Wegman's Food Markets, Inc. v. State

76 A.D.2d 95, 429 N.Y.S.2d 964, 1980 N.Y. App. Div. LEXIS 11732
CourtAppellate Division of the Supreme Court of the State of New York
DecidedJuly 10, 1980
StatusPublished
Cited by12 cases

This text of 76 A.D.2d 95 (Wegman's Food Markets, Inc. v. State) is published on Counsel Stack Legal Research, covering Appellate Division of the Supreme Court of the State of New York primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Wegman's Food Markets, Inc. v. State, 76 A.D.2d 95, 429 N.Y.S.2d 964, 1980 N.Y. App. Div. LEXIS 11732 (N.Y. Ct. App. 1980).

Opinion

OPINION OF THE COURT

Cardamone, J. P.

In this declaratory judgment action appellant, Wegman’s Food Markets, Inc. (Wegman’s), seeks a declaration that New York’s Unit Pricing Statute, former section 193-h of the Agriculture and Markets Law (repealed and renumbered as section 214-h [L 1977, ch 874, §§ 1, 3]) is unconstitutional. Appellant further seeks to permanently enjoin defendant-re[97]*97spondent J. Roger Barber, Commissioner of the Department of Agriculture and Markets, from enforcing the statute.

Designed to facilitate comparative pricing by consumers, section 193-h of the Agriculture and Markets Law, enacted in 1974, requires certain retailers to provide unit price information to their customers. Only food stores, or those stores "selling primarily food at retail”, which are not primarily selling food for consumption on the premises, fall within the reach of the statute. Among food stores there is an exclusion for those engaged in a specialty trade (e.g., bakeries or delicatessens) which the commissioner determines by regulation to be inappropriate for unit pricing (§ 214-h, subd 2, par b). Stores with annual gross sales of less than two million dollars are also excluded. Drug stores which compete with appellant, such as Rite-Aid, CVS Pharmacy and Fay’s Drugs, are exempted from the unit pricing requirement since they are not engaged in "selling primarily food”. The statute originally covered only three categories of consumer commodities commonly found in food stores: food, paper products and cleansing agents. Appellant did not contest this regulation and, in fact, had been providing its customers with unit pricing information on these items even before the enactment of section 214-h. In 1976 the statute was amended (L 1976, ch 420) by adding a fourth category of consumer commodities subject to unit pricing: "non-prescription drugs, female hygiene products and toiletries” (§ 193-h, subd 2, par a, cl [4]). Wegman’s sells up to 5,000 items known as health and beauty aids, which include many of these commodities. It claims that because this latest unit pricing requirement will increase its cost of doing business and injure its competitive position the statute violates due process. Since its major rivals in home health and beauty aid sales—large drug and variety stores—are not similarly subject to the regulation, Wegman’s argues that it also violates its constitutional right to equal protection. Finally, it alleges that the definitions in the statute are unconstitutionally vague.

The record before us reveals that Wegman’s operates 32 retail stores which sell food, related grocery products and general merchandise. It has voluntarily provided a computerized unit price information system in all of its stores since 1972. However, in order to comply with the amended version of the unit pricing statute, it will have to design and install a new computerized unit price information disclosure system. [98]*98Additional difficulties in this task result from the fact that some of these items are not warehoused by Wegman’s, but are delivered directly to the stores. Because Wegman’s currently does not maintain data concerning price and price changes, it claims that it will incur additional expenditures to comply with the amended version of the statute. The wholesalers who supply these items are responsible for inventoring and pricing them.

Respondents rely on various documents to demonstrate that the statute serves a legitimate purpose. The legislative enactment was intended to aid consumers in protecting the buying power of their food dollars. Based on research studies considered by the Legislature, unit pricing is effective in reducing price differences, making price increases more obvious to the purchaser and discouraging manufacturers from disguising price increases by reducing package size (NY Legis Ann, 1974, p 276). It is estimated that unit pricing of food products can save a shopper approximately 10% in food bills. The Legislature also found that the cost of implementing a unit pricing system would not exceed $2,500 per year and that this cost is relatively constant, regardless of the size of the store. As a result, unit pricing would impose a harsh burden on the exempted small store, but not an unreasonable burden on a large or medium-sized store. The 1976 amendment was designed to complete the purpose of the original enactment by "bringing under its coverage an important category of items found in most supermarkets” (NY Legis Ann, 1976, pp 71-72). The Legislature found that since these products come in a variety of shapes and sizes, comparison shopping is rendered difficult in the absence of unit pricing.

With respect to Wegman’s initial argument, it is well settled that the due process clause affords little protection from State regulation in the economic sphere. As long as the Legislature selects means which are reasonably calculated to serve a proper governmental purpose, the requirements of due process are satisfied. Only a minimal level of rationality is necessary to save an economic regulatory statute from constitutional attack on due process grounds, or, to put it another way, only where the State interferes with a citizen’s property without "rhyme or reason” does a deprivation of due process occur (Defiance Milk Prods. Co. v Du Mond, 309 NY 537, 541). As the Supreme Court stated in Williamson v Lee Opt. Co. (348 US 483, 488) "[t]he day is gone when this Court uses the [99]*99Due Process Clause of the Fourteenth Amendment to strike down state laws, regulatory of business and industrial conditions, because they may be unwise, improvident, or out of harmony with a particular school of thought [citations omitted]”. Moreover, the one challenging a statute on these grounds must overcome a heavy presumption of constitutionality (Montgomery v Daniels, 38 NY2d 41, 54). Applying these standards to the unit pricing statute involved in this case, it is apparent that appellant has not met its burden of demonstrating unconstitutionality. Wegman’s recognizes that unit pricing is a useful and helpful service and concedes that it is "logically and factually related to the valid public purpose of providing consumers with comparison shopping data”. The Legislature could reasonably have concluded that unit pricing promotes accurate price information and enables the shopper to reduce his expenses. Further, the Legislature found, based upon research, that the costs in complying with the statute would be minimal. The requirement of unit pricing does not, therefore, constitute an unreasonable interference with appellant’s business activities in violation of its right to due process.

Wegman’s principal argument is that the statute violates its right to equal protection because it treats food stores and other stores, selling identical products, differently. It agrees that the statute, as originally enacted, was valid, but contends that the 1976 amendment, adding the fourth category of consumer commodities, rendered it constitutionally defective. It argues that the original validity of the statute stemmed from the fact that all of the items which food stores were required to unit price were items sold primarily by food stores. Thus, it made sense to require only food stores to unit price these items. However, the added items, "non-prescription drugs, female hygiene products and toiletries”, are equally available to prospective purchasers in unregulated retail stores. In fact, as appellant points out, it derives less than 10% of its business from the sale of these items, while drug stores and general merchandise stores concentrate nearly exclusively on these items.

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Bluebook (online)
76 A.D.2d 95, 429 N.Y.S.2d 964, 1980 N.Y. App. Div. LEXIS 11732, Counsel Stack Legal Research, https://law.counselstack.com/opinion/wegmans-food-markets-inc-v-state-nyappdiv-1980.