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SUPREME COURT OF THE UNITED STATES

No. 95–1184

DAN GLICKMAN, SECRETARY OF AGRICULTURE, PETITIONER v. WILEMAN BROTHERS &

ELLIOTT, INC., et al.

on writ of certiorari to the united states court of appeals for the ninth circuit

[June 25, 1997]

Justice Stevens delivered the opinion of the Court.

A number of growers, handlers, and processors of California tree fruits (respondents) brought this proceeding to challenge the validity of various regulations contained in marketing orders promulgated by the Secretary of Agriculture. The orders impose assessments on respondents that cover the expenses of administering the orders, including the cost of generic advertising of California nectarines, plums, and peaches. The question presented to us is whether the requirement that respondents finance such generic advertising is a law "abridging the freedom of speech" within the meaning of the First Amendment.

Congress enacted the Agricultural Marketing Agreement Act of 1937 (AMAA), ch. 296, 50 Stat. 246, as amended, 7 U. S. C. §601 et seq., in order to establish and maintain orderly marketing conditions and fair prices for agricultural commodities. §602(1). Marketing orders promulgated pursuant to the AMAA are a species of economic regulation that has displaced competition in a number of discrete markets; they are expressly exempted from the antitrust laws. §608b. Collective action, rather than the aggregate consequences of independent competitive choices, characterizes these regulated markets. In order "to avoid unreasonable fluctuations in supplies and prices," §§602(4), these orders may include mechanisms that provide a uniform price to all producers in a particular market, that limit the quality and the quantity of the commodity that may be marketed, §§608c(6)(A),(7), that determine the grade and size of the commodity, §608c(6)(A), and that make an orderly disposition of any surplus that might depress market prices, ibid. Pursuant to the policy of collective, rather than competitive marketing, the orders also authorize joint research and development projects, inspection procedures that ensure uniform quality, and even certain standardized packaging requirements. §§608c(6)(D), (H), (I). The expenses of administering such orders, including specific projects undertaken to serve the economic interests of the cooperating producers, are "paid from funds collected pursuant to the marketing order." §§608c(6)(I), 610(b)(2)(ii).

Marketing orders must be approved by either two-thirds of the affected producers or by producers who market at least two-thirds of the volume of the commodity. §608c(9)(B). The AMAA restricts the marketing orders "to the smallest regional production areas. . . practicable." §608c(11)(b). The orders are implemented by committees composed of producers and handlers of the regulated commodity, appointed by the Secretary, who recommend rules to the Secretary governing marketing matters such as fruit size and maturity levels. 7 CFR §§916.23, 916.62, 917.25, 917.30 (1997). The committee also determines the annual rate of assessments to cover the expenses of administration, inspection services, research, and advertising and promotion. §§916.31(c), 917.35(f).

Among the collective activities that Congress authorized for certain specific commodities is "any form of marketing promotion including paid advertising." 7 U. S. C. §608c(6)(I). The authorized promotional activities, like the marketing orders themselves, are intended to serve the producers' common interest in disposing of their output on favorable terms. The central message of the generic advertising at issue in this case is that "California Summer Fruits" are wholesome, delicious, and attractive to discerning shoppers. See App. 530. All of the relevant advertising, insofar as it is authorized by the statute and the Secretary's regulations, is designed to serve the producers' and handlers' common interest in promoting the sale of a particular product.

The regulations at issue in this litigation are contained in Marketing Order 916, which regulates nectarines grown in California, and Marketing Order 917, which originally regulated peaches, pears, and plums grown in California. A 1966 amendment to the former expressly authorized generic advertising of nectarines, see 31 Fed. Reg. 8177, and a series of amendments, beginning in 1971, to the latter authorized advertising of each of the regulated commodities, see 36 Fed. Reg. 14381 (1971); 41 Fed. Reg. 14375, 17528 (1976). The advertising provisions relating to pears are not now being challenged, thus we limit our discussion to generic advertising of California nectarines, plums, and peaches.

Respondent Wileman Bros. & Elliott, Inc., is a large producer of these fruits that packs and markets its own output as well as that grown by other farmers. In 1987, after encountering problems with some fruit varieties under the maturity and minimum size standards in the orders, it refused to pay its assessments and filed a petition with the Secretary challenging those standards. In 1988 it filed a second petition challenging amendments to the maturity standards as well as the generic advertising regulations. The Administrative Law Judge (ALJ), in two separate decisions that are explained in a total of 769 pages, ruled in favor of Wileman on the Administrative Procedure Act (APA) issues, without resolving the respondents' First Amendment claims. App. to Brief in Opposition 393a. In a comparably detailed decision, the Judicial Officer of the Department of Agriculture entirely reversed the ALJ. Wileman, along with 15 other handlers, then sought review of the Judicial Officer's decision by filing this action in the District Court pursuant to 7 U. S. C. §608c(15)(B). A number of enforcement actions brought by the Secretary to collect withheld assessments were consolidated with the review proceeding. Acting on cross-motions for summary judgment, the District Court upheld both marketing orders and entered judgment of $3.1 million in past due assessments against the handlers.

In the Court of Appeals the handlers challenged the generic advertising provisions of the orders as violative of both the APA and the First Amendment. The Court rejected the statutory challenge, concluding that the record contained substantial evidence justifying both the original decision to engage in generic advertising and the continuation of the program. It explained:

"The Nectarine Administrative Committee and the Peach Commodity Committee engage in a careful process each year prior to and during their annual spring meetings in approving the advertising program for the upcoming season. Prior to the full committee meeting, the Subcommittee on Advertising and Promotion meets to review in detail the program developed by its staff. The staff in turn uses monthly reports on price trends, consumer interests, and general market conditions in the formation of the proposed advertising program.

.	.	.	.	.

"[I]t is only because the handlers themselves, through the committees, recommend a budget with a generic advertising component that the program is renewed by the Secretary every year. In fact, in most years the recommendations have been unanimous. We cannot assume that the handlers—the parties with firsthand knowledge of the state of their industry—would make recommendations that have an adverse effect on their businesses. Of course, the interests of the voting committee members may not always coincide with those of every handler in the industry. However, this court has previously noted that the Supreme Court `upheld the constitutionality of the system despite the fact that it may produce results with which some growers or handlers will disagree.' Saulsbury Orchards and Almond Processing, Inc. v. Yeutter, 917 F. 2d 1190, 1197 (9th Cir. 1990) (citing United States v. Rock Royal Coop., 307 U. S. 533 . . . (1939))." Wileman Bros. & Elliott, Inc. v. Espy, 58 F. 3d 1367, 1375–1376 (CA9 1995) (footnote omitted).

The Court of Appeals concluded, however, that government enforced contributions to pay for generic advertising violated the First Amendment rights of the handlers. Relying on an earlier Ninth Circuit decision that had cited our decision in Abood v. Detroit Bd. of Ed., 431 U. S. 209 (1977), see Cal-Almond, Inc. v. United States Dept. of Agriculture, 14 F. 3d 429 (CA9 1993), the court began by stating that the "First Amendment right of freedom of speech includes a right not to be compelled to render financial support for others' speech." Wileman Bros., 58 F. 3d, at 1377. It then reviewed the generic advertising regulations under "the test for restrictions on commercial speech set out in Central Hudson Gas & Elec. Corp. v. Public Serv. Comm'n of N. Y., 447 U. S. 557, 566 . . . (1980)." Id., at 1378. Although it was satisfied that the government interest in enhancing returns to peach and nectarine growers was substantial, it was not persuaded that the generic advertising passed either the second or third "prongs" of Central Hudson. With respect to the former, even though the generic advertising "undoubtedly" has increased peach and nectarine sales, the government failed to prove that it did so more effectively than individualized advertising. The court also concluded that the program was not "narrowly tailored" because it did not give the handlers any credit for their own advertising and because California was the only state in which such programs were in place.

The Court of Appeals' disposition of the First Amendment claim is in conflict with a decision of the Court of Appeals for the Third Circuit that rejected a challenge to generic advertising of beef authorized by the Beef Promotion and Research Act of 1985, 7 U. S. C. §§2901–2911. United States v. Frame, 885 F. 2d 1119, 1136, 1137 (CA3 1989). Characterizing that statute as "legislation in furtherance of an ideologically neutral compelling state interest," id., at 1137, and noting that the "Cattlemen's Board is authorized only to develop a campaign to promote the product that the defendant himself has chosen to market," id., at 1136, despite the plaintiff's objections to the content of the advertising, the court found no violation of his First Amendment rights.

We granted the Secretary's petition for certiorari to resolve the conflict, 517 U. S. ___ (1996), and now reverse.

In challenging the constitutionality of the generic advertising program in the Court of Appeals, respondents relied, in part, on their claimed disagreement with the content of some of the generic advertising. 58 F. 3d, at 1377, n. 6. The District Court had found no merit to this aspect of their claim, and the Court of Appeals did not rely on it for its conclusion that the program was unconstitutional. Rather, the Court of Appeals invalidated the entire program on the theory that the program could not survive Central Hudson because the Government had failed to prove that generic advertising was more effective than individual advertising in increasing consumer demand for California nectarines, plums, and peaches. That holding did not depend at all on either the content of the advertising, or on the respondents' claimed disagreement with any particular message. Although respondents have continued in this Court to argue about their disagreement with particular messages, those arguments, while perhaps calling into question the administration of portions of the program, have no bearing on the validity of the entire program.

For purposes of our analysis, we neither accept nor reject the factual assumption underlying the Court of Appeals' invalidation of the program—namely that generic advertising may not be the most effective method of promoting the sale of these commodities. The legal question that we address is whether being compelled to fund this advertising raises a First Amendment issue for us to resolve, or rather is simply a question of economic policy for Congress and the Executive to resolve.

In answering that question we stress the importance of the statutory context in which it arises. California nectarines and peaches are marketed pursuant to detailed marketing orders that have displaced many aspects of independent business activity that characterize other portions of the economy in which competition is fully protected by the antitrust laws. The business entities that are compelled to fund the generic advertising at issue in this litigation do so as a part of a broader collective enterprise in which their freedom to act independently is already constrained by the regulatory scheme. It is in this context that we consider whether we should review the assessments used to fund collective advertising, together with other collective activities, under the standard appropriate for the review of economic regulation or under a heightened standard appropriate for the review of First Amendment issues.

Three characteristics of the regulatory scheme at issue distinguish it from laws that we have found to abridge the freedom of speech protected by the First Amendment. First, the marketing orders impose no restraint on the freedom of any producer to communicate any message to any audience. Second, they do not compel any person to engage in any actual or symbolic speech. Third, they do not compel the producers to endorse or to finance any political or ideological views. Indeed, since all of the respondents are engaged in the business of marketing California nectarines, plums, and peaches, it is fair to presume that they agree with the central message of the speech that is generated by the generic program. Thus, none of our First Amendment jurisprudence provides any support for the suggestion that the promotional regulations should be scrutinized under a different standard than that applicable to the other anticompetitive features of the marketing orders.

Respondents advance several arguments in support of their claim that being required to fund the generic advertising program violates the First Amendment. Respondents argue that the assessments for generic advertising impinge on their First Amendment rights because they reduce the amount of money that producers have available to conduct their own advertising. This is equally true, however, of assessments to cover employee benefits, inspection fees, or any other activity that is authorized by a marketing order. The First Amendment has never been construed to require heightened scrutiny of any financial burden that has the incidental effect of constraining the size of a firm's advertising budget. The fact that an economic regulation may indirectly lead to a reduction in a handler's individual advertising budget does not itself amount to a restriction on speech.

The Court of Appeals, perhaps recognizing the expansive nature of respondents' argument, did not rely on the claim that the assessments for generic advertising indirectly limit the extent of the handlers' own advertising. Rather, the Court of Appeals apparently accepted respondents' argument that the assessments infringe First Amendment rights because they constitute compelled speech. Our compelled speech case law, however, is clearly inapplicable to the regulatory scheme at issue here. The use of assessments to pay for advertising does not require respondents to repeat an objectional message out of their own mouths, cf. West Virginia Bd. of Ed. v. Barnette, 319 U. S. 624, 632 (1943), require them to use their own property to convey an antagonistic ideological message, cf. Wooley v. Maynard, 430 U. S. 705 (1977), Pacific Gas & Elec. Co. v. Public Util. Comm'n of Cal., 475 U. S. 1, 18 (1986) (plurality opinion), force them to respond to a hostile message when they "would prefer to remain silent," see ibid., or require them to be publicly identified or associated with another's message, cf. PruneYard Shopping Center v. Robins, 447 U. S. 74, 88 (1980). Respondents are not required themselves to speak, but are merely required to make contributions for advertising. With trivial exceptions on which the court did not rely, none of the generic advertising conveys any message with which respondents disagree. Furthermore, the advertising is attributed not to them, but to the California Tree Fruit Agreement or "California Summer Fruits." See, e.g., App. 530.

Although this regulatory scheme may not compel speech as recognized by our case law, it does compel financial contributions that are used to fund advertising. As the Court of Appeals read our decision in Abood, just as the First Amendment prohibits compelled speech, it prohibits—at least without sufficient justification by the government—compelling an individual to "render financial support for others' speech." 58 F. 3d, at 1377. However, Abood, and the cases that follow it, did not announce a broad First Amendment right not to be compelled to provide financial support for any organization that conducts expressive activities. Rather, Abood merely recognized a First Amendment interest in not being compelled to contribute to an organization whose expressive activities conflict with one's "freedom of belief." 431 U. S., at 235. We considered, in Abood, whether it was constitutional for the State of Michigan to require government employees who objected to unions or union activities to contribute to an "agency shop" arrangement requiring all employees to pay union dues as a condition of employment. We held that compelled contributions to support activities related to collective bargaining were "constitutionally justified by the legislative assessment of the important contribution of the union shop" to labor relations. Id., at 222. Relying on our compelled-speech cases, however, the Court found that compelled contributions for political purposes unrelated to collective bargaining implicated First Amendment interests because they interfere with the values lying at the "heart of the First Amendment[—]the notion that an individual should be free to believe as he will, and that in a free society one's beliefs should be shaped by his mind and his conscience rather than coerced by the State." Id., at 234–235; see also id., at 235.

Here, however, requiring respondents to pay the assessments cannot be said to engender any crisis of conscience. None of the advertising in this record promotes any particular message other than encouraging consumers to buy California tree fruit. Neither the fact that respondents may prefer to foster that message independently in order to promote and distinguish their own products, nor the fact that they think more or less money should be spent fostering it, makes this case comparable to those in which an objection rested on political or ideological disagreement with the content of the message. The mere fact that objectors believe their money is not being well spent "does not mean [that] they have a First Amendment complaint." Ellis v. Railway Clerks, 466 U. S. 435, 456 (1984).

Moreover, rather than suggesting that mandatory funding of expressive activities always constitutes compelled speech in violation of the First Amendment, our cases provide affirmative support for the proposition that assessments to fund a lawful collective program may sometimes be used to pay for speech over the objection of some members of the group. Thus, in Lehnert v. Ferris Faculty Assn., 500 U. S. 507 (1991), while we held that the cost of certain publications that were not germane to collective-bargaining activities could not be assessed against dissenting union members, id., at 527–528, we squarely held that it was permissible to charge them for those portions of "the Teachers' Voice that concern teaching and education generally, professional development, unemployment, job opportunities, award programs . . . , and other miscellaneous matters." Id., at 529. That holding was an application of the rule announced in Abood and further refined in Keller v. State Bar of Cal., 496 U. S. 1 (1990), a case involving bar association activities.

As we pointed out in Keller, "Abood held that a union could not expend a dissenting individual's dues for ideological activities not `germane' to the purpose for which compelled association was justified: collective bargaining. Here the compelled association and integrated bar are justified by the State's interest in regulating the legal profession and improving the quality of legal services. The State Bar may therefore constitutionally fund activities germane to those goals out of the mandatory dues of all members. It may not, however, in such manner fund activities of an ideological nature which fall outside of those areas of activity." Id., at 13–14. This test is clearly satisfied in this case because (1) the generic advertising of California peaches and nectarines is unquestionably germane to the purposes of the marketing orders and, (2) in any event, the assessments are not used to fund ideological activities.

We are not persuaded that any greater weight should be given to the fact that some producers do not wish to foster generic advertising than to the fact that many of them may well object to the marketing orders themselves because they might earn more money in an unregulated market. Respondents' criticisms of generic advertising provide no basis for concluding that factually accurate advertising constitutes an abridgment of anybody's right to speak freely. Similar criticisms might be directed at other features of the regulatory orders that impose restraints on competition that arguably disadvantage particular producers for the benefit of the entire market. Although one may indeed question the wisdom of such a program, its debatable features are insufficient to warrant special First Amendment scrutiny. It was therefore error for the Court of Appeals to rely on Central Hudson for the purpose of testing the constitutionality of market order assessments for promotional advertising.

The Court of Appeals' decision to apply the Central Hudson test is inconsistent with the very nature and purpose of the collective action program at issue here. The Court of Appeals concluded that the advertising program does not "directly advance" the purposes of the marketing orders because the Secretary had failed to prove that generic advertising is any more effective in stimulating consumer demand for the commodities than the advertising that might otherwise be undertaken by producers acting independently. We find this an odd burden of proof to assign to the administrator of marketing orders that reflect a policy of displacing unrestrained competition with government supervised cooperative marketing programs. If there were no marketing orders at all to set maturity levels, size, quantity and other features, competition might well generate greater production of nectarines, peaches, and plums. It may also be true that if there were no generic advertising, competition would generate even more advertising and an even larger consumer demand than does the cooperative program. But the potential benefits of individual advertising do not bear on the question whether generic advertising directly advances the statute's collectivist goals. Independent advertising would be primarily motivated by the individual competitor's interest in maximizing its own sales, rather than in increasing the overall consumption of a particular commodity. While the First Amendment unquestionably protects the individual producer's right to advertise its own brands, the statute is designed to further the economic interests of the producers as a group. The basic policy decision that underlies the entire statute rests on an assumption that in the volatile markets for agricultural commodities the public will be best served by compelling cooperation among producers in making economic decisions that would be made independently in a free market. It is illogical, therefore, to criticize any cooperative program authorized by this statute on the ground that competition would provide greater benefits than joint action.

On occasion it is appropriate to emphasize the difference between policy judgments and constitutional adjudication. Judges who have endorsed the view that the Sherman Act is a charter of economic liberty, naturally approach laws that command competitors to participate in joint ventures with a jaundiced eye. Doubts concerning the policy judgments that underlie many features of this legislation do not, however, justify reliance on the First Amendment as a basis for reviewing economic regulations. Appropriate respect for the power of Congress to regulate commerce among the States provides abundant support for the constitutionality of these marketing orders on the following reasoning.

Generic advertising is intended to stimulate consumer demand for an agricultural product in a regulated market. That purpose is legitimate and consistent with the regulatory goals of the overall statutory scheme. See §602(1). At least a majority of the producers in each of the markets in which such advertising is authorized must be persuaded that it is effective, or presumably the programs would be discontinued. Whether the benefits from the advertising justify its cost is a question that not only might be answered differently in different markets, but also involves the exercise of policy judgments that are better made by producers and administrators than by judges.

As with other features of the marketing orders, individual producers may not share the views or the interests of others in the same market. But decisions that are made by the majority, if acceptable for other regulatory programs, should be equally so for promotional advertising. Perhaps more money may be at stake when a generic advertising program is adopted than for other features of the cooperative endeavor, but that fact does not transform this question of business judgment into a constitutional issue. In sum, what we are reviewing is a species of economic regulation that should enjoy the same strong presumption of validity that we accord to other policy judgments made by Congress. The mere fact that one or more producers "do not wish to foster" generic advertising of their product is not a sufficient reason for overriding the judgment of the majority of market participants, bureaucrats, and legislators who have concluded that such programs are beneficial.

The judgment of the Court of Appeals is reversed.

It is so ordered.