Pelts & Skins LLC v. Landreneau

448 F.3d 743, 2006 WL 1163855
Court of Appeals for the Fifth Circuit·Decided April 2, 2004·No. 03-30523·Published·Cited by 1 cases

Opinion

365 F.3d 423

PELTS & SKINS, LLC, Plaintiff-Appellee,
v.
William Dwight LANDRENEAU, Secretary for the Department of Wildlife and Fisheries, Defendant-Appellant.

No. 03-30523.

United States Court of Appeals, Fifth Circuit.

April 2, 2004.

Alex J. Peragine (argued), Covington, LA, for Plaintiff-Appellee.

C. Berwick Duval, II (argued), Stanwood Robert Duval, Duval, Funderburk, Sundbery, Lovell & Watkins, Houma, LA, for Defendants-Appellants.

Appeal from the United States District Court for the Middle District of Louisiana.

Before KING, Chief Judge, and BENAVIDES and CLEMENT, Circuit Judges.

BENAVIDES, Circuit Judge:

Plaintiff-Appellee Pelts & Skins farms alligators in Louisiana. Defendant-Appellant William Dwight Landreneau is Secretary of the Louisiana Department of Wildlife and Fisheries ("DWF"), the agency responsible for overseeing conservation of alligators.1 Louisiana requires alligator hunters and farmers to pay various fees, and DWF uses a portion of those fees to support generic marketing of alligator products. Pelts & Skins alleges that this practice constitutes a compelled subsidy for private speech that violates the First Amendment. The district court agreed with Pelts & Skins and permanently enjoined use of the fees to support generic marketing of alligator products.

We conclude that Pelts & Skins lacks standing to challenge the use of certain alligator-related fees. With regard to the fees Pelts & Skins does have standing to challenge, we agree with the district court that the use of those fees for generic marketing violates the First Amendment. We therefore affirm in part, vacate in part, and remand in part.

I.

The American alligator was once endangered, but Louisiana law now allows the hunting and farming of alligators for their meat and skins. DWF regulates the hunting, farming, processing, and shipment of alligators and alligator parts. See La.Rev.Stat. Ann. § 36:602(B) (West Supp.2004). DWF does not regulate the prices or marketing of alligators, but it does administer two funds, the proceeds of which support generic marketing of alligator products: the Louisiana Fur and Alligator Public Education and Marketing Fund (the "Marketing Fund") and the Louisiana Alligator Resource Fund (the "Resource Fund"). The generic marketing supported by these two funds is the focus of this case.2

The Marketing Fund derives its revenues from license fees, i.e., the fees associated with the hunting licenses that fur trappers and alligator hunters must carry. See id. §§ 56:251(A), 56:266(D). Twenty dollars of every twenty-five-dollar license fee are earmarked for the Marketing Fund.3 Id. The Louisiana Legislature created the Marketing Fund to market alligator and fur products, to educate the public about the harvesting of those products, and to recommend strategies to the fur and alligator industry. Id. § 56:266(B).

The Resource Fund derives its revenues from a variety of fees imposed on alligator hunters, farmers, and processors. Id. § 56:279. The most notable of these fees is the tag fee, a charge for the tag that must be attached to every harvested alligator skin. Id. § 56:253(C).4 The Legislature created the Resource Fund "to help defray the cost of alligator programs" administered by DWF. Id. § 56:279(A). The Resource Fund supports alligator-related research and, when surplus funds are available, helps to fund alligator-related law enforcement and marketing programs. Id. § 56:279(B).

DWF monitors both funds, and the Secretary must approve all expenditures for generic marketing, but another state-created entity, the Louisiana Fur and Alligator Advisory Council (the "Council"), is directly responsible for the content of the generic marketing and must review and approve all expenditures from the funds. Id. §§ 266(C), 279(D)(3). The Council comprises the Secretary (or his designate), who serves ex officio, and eleven appointed members. Id. § 56:266(C). The speaker of the House and the president of the Senate each appoint one member. Id. The Secretary appoints nine members, and those nine members must represent "a cross-section of trappers, alligator hunters, coastal landowners, and alligator farmers." Id. Two of those nine members must represent a private organization, the Louisiana Alligator Farmers and Ranchers Association. Id. The Secretary may appoint the remaining seven members based on nominations from the Louisiana Trappers and Alligator Hunters Association. Id.

Pelts & Skins, as Louisiana's (and the world's) largest alligator farming operation, pays fees that account for roughly 25% of the alligator-related revenues received by DWF. Pelts & Skins does not object to the collection of these revenues but does object to the expenditure of these funds on generic marketing. According to Pelts & Skins, its business depends on convincing consumers that it produces a unique product that is superior in quality to other alligator products. Generic alligator marketing undercuts this message because generic marketing does not differentiate between particular types, qualities, or brands of alligator products, but rather promotes the notion that alligator products in general are desirable, reliably available, and lawfully produced.5 Pelts & Skins also hints broadly that the Council's generic marketing campaign, which consists mainly of sending representatives to fashion shows and setting up educational displays, is a boondoggle. However, Pelts & Skins is quick to clarify that its objection to generic marketing stems from the message of that marketing, not its efficacy.

Based on its objection to the generic marketing's content, Pelts & Skins sought to enjoin DWF from expending revenues from the Marketing Fund and the Resource Fund for generic alligator marketing. According to Pelts & Skins, Louisiana violated the First Amendment by imposing mandatory fees on Pelts & Skins, then using those fees to subsidize a message with which Pelts & Skins disagrees. In response, the Secretary argued (1) that the Tax Injunction Act of 1937 barred federal jurisdiction; (2) that the generic marketing at issue was government speech not subject to First Amendment scrutiny; and (3) that, in the alternative, the generic marketing was merely ancillary to a broader cooperative regime and therefore consistent with the First Amendment.

The parties agreed to submit the case on the record without live testimony. The district court determined (1) that the Tax Injunction Act did not bar federal jurisdiction; (2) that the generic marketing was not government speech; and (3) that the use of mandatory fees to fund generic marketing was not ancillary to a broader cooperative regime. Pelts & Skins, L.L.C. v. Jenkins, 259 F.Supp.2d 482 (M.D.La.2003).

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Pelts & Skins LLC v. Landreneau, 448 F.3d 743, 2006 WL 1163855 (5th Cir. 2004).

448 F.3d 743 (Pelts & Skins LLC v. Landreneau) — published by Counsel Stack Legal Research, free access to 12M+ legal documents.

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