Virginia Law

As used in this chapter, unless the context requires a different meaning:

"Affiliate" means any person or subsidiary thereof, who has, either directly or indirectly, actual or legal control over a distributor, whether by stock ownership or in any other manner.

"Books and records" mean books, records, accounts, contracts, memoranda, documents, papers, correspondence, or other data, pertaining to the business of the person in question.

"Commission" means the Milk Commission.

"Consumer" means any person, other than a milk distributor, who purchases milk for human consumption.

"Distributor" means any of the following persons engaged in the business of distributing, marketing, or in any manner handling fluid milk, in whole or in part, in fluid form for consumption in the Commonwealth:

1. Persons, regardless of whether any such person is a producer:

a. Who pasteurize or bottle milk or process milk into fluid milk;

b. Who sell or market fluid milk at wholesale or retail to: (i) hotels, restaurants, stores, or other establishments for consumption on the premises; (ii) stores or other establishments for resale; or (iii) consumers; or

c. Who operate stores or other establishments for the sale of fluid milk at retail for consumption off the premises.

2. Persons, wherever located or operating, whether within or without the Commonwealth, who purchase, market, or handle milk for resale as fluid milk in the Commonwealth.

"Health authorities" include the Board of Health, the Office of Dairy and Foods in the Department, and the local health authorities.

"Licensee" means a licensed milk distributor.

"Market" means any locality, or two or more localities, and surrounding territory designated by the Commission as a marketing area.

"Milk" means the clean lacteal secretion obtained by the complete milking of one or more healthy cows properly fed, housed, and kept; including milk that is cooled, pasteurized, standardized, or otherwise processed with a view to selling.

"Producer" means any person, regardless of whether they are also a distributor, who produces milk for sale as fluid milk in the Commonwealth.

"Producer-distributor" means a distributor who handles only milk produced by himself.

"Sanitary regulations" include all laws and ordinances relating to the production, handling, transportation, distribution, and sale of milk and, so far as applicable, regulations adopted by the Board or the health authorities.

"Subsidiary" means any person that a distributor or an affiliate of a distributor has, or several distributors collectively have, either directly or indirectly, actual or legal control, whether by stock ownership or in any other manner.

Code 1950, § 3-346; 1966, c. 702, § 3.1-425; 2008, c. 860.

The Milk Commission is continued within the Department and shall report directly to the Commissioner. The Commission shall consist of an Administrator and seven members, all of whom shall be residents of the Commonwealth, appointed by the Governor, two of whom shall be producers, and five including the Administrator shall be consumers but none of such five latter members shall have any connection financially or otherwise with the production or distribution of milk or products derived therefrom. The remaining member of the Commission shall be a milk processor-distributor. The Administrator shall serve in an ex officio capacity without a vote. Any vacancies occurring shall be filled by appointment by the Governor. One member of the Commission shall act as chairman, who shall be elected annually by the membership of the Commission. No member shall serve as chairman and as Administrator and no chairman shall serve successive terms as chairman.

The Administrator shall devote full time to the duties of his office, which shall be located in the principal office of the Commission. The technical and other services for such Commission shall be performed, so far as practicable, by the Department, the Virginia Cooperative Extension Service, and the Virginia Agricultural Research and Experiment Station, without additional compensation. The Administrator may appoint a secretary and any such additional technical and other assistants and employees as may be necessary to carry out the provisions of this chapter, and prescribe their powers and duties. The Administrator shall supervise such personnel and shall prepare, approve, and submit all requests for appropriations and be responsible for all expenditures pursuant to appropriations.

Code 1950, § 3-347; 1958, c. 110; 1966, cc. 526, 702, § 3.1-426; 1974, c. 467; 1984, c. 444; 1985, c. 397; 2004, c. 57; 2008, c. 860.

The Administrator of the Commission shall hold office at the pleasure of the Governor for a term concurrent with the term of the Governor making the appointment or until a successor to that Administrator is appointed by the next succeeding Governor. The remaining seven members shall be appointed by the Governor for a term of four years. No member except the Administrator may serve for more than two consecutive terms of four years each. Any member appointed to fill an interim vacancy may be appointed for two additional consecutive terms of four years each after the expiration of the term of the interim vacancy that the member filled. After an absence of two years from the Commission, any former member may be reappointed for a maximum of one additional term of four years.

Code 1950, § 3-347.1; 1966, c. 526, § 3.1-426.1; 1974, c. 467; 1984, c. 355; 2008, c. 860.

The Commission shall meet on the call of the chairman or three of its members whenever he or they may deem necessary, and at such place as he or they may designate. Three members of the Commission shall constitute a quorum.

Code 1950, §§ 3-347.2, 3-351; 1966, cc. 526, 702, §§ 3.1-426.2, 3.1-429; 2008, c. 860.

The Commission shall be vested with the following powers:

1. To confer and cooperate with the legally constituted authorities of other states and of the United States, with a view of securing a uniformity of milk control, with respect to milk coming into the Commonwealth and going out of the Commonwealth in interstate commerce, with a view of accomplishing the purposes of this chapter and to enter into a compact or compacts for such uniform system of milk control;

2. To investigate all matters pertaining to the production, processing, storage, transportation, distribution, and sale of milk in the Commonwealth;

3. To supervise, regulate, and control the production, transportation, processing, storage, distribution, delivery, and sale of milk for consumption within the Commonwealth;

4. To act as mediator or arbiter in any controversial issue that may arise among or between milk producers and distributors, as between themselves, or that may arise between them as groups;

5. To examine into the business, books, and accounts of any milk producer, association of producers, or milk distributors, their affiliates or subsidiaries; to issue subpoenas to milk producers, associations of producers, and milk distributors, and to require them to produce their records, books, and accounts; to subpoena any other person from whom information is desired;

6. To take depositions of witnesses within, or without, the Commonwealth. Any member of the Commission, or any employee designated by the Commission, may administer oaths to witnesses and sign and issue subpoenas; and

7. To make, adopt, and enforce all regulations or orders necessary to carry out the purposes of this chapter. Every order of the Commission shall be posted for inspection in the main office of the Commission, and a certified copy filed in the office of the Commissioner. An order, applying only to a person named therein, shall be served on the person affected. An order, that is required to be served, shall be served by personal delivery of a certified copy, or by mailing a certified copy in a sealed envelope, with postage prepaid, to each person affected; or, in the case of a corporation, to any officer or agent of the corporation upon whom legal process may be served. If an order is not required to be served, then it shall be posted in the main office of the Commission and filed in the office of the Commissioner, which shall constitute due and sufficient notice to any person affected by the order.

Code 1950, § 3-352; 1966, c. 702, § 3.1-430; 2008, c. 860.

Any provision of this chapter conferring a general power upon the Commission shall not be impaired or qualified by the granting to the Commission by this chapter of a specific power.

Code 1950, § 3-353; 1966, c. 702, § 3.1-431; 2008, c. 860.

A. The Commission shall neither exercise its powers in any market, nor withdraw the exercise of its powers from any market, until after a public hearing is held for such market, and the Commission determines whether it will be in the public interest to exercise its powers in that market.

B. The Commission may on its own motion, call a public hearing as required under subsection A and shall call a public hearing upon the written application of a producers' association organized under Chapter 3 of Title 13.1 (§ 13.1-301 et seq.), supplying in the judgment of the Commission, a substantial proportion of the milk consumed in such market. If no such producers' association exists on such market, the Commission shall call a public hearing upon the written application of producers supplying a substantial proportion of the milk consumed in such market; and shall call a public hearing upon the written application of distributors distributing a substantial proportion of the milk consumed in that market.

C. The Commission may determine notice requirements and the time and location of any public hearing held under this section.

Code 1950, §§ 3-354 to 3-357; 1966, c. 702, §§ 3.1-432 to 3.1-435; 2008, c. 860.

The Commission may define a market area and define and fix the limits of the territorial area where milk shall be produced to supply a market area. Any producers, producer-distributors, or their successors currently shipping milk to any market may continue to do so until they voluntarily discontinue shipping to the designated milk market.

Code 1950, § 3-362; 1966, c. 702, § 3.1-441; 1974, c. 467; 2008, c. 860.

The Commission, after a public hearing and investigation, may establish the prices to be paid producers or associations of producers by distributors in any market, may fix the minimum and maximum wholesale and maximum retail prices to be charged for milk in any market, and may also establish different prices for different grades or classes of milk. The Commission may set different maximum retail prices for the same grade or class of milk on the basis of different methods of distribution. In determining the reasonableness of prices to be paid or charged in any market for any grade, quantity, or class of milk, the Commission shall be guided by all pertinent economic factors relevant to production, processing, and distribution of milk as they affect the public interest in maintaining an adequate supply of milk within the Commonwealth, including compliance with all sanitary regulations in force in such market, necessary operation, processing, storage, and delivery charges, the prices of other foods, and the welfare of the general public. The Commission may adopt a formula incorporating these economic factors that will adjust automatically the prices to be paid producers or associations of producers by distributors in any market, and then provide for the automatic adjustment of resale prices according to the result obtained by the use of this formula. Public hearings shall not be required for price adjustments obtained by use of a formula, but shall be held for adoption or amendment of the formula itself.

Code 1950, § 3-359; 1966, c. 702, § 3.1-437; 1974, c. 467; 2008, c. 860.

The Commission shall have no authority to establish a minimum retail price for milk, except upon a determination after a public hearing that the absence of a minimum retail price has caused or is about to cause a disruption in the Virginia milk market or some segment of the market that is likely to depress the producer price or has caused or is likely to cause a substantial reduction in competition between processor-distributors in an area, so as to adversely affect the public health and welfare that requires an adequate supply of milk at reasonable and fair prices. In accordance with the Administrative Process Act, § 2.2-4000 et seq. and in particular § 2.2-4002, the Commission may establish minimum retail prices on an emergency basis, prior to public hearing.

The Commission, in establishing any minimum retail price when it deems it necessary to do so, shall impose a minimum retail price only for an area or political subdivision wherein the public interest as herein set forth justifies a minimum retail price being set and shall be guided by the same factors used in determining the reasonableness of prices under § 3.2-3208. The Commission shall periodically review all outstanding minimum retail price orders to insure that they do not remain in effect any longer than the public interest requires.

1974, c. 467, § 3.1-437.1; 2008, c. 860.

The Milk Commission shall prepare and adopt a system of accounting designed to show, for each distributor of milk and milk products, under the supervision of the Commission, the total purchases by any distributor of each grade or class of milk; the total sales by each distributor and the revenue therefrom, for each grade or class of milk and the quantity thereof. Such accounting system shall be designed to show total purchases including the respective grades or classes of milk bought, as well as the total sales and the respective classes or grades of milk sold.

Each distributor of milk and milk products under the supervision of the Commission shall adopt and use the system of accounting adopted by the Milk Commission. The books and records of each distributor shall be open to inspection by the Commission or its agents during regular business hours, and shall be audited by it at such regular intervals as shall be prescribed by the Milk Commission.

It shall be unlawful for any distributor to pay for milk upon any such basis of grade or class lower than that upon which such milk is sold or used by him. Nothing herein shall prevent the sale of a grade or class of milk by a distributor as milk of a lower grade or class. It shall be unlawful for any distributor to fail to use the system of accounting herein prescribed or refuse to allow the same to be inspected or audited.

Code 1950, § 3-359.1; 1956, c. 74; 1966, c. 702, § 3.1-438; 2008, c. 860.

Any Commission employee designated for the purpose, shall have access to, and may enter at all reasonable hours, all places where milk is stored, bottled, or manufactured into food products and any designated employee shall have the power to inspect books and records in any place within the Commonwealth for the purpose of ascertaining facts to enable the Commission to administer this chapter. All information ascertained shall be confidential, unless the parties concerned agree to its being given out. The Commission may combine such information for any market and make it public.

Code 1950, § 3-361; 1966, c. 702, § 3.1-440; 2008, c. 860.

The Commission may require all distributors in any market designated by the Commission to be licensed by the Commission for the purpose of carrying out the provisions of this chapter. The Commission may decline to grant a license, or may suspend or revoke a license already granted upon due notice and after a hearing. The Commission may classify licenses, and may issue licenses to distributors to process or store or sell milk to a particular city or to a particular market within the Commonwealth.

Code 1950, § 3-360; 1966, c. 702, § 3.1-439; 2008, c. 860.

Each licensee shall furnish to the Commission verified reports containing information as required by the Commission.

Code 1950, § 3-364; 1966, c. 702, § 3.1-443; 2008, c. 860.

No distributor in a market covered by the provisions of this chapter shall buy milk from producers, or others, for sale within the Commonwealth, or sell or distribute milk within the Commonwealth, unless the distributor is duly licensed under the provisions of this chapter. It shall be unlawful for a distributor to buy milk from or sell milk to a distributor who is not licensed as required by this chapter. It shall be unlawful for any distributor to deal in, or handle milk if such distributor has reason to believe it has previously been dealt in, or handled, in violation of the terms and provisions of this chapter.

Code 1950, § 3-365; 1966, c. 702, § 3.1-444; 2008, c. 860.

Each distributor shall submit an application to the Commission for a license to operate as a distributor by mail, or otherwise, within five days after the provisions of this chapter become effective in a market. Thereafter, any distributor shall obtain a license to operate as a distributor before beginning business in that market. The application shall be made on forms furnished by the Commission.

Code 1950, § 3-366; 1966, c. 702, § 3.1-445; 2008, c. 860.

The licenses required by this chapter shall be in addition to any other licenses required by existing laws of the Commonwealth or by any municipal ordinance.

Code 1950, § 3-367; 1966, c. 702, § 3.1-446; 2008, c. 860.

A. Any person affected by and claiming the unlawfulness of any regulation of the Commission, or person aggrieved by and claiming the unlawfulness of a case decision or an order of the Commission may appeal to the Circuit Court where the principal office of the Commission is located. Except as otherwise provided in this section, Article 5 (§ 2.2-4025 et seq.) of the Administrative Process Act shall govern such appeal.

B. Upon filing of its pleadings by the Commission the cause shall be matured for hearing, and upon application of either party, the cause shall be placed at the head of the docket and heard forthwith.

C. Mere technical irregularities in the procedure of the Commission shall not be the basis of the decision of the court. In an appeal from an order or decision of the Commission, the case shall be heard upon the record certified to the court by the Commission. Additional testimony shall not be taken before the court, except to clarify the record or to introduce evidence as to the effect of the order upon the business of parties to the record below, or of producers standing in the same position as producer parties of record, but the court may, in proper cases, remand the record of the Commission for the taking of such further testimony as was not available upon the hearing appealed from, or such other testimony as the court shall provide may be taken. No part of the record, containing verbal or documentary evidence, shall be disregarded by courts because of technical rules of evidence.

Code 1950, §§ 3-369, 3-371; 1966, c. 702, §§ 3.1-448, 3.1-450; 1996, c. 573; 2008, c. 860.

Any person failing to comply with any subpoena issued by the Commission or pursuant to its authority is guilty of a Class 2 misdemeanor, and each day during which such violation shall continue shall be deemed a separate offense. In the event any person shall fail to comply with any regulation or order of the Commission, or obey any subpoena issued, or in the event of the refusal of any witness to testify to any matter concerning which he lawfully may be interrogated by the Commission or its representative, it shall be the duty of the Circuit Court where the principal offices of the Commission are located, upon application of the Commission, to compel obedience by attachment proceedings for contempt as in the case of disobedience of the requirements of a subpoena issued from the court, refusal to testify therein, or disobedience of an order or decree of the court. The proceedings herein authorized in the Circuit Court to compel obedience shall be in addition to the provisions of this section defining what shall constitute a misdemeanor and providing and prescribing the punishment therefor.

Code 1950, § 3-372; 1966, c. 702, § 3.1-451; 2008, c. 860.

The Commission shall prepare an annual budget and shall collect the sums of money required for this budget from the licensed distributors in markets where the provisions of this chapter are in operation. The expenses of the Commission, including salaries and the per diem of such personnel as the Commission finds it necessary to employ to properly carry out its functions under this chapter shall be met by an assessment of not over five cents ($0.05) per 100 pounds of milk, and cream (converted to terms of milk) handled by distributors and not over five cents ($0.05) per 100 pounds of milk, and cream (converted to terms of milk) sold by producers; these assessments to be the same per 100 pounds on producers and distributors. The exact amount of each monthly or semimonthly assessment shall be determined by the Commission as necessary to cover its expenses. All assessments shall be paid at the time the distributors pay the producers for the milk. All officers and employees of the Commission, who handle funds of the Commission or who sign or countersign checks upon such funds, shall severally give bond in such amount and with such sureties as shall be determined by the Commission. The cost of the bonds shall be paid by the Commission and the Commission shall determine the amount and sufficiency of the bonds.

Code 1950, § 3-373; 1958, c. 110; 1966, c. 702, § 3.1-452; 1974, c. 467; 1986, c. 408; 2008, c. 860.

There is hereby created in the state treasury a special nonreverting fund to be known as the Virginia Milk Commission Assessments Fund, hereafter referred to as "the Fund." The Fund shall be established on the books of the Comptroller. All receipts from assessments paid under this chapter shall be paid into the state treasury and credited to the Fund. Interest earned on moneys in the Fund shall remain in the Fund and be credited to it. Any moneys remaining in the Fund, including interest thereon, at the end of each fiscal year shall not revert to the general fund but shall remain in the Fund. Moneys in the Fund shall be used solely for the purposes of administering this chapter. Expenditures and disbursements from the Fund shall be made by the State Treasurer on warrants issued by the Comptroller upon written request signed by the Administrator or his duly authorized agent.

Code 1950, § 3-374; 1966, c. 702, § 3.1-453; 2008, c. 860.

If any person violates any provision of this chapter or the regulations adopted under this chapter, then either the Commissioner or the State Health Commissioner may petition any appropriate circuit for relief by injunction, without being compelled to allege or prove that an adequate remedy at law does not exist.

Code 1950, § 3-379; 1966, c. 702, § 3.1-458; 2008, c. 860.

Any person violating any provision of this chapter or of any license issued by the Commission is guilty of a Class 2 misdemeanor. Each day during which such violation shall continue shall be deemed a separate violation. Prosecutions shall be instituted by the attorney for the Commonwealth.

Code 1950, § 3-380; 1966, c. 702, § 3.1-459; 2008, c. 860.

The making of marketing agreements between producers' cooperative marketing associations and distributors and producer-distributors under the provisions of this chapter shall not be deemed a combination in restraint of trade or an illegal monopoly; or an attempt to lessen competition or fix prices arbitrarily, nor shall the marketing contract or agreements between the association and the distributors and producer-distributors, or any agreements authorized in this chapter, be considered illegal or in restraint of trade.

Code 1950, § 3-382; 1966, c. 702, § 3.1-461; 2008, c. 860.

No provision of this chapter shall apply or be construed to apply to foreign or interstate commerce, except insofar as the same may be effective pursuant to the United States Constitution and to the laws of the United States enacted pursuant thereto.

Code 1950, § 3-381; 1966, c. 702, § 3.1-460; 2008, c. 860.