Supreme Court of the United States
EUGENE SCHRODER; EDWIN PETROWSKY; R. RUSSELL GRIDER; and WESLEY MYERS,
GEORGE W. BUSH, President of the United States; ANN M. VENEMAN, United States Secretary of Agriculture; PAUL H. OíNEILL, United States Secretary of the Treasury; and UNITED STATES OF AMERICA,
On Petition For A Writ Of Certiorari
United States Court Of Appeals For The Tenth Circuit
PETITION FOR A WRIT OF CERTIORARI
WALKER F. TODD
Counsel of Record
Attorney at Law
1164 Sheerbrook Drive
Chagrin Falls, Ohio 44022
Attorney for Petitioners
Petitioners, a group of four farmers residing in Colorado, New Mexico, and Kansas, brought an action against the United States for an injunction against farm foreclosures until parity pricing principles, declared to be the underlying law of U.S. agriculture in 1933 and never repealed or suspended, were enforced in the United States. They also sought a declaratory judgment regarding the continuing validity and effect of farm parity, which they argued was the principal component of a four-part compensatory scheme for market conditions in agriculture enacted in the mid-1930s to validate the regulatory taking of U.S. farmersí production rights under the Agricultural Adjustment Act of 1933. 7 U.S.C. Section 601. They argue that the taking continues, that neither parity nor other components of the four-part scheme are enforced for the benefit of U.S. agriculture even though the powers at issue were delegated for the principal benefit of agriculture, together with other key economic sectors, and that these powers were delegated permanently and unconstitutionally, without intelligible principles by which they may be reviewed, and in some instances without submission to political review through the congressional appropriations process. The Tenth Circuit nevertheless held that the district court ruled properly in dismissing the action below for (a) raising nonjusticiable political questions and (b) failing to state a cause of action on which relief could be granted, the relief requested raising matters of (principally) executive branch discretion.
The questions presented are:
Whether the enforcement of laws already on the statute books, the factual basis of the relief requested here, raises nonjusticiable political questions, as distinguished from the typical political question in which one party or another seeks adoption of a novel policy;
Whether the subject matter of the amended complaint below raises issues that are so involved with executive branch discretion, especially in foreign policy matters and their application to U.S. domestic agriculture, that the federal courts should not and cannot grant forms of relief that invade such discretionary areas; and
Whether it is constitutional, on
its face or as applied, for Congress to delegate permanently to the executive
branch, without statutory articulation of intelligible principles for the
delegation or statutory subjection of the delegation to political review
through the appropriations process, subject matters that the U.S. Constitution
textually confides to Congress alone (or in one instance, a shared power
of the executive and legislative branches that effectively is exercised
by the executive branch alone).
STATEMENT PURSUANT TO RULE 29.6
Petitioners Eugene Schroder,
Edwin Petrowsky, R. Russell Grider, and Wesley Myers each and all state
that they are suing the United States in the present action in their individual
capacities and that none of them and none of their farming interests is
or has been since the commencement of the present action a subsidiary or
an affiliate of any publicly owned corporation. None of them
is the owner of more than a ten percent interest in any corporation.
No publicly owned corporation has a financial interest in the outcome of
this petition for certiorari.
TABLE OF CONTENTS
TABLE OF AUTHORITIES
PETITION FOR A WRIT OF CERTIORARI
Petitioners respectfully petition
for a writ of certiorari to review the judgment of the United States Court
of Appeals for the Tenth Circuit in this case.
The district courtís opinion
(per Kane, J.) dismissing petitionersí complaint (Appendix ["Pet. App."]
17a-18a) is unpublished at this writing. The ruling by the court
of appeals (per Ebel, J., joined by McWilliams and Brimmer, JJ.) affirming
(Pet. App. 1a-16a) is published at 263
F.3d 1169. There are no subsequent hearings or opinions.
STATEMENT OF JURISDICTION
The court of appeals entered
its opinion on August 24, 2001. Petitioners invoke this Courtís jurisdiction
under 28 U.S.C. Section 1254 (1).
CONSTITUTIONAL AND STATUTORY PROVISIONS INVOLVED
The constitutional provisions relevant to this petition are as follows: In Article I (congressional powers), section 1 (legislative power); section 7 (origin of revenue bills); section 8, clauses 2 (borrowing money), 3 (regulation of interstate and foreign commerce), and 5 (coining and regulating value of money and of foreign coin); and section 9, clause 7 (appropriations). In Article II (executive powers), section 1, clause 1 (executive power) and section 2, clause 2 (treaty power). In Article IV (general powers), section 4 (guarantee or republican form of government). Among the Amendments, number 5 (due process and taking clauses) and number 14 (civil rights), section 1 (privileges and immunities, due process, and equal protection clauses). The pertinent constitutional texts are reprinted in the Appendix at 19a-21a.
The principal set of statutes relevant
to this petition is the Agricultural Adjustment Act of May 12, 1933, as
amended (7 U.S.C. Section 601, et seq.), together with associated agricultural
statutes, of which pertinent portions are reprinted in the Appendix at
22a-51a. Jurisdictional statutes cited either in the court of appeals
opinion or petitionersí briefs below and referred to here include the Administrative
Procedure Act (5 U.S.C. Section 702), general federal jurisdiction under
28 U.S.C. Section 1331, and various portions of Title 28, of which pertinent
portions are printed in the Appendix at 22a, 62a-67a. Money and banking
statutes relevant to this petition are various provisions of the Federal
Reserve Act from Title 12 (Pet. App. at 51a-53a) and the Gold Reserve Act
of 1934 from Title 31 (Pet. App. at 67a-71a). Antitrust and national
policy goals statutes relevant to this petition are from Title 15 (Pet.
App. at 54a-58a). Provisions of the Trade Agreements Act of 1934,
as amended (19 U.S.C. Section 1351), that are relevant to this petition
are reprinted in the Appendix at 58a-62a. Provisions of the International
Emergency Economic Powers Act (50 U.S.C. Section 1701, et seq.) that are
relevant to this petition are reprinted in the Appendix at 71a-78a.
STATEMENT OF THE CASE
1. Positive Statement of the Petitionersí Case
Petitioners, since the inception of their actions leading to the filing of the complaint and amended complaint in the district court, consistently have made the entirety of the following argument, which is the positive statement of their case:
During the perceived national economic emergency in early 1933, executive branch authority to promulgate extraordinary orders for the regulation of the domestic U.S. economy in peacetime was founded on a World War I wartime statute, the Trading With the Enemy Act of 1917. Doubts about the presidentís peacetime authority to issue the bank holiday order on March 6, 1933, and related orders were to be resolved by congressional passage of resolutions supporting those orders on March 9, 1933. The national economic emergency was extended to U.S. agriculture by the Agricultural Adjustment Act of May 12, 1933, as amended (AAA). 7 U.S.C. Section 601, et seq. (Pet. App. at 22a-51a). This emergency, as applied to domestic U.S. agriculture, never has been allowed to expire. Compare 7 U.S.C. Section 613 (AAA ends whenever the president or secretary of agriculture says that it ends, Pet. App. at 28a) with 7 U.S.C. Section 7301 (list of statutes suspended or repealed by the "Freedom to Farm Act" of 1996, including none of the statutes cited in this petition, Pet. App. at 48a-51a). The continued regulation of U.S. farmersí production rights constituted and still constitutes a statutory and regulatory taking of a private property right for which just compensation has to be paid if the taking is to be constitutional, either on its face or as applied.
In lieu of direct monetary compensation for the 1933 taking of farmersí production rights, ample authority documents that Congress authorized the executive branch to offer farmers a four-part compensatory scheme intended to create market conditions in agriculture conducive to the establishment of pricing parity. 7 U.S.C. Section 602 (a)(1) (Pet. App. at 26a). The first of the four parts of that scheme, parity, was to be calculated according to formulas set forth in 7 U.S.C. Section 1301 (a) (Pet. App. at 29a-32a), essentially based on a comparison of the index of farm prices received vs. costs of farmersí inputs for the base period 1910-1914. Id. at Section 1301 (a)(1)(B). The parity provisions of the AAA have been amended many times, including a 1949 restatement that is the underlying law of parity today. See, e.g., 7 U.S.C. Section 1301 (a)(1)(G) (Pet. App. at 31a). Subsequent farm bills enacted every four or five years essentially have been mere suspensions of parity or, as one authority on parity explained it, "alternative means of reaching parity": In the absence of enactment of a new farm bill, the underlying parity provisions of the AAA (in this case, 1949 parity) automatically become the operative law of the land in agriculture. See, Randy Cook, History of Parity, Sept. 29, 2000 (unpublished), in Appendix for Plaintiffsí (Petitionersí) Appellate Brief (this case), at 17-24, filed in 10th Cir., Oct. 29, 2000. Parity is still referred to as a national goal for agriculture. 15 U.S.C. Section 1022c (C)(ii) (Pet. App. at 57a). Parity still is the basis for the compensatory formula for U.S. farmers adversely affected by trade embargoes implemented by the executive branch in pursuit of foreign policy goals. 7 U.S.C. Section 5671 (b)(1)(C), (b)(2) (Pet. App. at 47a-48a). This statute was enacted in 1979, and 15 U.S.C. Section 1022c was amended as recently as 1990. If parity is no longer the law of the land, having expired with either the 1938 revision of the AAA or the post-1955 train of intermediate-term farm bills that culminated in the Freedom to Farm Act of 1996 (7 U.S.C. Section 7301, Pet. App. at 48a-51a), as critics of the Petitionersí lawsuit contend, then how does one explain these statutes? Moreover, a series of U.S. Supreme Court decisions from the 1930s to the present moment (cited in connection with this argument in Reasons for Granting the Writ below) also has confirmed the currency of parity as the underlying agricultural law of the land by reference to it.
The second part of the four-part compensatory scheme for agriculture from the mid-1930s is foreign exchange regulation. Under 31 U.S.C. Section 5301 (Pet. App. at 67a-68a), originally part of the Thomas Amendment of AAA (May 27, 1933), the President is authorized to require the Secretary of the Treasury to enter agreements with the Federal Reserve Banks and the Board of Governors to conduct open-market operations in support of Treasury objectives if U.S. foreign commerce is adversely affected by instability in the value of foreign coins and currency. Later, on January 30, 1934, Congress enacted the Gold Reserve Act, now codified at 31 U.S.C. Section 5302 (Pet. App. at 69a-70a), to authorize the Secretary of the Treasury, subject to the Presidentís approval, to operate the present Exchange Stabilization Fund (ESF) with respect to foreign exchange market interventions.
It appears that originally loans to foreign countries by the ESF were not contemplated. Indeed, other federal departments, such as Commerce or State, or agencies, such as the former Reconstruction Finance Corporation or the Agency for International Development, made such loans, but practices evolved between the Treasury and the Federal Reserve since about 1960 (including Federal Reserve funding of the ESFís loans outside the congressional appropriations process) that eventually (1977-1978) gave rise to congressional restrictions on ESF loans. See, e.g., id. at Section 5302 (b) and (c) (Pet. App. at 69a-70a); former Mexican Debt Disclosure Act of 1995, codified following this section, expired in 1997 (Pet. App. at 70a). Section 5304 (Pet. App. at 71a) authorizes the Secretary of the Treasury to issue any necessary regulations under both Sections 5301 and 5302.
The sticking point in this set of statutes, originally enacted in the full flowering of the Presidentís near-dictatorial powers under the First New Deal, is the provision that, subject to the Presidentís approval, the ESF
is under the exclusive control of the Secretary [of the Treasury], and may not be used in a way that direct control and custody pass from the President and the Secretary. Decisions of the Secretary are final and may not be reviewed by another officer or employee of the Government.Id. at Section 5302 (a)(2) (Pet. App. at 69a)(part of original statutory language, never amended). The Federal Government argues that this language means that no court may review actions of the ESF and that Congress also receives reports about ESF activity only by grace of the executive branch, not by any statutory or constitutional right. A more appropriate interpretation of this set of statutes is that (1) they should be construed together, 31 U.S.C. Sections 5301-5304 (Pet. App. at 67a-71a); (2) the Treasury cannot evade review of agency action (in this case, for an agency that existed before the first Administrative Procedure Act was enacted in 1940) merely by failing to issue appropriate regulations; (3) the "sole and unreviewable control of the President and Treasury" language for the ESF is unconstitutional on its face and reasonably should be interpreted to save its constitutionality by allowing the federal courts to review the agencyís actions; and (4) in exercising appropriate authority over the ESF under the relevant statutes, the President and Secretary of the Treasury should take note of market conditions in U.S. agriculture rationally and demonstrably caused by the depreciation of particular foreign currencies and coins from their normal standards of value.
This much rationally appears to be comprehended within the existing ESF statutes: It cannot be argued credibly in a constitutional republic that the President and the Secretary of the Treasury may use the ESF as personal piggy banks of foreign exchange in the nature of executive branch slush funds. See, Anna J. Schwartz, Time to Terminate the ESF and IMF and Declaration of Anna J. Schwartz, in Walker F. Todd, ed., Time to Abolish the International Monetary Fund and the Treasuryís Exchange Stabilization Fund: Documents on Their Origins, Consequences, and Failures, With a Roadmap to Abolition, 4-27, 28-34, Monograph No. 54 (Dec. 1998), Comm. for Monetary Research & Educ. The basic argument of Petitioners with respect to the ESF is that U.S. foreign exchange policy since 1995 has been conducted without regard to the interests of U.S. agriculture. However, the nature of the extraordinary authority over foreign exchange delegated to the President and the Secretary of the Treasury, 31 U.S.C. Section 5302 (a)(2) (Pet. App. at 69a), and the general deregulation of the production controls side of U.S. agriculture under the Freedom to Farm Act of 1996, 7 U.S.C. Section 7301 (Pet. App. at 48a-51a), objectively require the President and the Secretary of the Treasury to take the interests of U.S. farmers into account in managing foreign exchange and in structuring post-currency-devaluation International Monetary Fund (IMF) bailouts of major foreign competitors of U.S. agricultural producers, like those for Brazil (1999-2000), Argentina (2000-2001), and Turkey (2001).
Petitioners contend that the ESF, both as created and as administered, is unconstitutional, both on its face and as applied. The statute originally creating the ESF as an emergency measure, subsequently renewed at two-year intervals, might have strengthened some of the modern jurisdictional objections to any case challenging the ESFís creation by providing for expiration of the authority delegated to the President and the Secretary of the Treasury before the next succeeding session of Congress. Such an agency clearly could be reformed within the political operations of the executive and legislative branches and, moreover, by the time any court challenge to the ESF reached the U.S. Supreme Court, the matter probably would have been moot if the authorizing statute were allowed to expire without renewal. However, the permanent creation and existence of the ESF as it stands, not subject to annual appropriations except for its incidental operating expenses (see, U.S. Constitution, Art. I, Sec. 9, cl. 7, in Appendix at 19a), an entity that lacks articulated intelligible principles for its operation, and exercising exclusively a power (the regulation of foreign exchange) that in the text of the Constitution is reserved to Congress alone (Art. I, Sec. 8, cl. 5, in Appendix at 19a) and is nowhere given to the executive branch unless it be within the general executive powers (Art. II, Sec. 1, cl. 1, in Appendix at 19a), raises all the issues of the non-delegation doctrine discussed in Justice Thomasís concurring opinion in Whitman v. American Trucking Assín, Inc., 531 U.S. 437, 121 S.Ct. 903, 919-920 (2001) (Pet. App. at 79a-80a), citing J.W. Hampton, Jr., & Co., v. United States, 276 U.S. 394, 408 (1928) (on the "intelligible principle" doctrine for congressional delegations of power).
The third component of the 1930s four-part compensatory scheme for U.S. agriculture that is at issue in Petitionersí case is the Trade Agreements Act of June 12, 1934, as amended (19 U.S.C. Section 1351, Pet. App. at 58a-62a). This Act, also passed by the First New Deal Congress, created the executive branch Office of the U.S. Trade Representative (OTR). Previously, trade agreements with foreign countries were viewed as treaty matters and typically were negotiated by representatives of both the executive branch and the U.S. Senate, reflecting the shared treaty-making power. U.S. Constitution, Art. II, Sec. 2, cl. 2. (Pet. App. at 20a). One of the possibly unforeseen consequences of the Act creating the OTR was that the operations of that office became swept into the general rubric of the unilateral executive branch conduct of foreign affairs, a doctrine that acquired great currency for the first time in the mid-1930s, albeit without foundation in previous constitutional jurisprudence or actual practice. After all, what precedents does Justice Sutherland cite for his famous dictum in Curtiss-Wright? See, e.g, United States v. Curtiss-Wright Export Corp., 299 U.S. 304, 320 (1936). In granting the President and the OTR extraordinary authority to make executive trade agreements with the practical legal effect of treaties in derogation of the constitutionally shared treaty-making power, Congress stated explicitly that the President, "in the course of negotiating any foreign trade agreement under this section [19 U.S.C. Section 1351], should seek advice from representatives of industry, agriculture, and labor." (Emphasis added.) Id. at Section 1351 (f) (Pet. App. at 62a). Petitioners contend that, especially in post-1993 trade agreements (supremely exemplified in the North American Free Trade Agreement with Mexico in 1993), the interests of U.S. farmers were not consulted, or were ignored if they were. The issue of statutory interpretation raised is whether the statute just cited, expressing the "sense of the Congress," is a binding condition on the Presidentís exercise of the OTR authority delegated by this statute. If it is, then like parity and foreign exchange regulation before it, this third element of the 1930s four-part compensatory scheme for the statutory and regulatory taking of U.S. agricultural production rights has been abandoned.
The fourth element of the four-part compensatory scheme is regulation of market concentrations in agriculture. The Sherman Anti-Trust Act of 1890 was amended in 1937 specifically to increase the authority of the U.S. Department of Justice to initiate anti-trust enforcement actions against persons whose activities tended to increase market concentrations in agriculture. 15 U.S.C. Sections 1, 18 (Pet. App. at 54a-56a). Section 18 of this title in particular prohibited acquisitions of shares of stock or assets of other persons where the effect of the acquisitions would be "substantially to lessen competition, or to tend to create a monopoly." At the same time, 7 U.S.C. Sections 291 and 292 (Pet. App. at 22a-25a) essentially prohibited farmers from combining to raise prices.
In the thinking of the creators of anti-trust policy in the 1930s, it would have made little sense to promise farmers parity, on the one hand, and then to allow sellers of farmersí inputs, or buyers of their outputs, to concentrate their resources through mergers and acquisitions and thereby regain pricing power over farmers that the promise of parity was intended to prevent. Still, through governmental inaction, at both the federal and the state levels in recent decades, sellers of farmersí inputs have been allowed to concentrate their resources so that farmers have far fewer choices about brands of equipment, seeds, fertilizers, etc., to purchase and of places to purchase them than only a few decades ago. Similarly, farmer producers selling the main commodity crops that have been the subjects of extensive U.S. Department of Agriculture regulation and subsidies since the 1930s increasingly confront a paucity of buyers. In Kansas, for example, a major wheat-producing state, only 18 flour mills bid for grain today, and only two of them could be regarded as truly independent of the four large, multinational grain companies that control the U.S. grain trade. See, Ed Petrowsky, On Flour Mills in Kansas (unpublished), Oct. 19, 2000, in Appendix for Plaintiffsí Appellate Brief (this case) at 25, filed October 29, 2000.
Worst of all, concentrations in production techniques due to the spread of contract farming and direct competition (some of it subsidized by U.S. government programs) with U.S. farmers from offshore production facilities owned or controlled by the four largest multinational grain companies have presented U.S. farmers with unforeseen difficulties that arise from the failure of official anti-trust policy enforcement. Thus, the fourth and final element of the compensatory scheme for the taking of U.S. farmersí production rights also has failed as an outgrowth of official U.S. governmental policy.
What is the upshot of the positive statement of the Petitionersí case? It is fundamentally a takings case, but a takings case of a sort that the federal courts do not usually encounter. It involves a statutory or regulatory taking of a production right, not of legal title to the land that the Petitioners own (other than through foreclosures). They seek no monetary damages or relief.
The Petitioners seek only (a) a moratorium on farm foreclosures, originally requested to be enforced by an injunction, and (b) a declaratory judgment stating that parity remains the overriding federal law of the land regarding U.S. agriculture until Congress amends or repeals the relevant statutes. They seek no new appropriations of funds for agricultural relief or support programs. In the courts, they seek no reallocation of appropriated funds.
The moratorium on farm foreclosures, pending full implementation of parity pricing principles or other policy actions amounting to renewed co-ordination aimed at implementing the four-part scheme to restore orderly marketing conditions in agriculture, is a form of relief that the federal courts could grant. If there were questions regarding the authority of the federal courts to order a moratorium affecting defendants who were not represented in the case, then the relief could be confined to only foreclosures arising from federally funded farm mortgages (e.g., those issued by the Farm Credit System or the Farmers Home Administration). The next broader area of relief via moratorium, arguably still within the circle of the federal courtsí jurisdiction, would affect all farm mortgages that are federally insured or guaranteed or issued by federally chartered institutions. This would involve national banks and holders of federally insured or guaranteed farm mortgages, for example.
The court of appeals expressed concern at oral argument about issuing an injunction that would affect adversely persons not represented by attorneys from the U.S. Department of Justice, and it is conceded that the courtís concern might be well-taken. However, all federally funded farm mortgages ultimately flow through either the Treasury or the Department of Agriculture or both, and issuers and holders of federally insured or guaranteed farm mortgages have been exposed to similar debt restructurings since the 1986 rescue of the Farm Credit Administration. The next outward ring of defendants-respondents affected by a moratorium ordered by the federal courts might be federally insured financial institutions, regardless of chartering authority. Federally insured banks, savings and loans, and credit unions are used to filing reserve requirement reports with the Federal Reserve by virtue of their eligibility for federal deposit insurance. A safe dividing line within this category might be requiring all federally insured depository and lending institutions to be subject to the moratorium but exempting uninsured but eligible institutions.
Regarding a declaratory judgment
on parity, the statutory basis for such a declaration by the federal courts
is clear. Any new farm bill enacted by Congress next year (the current
farm bill, Freedom to Farm Act of 1996, expires in September 2002) must
either put in place some compensatory scheme in place of parity pricing
principles, or the 1949 parity legislation will revert to being the law
of the land in agriculture. Compare 7 U.S.C. Section 1301 (a)(1)(E)-(G)(Pet.
App. 30a-31a) with 7 U.S. C. Section 7301 (Pet. App. 48a-51a). Current
press reports (mid-November 2001) indicate that both the House of Representatives
and the Senate will reject the reforms proposed by the White House and
the ranking minority member of the Agriculture Committee, Senator Richard
Lugar (R.-Ind.), and will adopt instead a five-year farm bill (Senate version)
or a ten-year farm bill (House version) that "places no limits on subsidies
to Americaís wealthiest farmers and increases spending for conservation
and food stamps." Elizabeth Becker, $88 Billion Farm Bill Wins Approval
of Senate Panel, N.Y. Times, Nov. 16, 2001, at A-18. The federal
courts are competent to grant the forms of relief requested in the courts
2. Statement of the Appellate Case: Petitionersí Case for Review
The U.S. District Court for the District of Colorado dismissed Petitionersí complaint as raising nonjusticiable political questions and for requesting forms of relief that could not be granted (implicitly, as purportedly requiring judicial invasions of areas of executive branch discretion where the courts have given the executive broad leeway, as in the conduct of foreign affairs). Following oral argument before a three-judge panel in Denver, Colorado, on March 12, 2001, the Tenth Circuit affirmed, noting that the Petitioners must seek relief for the issues raised in the complaint (generally, the current plight of the small family farmer) in the elected branches of government. Schroder v. Bush, 263 F.3d 1169, 1171-1172 (10th Cir. 2001) (Pet. App. at 1a, 2a-5a). In addition, the Tenth Circuit found that the Petitionersí takings claim (U.S. Constitution, Amends. 5 and 14, cl. 1, in Appendix at 20a-21a) failed, having been presented inadequately on appeal, and also that it was time-barred. 263 F.3d 1169, 1176-1177 (Pet. App. at 1a, 14a-16a).
The court of appealsí holdings merit this Courtís immediate review because each and every one of the grievances cited in the Petitionersí amended complaint continues unabated and unrelieved to the present moment (mid-November 2001). Left undisturbed, the Tenth Circuitís opinion will become a precedent for unilateral, unreviewed, and unreviewable executive branch conduct of foreign commercial or banking operations (through the Treasuryís ESF), a power that the Constitution explicitly delegates to Congress alone (regulating the value of foreign exchange). At risk is the principle that the executive can do almost anything, almost anywhere, no matter how thoroughly commercial, escaping both judicial review and the checks and balances intended to be provided through the annual or biennial appropriations process, usurping the powers of Congress in the process, as long as the executive plausibly can characterize its activity as having anything at all to do with the conduct of foreign affairs. Nondelegation principle issues of the type discussed in Hampton and Whitman, supra, are raised squarely in this case regarding both the foreign trade agreements (OTR) and foreign exchange regulation (ESF) powers and were briefed in both the district court and the Tenth Circuit, but the Tenth Circuit did not reach these issues in its opinion. See, e.g., Plaintiffsí (Petitionersí) Appellate Brief (10th Cir.) at 26-28, filed October 29, 2000.
The court of appealsí holdings further merit this Courtís immediate review because the Tenth Circuitís opinion will be added to the federal governmentís litany of inapposite case citations on the proper interpretation of the doctrine of nonjusticiability of political questions and on the proper classification of cases falling within the parameters of that doctrine. Most of the cases cited in the governmentís briefs and in the Tenth Circuitís opinion on this point did not, in their holdings, reflect prudential judicial abstention from affairs constitutionally confided to the elective branches of government; in fact, in most of those cases, including the granddaddies of them all, the U.S. Supreme Court actually reached decisions on the merits. Marbury v. Madison, 5 U.S. (1 Cranch) 137 (1803). Baker v. Carr, 369 U.S. 186 (1962). INS v. Chadha, 469 U.S. 919 (1983). The governmentís argument, inferentially sustained by the Tenth Circuit, is that if, within the decision of a political question case, any rule of decision is cited whatsoever that points toward "prudential abstention," then that reference overrides any contrary or stronger reasoning process or rule by which this Court ultimately found that it was required to reach a decision on the merits and in fact did so. But that is exactly what happened in the leading cases just cited. The merits were reached in each instance.
The court of appealsí holdings merit this Courtís immediate review because the Tenth Circuit misconstrued the nature of the relief sought, which never was for an injunction of broader scope than the relevant courtís jurisdiction would support (e.g., a moratorium on all farm foreclosures within the territory of the Tenth Circuit). If the Petitionersí case succeeded, other plaintiffs in other districts or circuits could file analogous petitions of their own, if they wished, but the Petitioners did not ask any federal court to overreach its own jurisdiction. Similarly, the precise targets of such an injunction (i.e., all federally funded farm mortgages vs. all federally insured or guaranteed farm mortgages vs. all farm mortgages from any source) clearly were intended from the pleadings to be whatever set of institutions would comport with the courtís jurisdiction and the identity of the entities plausibly said to have their interests in this litigation represented by the U.S. Department of Justice (a category that clearly would include all federally funded farm mortgages and, probably, all federally insured or guaranteed farm mortgages).
The court of appealsí holding
also merits this Courtís immediate review because it misconstrues Petitionersí
takings claim. Schroder v. Bush, 263 F.3d 1169, 1176-1177
(Pet. App. at 1a, 14a-16a). Ordinarily, a takings claim involving
a property rights interest receives heightened scrutiny because of the
fundamental nature of the life, liberty, or, in this instance, property
interest involved. The Tenth Circuit apparently reasoned that property
rights claims nearly always state a claim for money damages or their equivalent,
which emphatically was not the case here. Monetary claims arising
from property, the Tenth Circuit apparently reasoned, must be filed under
a different set of federal jurisdictional statutes related to the Tucker
Act, 28 U.S.C. Section 1491 (Pet. App. at 63a-64a). Also, the Tenth
Circuit found Petitionersí takings claim time-barred under 28 U.S.C. Section
2401 (Pet. App. at 65a). Finally, the Tenth Circuit might have been
led astray into the morass of Tucker Act cases by inapposite analogy to
28 U.S.C. Section 2409a (Pet. App. at 65a-67a), which deals with quiet
title actions against the United States and jurisdiction of other types
of real property claims where the matter at issue is actual legal title
to real estate. Instead, Petitionersí case involves statutory or
regulatory actions precluding unfettered use and enjoyment of real property
interests, which is what AAA actually accomplished, instead of the actual
nationalization of all U.S. farm land, which some New Dealers allegedly
advocated. Upon inspection, the Tucker Act generally applies to claims
for monetary damages arising from tort and contract claims against the
United States. It is far from clear that jurisdiction in the U.S.
Court of Claims under the Tucker Act would have been appropriate for statutory
and regulatory takings raising constitutional issues (e.g., the nondelegation
principle) and seeking no monetary relief in this instance. Similarly,
the statutes of limitations prescribed in 28 U.S.C. Sections 2401 and 2409a
(Pet. App. at 65a-67a) simply are inapplicable to claims of the Petitionersí
types, which do not involve federal tort or contract claims, or federal
takings of actual legal title to land (other than via mortgage foreclosures).
Note on Federal Jurisdiction
The bases cited for federal jurisdiction in the court of first instance, here the U.S. District Court for the District of Colorado, were 28 U.S.C. Section 1331 (Pet. App. at 63a) and 5 U.S.C. Section 702 (Pet. App. at 22a). The first statute covers general federal questions. The factual basis asserted for the Petitionersí case is the failure of the four-part compensatory scheme for the federal statutory and regulatory taking of U.S. farmersí production rights in the AAA. The four-part scheme was intended to be the "just compensation" that would save the constitutionality of the taking. See, e.g., Arthur M. Schlesinger, Jr., The Coming of the New Deal 35-36 (1959). See also, U.S. Constitution, Amend. V (due process and takings clauses) (Pet. App. at 20a) and Amend. XIV, Sec. 1 (privileges and immunities and due process clauses) (Pet. App. at 20a-21a).
The second statute, 5 U.S.C. Section 702, confers jurisdiction on the federal courts for claims requesting declaratory or injunctive relief and not monetary damages (the precise forms of relief requested here) and waives the federal governmentís claim of sovereign immunity in appropriate cases. At issue in the district court (although not addressed in the Tenth Circuitís opinion) was the federal governmentís contention that the first proviso of this statute denies jurisdiction if another statute (i.e., 31 U.S.C. Section 5302 (a)(2) [Pet. App. at 69a]) expressly precludes judicial review. Essentially, the governmentís argument was that the ESFís governing statute precludes judicial review by language stating that decisions of the President and Secretary of the Treasury in this area "may not be reviewed by any other officer or employee of the Government." Petitionersí reply essentially is to the effect that federal judges ordinarily are not considered "officers or employees of the Government," which is language evoking the executive, not the judicial, branch of the federal government, and that preclusion of judicial review is so extraordinary a constitutional step that statutes of that nature should express judicial preclusion explicitly and not merely by implication.
The other principal jurisdictional argument in the district court involved the propriety of Petitionersí invocation of 5 U.S.C. Section 702 (Pet. App. at 22a) regarding either the President, who generally is held not to be the head of an agency subject to judicial review under this statute, or the heads of cabinet departments (also claimed not to be agencies subject to judicial review). Petitioners conceded that jurisdiction over the President is difficult and usually is reserved only for grand cases like Nixon v. United States, 418 U.S. 683 (1974) (the presidential tapes case), but Petitioners argued that, as Nixon shows, such jurisdiction is not completely unknown. Also, Petitioners contended that, with respect to cabinet departments (Treasury and Agriculture) and agencies like the ESF and OTR that predated the Administrative Procedure Act, their official actions may be reviewed by the federal courts and in fact are reviewed by the courts. In Youngstown Sheet & Tube Co. v. Sawyer (Steel Seizures case), 343 U.S. 579 (1952), for example, the named party defendant in an injunctive action not unlike the present one was the Secretary of Commerce, who was charged with implementing the contested seizures of the struck steel companies.
In any event, the Tenth Circuit decided
the Petitionersí case on other grounds (especially the political question
doctrine) and did not reach a decision on the narrow jurisdictional points.
Inferentially, however, both the district court and the Tenth Circuit might
be viewed as having found a sufficient statutory basis for jurisdiction
in this case because, unless Petitioners are profoundly mistaken in this
regard, a federal court ordinarily would find that it has no statutory
jurisdiction first, before moving on to decide jurisdictional issues on
grounds like the political question doctrine. Indeed, Petitioners
have the impression that the political question doctrine normally is couched
in terms of refraining from the exercise of jurisdiction that otherwise
might attach due to prudential concerns about impinging on decisions properly
conferred on the elected branches of government. See, e.g.,Alexander
M. Bickel, The Least Dangerous Branch 125-126, 184 (2d ed. 1986).
REASONS FOR GRANTING THE WRIT
The Petition for Certiorari should be granted for four reaaons initially suggested in the second numbered subdivision of the Statement of the Case above. First, the Tenth Circuitís holding in the Petitionersí case below tends to confirm the executive branch in the unfortunate and unconstitutional trend originally set in motion by Justice Sutherlandís dictum in Curtiss-Wright that any action arising from domestic economic activity, no matter how purely and inherently domestic, may be regulated and its product seized by the executive in pursuit of allegedly foreign affairs goals, in which the executive allegedly is supreme and unchallengeable. Under the Curtiss-Wright doctrine, the President allegedly exercises a "very delicate, plenary and exclusive power . . . as the sole organ of the federal government in the field of international relations." (Emphasis added.) 299 U.S. 304, 320. A second reason for granting the writ that is comprehended within the first reason is the violation of the nondelegation principle that is raised by the delegation of sole authority over the operations of the ESF and the OTR to the executive branch, permanently in both cases, without an articulated intelligible principle (ESF) or with an arguably intelligible principle that is violated constantly without consequences (OTR), and without congressional review through the appropriations process (ESF), while the Constitution explicitly delegates these operations to the legislative branch alone (regulation of foreign exchange and foreign commerce). See, Justice Thomasís concurrence in Whitman, 531 U.S. 457, 121 S.Ct. 903, 919-920 (Pet. App. 79a-80a).
The second overall reason for granting the writ is the district courtís and Tenth Circuitís misapplication of the "prudential abstention" rules of the political question doctrine to a case of the Petitionersí type: Most of the standard political question cases involve advocacy of enactment of a particular policy approach where an opposing or no policy apparatus already exists. But in this case, Petitioners neither advocate that a new policy be adopted nor ask the federal courts to legislate; rather, they advocate that policies already declared be pursued and that statutes already enacted be enforced. The four-part compensatory scheme described in the first numbered subdivision of the Statement of the Case above is not a mere legislative or policy proposal: It is emphatically already the law of the land for U.S. agriculture, and it is not being enforced. Thus, the standard form of political question analysis is inapplicable to Petitionersí case, even ignoring the misinterpretations of what this Court actually said and did in the standard litany of political question cases: Marbury, 5 U.S. (1 Cranch) 137; Baker, 369 U.S. 186; Chadha, 462 U.S. 919; and progeny.
The third overall reason for granting the writ is the district courtís and Tenth Circuitís misinterpretation of their capacities to grant the forms of relief requested, an injunction against farm mortgage foreclosures and a declaratory judgment to the effect that parity pricing principles continue to be the underlying agricultural law of the land. This Courtís upholding of farm mortgage foreclosure moratoria is precedented. See, e.g., Home Building & Loan Assín v. Blaisdell, 290 U.S. 398 (1934) (validation of a Minnesota state mortgage foreclosure moratorium statute). Regarding the requested declaratory judgment, this Court has issued rulings on the constitutionality of AAA many times, generally sustaining it. See, Butler v. United States, 297 U.S. 1 (1936) (processing tax under AAA was invalid, but parity pricing principle itself was not so far invalidated that Congress could not re-enact AAA). But see, later cases in which the AAA (including, parity itself) has been vindicated. Wickard v. Filburn, 317 U.S. 111 (1942) (validity of AAA in intrastate commerce). Parker v. Brown, 317 U.S. 341 (1943) (upholding validity of the so-called single plan for parity). Barlow v. Collins, 397 U.S. 159 (1970) (Secretary of Agricultureís regulations affecting assignability of parity payments to tenant farmers could be reviewed in the federal courts). West Lynn Creamery, Inc, v. Healy, 512 U.S. 186, 188-189 (1994) (various Massachusetts restrictions on out-of-state milk were unconstitutional burdens on interstate commerce). Glickman v. Wileman Bros. & Elliott, Inc., 521 U.S. 457, 461-462 (1997) (marketing orders for fruits and nuts are still valid exercises of regulatory authority under AAA). Thus, there are ample precedents for both of the requested forms of relief.
The fourth and final overall
reason for granting the writ is that the Tenth Circuitís opinion misconstrues
Petitionersí takings claim as a claim for money damages (which it emphatically
is not) and applies statutory analysis to the claim that would be appropriate
only for tort or contract claims under the Tucker Act and also applies
statutes of limitation to the claim that would be appropriate only for
actual governmental takings of legal title to property. The taking
in Petitionersí case is a statutory or regulatory taking of a subset of
property rights regarding use (production rights on the property) instead
of an actual taking of legal title. An apposite analogy is the line
of reasoning of this Court in Lucas
v. South Carolina Coastal Council, 505 U.S. 1003, 1019 (1992) (when
the owner of real property has been called upon to sacrifice all economically
beneficial uses in the name of the common good, he has suffered a taking).
Brief explanation of these four reasons for granting the writ follows.
The Decision Below Grants the Executive Branch Unfettered Discretion to Regulate Domestic Economic Activity in the Name of Foreign Affairs
A. Conduct of Foreign Affairs Impinges on Domestic Agricultural Economy
Justice Sutherlandís famous dictum in Curtiss-Wright, 299 U.S. 304, 320, regarding the Presidentís "very delicate, plenary and exclusive power" in foreign affairs should have been challenged more vigorously from the outset in light of the prior tradition of shared responsibility with Congress, at least regarding the making of treaties. U.S. Constitution, Art. II, Sec. 2, cl. 2 (Pet. App. at 20a)(treaties require the concurrence of two-thirds of the Senate). To the extent that modern cases have built on this dictum, they have created a situation in which the executive branch increasingly and solely makes economic policy decisions affecting domestic economic activity, which normally would be outside the scope of foreign affairs. In this instance, decisions of the executive affecting both prices paid and prices received by U.S. farmers, principally implemented through the Treasury and the Department of Agriculture, but to a significant extent through the OTR also, have been raised by the federal governmentís briefs to the unquestionable status of holy writ. Unfortunately, the Tenth Circuit, while apparently sympathetic to the plight of small family farmers, has elected not to question the nexus between the executiveís conduct of foreign affairs and the prices paid and received by farmers. This issue was briefed fully for the courts below: The United States has pursued a bifurcated policy since about 1995 in which the interests of domestic farmers are deliberately sacrificed for larger foreign policy goals, sometimes disguised as the liberalization of international trade, which this bifurcated policy is not.
On one hand, open-market operations of the Federal Reserve Banks, conducted through the Federal Open Market Committee, have led to an increase of the U.S. dollar index quoted on the New York Board of Trade and daily in the financial sections of major newspapers, a rough proxy for the foreign exchange value of the dollar, from about 95 in 1995, roughly the beginning of the current phase of U.S. farmersí economic difficulties, to about 116 in mid-November 2001. That index was already above 100 (1973 is the base year) in 1999, when the Petitioners sent a notice of the causes of their complaint to the relevant federal departments and agencies, including the Executive Office of the President. By March 2001, the time of oral argument in this case in the Tenth Circuit, the index stood at 112. On the Federal Reserveís role, see 12 U.S.C. Sections 225a, 241, and 355 (Pet. App. at 51a-54a). In briefs below, the government has contended that the President is the federal official ultimately responsible for the nationís monetary policy, which is not entirely correct respecting the Federal Reserveís role in domestic monetary policy but might be correct (statutorily, even if not constitutionally) respecting the foreign exchange value of the dollar, at least since 1934.
On the other hand, since 1995, the Treasury, operating through the ESF (which it totally controls) and the IMF (in which it holds an 18 percent blocking veto, or de facto control), has extended tens of billions of dollars of bailout funds to foreign countries devaluing their currencies as a condition of obtaining the IMFís assistance. Several of those countries are direct competitors of U.S. farmers, including Mexico (fruits, vegetables, and cattle), Argentina (corn, wheat, sheep, and cattle), Brazil (soybeans and cattle), and Turkey (wheat). Other countries have had major currency devaluations but without ESF or IMF assistance, including Canada (wheat) and Australia (sheep, wheat, corn, and cattle). The use of the Treasuryís funds to assist these countries amounts to forcing U.S. farmers to subsidize their biggest foreign competitors. Also, the OTR has negotiated major trade agreements since 1993 with several countries with similar competitive profiles: Chile (fruits and vegetables), Colombia (fruits and cut flowers), and Mexico (see above). In these instances, tariff barriers against foreign food and fiber imports into the United States are reduced, but the dollar appreciation offsets any advantage that U.S. producers might expect to obtain from being able to export to the other country. Thus, foreign affairs intrude into the domestic U.S. agricultural economy.
The Nondelegation Principle Is Violated
The statutory delegations of sole conduct of the operations of the ESF and the OTR to the executive branch violate the general principles of separation of powers and specific constitutional provisions. The Constitution, Art. I, Sec. 8, cl. 5 (Pet. App. at 19a), delegates the regulation of foreign exchange, implicitly treating it as a commercial activity, to Congress, not the executive. The regulation of foreign trade (Art. I, Sec. 8, cl. 3, in Appendix at 19a) also is delegated to Congress in the same clause that delegates the regulation of domestic trade. It is an overreaching of executive branch power to treat these matters as exclusively executive and somehow falling under the rubric of the general executive power, as the government contended in the courts below. See, U.S. Constitution, Art. II, Sec. 1, cl. 1.
Both instances, foreign exchange and foreign trade, involve matters that are inherently legislative and that become executive only by legislative acquiescence. Unfortunately, that acquiescence frequently occurs. To be traditionally constitutional, these delegations should require an initial reporting line of responsibility to Congress, not to the executive, periodic appropriations (this is done for the OTR but not for the ESF), and either a predetermined cessation date or a procedure by which Congress could reclaim these powers. However, these functions are delegated permanently to the ESF and OTR, with inadequate standards of accountability and review to Congress, and outside the appropriations process for the ESF. The foreign affairs power should not include commercial powers that constitutionally belong to Congress instead. See generally, Harold Hongju Koh, The National Security Constitution: Sharing Power After the Iran-Contra Affair (1990), especially at 38-100, 134-149. See also, Richard H. Fallon, Jr., Daniel J. Meltzer, and David L. Shapiro, Hart & Wechslerís The Federal Courts and the Federal System 289-293 (4th ed. 1996) (hereinafter Hart & Wechsler). Both Koh and Hart & Wechsler are properly critical of the general judicial acquiescence in the executiveís power grab for control of foreign commercial matters under the rubric of foreign affairs, an expansion of the Curtiss-Wright doctrine. The gist of these citations from Koh and Hart & Wechsler and the cases discussed there is clearly antithetical to the citations relied upon in the Tenth Circuitís opinion on these points, Schroder v. Bush, 263 F.3d 1169, 1174-1176. See, e.g., Goldwater v. Carter, 444 U.S. 996 (1979) (Justice Rehnquist ruled on the merits that the president could not terminate a treaty already approved by Congress); Japan Whaling Assín v. American Cetacean Society, 478 U.S. 221 (1986) (Supreme Court reviewed on the merits Secretary of Commerceís decision in a Japanese whaling case allegedly having a delicate posture for Japan-U.S. foreign relations).
Koh, supra, at 148, summarizes the argument for granting the writ of certiorari on this first point as follows:
[T]he trend toward executive insulation from judicial review in foreign affairs is a relatively recent development, which finds little support in our constitutional traditions. Since the founding of the National Security Constitution , the courts have played a pivotal role in maintaining the constitutional equilibrium of the national security system. That role has required judges to police the boundaries of the branchesí authority in foreign affairs to maintain the constitutional principle of balanced institutional participation. Particularly when Congress legislates a framework statute governing executive decisions, those decisions should remain fully subject to judicial review. Thus, the recent foreign-affairs cases in which courts have abstained from such review ultimately betray not doctrinal fidelity, but reflexive timidity.Finally, on this first reason for granting the writ, the permanent delegation to the executive of legislative branch powers textually committed to Congress, combined with inadequate or no articulated standards of review of executive branch action (ESF) or minimally articulated standards that apparently are consistently ignored (OTR) raises all the issues that Justice Thomas mentioned in Whitman, citing Hampton, 531 U.S. 457, 121 S.Ct. 903, 919-920 (Pet. App. at 79a-80a); 276 U.S. 394, 409. If this Court ever wished to deal with the clearest example of breach of the nondelegation doctrine, the Petitionersí case presents such an example.
Prudential Abstention Principles Said to Be Embedded Within the Nonjusticiable Political Question Doctrine Prove on Closer Inspection to Be Inapplicable to Petitionersí Case, but Tenth Circuit Will Buttress Other Misled Circuits on This Issue
The lower courts have misapplied the principle of prudential abstention and the doctrine of nonjusticiable political questions in Petitionersí case. See, Schroder v. Bush, 263 F.3d 1163, 1173-1176. First, the standard political question doctrine as articulated in the governmentís briefs and in the Tenth Circuitís opinion implies that contestants are merely seeking relief in a judicial forum that, because of conflicting interests with other members of society, contestants should seek in a political forum instead, through one or more of the elected branches of government. In fact, Petitioners have sought and continue to seek political relief for the plight of U.S. farmers, including themselves, but they also seek enforcement of policies already decided upon and statutes already enacted. Parity and the four-part compensatory scheme already have been enacted Ė Petitioners have nothing to advocate in the legislative branch except commissions of inquiry to find out why the standing policy has not been implemented. Thus, the interests ordinarily served by a policy of prudential judicial abstention are absent here.
Regarding the misinterpretation and
misapplication of the political question doctrine generally, critics of
the doctrine observe that, in fact, this Court usually has actually reached
the merits of the cases most often cited in favor of abstention.
In Marbury, Baker, and Chadha, the Court decided the cases
on the merits. 5 U.S. (1 Cranch) 137; 369 U.S. 186; 462 U.S. 919.
Koh observes, supra, at 135, that throughout the early development of modern
national security practices, this Court almost always reached the merits
of the cases. This aspect began to change only with the issuance
of dicta in Chicago
& S. Air Lines v. Waterman S.S. Corp., 333 U.S. 103, 111 (1948),
asserting the nonreviewability of executive branch foreign affairs matters,
one year into the Cold War. But the contrary principle (presumption
in favor of reviewability) persisted through Youngstown, 343 U.S.
579 (1952), suffering a severe setback only when Dames
& Moore v. Regan was decided. 453 U.S. 654 (1981).
Despite the obvious foreign affairs connection in Dames & Moore
(regarding U.S. claims on Iran during the hostage seizures), this Court
reached the merits and found that Congress had acquiesced so fully as to
be deemed to have approved the Presidentís actions there under the International
Emergency Economic Powers Act (IEEPA). 50 U.S.C. Sections 1701-1706
(Pet. App. at 71a-78a). By the time Chadha was reached,
supra, this Court still decided the case on the merits but basically prohibited
Congress from exercising legislative control over various aspects of the
Presidentís control of foreign affairs. The important principle to
be observed here is that the federal courts should entertain the Petitionersí
case on the merits and should not decline to hear it on some mistaken notion
that the merits never are reached in foreign affairs cases. On the
contrary: Such cases frequently (perhaps usually) reach the merits,
and this Court needs to say so to prevent the Ninth, Tenth, Eleventh, and
D.C. Circuits from persisting in ruling that such cases should not reach
the merits. See, Schroder v. Bush, 263 F.3d 1169, 1173-1176.
This Court Can and Should Grant the Forms of Relief Requested
This Court clearly has the capacity to issue an injunction prohibiting farm foreclosures, at least in the territory of the Tenth Circuit where all Petitioners reside, until the executive and legislative branches certify to the Court that they have reached a common position on farm foreclosures in light of other policies that Congress has approved and that the Executive Branch has implemented. Basically if in 1996 the production controls of AAA were lifted from U.S. agriculture under the Freedom to Farm Act, which largely was a congressional decision, it then made little or no sense for the Treasury (ESF) to undo the market competitiveness of U.S. farmers by subsidizing imports of grains and other covered commodities and crops. Even if the ESF effected no such subsidy directly itself, the net effect of the Treasuryís foreign exchange policies since 1995 has been to cheapen the price of imported goods and services and to drive up the dollarís value.
The unreconciled division of agricultural
policy between Congress (running fast to fill the hole in domestic agricultural
payments that executive branch policies have created) and the executive
means that the ills of which Petitioners initially complained formally
in 1999 will continue for the indefinite future. Under precedents
such as Blaisdell, supra, 290 U.S. 398, this Court may validate
mortgage foreclosure moratoria. Under precedents like Parker,
317 U.S. 341, this Court also may issue a declaratory judgment to the effect
that parity is the law of the land, as well. The forms of relief
requested below are within the capacity of this Court to grant.
The Tenth Circuit Has Misconstrued Petitionersí Takings Claim, Which Is a Statutory or Regulatory Takings Claim Analogous to the Lucas Case
Perhaps led to this conclusion by the governmentís briefs, the Tenth Circuitís opinion misconstrues Petitionersí takings claims (5th and 14th Amendments) as claims for money damages, when they are in fact claims for injunctive and declaratory relief only. The statutes and cases cited apparently reflected a desire on the part of the Tenth Circuit for a more elaborate development of a takings argument in the case below. See, Schroder v. Bush, 263 F.3d 1169, 1176-1177. But, as was noted at oral argument in the Tenth Circuit, there never was a hearing in the district court, and, thus, only issues raised by the government were briefed responsively by Petitioners.
The Tenth Circuit noted that Petitionersí amended complaint contained references to the nature of the case as a takings claim at 6, 25-26. On appeal, Petitioners concentrated their energies in overcoming the district courtís dismissal on political question grounds and for failure to state a claim on which relief could be granted, there being no comment on the takings claim in the district courtís opinion.
From the inception of the case, as the first numbered subdivision of the statement of the case above makes plain, Petitioners never argued that legal title to their property has been taken by the government. Rather, it was argued, throughout most of the AAA era, farmersí production rights (a distinctive form of property right) have been taken. Regardless of how the taking occurred, it was supposed to be compensated, and there was a failure of compensation. The compensation was an elaborate, four-part scheme designed to restore orderly marketing conditions in agriculture, no part of which currently is being implemented as originally intended.
Because of the complexity of the compensation plan, Petitioners have always found in their public appearances that it was more important to explain the four-part compensation scheme under AAA than to explain the taking of farmersí property rights (emphasis on the compensation rather than on the taking). After all, it was argued, AAA, 7 U.S.C. Section 601 (Pet. App. at 25a), constituted the taking: The executive and legislative proclamation of a national emergency in agriculture and the impressment of agriculture with the national interest. What was taken then was farmersí production rights, thenceforth to be regulated closely by the federal government.
This Court has held that the taking of the right to use real property as one sees fit, especially for productive use, is nevertheless a taking even if legal title does not pass to the government. Lucas v. South Carolina Coastal Council, 505 U.S. 1003, 1019 (1992). The sacrifice of economically beneficial uses to the common good constitutes a taking. That is exactly what befell U.S. agriculture on May 12, 1933: Nearly all economically beneficial use according to oneís predilections in agriculture ground rapidly to a halt. This Courtís decision in Wickard v. Filburn, 317 U.S. 111 (1942), signaled that there was nearly no end to the level of federal interference in minutely local agricultural practices.
On its face, it appears that it would be impossible to fit the taking in Petitionersí case into the classic rubric of a tort or contract claim under the Tucker Act or a quiet title or other title action under 28 U.S.C. Sections 2401 and 2409a (Pet. App. at 65a-67a). The statutes of limitations for such claims are irrelevant to Petitionersí case.
Instead, Petitioners are stating
an equitable claim for equitable relief. Where the wrong alleged
is a constitutional violation (a taking in which there has been failure
of agreed compensation Ė there is no parity, even though it is the law
of the land) the request for equitable relief may be stated even decades
after the onset of the taking if the lesson in McCulloch v. Maryland,
17 U.S. (4 Wheat.) 316 (1819), were taken literally: "It will not
be denied, that a bold and daring usurpation might be resisted, after an
acquiescence still longer and more complete than this." The constitutionality
of the Bank of the United States had been in issue since its founding in
1791. Yet, 28 years after the fact, Chief Justice Marshall was willing
to deal with the Bankís constitutionality as though it were freshly brought
to his attention.
For the foregoing reasons, the petition for a writ of certiorari should be granted.
WALKER F. TODD
Counsel of Record
Attorney at Law
1164 Sheerbrook Drive
Chagrin Falls, Ohio 44022
Attorney for Petitioners
Originally established under
two-year emergency statutes, the ESF was made permanent in 1945.
In June 1998, after the original Mexican Debt Disclosure Act of 1995 had
expired and following press reports of new ESF loan [page 6] commitments
to various East Asian countries that had been encountering foreign
payments difficulties since the summer of 1997, members of Congress attempted
to enact an amendment of 31 U.S.C. Section 5302 limiting the authority
of the ESF to make loans to foreign countries without the prior, explicit
approval of Congress to a maximum term of six months and a maximum amount
of $1 billion. Secretary of the Treasury Robert Rubin sent a letter
for the executive branch to House of Representatives Speaker Robert Livingston
(R.-Lou.) on June 23, 1998, threatening to ask the President to veto the
appropriation for the Treasury and the U.S. Postal System if this amendment
passed. The amendment failed in the House, 221-195. Thus, the
Treasury continues to assert unreviewable, unilateral, unappropriated authority
for the ESF that renders its structure unconstitutional on its face and
its operations unconstitutional as applied.
The Petitionersí case in both the district court and the court of appeals was commenced, and oral argument in the court of appeals was held, before the Whitman case was decided.
Koh writes, supra, at 94:
Among government attorneys, Justice
Sutherlandís lavish description of the presidentís powers is so often quoted
that it has come to be known as the "Curtiss-Wright, so Iím right,í cite"
Ė a statement of deference to the president so sweeping as to be worthy
of frequent citation in any government foreign affairs brief.