Under the Agricultural Marketing Agreement Act of 1937, the U.S. Department of Agriculture (USDA) issues a Raisin Marketing Order (RMO), which restricts the amount of raisins from a crop year that raisin handlers in California may sell on the open market. Handlers must separate raisins into “free tonnage,” which they may sell, and “reserve tonnage,” which they then transfer to the Raisin Administrative Committee (RAC) for it to sell in secondary and non-competitive markets to fund its administration.
The Hornes have farmed raisins in California since 1969. In 2002, Raisin Valley Farms—in partnership with Lassen Vineyards, owned by the Hornes and Ms. Horne’s parents—purchased equipment to clean, sort, stem, and package their own raisins, that is, to function as a handler. In addition to handling raisins produced by their farm, they processed raisins for other local growers, but did not comply with the RMO and did not transfer title to a portion of their crops to the RAC.
In April 2004, the Agriculture Marketing Service took legal action against the Hornes for crop years 2002–2003 and 2003–2004, when they were required to set aside 47 percent and 30 percent, respectively. The attempt by the Hornes to challenge the $695,226 in penalties levied against them on constitutional groups was rejected by the lower federal courts. In 2013, the Supreme Court of the United States ruled unanimously that the family could raise a constitutional defense against federal agency action. On remand, the Ninth Circuit held there was not a taking because real property was not involved, the family did not lose all the value of its property, and the family received a public benefit.
On September 8, 2014, the Hornes again petitioned for a writ certiorari. On October 8, 2014, MSLF filed an amicus curiae brief in support of the Hornes. On January 16, 2015, the Supreme Court granted the petition. On March 9, 2015, MSLF filed an amicus curiae brief on the merits in support of the Hornes. On April 22, 2015, the Supreme Court heard oral arguments. On June 22, 2015, the Supreme Court ruled 8-1 that the family’s property had been taken without “just compensation” and ruled 5-3 that the value of the property taken was the fine assessed by the U.S. Department of Agriculture.