Port Washington, WI – Ozaukee County Circuit Court Judge Paul Malloy ruled Tuesday against the state of Wisconsin’s request for dismissal of a lawsuit seeking to overturn a ban on imported butter that does meet Wisconsin’s label requirements.

“I’m very reluctant to grant a motion for dismissing those three counts,” Malloy said. “And if anything the parties have at least met their obligations of coming forward with enough allegations to survive. That, and it’s a matter of how the law is applied after discovery.”

Malloy asked the attorneys for both sides to give him a schedule for discovery in the case in a week for scheduling future court dates. Discovery could be six to nine months, according to Wisconsin Institute for Law & Liberty President Rick Esenberg who is representing the plaintiffs seeking to have the 1953 butter label law declared in violation of the state constitution. Afterwards either or both sides could ask for summary judgement, and if that fails the case could go to trial.

Photo by James Wigderson

Judge Paul Malloy listens to Assistant Attorney General Katherine Spitz, WILL President Rick Esenberg and WILL Attorney Jake Curtis debate whether the state’s motion to dismiss was appropriate.

At issue is the Wisconsin law that prevents the sale of butter in Wisconsin that has not been graded and labeled by the Department of Agriculture, Trade and Consumer Protection (DATCP). The DATCP website states:

All butter sold in Wisconsin must contain a label bearing a statement of the grade determined using the process outlined above. The grade statement must include reference to Wisconsin and the grade with some acceptable variations including abbreviation of Wisconsin to Wis. and the grade letter can precede the word “grade”. The following are both considered acceptable labeling statements: Wisconsin Grade AA or Wis. AA Grade. The statement must be in a font size that is no smaller than 12-point type on a strongly contrasting background and should prominently appear on the part or panel of the label that is presented or displayed under customary conditions of purchase.

For grades AA or A, a uniform grade insignia may be used on the package consisting of the grade statement enclosed by an outline map of Wisconsin. The lines forming the map cannot be less than 3 points in width and no other writing can appear within the outline map.

The only exception to the law is if the federal government has already labeled and graded the butter U.S. Grade AA, U.S. Grade A or U.S. Grade B.

Violators of the 1953 law could face up to one year in a county jail, up to $5,000 in fines, and a permanent injunction against future butter sales, according to WILL.

WILL filed the lawsuit to overturn the law on behalf of four consumers and Slow Pokes Local Foods, a Grafton food store that would like to sell Kerrygold butter, a high-quality import butter from Ireland. Currently, the only way for Wisconsin consumers to purchase Kerrygold butter is to cross the state line, reminiscent of the “margarine runs” Wisconsinites made in the 1960s to purchase colored margarine.

The attorney general’s office moved to dismiss the case because they claimed the label requirement was a legitimate government function of providing consumers with information about the quality of the butter. However, Esenberg told the court the state had already conceded that the labeling requirement provided no additional health information about the butter product.

“The state concedes it does not serve any safety interest,” Esenberg said. “It does not serve any health interest. Although it says it is intended to protect the public from adulterated or misbranded products, the law doesn’t have anything to do with adulteration and misbranding. It doesn’t have anything to do with any claim the seller makes. It doesn’t have to do with whether there is a contaminate in the product.”

“It does not have anything to do with anything really that a consumer is not in a better position to ascertain for herself,” Esenberg said.

Much of the debate centered around whether it was appropriate for the case to be subject to a motion for dismissal given the “rational basis review” standard. Esenberg said that given the precedents for these types of review that, while a summary judgement could be considered after the facts of the case are discovered, it would present too high of a bar for plaintiffs seeking to overturn the law for the courts to defer to the state’s regulatory authority before the facts are known.

“It’s simply not possible to decide these cases on a motion to dismiss,” Esenberg said. “You simply can’t deny the plaintiff an opportunity to say, well, when you look at the facts, when you look at the situation on the ground, it’s not simply that we think the law is wrong, it’s not simply that we’re asking the court to substitute its judgement for the judgement of the legislature. But the facts on the ground establish there simply is no rational relationship between the law and a legitimate state purpose.”

After the hearing, Esenberg said the result was “very gratifying” for his clients.

“It re-affirms the notion if the state wants to restrict your ability to earn a living, to engage in a legitimate business,” Esenberg said. “It has to offer some real reason, some reason that bears a rational connection to the purpose that the state is trying to achieve. And that it is necessary for courts not simply to accept whatever the government says.”

Assistant Attorney General Katherine Spitz declined to comment after the hearing, referring all questions to the attorney general’s office.

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