The Decades-Long US Plan That Confiscated Raisins to Control Prices
Under a 1949 federal agricultural marketing order, the US government required raisin growers to surrender a portion of their annual crop to a state-run reserve without upfront payment. In peak years, officials seized up to 47% of the harvest to artificially restrict market supply and maintain high commodity prices. The confiscated raisins were dumped overseas or distributed to school lunches until the Supreme Court ruled the seizure unconstitutional in 2015.
The Origins of the Raisin Reserve
During the Great Depression, collapsing commodity prices devastated American agriculture. In response, Congress passed the Agricultural Marketing Agreement Act of 1937, granting the federal government expansive powers to stabilize farm goods markets. The legislation allowed the United States Department of Agriculture to issue marketing orders that established binding industry-wide standards, volume quotas, and pooling arrangements.
In 1949, federal authorities established Marketing Order No. 989 specifically for California raisin growers. California produced nearly the entire domestic supply of raisins and a major share of the global total. To prevent post-harvest gluts from crashing open-market prices, the order created the Raisin Administrative Committee, an industry board overseen by the Secretary of Agriculture with the authority to dictate how much fruit could reach consumer shelves each year.
The Mechanics of Crop Confiscation
Under the marketing order, an annual harvest was split into two categories: free-tonnage raisins and reserve-tonnage raisins. Raisin handlers—the packing businesses that wash, inspect, and package the dried fruit—could sell the free percentage at market rates. The reserve percentage, however, had to be surrendered directly to the Raisin Administrative Committee without any guaranteed upfront payment.
The committee exerted physical control over the reserve raisins. Trucks delivered the fruit directly into designated reserve warehouses, and title to the crop transferred entirely to the government-sponsored body. The committee disposed of this surplus in non-competitive avenues, such as donating them to federal school lunch programs, exporting them to foreign markets at discounted rates, or distributing them to other government agencies.
Growers retained only an indirect, contingent equity stake in the reserve pool. After subtracting administrative fees and the operational costs of maintaining and marketing the reserve, the committee distributed whatever net proceeds remained back to the producers. In bountiful years, these proceeds could be meager or non-existent. During the 2002–2003 harvest season, for example, the reserve requirement was set at 47 percent, and growers received zero dollars in net return for that surrendered portion of their harvest.
The Hornes' Rebellion
Marvin and Laura Horne had cultivated vineyards in California's Central Valley for decades. Frustrated by an arrangement that systematically appropriated substantial shares of their crop, the Hornes decided in the early 2000s to reconfigure their farming business. They invested in their own cleaning, sorting, and packaging equipment so they could prepare their raisins for retail sale without relying on outside commercial handlers.
The Hornes argued that because they were growing and packing their own fruit, they were acting exclusively as producers rather than commercial handlers. Under their reading of the 1937 statute, the reserve requirements applied to intermediate commercial handlers rather than independent farmers. Consequently, across multiple growing seasons, they refused to surrender any percentage of their harvest to the Raisin Administrative Committee.
The Department of Agriculture rejected this interpretation. An administrative law judge concluded that the Hornes' processing activities placed them squarely under the regulatory definition of handlers. The federal government ordered the couple to pay the full market value of the unreserved raisins—nearly half a million dollars—alongside hundreds of thousands of dollars in civil penalties and administrative assessments for noncompliance.
The Constitutional Collision
Instead of paying the penalties, the Hornes took the federal government to court, arguing that the mandatory raisin surrender violated the Fifth Amendment of the United States Constitution. The Fifth Amendment’s Takings Clause prohibits private property from being taken for public use without just compensation.
The legal battle spent a decade moving through the federal judiciary. When the dispute reached the United States Court of Appeals for the Ninth Circuit, the appellate judges ruled against the Hornes. The Ninth Circuit drew a sharp legal boundary between real property, such as real estate, and personal property, such as crops or personal effects. The court concluded that personal property was subject to lesser constitutional safeguards and that the reserve requirement was merely a regulatory condition imposed on participating in the commercial raisin market.
The Ninth Circuit reasoned that raisin farming was a commercial activity, not an absolute right. Under this view, the government could legally impose conditions on agricultural commerce, including the mandatory surrender of inventory, because growers retained the theoretical option of planting different crops or exiting the raisin trade altogether.
The Supreme Court's Verdict
In 2015, the case arrived at the Supreme Court as Horne v. Department of Agriculture. Chief Justice John Roberts delivered the majority opinion, which overturned the Ninth Circuit’s decision and declared the raisin reserve system unconstitutional.
Roberts rejected the idea that personal property receives weaker constitutional protection than real estate. The majority opinion traced the history of takings protections back to the Magna Carta of 1215, highlighting that early legal charters specifically sought to restrain the crown's seizure of personal commodities like corn and timber. The Court held that the government owes just compensation whenever it physically seizes property, regardless of whether that property is an acre of farmland or a crate of dried fruit.
The Supreme Court also dismantled the argument that the reserve was an acceptable regulatory condition on interstate commerce. Chief Justice Roberts wrote that selling produce across state lines is an ordinary commercial right, not a special government benefit or subsidy. The government could not force citizens to waive their Fifth Amendment rights to just compensation merely as the price of entering the commercial marketplace.
Fractured Opinions and Lingering Questions
While the majority ruled decisively that an unconstitutional physical taking had occurred, the justices were divided on other facets of the case. Justice Stephen Breyer, joined by Justices Ruth Bader Ginsburg and Elena Kagan, agreed that the reserve requirement constituted a taking, but argued that the case should be sent back to lower courts to calculate just compensation. Breyer suggested that the price-stabilizing effects of the marketing order might have enriched the Hornes enough to offset the monetary value of the seized raisins.
Justice Sonia Sotomayor was the sole complete dissenter. She argued that the reserve program did not constitute a per se physical taking because the Hornes retained a property interest in the net financial proceeds from the reserve pool. In her view, a physical taking only occurs when the government strips an owner of every single property right, which she maintained had not happened here.
The ruling in Horne v. Department of Agriculture effectively ended the federal raisin reserve mechanism, allowing growers to retain and sell the entirety of their crops. Beyond the agricultural sector, the decision reinforced limits on administrative power, setting a binding precedent that statutory regulatory programs cannot circumvent the Takings Clause by disguising physical seizures of goods as conditions of market participation.
Key takeaways
•Under a 1949 federal marketing order, raisin handlers were legally forced to turn over a portion of their crop—reaching up to 47 percent in surplus years—to a state-run reserve pool.
•Surplus raisins were physically controlled by the government-backed Raisin Administrative Committee and diverted to school lunches, federal agencies, or export markets to artificially inflate domestic prices.
•In the 2015 decision Horne v. Department of Agriculture, the Supreme Court ruled the seizure unconstitutional, holding that the Fifth Amendment protects personal property from uncompensated physical takings just as it protects real estate.
•The Court firmly rejected the government's position that participating in interstate commerce is a government-granted privilege that can be conditioned on forfeiting constitutional property rights.