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Appeals Court Upholds Ruling Against Beef Checkoff

On July 8, 2003, a panel of three judges of the U.S. Eighth Circuit Court of Appeals upheld a June 2002 ruling that deemed the current Beef Checkoff Program unconstitutional. At the same time, however, the Court of Appeals left in effect a stay of injunction that will allow the checkoff program to continue until the court issues its mandate.

"This is certainly a blow, but it's not the end of the battle," said Monte Reese, chief operating officer of the Cattlemen's Beef Promotion and Research Board, which administers the Beef Checkoff Program. "There are further avenues of review that the Department of Justice is considering. In the meantime, we will continue to engage in programs to build demand for beef while this legal process plays out."

The Court of Appeals affirmed the ruling of U.S. District Judge Charles Kornmann, in a case that was brought by the Livestock Marketing Association (LMA) and the Western Organization of Resource Councils (WORC). The plaintiffs argued that the beef checkoff program violates the First Amendment of the Constitution by promoting or advancing the generic sale of beef, against the will of some producers who pay the $1-per-head checkoff.

The Department of Justice, which represents the USDA and the Beef Board in the case, now has 45 days to decide whether to ask for a rehearing by the full slate of judges that sit on the Eighth Circuit in St. Louis. The Department of Justice can also seek review of the case by the Supreme Court. In the meantime, checkoff assessments and programming will continue, as usual.

"Obviously, we're disappointed with this ruling," said Beef Board Chairman Andy Tucker, a producer from Rockledge, Fla. "But there are too many good things happening with the checkoff right now to let this discourage us from continuing our efforts to build demand for beef through the 'Beef. It's What's for Dinner' promotional programs and other checkoff initiatives.

"The checkoff represents the key way for us, as producers, to invest in our futures," Tucker continued, "and I remain confident that the facts will support a reversal of this decision in the long run."

Tucker pointed out that the USDA and Department of Justice have stood strong behind the checkoff program throughout this legal challenge and are expected to continue to do so through the ongoing legal processes.

In independent surveys conducted since the launch of the beef checkoff program nearly 17 years ago, producers have repeatedly voiced strong support for the program, Tucker said. In the latest survey, released in January 2003, about 75 percent of producers said they believed that the Beef Checkoff Program helps them compete against other proteins, such as pork and chicken.

LMA Applauds Decision
Livestock Marketing Association President Billy Perrin said the decision, affirming that the beef checkoff is unconstitutional and unenforceable, "also affirms all American beef producers’ First Amendment, free-speech right."

The 8th Circuit rejected the Cattlemen’s Beef Board’s assertion that its promotion and advertising programs were "government speech," and thus immune from LMA’s first amendment challenge.

The Appeals Court agreed with Federal District Court Judge Charles Kornmann that the beef checkoff is, "in all material respects, identical to the mushroom checkoff," which the U.S. Supreme Court struck down in 2001.

"We conclude," the Appeals Court said, "that the government’s interest in protecting the welfare of the beef industry by compelling all beef producers and importers to pay for generic beef advertising is not sufficiently substantial to justify the infringement" on producers’ First Amendment free speech right.

Noting the Appeals Court statement that, based on its findings, "no remaining aspects of the (Beef) Act can survive," Perrin said, "Hopefully, this decision will bring finality to this long-running dispute."

NFU Pleased with 8th Circuit Court of Appeals Ruling on Beef Checkoff
In response to the Eighth U.S. Circuit Court of Appeals ruling today, National Farmers Union President Dave Frederickson said, "We are pleased with the decision by the Court of Appeals. NFU supports a voluntary, not mandatory, producer controlled checkoff promotion program of U.S. origin commodities."

Agriculture Secretary Ann M. Veneman statement
"I am disappointed that the U.S. Court Appeals for the 8th Circuit upheld the lower court’s ruling that the Beef Checkoff Program is unconstitutional. USDA regards such programs, when properly administered, as effective tools for market enhancement. We are consulting with the U.S. Department of Justice to determine the next steps regarding this matter."

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