A restaurateur is suing the state of Arizona to block its upcoming cage-free egg mandate.
The regulation, approved in 2022, takes effect on Jan. 1, 2025. Egg producers with fewer than 20,000 egg-laying hens are exempt.
Legal experts have said that the case, National Pork Producers Council v. Ross, was important because the court’s ruling has implications reaching well beyond agriculture law. State-level energy and climate regulations have also been challenged under the so-called dormant commerce clause, or negative commerce clause, in the U.S. Constitution, which prohibits states from enacting legislation that discriminates against or excessively burdens interstate commerce.
According to Pacific Legal Foundation (PLF) and the Goldwater Institute, which both filed the current lawsuit on behalf of restaurateur Grant Krueger and his multi-restaurant business, cage-free eggs are more expensive to produce than conventionally raised eggs.
Mr. Krueger has 34 years of experience in the restaurant business, getting his start as a dishwasher and busboy in his hometown of Detroit. He later earned a business degree from the University of Arizona, and spent 10 years running a pub, self-storage complex, and homebuilding company in Mexico before returning to Tucson, Arizona, where he now owns restaurants through the Union Hospitality Group, which he founded in 2010.
And he purchases large quantities of eggs for the restaurants, according to PLF.
AZDA estimates the new rule would add between one cent and 3.25 cents to the price of an egg, or raise the price of eggs for each person by $2.71 to $8.79 per year. With consumption of about 270 eggs per year and a statewide population of almost 7.5 million people, the increase in costs for Arizonans would range from $20 million to about $66 million.
AZDA justified the cage-free egg rule by saying it was needed to address “the public’s growing concerns about animal welfare, including the hens’ ability to move freely and express their natural behaviors.” The rule was intended “to represent the best management practices in the shell egg industry that ensure the production of high-quality, cruelty-free eggs.”
The restaurant industry generally operates on tight profit margins of 4 percent to 5 percent on average. Around 95 percent of money coming in the door goes right back out to pay for food, employee wages, insurance, utilities, and—depending on the establishment—extras such as television and live music. And, as AZDA acknowledged, “Retailers will likely pass some of the increased costs to consumers.”
PLF attorney Josh Robbins said the way the cage-free egg regulation was created makes it constitutionally suspect.
“The main problem that we see with the rule is that the Arizona Legislature delegated to the Arizona Department of Agriculture unconstitutionally the power to legislate over poultry husbandry—to create this rule at all,” Mr. Robbins said in an interview.
The Arizona constitution “requires that the Arizona Legislature alone do the legislating,” he said. AZDA “has responsibility to execute or implement the policies that the Legislature enacts.”
The rule was created after Arizona egg producers and industry groups lobbied AZDA, the legal complaint states.
Initially, they went to the Legislature to seek legislation mandating the cage-free housing of egg-laying hens, but they were directed to AZDA instead.
“AZDA then promulgated the rule itself without any further input from the Arizona Legislature pursuant to an impermissibly broad statutory delegation of lawmaking power,” the document says.
“Neither Arizona’s statutes governing executive branch rulemaking nor the Arizona Constitution permit AZDA to promulgate rules pursuant to such a standardless grant of authority.”
Giving AZDA this power “led to a collusive process in which egg producers and industry groups worked closely with the agency to develop the rule they wanted[.]”
The statute the Legislature relied on when issuing the rule “does not specifically authorize AZDA to issue a rule requiring egg-laying hens to be housed in a cage-free manner or to otherwise regulate the housing of egg-laying hens.”
And the statute itself “provides no standards, policies, or otherwise intelligible principles for AZDA to follow in its development of poultry husbandry and egg production regulations or by which the reasonable necessity of any such regulation can be evaluated,” the legal complaint said.
Mr. Robbins said he was optimistic about the case.
“I think we’re confident in our arguments,” he told The Epoch Times.
The Epoch Times reached out for comment to Paul Brierly, director of the Arizona Department of Agriculture.
He replied: “No comment at this time.”
