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States set for egg fight

BY DANIEL SEIDL | MARCH 11, 2014 5:00 AM

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An egg lawsuit is hatching in the United States, and half a dozen states have joined the cause.

Iowa officials say the effect of the law would hurt Iowa farmers by regulating their egg production, which could affect the price of eggs.

However, Iowa Egg Council Executive Director Kevin Vinchattle said the lawsuit’s importance is mostly about the extension of one state’s power over others.

“Really, this is about much more than eggs,” Vinchattle said. “As a matter of law, I think it’s a very interesting legal question. Frankly, I think it needs to be decided.”

The law in question, called Proposition 2, was enacted in California in 2008. The law effectively banned standard-size cages from being used in the state to hold chickens.

In 2010, the state passed an addition to this law stating other states would not be able to export eggs to California unless they followed this regulation, a law that will go into effect in 2015.

The lawsuit, originally filed by Missouri’s Attorney General Chris Koster, claims this law is in violation of the commerce and supremacy clauses of the constitution.

Iowa farmers who do not comply with California’s regulations would not be able to export to the state.

Iowa is the No. 1 state in terms of egg production, with more than 14 billion eggs produced per year. More than 9 percent of these eggs are exported to California, which is more than Iowa exports to any other state. Approximately 30 percent of the eggs imported to California are from Iowa.

Vinchattle said the regulation would effectively leave states with two options; change their own egg production — which could increase egg prices — or stop supplying to California.

The Iowa Department of Agriculture, though not involved in the lawsuit directly, is also opposed to the regulation, said communications Director Dustin Vande Hoef.

“It’s important that our eggs have access to that market,” he said. “California consumers can have the choice, but they shouldn’t have their choices limited.”

Gov. Terry Branstad officially announced his support for the lawsuit last week, and Iowa will join the states of Missouri, Alabama, Nebraska, Oklahoma, and Kentucky in the legal battle.

“The burdensome law from the state of California effectively regulates the industry across state lines, hurts Iowa agriculture, and is detrimental to Iowa egg producers,” Branstad said in a press release.

Timothy Hagle, a University of Iowa associate professor of political science, said the process of a lawsuit between states is not unusual.

Hagle said the procedure is not too different from other lawsuits. The first question for officials is who has jurisdiction, which in cases like this, is usually the federal court.

“States can’t impose through their laws some additional restrictions that affect the trade of other states,” he said. “Between state laws and federal laws, federal laws will take precedence.”

Vinchattle agreed this market should not be cut off from Iowa egg producers.

“The egg business is supply and demand,” he said. “If we have an oversupply of eggs, that is definitely going to decrease prices. If we’re shut out of a market of 38 million, it’s definitely going to have an impact.”


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