Overview
California may have finally lost its 40+ year effort to ban sales of alligator and crocodile products based on federal preemption. Luxury retailers got an early holiday gift on October 13, 2020, when Judge Kimberly J. Mueller of the Eastern District of California granted a motion for a preliminary injunction enjoining enforcement of California's ban on the sale of alligator and crocodile products, Penal Code Section 653o. The October 13th order extends the injunction until final disposition of the case, giving purveyors of alligator and crocodile goods another reprieve, and signaling that the state law may never take effect because it is likely preempted by federal law.
Plaintiffs' Motion for Preliminary Injunction
In the case of April in Paris et al. v. Becerra (brought by a group of 11 farmers, retailers, and manufacturers) and Delacroix Corp et al. v. Becerra (brought by one of Louisiana's largest coastal landowners, in conjunction with the Louisiana Landowners Association and Louisiana Wildlife and Fisheries Commission), the court determined that plaintiffs would likely succeed in their assertion that section 653o is preempted by the federal Endangered Species Act (ESA) § 6f, codified as 16 U.S.C. § 1535(f).
Section 1535(f) provides: "Any State law or regulation which applies with respect to the importation or exportation of, or interstate or foreign commerce in, endangered species or threatened species is void to the extent that it may effectively … prohibit what is authorized pursuant to an exemption or permit provided for in this chapter or in any regulation which implements this chapter." Plaintiffs in April in Paris argued that the Fish and Wildlife Service Regulations and the Convention on International Trade in Endangered Species of Wild Fauna and Flora (CITES), which regulates international trade of wild animals, including American alligator and Nile and saltwater crocodiles, constitute authorization under an "exemption or permit" that contradicts California's ban. As a result, the court held that the California law is likely preempted by section 1535(f).
The court balanced the relative harms to the parties, noting that the government enforcers' interest was purely to advance a public policy objective, whereas for the plaintiffs if an injunction was not granted they would suffer "significant immediate harm" because "their businesses rely in large part on the ability to continue;" and absent an injunction, they would suffer from lost sales, lost business relationships, and lost goodwill. The court cited declarations from numerous industry members that described the potential impact of the ban, including "complete liquidation of Beverly Hills, California-based alligator and crocodile business," "[a] need to move from California to continue using specialized trade skills," and that California's economy will be significantly harmed given that "California accounts for nearly 30% of the retail sales of luxury leather goods in the United States." Although injunctions are not often warranted in cases involving purely "economic injuries," the court explained that because plaintiffs may not otherwise be able to recover monetary damages from the losses they would suffer, and given that "the harms alleged are likely to be diffuse, industrywide and difficult to quantify as damages," injunctive relief was warranted: "It appears there would be no way to remedy after the fact the harms plaintiff[s] would suffer[] without an injunction."
In considering the competing public policy interest of the State of California to protect wildlife, the court found that because section 653o was likely preempted, "[t]he question is not which policy better protects animals, but whether state or federal law controls. Although California has its own interest in protecting animals, the reach of that interest ends where the preemptive effect of federal law begins."
California's 40+ Year Wrestling Match to Keep Alligator Products out of the State
Judge Mueller's ruling is not the first of its kind. In 1979, a federal judge blocked then-Governor Jerry Brown from enforcing a prohibition on the American alligator trade in Fouke Co. v. Brown, 463 F. Supp. 1142 (E.D. Cal. 1979) based on federal ESA preemption. Because the Fouke injunction is still in effect, the court in April in Paris and Delacroix placed the burden on the government defendants to show why the rationale of Fouke should no longer apply – which burden the defendants failed to meet on all fronts.
The California Legislature lifted the ban in 2006 but added a sunset provision that would reinstate it in 2010, once again making the importation and sale of alligator and crocodile parts illegal. Additional sunset provisions were added in 2009 and 2014. In 2019, similar efforts to repeal or postpone section 653o's crocodile/alligator ban were made but none were passed before the end of the legislative session on September 13, 2019. As of October 27, 2020, only one of those efforts is still viable, AB 719, which is still in the Senate Appropriations Committee, and would require manufacturers to submit proposals to the Department of Fish and Wildlife on technology to track the source of crocodile or alligator hides used in the manufacturing process. For companies that do not use such tracking systems, the bill would prohibit the importation or sale of alligator and crocodile products into the state after March 30, 2022.
Conclusion
For, usually luxury, retailers that sell alligator and crocodile products, this is a welcome decision, coming at a particularly opportune time immediately before the holiday season following the devastating impact of COVID on the retail industry. Not only does the preliminary injunction delay the potential implementation of the alligator and crocodile ban, the October 13th order evidences that the ban would likely be preempted. Nevertheless, given the rollercoaster ways of this law, and the steep penalties that attach for violations when and if it is ever implemented, retailers that sell any exotic animal skin products would be wise to track the consolidated April in Paris case and legislative efforts aimed at banning the sale of alligators and crocodile products.