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To Determine If Mandatory Marketing Fees Are Unconstitutional

By Published on .

WASHINGTON (AdAge.com) -- The U.S. Supreme Court today agreed to decide whether requiring beef ranchers to fund industry marketing programs amounts to compulsory speech and is a violation of their First Amendment rights.

A decision by U.S. Court of Appeals for

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the 8th Circuit set the stage for today's announcement. The lower court in July 2003 ruled that collecting money to support the beef industry's campaign violated the constitutional rights of ranchers who didn't want to contribute.

$80 million raised
The Livestock Marketing Association and the Western Organization of Resource Councils had originally challenged a marketing fee of $1 per head of cattle that beef ranchers are required to pay under 1985's Beef Promotion and Research Act. The money goes to the Cattlemen's Beef Promotion and Research Board and raises $80 million a year, about $13 million of which goes to advertising, from Publicis Groupe's Leo Burnett USA, which carries the familiar tagline "Beef. It's what's for dinner."

Some ranchers who pay the fee claimed the marketing campaign doesn't significantly benefit them and they are being forced to fund messages they don't agree with.

Paying for other people's speech
"It's unfair. We are having to pay for what someone else wants us to say," said Mabel Dobbs of Weiser, Idaho, the chairman of the Western Organization of Resource Councils' livestock committee. "We have no control."

The Cattleman's Beef Promotion and Research Board and the U.S. Department of Agriculture won a stay to allow the collections to continue while the case was appealed to the Supreme Court. They argued that the promotion, which is overseen by the government, was important to the industry, and that the ranchers did indeed benefit from the marketing effort.

A number of state attorneys general also urged the Supreme Court to overturn the lower court ruling.

From milk to pork
The beef case could have major implications on other ranch and farm commodity programs. More than $600 million is raised to advertise everything from the "milk mustache" campaign to one for pork products, touted as "the other white meat," using similar industry checkoffs, and several also face legal challenges.

Ad groups said an earlier Supreme Court decision, in a case striking down checkoffs for mushroom growers, is confusing because the court attempted to distinguish between situations in which advertising is the "principal object" of collecting fees, which is unconstitutional, and instances when it isn't the main reason, such as for setting standards that included some advertising, and therefore legal.

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