California‘s Proposition 12 has survived a challenge in a federal appeals court brought by the National Pork Producers Council and American Farm Bureau Federation, which alleged it imposed excessive costs on out-of-state pork producers who will have to comply with the law’s animal housing requirements.

“For dormant Commerce Clause purposes, laws that increase compliance costs, without more, do not constitute a significant burden on interstate commerce,” the 9th U.S. Circuit Court of Appeals said in a 3-0 decision.

The “dormant Commerce Clause” “refers to the prohibition, implicit in the Commerce Clause, against states passing legislation that discriminates against or excessively burdens interstate commerce,” according to Cornell Law School’s Legal Information Institute.

“We are disappointed in the court’s decision and maintain our position on Prop 12: It is a clear violation of the U.S. Constitution’s Commerce Clause,” NPPC spokesman Jim Monroe said. “We are evaluating the decision and our next steps.”

The groups’ complaint against the state “fails to make a plausible allegation that the pork production industry is of such national concern that it is analogous to taxation or interstate travel, where uniform rules are crucial,” the court said.

In April 2000, a district court dismissed the groups’ complaint, leading to the appeal. The U.S. Supreme Court recently denied a petition filed by the North American Meat Institute seeking review of a 9th Circuit decision that also upheld an adverse district court decision.

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NPPC and AFBF argued that Prop 12 has an “impermissible extraterritorial effect,” but the appeals court cited a string of Supreme Court cases to say the “extraterritoriality principle” should only apply to state laws that are “price control or price affirmation statutes.”

“It is undisputed that Proposition 12 is neither a price-control nor price-affirmation statute, as it neither dictates the price of pork products nor ties the price of pork products sold in California to out-of-state prices,” the court said.

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