The Ninth Circuit Court of Appeals upheld a lower court’s 2017 injunction against the collection of the Montana state beef checkoff in a decision released Monday. The ruling supports ranchers’ claim that the state’s beef checkoff program impinges on their First Amendment rights by obligating them to pay taxes to support “private speech.” As the case between the Ranchers-Cattlemen Action Legal Fund (R-CALF) and the Department of Agriculture unfolds, it has greater implications for checkoff programs in other states.
David Muraskin, a lawyer with Public Justice who is lead counsel on the case, says the ruling indicates that the ranchers are likely to win a permanent injunction against the collection of the state checkoff. Muraskin says commodity checkoff programs in other states could face a similar fate, if they are administered similarly to the beef checkoff.
In the beef checkoff program, ranchers are required to pay $1 per head of cattle sold into a federal beef checkoff pool, and that money is used for beef marketing, research, and promotion. Typically, half of each dollar is redirected to state beef councils, which use the money to market, research, and promote beef at the state level. Checkoff funds pay for advertising campaigns like, “Got Milk?” and, “Beef. It’s what’s for dinner.”
But Montana-based R-CALF has argued that the Montana Beef Council, because it is a private agency that is not overseen by the government, is engaging in “private speech” to promote generic beef products. Those promotions, ranchers say, favor large-scale, conventional beef producers and don’t allow for independent ranchers to distinguish themselves in the market.
“State beef councils just operate on their own,” says Muraskin. The government “doesn’t appoint any members and there’s no direct federal supervision.” And because a 2005 Supreme Court ruling found that checkoffs must be overseen by the federal government to preserve their status as “public speech,” Monday’s ruling suggests that the beef checkoff is unconstitutional in its current form.
“Today’s ruling ensures that for the first time in over three decades Independent Montana [sic] cattle producers have a choice as to whether to continue funding a private message that essentially says that beef is beef regardless of where the cattle from which the beef was derived were born or raised,” said Bill Bullard, the CEO of R-CALF USA, in a statement. “That generic message is contrary to the interests of Montana ranchers who want to capitalize on the superior beef products that are produced from their high quality, USA-produced cattle.”
The first injunction on the collection of Montana’s beef checkoff tax was filed in June 2017 and required producers to opt in to funding the state’s promotion and marketing programs. That year, the Montana Beef Council collected just $150,000, a drop from the $800,000 it typical collects.