Horne v. Department of Agriculture
576 U.S. 350 (2015)
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Rule of Law:
A governmental mandate to physically relinquish a portion of one's personal property for government use is a per se physical taking under the Fifth Amendment, requiring just compensation. This categorical duty cannot be evaded by reserving a contingent interest in the property's future proceeds for the owner or by framing the relinquishment as a condition for engaging in commerce.
Facts:
- Marvin and Laura Horne were California raisin growers and handlers.
- Pursuant to the Agricultural Marketing Agreement Act of 1937, the U.S. Department of Agriculture's California Raisin Marketing Order sought to maintain stable raisin prices.
- The Order required raisin growers in certain years to give a percentage of their crop to a government-controlled entity, the Raisin Administrative Committee.
- In 2002-2003, the Committee mandated that growers turn over 47% of their crop; in 2003-2004, the mandate was 30%.
- The Committee took title to these "reserve raisins" and disposed of them at its discretion, including by selling them in noncompetitive markets or donating them.
- Growers retained a contingent interest in any net proceeds from the Committee's sales, but these proceeds were not guaranteed and in one year at issue were zero.
- In 2002, the Hornes refused to set aside any raisins for the government.
- As handlers, the Hornes paid other growers in full for all their raisins, taking full ownership before refusing to comply with the reserve requirement.
Procedural Posture:
- The U.S. Department of Agriculture (USDA) initiated an enforcement action against the Hornes for failing to comply with the Raisin Marketing Order.
- The USDA assessed a fine against the Hornes equal to the market value of the withheld raisins (approx. $480,000) plus a civil penalty of over $200,000.
- The Hornes sought review of the fine in federal court, arguing the reserve requirement was an unconstitutional taking. The case eventually reached the U.S. Supreme Court.
- In Horne v. Department of Agriculture (Horne I), the Supreme Court held that the lower courts had jurisdiction to hear the Hornes' takings defense.
- On remand, the U.S. Court of Appeals for the Ninth Circuit ruled in favor of the government, holding that the reserve requirement was a use restriction, not a per se physical taking.
- The Hornes petitioned the U.S. Supreme Court for a writ of certiorari, which was granted.
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Issue:
Does a government marketing order that requires raisin growers to physically set aside a percentage of their crop for the government's account, free of charge, constitute a per se taking of private property under the Fifth Amendment for which just compensation is required?
Opinions:
Majority - Chief Justice Roberts
Yes, the government's requirement that raisin growers physically set aside a portion of their crop is a per se taking. The Fifth Amendment's protection against uncompensated takings applies equally to personal property as it does to real property. A physical appropriation of property is a 'classic taking' that requires just compensation without regard to other factors like public benefit or economic impact. The government's program requires the actual transfer of raisins, passing title to the Committee and depriving owners of their rights to possess, use, and dispose of their property. The fact that growers retain a contingent interest in potential future proceeds does not negate the physical taking; at most, it relates to the calculation of just compensation. Furthermore, the government cannot condition the right to engage in ordinary commerce on the forfeiture of a constitutional protection, distinguishing this case from those involving voluntary exchanges for significant government benefits, such as selling dangerous chemicals.
Dissenting - Justice Sotomayor
No, the Order does not effect a per se taking. A per se taking under Loretto v. Teleprompter occurs only when governmental action destroys every single property right in the 'bundle' of rights. Here, the Hornes retained a significant property interest: the right to receive net proceeds from the disposition of the reserve raisins. Because this right was not destroyed, the Order does not constitute a per se physical taking and should instead be analyzed under the flexible Penn Central framework, which the Hornes did not argue. The reserve requirement is not a classic physical seizure but a condition for participating in a government-regulated and price-supported market, which our precedents permit.
Concurring - Justice Thomas
Yes, this is a per se taking. I join the majority's opinion in full. I write separately to note that it is far from clear that the Raisin Administrative Committee's conduct even meets the 'public use' requirement of the Takings Clause. The Committee takes raisins from citizens and sells or gives them to exporters and foreign governments, which may not constitute a true public use as originally understood.
Concurrence in part and dissent in part - Justice Breyer
Yes, the program constitutes a taking, but the case should be remanded to determine just compensation. I agree with the majority that the reserve requirement is a taking. However, I dissent from the Court's decision on the remedy. The proper calculation of just compensation should deduct any financial benefits the Hornes received from the government program—such as artificially enhanced prices for their remaining, non-reserve raisins—from the value of the raisins that were taken. It is possible that the net effect of the program provided just compensation, in which case there would be no Takings Clause violation.
Analysis:
This decision solidifies the principle that the Takings Clause affords the same high level of protection to personal property as it does to real property in cases of direct physical appropriation. By rejecting the government's argument that the reserve requirement was merely a regulatory condition on commerce, the Court limited the scope of the 'unconstitutional conditions' doctrine in this context. The ruling curtails the government's ability to implement price-stabilization schemes that involve the physical seizure of property, forcing it to use regulatory tools that do not involve such appropriations, like production quotas or direct subsidies. This strengthens the rights of property owners against physical invasion, even when part of a complex economic regulatory program.
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