Newark Gardens, Inc. v. Michigan Potato Industry Commission

847 F.2d 1201, 56 U.S.L.W. 2665, 1988 U.S. App. LEXIS 6489
CourtCourt of Appeals for the Sixth Circuit
DecidedMay 16, 1988
Docket87-1351
StatusPublished
Cited by2 cases

This text of 847 F.2d 1201 (Newark Gardens, Inc. v. Michigan Potato Industry Commission) is published on Counsel Stack Legal Research, covering Court of Appeals for the Sixth Circuit primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Newark Gardens, Inc. v. Michigan Potato Industry Commission, 847 F.2d 1201, 56 U.S.L.W. 2665, 1988 U.S. App. LEXIS 6489 (6th Cir. 1988).

Opinion

RALPH B. GUY, Jr., Circuit Judge:

The question presented in this case is whether certain provisions of the Michigan Potato Industry Commission Act (MPICA) are in conflict with and, thus, preempted by the federal Agricultural Fair Practices Act (AFPA). Under the MPICA, producers and shippers of potato products in Michigan are required to pay an assessment to the Michigan Potato Industry Commission (the Commission) which uses the proceeds to promote Michigan potato products. Plaintiff, Newark Gardens, Inc., is a family-owned business engaged in potato farming in Michigan. Plaintiff filed suit in federal district court against the Michigan Department of Agriculture and the Commission seeking declaratory and injunctive relief and damages. Plaintiff claimed that the mandatory assessments imposed under the MPICA were in violation of the AFPA which protects the rights of farmers to join cooperative associations or to remain independent, and provides further protection against economic coercion by producer or processor associations. The district court below dismissed the claims against the Michigan Department of Agriculture, on eleventh amendment grounds. Subsequently, the court granted summary judgment in favor of the Commission, finding that the imposition of the mandatory assessments was not in contravention of the intent and purposes of the AFPA. Plaintiff appeals the dismissal of its claims against the Com *1202 mission. For the following reasons, we affirm the judgment of the district court.

I.

A.

In examining the central issue of preemption, we find guidance in a recent decision of the United States Supreme Court in which the Court was called upon to determine whether the AFPA preempted another Michigan agricultural act. See Michigan Canners & Freezers Association v. Agricultural Marketing and Bargaining Board, 467 U.S. 461, 104 S.Ct. 2518, 81 L.Ed.2d 399 (1984) (Michigan Canners). In Michigan Canners, the Court found that the AFPA did not explicitly preempt state law, nor did it reflect an intent to occupy the entire field of agricultural-product marketing. 467 U.S. at 469, 104 S.Ct. at 2522. Therefore, the only question before the Court was whether preemption arose as a result of irreconcilable conflict between the state and federal laws. Likewise, the sole question before this court is whether the MPICA “stands as an obstacle to the accomplishment and execution of the full purposes and objectives of Congress.” Michigan Canners, 467 U.S. at 469, 104 S.Ct. at 2523 (quoting Hines v. Davidowitz, 312 U.S. 52, 67, 61 S.Ct. 399, 404, 85 L.Ed. 581 (1941)). In the event of a conflict between the state and federal laws, the federal law must prevail by virtue of the supremacy clause contained in article VI, clause 2, of the United States Constitution. Nevertheless, in Kelly v. Washington, 302 U.S. 1, 58 S.Ct. 87, 82 L.Ed. 3 (1937), the Supreme Court stated:

The principle is thoroughly established that the exercise by the State of its police power, which would be valid if not superseded by federal action, is superseded only where the repugnance or conflict is so “direct and positive” that the two acts cannot “be reconciled or consist ently stand together.”

Id. at 10, 58 S.Ct. at 92 (citations omitted).

B.

The MPICA was enacted by the Michigan legislature in 1970. Under section 2 of the MPICA, the Potato Industry Commission was established within the Michigan Department of Agriculture. Mich.Comp.Laws Ann. § 290.422(1). The Commission is comprised of fifteen voting members appointed by the governor; ten growers, two processors, two shippers, and one retailer. Id. Section 3 of the MPICA sets forth the powers and duties of the Commission:

Sec. 3. (1) The commission shall foster, develop, and promote the potato industry through research, promotion, advertising, market expansion, development of new markets, education, and the development and dissemination of market and industry information. The commission may develop procedures and carry out any other activity necessary to accomplish the purposes of this act.
(2) To accomplish its purpose, the commission shall collect, prepare, and disseminate information relating to all of the following:
(a) The importance of potatoes in human nutrition.
(b) The manner, method, and means used and technology employed in the production, transportation, marketing, processing, and grading of potatoes.
(c) The laws of this state relating to the production, transportation, marketing, processing, and grading of potatoes, to insure a pure and wholesome product.
(d) Factors affecting the potato industry, such as unbalanced production, effect of the weather, influence of consumer purchasing power, and price relative to the cost of other foods.
(e) Branding, labeling, stenciling, sealing, or packaging potatoes to protect their identity.
(f) Other information as may be necessary to promote increased consumption of potatoes, and a better understanding and more efficient cooperation between producers, dealers, and the consuming public.

Mich.Comp.Laws Ann. § 290.423(1), (2).

Section 4 imposes a mandatory assessment “on potatoes grown in the state” levied against growers and shippers in or *1203 der to finance the activities of the commission. Mich.Comp.Laws Ann. § 290.424. Sections 5 and 7 provide for the enforcement of the MPICA by the Department of Agriculture through the imposition of fines. Mich.Comp.Laws Ann. § 290.425, .427. Under section 6, a producer or shipper who fails to pay the mandatory assessment or who fails to comply with the financial reporting and disclosure requirements is guilty of a misdemeanor. Mich.Comp.Laws Ann. § 290.426.

C.

Congress enacted the AFPA in 1968. In the declaration of policy set forth in section 2 of the AFPA, Congress stated in part:

The efficient production and marketing of agricultural products by farmers and ranchers is of vital concern to their welfare and to the general economy of the Nation. Because agricultural products are produced by numerous individual farmers, the marketing and bargaining position of individual farmers will be adversely affected unless they are free to join together voluntarily in cooperative organizations as authorized by law. Interference with this right is contrary to the public interest and adversely affects the free and orderly flow of goods in interstate and foreign commerce.
It is, therefore, declared to be the policy of Congress and the purpose of this chapter to establish standards of fair practices required of handlers in their dealings in agricultural products.

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Bluebook (online)
847 F.2d 1201, 56 U.S.L.W. 2665, 1988 U.S. App. LEXIS 6489, Counsel Stack Legal Research, https://law.counselstack.com/opinion/newark-gardens-inc-v-michigan-potato-industry-commission-ca6-1988.