration of much of the broiler industry. That is, they have taken on more than one of the tasks necessary to bring broilers to consumers. Thus, many NBMA members ² own and operate not only processing plants, but also feed mills, hatcheries, and breeder flocks (for the production of broiler eggs). Still, most NBMA members are processors, and a few operate only processing plants.

The one major operation not generally performed by the integrator firms is the actual raising of the broiler chicks to maturity. This is handled by farmers called contract growers. These growers raise the chicks on their own farms in their own buildings. They provide their own labor and equipment. The growers also supply the water and electricity needed during the grow-out process, as well as the litter and fuel used in lining and heating the broiler houses. The day-to-day husbandry of the flocks is left to the growers.

Title to the broiler chicks is retained by the broiler integrators during the grow-out process. The integrators also supply feed and veterinary services. The integrators decide the number and timing of chick placements and the age and size at which the birds will be marketed.

Generally, the growers are treated by the integrators as independent contractors. The contracts provide for a minimum and maximum payment per bird or per pound to the grower. ³

B. The Litigation

The government brought a civil antitrust action ⁴ against NBMA, alleging that the Association's members and others had combined to fix broiler prices and to restrict broiler production in order to increase broiler prices. After a period of discovery, both parties moved for partial summary judgment on agreed facts. The issue was whether NBMA's members are farmers within the meaning of the Capper-Volstead Act, which states generally that "(p)ersons engaged in the production of agricultural products as farmers, planters, ranchmen, dairymen, nut or fruit growers" may engage in certain activities cooperatively. ⁵

The district court held that NBMA's members are farmers as the term is used in the Act and granted NBMA's motion for partial summary judgment. ⁶ Then the government, with NBMA's acquiescence, filed an amended complaint, deleting all of the allegations that survived the partial summary judgment. ⁷ The parties stipulated that the government would be allowed to bring a later action reviving those allegations.

The district court granted final judgment in favor of NBMA, ⁸ and the case is here on the government's appeal of the district court's final order.

II. DISCUSSION

We have noted already that the issue we must decide today is novel. In fact, the Capper-Volstead Act, since its enactment in 1922, has received little attention from the Supreme Court. ⁹ Moreover, no significant body of Capper-Volstead law has developed in the lower federal courts. ¹⁰ And the legal commentary has not been abundant. ¹¹ The positions of the parties may be stated briefly. The government contends that Congress clearly meant to limit the benefits of the Capper-Volstead Act to persons that own or operate farms. The government argues that this interpretation comports with the ordinary meaning of the word "farmers" and with the central themes of the legislative history of the Act. The record reflects and NBMA concedes that some of its members neither own nor operate any farms on which broilers are raised to maturity.

NBMA counters that "farmers" ought to be read "in a realistically broad sense." ¹² Deemphasizing "farmers," but clearly aware that the term "farmers" is the slipper that must fit the foot, NBMA argues that Congress intended to afford Capper-Volstead's protection "to all persons actually engaged in the production of agricultural products." ¹³ NBMA urges that its members are so engaged principally because they own the chicks, furnish the feed, and share in the risks that attend broiler production.

Neither of the interpretations seems on its face wholly irrational. Our task is to decide which of the two is the more congenial to the language and purpose of Capper-Volstead.

A. The Words Congress Used

We begin with the words of the statute. ¹⁴ Congress granted a measure of protection from the antitrust laws to "(p)ersons engaged in the production of agricultural products as farmers, planters, ranchmen, dairymen, nut or fruit growers . . . ." NBMA focuses on the first part of the clause persons engaged in the production of agricultural products as the key to the Act's coverage. It seems clear, however, that the universe of persons engaged in the production of agricultural products can be larger than the universe of those so engaged as farmers, planters, ranchmen, dairymen, nut or fruit growers. ¹⁵ The test then, is whether broiler integrator firms are farmers.

What meaning are we to place on the word "farmers"? It is long settled that words in statutes should be given their ordinary, popular meaning unless Congress clearly meant the words in some more technical sense. ¹⁶ Mr. Justice Frankfurter stated the point well:

(L)egislation when not expressed in technical terms is addressed to the common run of men and is therefore to be understood according to the sense of the thing, as the ordinary man has a right to rely on ordinary words addressed to him.

Addison v. Holly Hill Fruit Products, Inc., 322 U.S. 607, 618, 64 S.Ct. 1215, 1221, 88 L.Ed. 1488 (1944). Of course we cannot take a poll to determine the ordinary, popular meaning of the word "farmers." And our confidence in the dictionary for this purpose is not great. ¹⁷ We are left to our judgment, informed by the whole of our experience.

We cannot conceive that the ordinary, popular sense of the word "farmers" would fit broiler integrator companies. The husbandry of the broiler flocks is carried out neither by these firms nor by their employees, but by the contract growers. The farms where the husbandry is done are owned not by NBMA members or their employees, but by these growers. Whatever else farming may mean, an irreducible minimum must be either husbandry of animals or crops or farm ownership. Given the absence of both of these elements here, none of the factors suggested by NBMA as indicative of farming nor all of the factors together would seem a sufficient shoe horn to squeeze these companies into farmers' boots. Asked to examine the broiler business and to identify the "farmers," Justice Frankfurter's common run of men, we think, would point to the contract growers the persons who own and operate the farms as the "farmers."

NBMA cautions us against a romantic view of agriculture and points out that agriculture has changed greatly from the Jeffersonian conception of the self-sufficient yeoman. We agree that agriculture has changed much. But the ordinary, popular meaning of the word "farmer" has not. When the common run of people wish to speak of the broader spectrum of modern agriculture, the word generally used is "agribusiness." "Farmer" still means what it meant in 1922 one who owns or operates a farm.

Mr. Justice Holmes observed once that "the meaning of a sentence is to be felt rather than to be proved . . . ." United States v. Johnson, 221 U.S. 488, 496, 31 S.Ct. 627, 55 L.Ed. 823 (1911). We believe the Capper-Volstead Act, with its listing of beneficiaries farmers, planters, ranchmen, dairymen, nut or fruit growers has a feeling, a cadence of meaning, that has no place for NBMA's member companies.

B. The Legislative History

Our examination of the legislative history of Capper-Volstead has only reinforced our conviction that Congress meant "farmers" to be read in its ordinary sense, as urged by the government, rather than in an imaginative, broad sense, as urged by NBMA.

The Act's legislative history carries two dominant themes. Congress meant to improve the bargaining position of farmers vis-a-vis corporate middlemen in order to increase farm income and, importantly, to stop the rise of tenancy and the migration of farm families to the cities. Second, Congress was convinced that the benefits afforded to farmers by Capper-Volstead should not be...