IJ Puts “Regulatory Capture” On Trial

April 1, 2008

Chris Johnson spent years learning how to float (or file) horses’ teeth from his father, Jim. By contrast, veterinary students in Minnesota typically receive about 40 minutes of instruction and practice in horse teeth floating, and they are not even graded for competence.

So who are state bureaucrats trying to put out of business when it comes to floating teeth in the North Star State? Thanks to the politically powerful veterinary cartel, the answer is Chris Johnson. Enter the Institute for Justice Minnesota Chapter, which filed suit on behalf of Chris in August 2006 and took the case to trial in January 2008. The trial lasted four days and featured all the hallmarks of IJ-style public interest litigation, from the clarion call for economic liberty, to inspirational clients and witnesses, to outstanding teamwork among IJ lawyers and staff from multiple offices. This was also IJ-MN Executive Director Lee McGrath’s first trial as lead attorney, which is a major rite of passage for litigators and one that showed Lee at his dedicated, unflappable best.

As intense as trials are, the preparation and lead-up phase can be nearly as exhausting, with multiple filing deadlines, boxes of documents to cull, and witnesses to prepare. But Lee, along with IJ Staff Attorney Nick Dranias and paralegal Margaret Daggs, worked tirelessly to make sure IJ-MN’s trial debut would be a smash.

Veterinarians—who charge up to three times more than horse teeth “floaters”—could not compete with Chris, or his father, Jim Johnson, above, so they looked to Minnesota’s Board of Veterinary Medicine to protect the economic booty that they could not earn in the market.

And it was.

The trial began with client Chris Johnson explaining the concept of horse teeth floating to an engaged and inquisitive trial judge. Chris described how horses’ teeth grow throughout their lifetimes and need to be filed down or “floated” periodically so the horse can chew its food properly. Taking his lead from Lee’s pitch-perfect direct examination, Chris even demonstrated how a float is done, using a horse’s skull and his own tools. By the end of his testimony, it was clear to everyone in the courtroom that Chris is a highly skilled, well-trained professional who knows more about floating horses’ teeth than most veterinarians.

Citing scheduling conflicts, the state’s lawyers next asked if they could call one of their own expert witnesses. As it turns out, the witness, a professor at Minnesota’s veterinary college, was more helpful to our case than to the state’s. Although the state’s direct examination was underwhelming, establishing little more than the fact that germs can be spread by people who do not wash their hands or their instruments after working with farm animals, the cross-examination was considerably more lively.

Among other things, we confronted the state’s expert with several graphic pictures of a calf being dehorned, which is a messy and painful procedure that, unlike horse teeth floating, requires no license in Minnesota. The witness was forced to admit, albeit reluctantly, that dehorning is a much more invasive and painful procedure than floating, and that it presents a far greater risk of disease transmission.

And that became one of the central—and, we think, devastating—themes of the trial: namely, that Minnesota has no coherent reason for singling out horse teeth floating among a wide range of other, far more invasive and potentially dangerous animal husbandry practices such as dehorning, castration and tail-docking, as something that can only be done by state-licensed veterinarians (or specially certified equine dentists working under the supervision of veterinarians).

Other witnesses included a local farrier who explained how much more invasive her work can be than a floater’s because she drives nails into a horse’s hoof within millimeters of living tissue; a farmer who told us more than we ever wanted to know about pig castration; and a long-time horse owner who explained how hard it is to find any veterinarian (let alone a competent one) willing to float her horses’ teeth. Finally, we called University of Minnesota Economics Professor Morris Kleiner, who testified that the state’s regulation of horse teeth floaters showed all the hallmarks of “regulatory capture”—when industry insiders take hold of government power to keep out competition.

As usual in such trials, the judge did not issue a ruling at the end of the bench trial, but instead asked for post-trial briefs. We certainly won the moral battle in the courtroom, so our task now is to show that the just and reasonable result—allowing Chris Johnson to float horses’ teeth without pointless government restriction—is also the proper legal result. We believe the Minnesota Constitution is firmly on our side there, and we are optimistic about a favorable outcome.

Each of the Institute for Justice’s battles for economic liberty, no matter how seemingly arcane or obscure, is another important thread in the larger tapestry of precedents we are working to weave back into America’s constitutional jurisprudence. A victory for Chris will help win a victory for the next entrepreneur we represent. Step by step, case by case, we are moving toward a day when judges give our economic liberties, including the right to earn an honest living, the same respect they give other constitutional rights. With your help, we are working to get there.

Clark Neily is an IJ senior attorney.

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