Cricket Hosiery, Inc. v. U.S.

• Decision Date: 24 April 2006
• Docket Number: Slip Op. 06-56. Court No. 03-00553.
• Citation: 429 F.Supp.2d 1338
• Parties: CRICKET HOSIERY, INC., the William Carter Co., and Artex International, Inc., and on behalf of all others similarly situated, Plaintiffs, v. UNITED STATES, Defendant, and F.T.B. Farms, William Lovelady, Robert E. McLendon Farms LLC, A-Turnblin-T Ranches, California Cotton Growers Association, Delta Council, Southern Cotton Growers, Inc., and Texas Cotton Producers, Inc., Defendant-Intervenors.
• Court: U.S. Court of International Trade

429 F.Supp.2d 1338

CRICKET HOSIERY, INC., the William Carter Co., and Artex International, Inc., and on behalf of all others similarly situated, Plaintiffs, v. UNITED STATES, Defendant, and F.T.B. Farms, William Lovelady, Robert E. McLendon Farms LLC, A-Turnblin-T Ranches, California Cotton Growers Association, Delta Council, Southern Cotton Growers, Inc., and Texas Cotton Producers, Inc., Defendant-Intervenors.

Slip Op. 06-56. Court No. 03-00553.

United States Court of International Trade.

April 24, 2006.

The Cullen Law Firm PLLC, Washington, DC (Paul D. Cullen, Sr. and Joseph A. Black); James A. Moody, and Greenburg Traurig LLP, Washington, DC (Teresa M. Polino), for the plaintiffs, of counsel.

Peter D. Keisler, Assistant Attorney General, Barbara S. Williams, Attorney in Charge, International Trade Field Office, Commercial Litigation Branch, Civil Division, United States Department of Justice (Aimee Lee); Office of the General Counsel, United States Department of Agriculture (Frank Martin), of counsel; Office of the Assistant Chief Counsel, International Trade Litigation, United States Bureau of Customs and Border Protection (Yelena Slepak), for the defendant, of counsel.

Wilmer Cutler Pickering Hale and Dorr LLP, Washington, DC (Randolph D. Moss, David W. Ogden, Brian M. Boynton, and Leondra R. Kruger), for the defendant-intervenors.

OPINION

MUSGRAVE, Judge.

Before the Court are defendant's Motion to Dismiss and Motion for Judgment on the Agency Record and defendant-intervenors' Motion to Dismiss or, in the Alternative, for Judgment on the Agency Record. By their motions these parties seek the dismissal of plaintiffs' Amended Class Action Complaint ("Amended Complaint") in its entirety. The Court has jurisdiction over this matter pursuant to 19 U.S.C. § 1581(i) (2000). See Cricket Hosiery, Inc. v. United States, 26 CIT ___, 2004 WL 1376402 (2004) (2004) ("Cricket I") (denying defendant's motion to dismiss for lack of subject matter jurisdiction); Orleans Int'l, Inc. v. United States, 334 F.3d 1375 (Fed.Cir.2003) ("Orleans") (finding that the United States Court of International Trade had exclusive jurisdiction over domestic producers' challenge to the constitutionality of the collection of assessments pursuant to the Beef Marketing and Promotion Act).

Background

On August 18, 2003, plaintiffs, domestic importers of cotton and cotton products, commenced this action alleging that the Cotton Research and Promotion Act of 1966, as amended, 7 U.S.C. § 2101 et seq. (2000) ("Cotton Act"), and the regulations implementing the Cotton Act, 7 C.F.R. § 1205 et seq. (2003) ("Cotton Order"), violated their constitutional rights. Specifically, plaintiffs alleged that the Cotton Act violated their rights of Free Speech and Free Association. See Compl. at paras. 28, 30. In May 2004 the Court stayed this action pending the Supreme Court's resolution of Johanns v. Livestock Marketing Association. See Johanns v. Livestock Mktg. Ass'n, 544 U.S. 550, 125 S.Ct. 2055, 161 L.Ed.2d 896 (2005) ("Livestock Mktg. III"). That action, which was initially commenced in the Northern District of South Dakota, was brought by several members of the domestic beef and cattle industries who challenged, on constitutional grounds, the Beef Promotion and Research Act of 1985, as amended, 7 U.S.C. § 2901 et seq. (2000) (the "Beef Act"). See Livestock Mktg. Ass'n v. United States Dep't of Agric., 207 F.Supp.2d 992, 996-997 (D.S.D.2002) ("Livestock Mktg. I"), vacated by, 544 U.S. 550, 125 S.Ct. 2055, 161 L.Ed.2d 896. The plaintiffs in Livestock Marketing I raised constitutional challenges to the Beef Act, arguing that the promotional messages created pursuant to that Act violated their rights of Free Speech and Free Association. The plaintiffs found the promotional messages to be objectionable for various reasons including that "generic promotion of beef serves to promote imported beef," that "generic advertising increases foreign imports which hurts . . . business," that "generic advertising . . . implies beef is all the same," and that any messages of the Beef Act should promote only American beef. See id. at 997. The district court, relying on the Supreme Court's Free Speech jurisprudence, found that the assessments paid by the plaintiffs to fund the Beef Board were akin to "dues" paid to a union shop or a state bar association. See id. at 997-98 (citing Abood v. Detroit Bd. of Ed., 431 U.S. 209, 233, 97 S.Ct. 1782, 52 L.Ed.2d 261 (1977) ("Abood"); Keller v. State Bar of Cal., 496 U.S. 1, 13, 110 S.Ct. 2228, 110 L.Ed.2d 1 (1990) ("Keller")). The district court reasoned, that

the use of compelled "dues" for advancing ideological causes objectionable to any member of the group violates the First Amendment. Compelling plaintiffs to make contributions for speech to which they object works an infringement of their constitutional rights. Abood, 431 U.S. at 234, 97 S.Ct. 1782.

If there is any fixed star in our constitutional constellation, it is that no official, high or petty, can prescribe what shall be orthodox in politics, nationalism, religion, or other matters of opinion or force citizens to confess by word or act their faith therein.

Abood, 431 U.S. at 235, 97 S.Ct. 1782 (quoting West Va. Bd. of Ed. v. Barnette, 319 U.S. 624, 642, 63 S.Ct. 1178, 87 L.Ed. 1628 (1943)). The First Amendment protects not only the right to engage in or not engage in political speech but also any "expression about philosophical, social, artistic, economic, literary, or ethical matters." Abood, 431 U.S. at 231, 97 S.Ct. 1782. See also NAACP v. Ala. ex rel. Patterson, 357 U.S. 449, 460, 78 S.Ct. 1163, 2 L.Ed.2d 1488 (1958) ("it is immaterial whether the beliefs sought to be advanced . . . pertain to political, economic, religious or cultural matters").

Livestock Mktg. I, 207 F.Supp.2d at 998. The district court then reviewed the Supreme Court's decision in United States v. United Foods. See id. at 1000 (citing United States v. United Foods, Inc., 533 U.S. 405, 121 S.Ct. 2334, 150 L.Ed.2d 438 (2001) ("United Foods")). In United Foods, the Supreme Court found that the collection of assessments from domestic producers of mushrooms to fund a board that created promotional messages pursuant to the Mushroom Promotion, Research, and Consumer Information Act, as amended, 7 U.S.C. § 6101 et seq., which the plaintiffs found to be objectionable, unconstitutionally violated their First Amendment rights. See United Foods, 533 U.S. at 415-16, 121 S.Ct. 2334. Following the Supreme Court's lead in United Foods, the district court found that the collection of assessments from domestic producers of beef and beef products to fund a board that created promotional messages pursuant to the Beef Act, which the plaintiffs found to be objectionable, unconstitutionally violated their First Amendment rights. The district court reasoned that

[t]he beef checkoff is unconstitutional in violation of the First Amendment because it requires plaintiffs to pay, in part, for speech to which the plaintiffs object. The Constitution requires that expenditures for advertising of beef be financed only from assessments paid by producers who do not object to advancing the generic sale of beef and who are not coerced into doing so against their wills.

Livestock Mktg. I, 207 F.Supp.2d at 1002 (citing Abood, 431 U.S. at 236-237, 97 S.Ct. 1782). In reaching its conclusion the district court specifically rejected the arguments of the defendant and the defendant-intervenors that the speech did not infringe upon the plaintiffs' First Amendment rights because it was "government speech." See id. at 1003-07. The district court, relying on United States v. Frame, stated that "[t]he Third Circuit rejected the government's contention that the compelled expressive activities mandated by the Act constitute `government speech' . . . ." Id. at 1004 (citing United States v. Frame, 885 F.2d 1119, 1132 (3rd Cir.1989)).

That action was then appealed to the Court of Appeals for the Eighth Circuit. In contrast to the district court, the court of appeals found that the speech complained of was, indeed, government speech. See Livestock Mktg. Ass'n v. United States Dep't of Agric., 335 F.3d 711, 719-26 (8th Cir.2003) ("Livestock Mktg. II"), vacated by, remanded by, 544 U.S. 550, 125 S.Ct. 2055, 161 L.Ed.2d 896 ("The government speech doctrine has firm roots in our system of jurisprudence."). The court of appeals noted that, since the district court had not found that the speech complained of was government speech, the district court had not applied the test set out in Central Hudson Gas & Electric Corporation v. Public Service Commission of New York to determine whether such speech survived heightened First Amendment scrutiny. See id. at 722 (citing Central Hudson Gas & Elec. Corp. v. Public Svc. Comm'n of NY, 447 U.S. 557, 570-71, 100 S.Ct. 2343, 65 L.Ed.2d 341 (1980) ("Central Hudson"); Glickman v. Wileman Bros. & Elliott, Inc., 521 U.S. 457, 470, 117 S.Ct. 2130, 138 L.Ed.2d 585 (1997) ("Glickman")). The court of appeals, applying the Central Hudson test, found that the speech did not survive heightened scrutiny because

notwithstanding the reasoned counterpoints advanced by the dissent in United Foods, see 533 U.S. at 419-31, 121 S.Ct. 2334 (Breyer, J., dissenting), we conclude that the government's interest in protecting the welfare of the beef industry by compelling all beef producers and importers to pay for generic beef advertising is not sufficiently substantial to justify the infringement on appellees' First Amendment free speech right. Accordingly, the district court did not err in holding that the Beef Act and the Beef Order are unconstitutional and unenforceable.

Id. at 725-26.

The matter was again appealed and the Supreme Court granted certiorari. See Nebraska Cattlemen, Inc., v. Livestock Mktg. Ass'n, 541 U.S. 1062, 124 S.Ct. 2390, 158 L.Ed.2d 962 (2004). The Supreme Court found that, in general,...