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Monday, January 12, 2009

Ind. Decisions - One Indiana opinion today from the 7th Circuit

In White Eagle Coop. v. USDA (ND Ind., Judge Sharp), a 42-page opinion, Judge Ripple writes:

The plaintiffs brought this action against the United States Department of Agriculture (“USDA” or “the Government”), challenging the USDA’s rulemaking process and a resulting amendment to the Mideast Milk Marketing Order. The plaintiffs alleged violations of the Agricultural Marketing Agreement Act of 1937, 7 U.S.C. § 601 et seq.; the USDA’s rules of practice, 7 C.F.R. § 900.1 et seq.; the Administrative Procedure Act, 5 U.S.C. § 551 et seq.; the Regulatory Flexibility Act, 5 U.S.C. § 601 et seq.; and the Fifth Amendment’s Due Process Clause. A number of dairy producers who supported the regulatory changes intervened to defend the amended rule and the adoption process. The district court granted summary judgment to the USDA and the intervenors on all counts. For the reasons set forth in this opinion, we affirm the judgment of the district court. * * *

In short, the USDA rejected White Eagle’s arguments because they missed the mark. Although the diversion limits may have decreased the volume of milk available for manufacturing uses, with a resultant decrease in returns for some producers, preserving returns for every producer was not the USDA’s primary goal. Instead, the problem that the USDA was attempting to address through diversion limits was the opportunistic entry into the market by producers (to take advantage of the higher blend price) who did not regularly serve the Class I needs of the market, with the resultant additional costs. Thus, far from being a reason not to implement the diversion limits, the fact that some producers would be excluded from the pool (because they did not serve regularly the fluid needs of that market), and may suffer a decrease in returns (because they could no longer benefit from the higher blend price), was consistent with the policy approach the USDA had adopted in its prior milk marketing orders and continued in the order at issue.

We cannot say, therefore, that the USDA’s adoption of the present order was arbitrary or capricious, nor do we believe that the USDA failed to consider relevant evidence in adopting the current rule.

Conclusion. For the foregoing reasons we affirm the judgment of the district court. AFFIRMED

Posted by Marcia Oddi on January 12, 2009 12:09 PM
Posted to Ind. (7th Cir.) Decisions