United States District Court, District of Columbia
E. BOASBERG United States District Judge.
three Opinions, the Court has finally chopped this case all
the way down to its stump. All that remains is the
determination of a remedy. Yet just as the roots of the tree
are often tricky to yank out, such is the predicament here.
This dispute involves Defendant U.S. Department of
Agriculture's so-called Softwood Lumber Checkoff Order,
which authorized its Softwood Lumber Board to collect
assessments from lumber companies and then to spend those
funds on marketing efforts on behalf of the softwood-lumber
industry as a whole. Plaintiff Resolute Forest Products,
Inc., which was assessed some $1.1 million since the Order
went into effect in 2011, challenged the Department's
Order as unlawfully promulgated. This Court ultimately
agreed. See Resolute Forest Prods., Inc. v. U.S.
Dep't of Agric. (Resolute III), No.
14-2103, 2016 WL 2885869 (D.D.C. May 17, 2016).
now asks for its money back. That simple request, however, is
laden with complicated questions of sovereign immunity, the
statutory authority for relief, and considerations of equity.
Following a status hearing, submissions on the remedies
question, and supplemental Court-ordered briefing, the Court
ultimately determines that a full refund of the illegal
assessments is indeed due.
Opinions have mostly set the backdrop for the latest spat
between Resolute and the Department of Agriculture as well as
its Secretary, Tom Vilsack (the two of which the Court will
refer to jointly as Defendant). See Resolute III,
2016 WL 2885869, at *1-3; Resolute Forest Prods., Inc. v.
U.S. Dep't of Agric. (Resolute II), No.
14-2103, 2016 WL 1714312, at *1 (D.D.C. Feb. 2, 2016);
Resolute Forest Prods., Inc. v. U.S. Dep't of
Agric. (Resolute I), 130 F.Supp.3d 81, 86-88
(D.D.C. 2015). Even so, because none of those dispositions
focused on remedial issues, the Court sketches in a few added
The CPRIA and Softwood Lumber Checkoff Program
has long regulated the promotion and sale of agricultural
commodities by enabling the federal government to coordinate
with industries to advance such promotional efforts.”
Resolute I, 130 F.Supp.3d at 86. Everything from
kiwifruit to popcorn is subject to federal marketing orders.
See 7 U.S.C. §§ 7461-7491.
issue here is softwood lumber. For that product, the
Commodity Promotion, Research, and Information Act of 1996
(CPRIA), id. §§ 7411-7425, empowers the
Secretary to issue an order that creates an industry-led
board and allows that board to collect assessments from
lumber companies so that it can engage in marketing campaigns
for the industry as a whole. See id. §§
7413(a), 7414(b), (c)(1); Resolute I, 130 F.Supp.3d
at 87. To protect small-volume lumber distributors and
minimize administrative costs, the Secretary may specify in
that order that a “de minimis quantity of an
agricultural commodity” produced annually by each
company is exempt from these fees. See 7 U.S.C.
present case, the Secretary's Softwood Lumber Checkoff
Order - promulgated in 2011 following notice-and-comment
rulemaking - did precisely these things. First, the Checkoff
Order established the Softwood Lumber Board to carry out
lumber-promotion activities. See Softwood Lumber
Research, Promotion, Consumer Education and Industry
Information Order, 76 Fed. Reg. 46, 185 (Aug. 2, 2011).
Next, to fund those activities, the Checkoff Order required
industry members that trafficked in more than a de
minimis quantity of softwood lumber - specifically, 15
million board feet (15mmbf) per fiscal year - to pay
assessments to the Board. See Resolute I, 130
F.Supp.3d at 87; see also 7 U.S.C. §
7415(a)(1). Those members producing less are exempt from such
certain as taxes are, few are keen to pay the toll.
Suspecting as much, the CPRIA provides a legal mechanism for
companies to object to a checkoff order. Relevant here, the
Act allows disgruntled members to bring administrative, and
then judicial, challenges to an order.
statute provides, first, for administrative relief:
A person subject to an order issued under this subchapter may
file with the Secretary a petition -
(A) stating that the order, any provision of
the order, or any obligation imposed in connection with the
order, is not established in accordance with law; and
(B) requesting a modification of the order
or an exemption from the order.
Id. § 7418(a)(1). Once the Secretary rules on
the petition, federal district courts then have
“jurisdiction to review the final ruling on the
petition of the person.” Id. §
7418(b)(1). If the order is unlawful, however, courts have a
choice of remedies:
If the court determines that the ruling is not in accordance
with law, the court shall remand the matter to the Secretary
with directions -
(A) to make such ruling as the court
determines to be in accordance with law; or
(B) to take such further action as, in the
opinion of the court, the law requires.
Id. § 7418(b)(3).