13 states ask the US Supreme Court to crack California's egg law
Thirteen states have asked the U.S. Supreme Court to block a California law requiring eggs sold in the Golden State to be sourced from hens that have enough space to lie down, stand up, turn around and fully stretch out out in their cages, according to the Associated Press.
The attorneys general of the 13 states — a dozen Republicans and one Democrat — claim that since taking effect in 2015, the law has cost consumers across the country up to $350 million annually due to higher egg prices. The lawsuit also states that California's requirements violate the interstate commerce clause of the U.S. Constitution and that federal law supersedes them.
Leading the charge, according to the AP, is Missouri Attorney General Josh Hawley, a Republican running for a U.S. Senate seat next year. He wrote that California's egg law is "a clear attempt by big-government proponents to impose job-killing regulations" on other states. In addition to Missouri, the other plaintiff states include Alabama, Arkansas, Indiana, Iowa, Louisiana, Nebraska, Nevada, North Dakota, Oklahoma, Texas, Utah and Wisconsin.
Last year, a federal appeals court panel rejected separate but similar claims brought by six states on the grounds that they couldn't prove California's law would impact more than individual farmers. In this latest lawsuit, the 13 states are asking the Supreme Court to take the case directly, rather than requiring it to move through the lower courts first.
California's animal welfare law, known as Proposition 2, requires that egg-laying hens, veal calves and pregnant pigs have sufficient space to lie down, stretch out and turn freely in their enclosures. It passed in 2008 with more than 63% of the vote, which at the time was the most votes ever received on a U.S. ballot measure. In 2010, the California State Assembly extended the law's provisions by mandating that all eggs sold in California, regardless of origin, had to meet the same requirements.
An academic research study of egg production and pricing data in California found consumers initially paid 33% more after the stricter animal welfare laws went into effect in 2015. The price hike has moderated closer to about 9% more since then. California egg producers anticipated Proposition 2's impact and began implementing provisions of the new rules years before they had to. Even before 2015, there were fewer hens, so production in the state started to drop and prices began to rise, according to the study.
Egg producers have begun raising cage-free and free-range eggs to keep up with growing consumer interest in animal welfare initiatives. One study found that shoppers buy free-range eggs because they thought the laying hens were "happier," thereby creating a tastier product. Walmart, Target, Costco and other companies have also pledged to transition to cage-free eggs during the next decade. And six other states — Massachusetts, Michigan, Ohio, Oregon, Rhode Island and Washington — have adopted laws banning or restricting the use of cages in shell egg production.
But the industry may have overestimated consumer willingness to spend more for these premium eggs. In October, Cal-Maine Foods — the country's largest producer and marketer of shell eggs — announced it would reduce its cage-free production in response to waning interest. CEO Dolph Baker said even though many food service providers, national restaurant chains and major retailers have publicly said they would transition away from conventional eggs, the higher price for the specialty product "has resulted in reduced demand." He added that Cal-Maine was positioned to increase production of cage-free eggs if demand trends change.
Time will tell if opponents to the California egg law will prevail, but barring any fresh legal arguments, it's hard to see how this latest challenge differs from previous failed lawsuits. Still, the allegations could hint at a growing crack in the premium egg market, which may shrink if consumers continue to show a reluctance to pay up.
- Associated Press 13 states launch new legal challenge to California egg law