Full Title Name:  Detailed Discussion of Dog Auctions and Retail Rescue

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Kayla Venckauskas Place of Publication:  Michigan State University College of Law Publish Year:  2018 Primary Citation:  Animal Legal & Historical Center 1 Country of Origin:  United States
Summary: This paper first describes a typical dog auction. Next, the paper details the factors that have led to dog auctions being fueled by well-intentioned rescue groups, relevant law that applies to dog auctions and what other legislative factors impact this trend. Finally, the paper offers potential solutions to shore up this growing problem.

I. Introduction

Puppy mills and large-scale commercial breeders are the common enemy to most rescue groups. And for decades these groups have found themselves in the same room at odds with one another in a strange situation due to the classification of dogs as mere property. Dog auctions were a place where these millers and breeders could go to sell off their unwanted stock of dogs and equipment to others in the field, and also to desperate rescuers who would pay pennies for what the sellers had determined were worthless baggage. Historically, the rescuers would often pay very low prices, as they were often considered to be taking the dogs off the millers’ hands and all would continue on their way.

In the last decade or so, with the rise of animal welfare campaigns and social media, the model of these dog auctions has revamped itself. Now, it is not uncommon for the dog auctions to be filled with rescuers who are paying top dollar for purebred puppies. There are a few factors and a few actors contributing to this change in dynamic. First, some suggest that successful spay and neuter programs have affected the supply of “desirable” puppies. Has the Rescue Movement Lost Its Way?, CCHS News (April 2018), available at http://www.cuhumane.org/NewsEvents/NewsDetails/tabid/84/nid/52/r/1/Default.aspx. Second, there is a stigma surrounding buying from breeders and pet stores. Third, there is a lack of communication among rescue groups as to what bidding is appropriate and how outbidding each other at auction may actually be helping the puppy mill industry flourish. And fourth, there is a growing need to fulfill breed specific rescue requests. Then there are the actors involved, including rescuers new to the scene and who often do not know who they are bidding against, rescuers trying to secure specific breed puppies, and the original type of rescuers who only take the leftover dogs that the millers and breeders dump for low sums.

This paper will first describe a typical dog auction. Next, the paper details the factors that have led to dog auctions being fueled by well-intentioned rescue groups, relevant law that applies to dog auctions and what other legislative factors impact this trend. Finally, the paper offers potential solutions to shore up this growing problem.  

II. The Dog Auction

Most people have never heard of a dog auction, let alone attended one. People picture either buying a dog from a respected breeder or adopting one from their local humane society. Yet, there exists a market where large-scale brokers of dogs go to sell off the dogs they no longer have use for or think they will get better money for than at retail stores. Kim Kavin is the author of one of the most revealing books on dog auctions, The Dog Merchants: Inside the Big Business of Breeders, Pet Stores, and Rescuers. In an interview with Kavin by Forbes in 2017, Kavin explained that larger auctions can bring in half a million dollars. Individual dogs can go for nearly $10,000. The most surprising factor is that these are supposed to be the “excess” or even “spent” dogs from breeders, and they are bringing in even higher prices than the retail dogs. Dogs for Sale: The Business of Dog Auctions, Forbes (April 2017), available at https://www.forbes.com/sites/megchristensen/2017/04/24/dogs-for-sale-the-business-of-dog-auctions/#74863220787f.

A. The Set-Up of the Dog Auctions

There are two big dog auctions in the country, the biggest being Southwest Auction Service, which was founded in 1988, and its smaller competitor, Heartland Sales, founded in 2003. Both auctions are located in Missouri and are a legal way for millers and commercial breeders to sell off their “stock” to anyone willing to pay. Dog Rescuers, Flush with Donations, Buy Animals From the Breeders They Scorn, Washington Post (April 2018), available at https://www.washingtonpost.com/graphics/2018/investigations/dog-auction-rescue-groups-donations/?utm_term=.bd5b38ef4f34. There are other dog auctions throughout the country, but they are typically much smaller in scale.

The auctions do not permit any type of photo or video documentation. A public flyer on the Southwest Auction Service website for an upcoming auction in September of 2018 contains the following language:


Southwest Auction Service flyer for September 22, 2018 (last visited Sep. 26, 2018), available at  http://www.swaauction.com/ and the page http://docs.wixstatic.com/ugd/d384ba_9e426f32b6284405b9cd85822cdd25b8.pdf [http://perma.cc/J3W6-5Z2B].

The millers and breeders looking to get rid of their stock will head there early in the morning with trucks that are filled with cages of their unwanted puppies and dogs. The practice began by these breeders looking to dump their worthless stock - older females who could no longer be used as breeding stock anymore, puppies with deformities, or any other older dog; auctions even functioned as “going out of business” types sales. In fact, the auctioneer’s statement for Southwest Auctions website explains that the current auction is a “kennel reduction” because the proprietor “kept back too many puppies and needs to liquidate a few.” Southwest Auction Service flyer for September 22, 2018 (last visited Sep. 26, 2018), available at  http://docs.wixstatic.com/ugd/d384ba_9e426f32b6284405b9cd85822cdd25b8.pdf [http://perma.cc/J3W6-5Z2B].

According to the Washington Post article, in previous years before rescues became heavily involved, the cages would be lined up and those looking to bid could walk around and take note of the dogs they might try to bid on. Then, everyone would take their places and, one by one, the dogs would be brought in their cages and put onto the table while the auctioneer describes their salvageable attributes and takes bids. The people who were bidding were often other millers or breeders. If a dog was not getting bids, then a rescuer would step in and pay next to nothing for the dog either during the auction or at the end when the dog had not gone for anything. Dog Rescuers, Flush with Donations, Buy Animals From the Breeders They Scorn, Washington Post (April 2018), available at https://www.washingtonpost.com/graphics/2018/investigations/dog-auction-rescue-groups-donations/?utm_term=.ce6858f54324.

B. Rescuers and Good Intentions

This is no longer the normal practice at these auctions. Now, rescuers are some of the predominant buyers of the miller’s and breeder’s stock. According to Kavin in her Washington Post article, a decade ago, rescue groups would buy dogs for five to ten dollars at these auctions. At current auctions, rescuers generate “about one-third, maybe even forty percent” of the auction income according to one auctioneer. Dog Rescuers, Flush with Donations, Buy Animals From the Breeders They Scorn, Washington Post (April 2018), available at https://www.washingtonpost.com/graphics/2018/investigations/dog-auction-rescue-groups-donations/?utm_term=.ce6858f54324.

Kavin and others suggest that the rise of breed specific rescue groups may inadvertently skew dog auctions. Breed specific rescue groups focus on providing families with a specific breed of rescue dog or puppy as opposed to a rescue dog or puppy that may be a mix or another more “undesirable” breed. There is often a shortage of the desired breed to actually be rescued. As a result, these groups raise funds through online campaigns to fund a trip to the auctions where they buy the desired dogs to bring to loving homes. Some critics argue that this is a misguided use of donated funds because this is essentially funding the continuation of puppy mills and commercial breeders by providing them the cash to buy new stock. Through successful Internet fundraising, rescues raise thousands of dollars to send people to rescue dogs from these dog auctions. Instead of paying thrift store pricing, the rescues spend thousands, sometimes $5,000 or more, on a single dog.

To put the amount spent per dog into perspective for how much these payments fund millers and breeders, about $2.68 million has been spent by rescue and advocacy group on 5,761 dogs at auction from 2009 to 2018. Dog Rescuers, Flush with Donations, Buy Animals From the Breeders They Scorn, Washington Post (April 2018), available at https://www.washingtonpost.com/graphics/2018/investigations/dog-auction-rescue-groups-donations/?utm_term=.ce6858f54324. Bob Hughes, the owner of Southwest Dog Auction, states that within the last 10 years, rescue purchases have generated about one-third to forty percent of the auction income. In one instance, a breeder had purchased two Cavalier King Charles spaniels at the auction for a total of $8,305, a steal for this breed. After he left, he was contacted by rescue groups who had begun immediately fundraising online to save these dogs. They ended up paying this breeder $24,200 for the two dogs with the online funds raised. Perhaps what is maybe more disturbing is that the rescuer at the auction and another rescuer apparently affiliated with the group were the adopters of these two “rescue” dogs. Dog Rescuers, Flush with Donations, Buy Animals From the Breeders They Scorn, Washington Post (April 2018), available at https://www.washingtonpost.com/graphics/2018/investigations/dog-auction-rescue-groups-donations/?utm_term=.ce6858f54324.

Not only do breed rescues contribute to exaggerated auction prices, but the legislative trend of “pet store bans” may also fuel the trend toward rescuing auction dogs. Some rescuers may be going to auctions in order to provide pet stores with a supply of rescue dogs. This may seem like a strange concept, but such a dynamic arose in the wake of these new pet store bans that cities and states have begun enacting to curb commercial breeding. The Washington Post reports that, in 2018, about 250 municipalities had enacted bans on retail pet stores that permit them to only sell dogs obtained from registered rescues. Following the municipal bans, a few states have proposed legislation, with two being successful, California (A.B. 2445, 2017-2018 Regular Session (Ca. 2017) and Maryland (Md. H.B. 1662, 438th Gen. Assemb. (Md. 2018)). See also Dog Rescuers, Flush with Donations, Buy Animals From the Breeders They Scorn, Washington Post (April 2018), available at https://www.washingtonpost.com/graphics/2018/investigations/dog-auction-rescue-groups-donations/?utm_term=.ce6858f54324; and States with Retail Pet Sale Bans, Best Friends Animal Society (n.d), available at https://bestfriends.org/resources/states-retail-pet-sale-bans. See further discussion in Section IVA.

Even traditional rescue groups may unintentionally contribute to the problem. The traditional type of rescuers are just trying to get dogs out of the trade. In the past, these groups used to all know one another and usually avoided bidding against each other, so no one was putting money into the pockets of millers and breeders. The problem now is many new groups have come on the scene to attempt to do this work and they start outbidding each other thinking they are outbidding a breeder or miller. However, this is a best case scenario for the seller because they are now getting top dollar for an unwanted dog and can buy more dogs to put through the cycle. Another thing to note is that, while it is illegal for rescuers to coordinate with each other on bidding, when rescuers see that a dog is being saved at low cost, they usually take solace knowing they do not need to bid on it. Designer and Purebred Puppies from Other States Sold as Rescue Dogs in Chicago, Outsmarting City Ordinance, Chicago Tribune (May 2018), available at http://www.chicagotribune.com/news/local/breaking/ct-met-pet-store-rescue-puppies-20180430-story.html; Dog Rescuers, Flush with Donations, Buy Animals From the Breeders They Scorn, Washington Post (April 2018), available at https://www.washingtonpost.com/graphics/2018/investigations/dog-auction-rescue-groups-donations/?utm_term=.ce6858f54324.

Regardless of what category a rescuer falls under, these groups are all usually well-intentioned. Their thinking is that any dog taken out of the trade is a worthwhile purchase, but the reality is that paying large sums of money to breeders and millers facilitates and grows the practice they are trying to eradicate. This is part of what has been deemed “retail rescue," the practice of buying purebred or designer-mix puppies at auction for top dollar and selling them off as rescued from the puppy mill trade. This practice is not doing much to curtail the millers and breeders from buying more puppies to put through the breeding cycle. Spending such high amounts is no different than other breeders and millers buying the dogs because all the money is going to the same place and facilitating the same practices these rescues are advocating to eradicate. Scam Alert: Rescue Group Are Buying Dogs From Breeders, PETA (April 2018), available at https://www.peta.org/blog/scam-alert-rescue-groups-are-buying-dogs-from-puppy-mill-auctions/.

C. Breeders Abusing the System

Not only are the well-intentioned rescuers pushing dog auction prices, but some breeders’ specific actions also contribute. These breeders are reporting that they hold their dogs until they are about a year old and then bringing them to auction because they can make more money than they can by selling the dog to a pet store. This leaves dogs in the facilities for longer lengths of time and funnels even more money to breeders and millers. The dogs that often go for thousands at auction are often around one-year-old and a designer mix or purebred; they also often have issues such as allergies which make them harder to sell to pet stores but not at auction. Puppies that breeders would often dump at auction are now being saved to sell for thousands at auction. Breeders also take advantage of new rescuers entering the scene. New rescuers often do not realize they are bidding against other new rescuers and they pay prices way higher than the breeder was hoping to get. The main beneficiary of these missteps is the puppy mill and commercial breeding industries. Dog Rescuers, Flush with Donations, Buy Animals From the Breeders They Scorn, Washington Post (April 2018), available at https://www.washingtonpost.com/graphics/2018/investigations/dog-auction-rescue-groups-donations/?utm_term=.ce6858f54324.

To add to this, there is a particular subset of puppy mill breeders that many may find unexpected. The Amish are often viewed as a pacifist and respectful society of people, but because of their thinking towards animals as ”products or livestock” to be utilized, they are a major group contributing to the puppy mill industry. They are some of the worst perpetrators of puppy mill breeding and are concentrated in Pennsylvania, Ohio and Indiana, states already at the top of the list for having the worst reputations for puppy mills. According to a USDA licensure report, 63% of Ohio’s puppy mills are run by the Amish, and a staggering 97%-98% of puppy mills in both Pennsylvania and Indiana are run by the Amish as well. Amish Connection to Puppy Mills, Bailing Out Benji (December 2017), available at https://bailingoutbenji.com/amish-connection-to-puppy-mills/. The Amish are frequent flyers at the dog auctions to sell off their stock to rescuers and other breeders, and they are directly benefitting from this new way of rescues bidding. It has even been reported that, when Amish millers know rescuers are the ones bidding, they themselves will bid against them to jack up the prices knowing that the rescuers will outbid them. Puppy Mill ‘Total Dispersal’ Results in Auction of Over 400 Dogs in Missouri, ShelterMe.TV (2016), available at https://shelterme.tv/news/puppy-mill-closure-results-in-auction-of-over-400-dogs-in-missouri/. Animal advocates argue that this abuse of the system by traditional breeders and Amish breeders puts profit considerations far above the welfare needs of the dogs that may unnecessarily suffer in substandard “puppy mill” conditions.

III. Federal and State Laws Related to Dog Auctions

Despite the problems created by the interplay of rescuers and breeders, there are no laws on either a federal or state level that focus on the operation and practice of dog auctions. As mentioned previously, it has been only in the last decade where the money rescues bring to these auctions has created a niche market for dog breeders. No law addresses how conflated the prices (funded by generous social media campaigns and “Go Fund Me” accounts) can generate. Federal and state laws do little to even curtail the number of dogs that make it to auction.

A. Federal Law: The AWA and Regulations

The sole federal law that deals with dog auctions is the Animal Welfare Act 7 U.S.C. § 2131 et seq. While a “dog auction” is not a defined term, those “dealers” who supply the auctions do fall under the ambit of the act:

(f) The term “dealer” means any person who, in commerce, for compensation or profit, delivers for transportation, or transports, except as a carrier, buys, or sells, or negotiates the purchase or sale of, (1) any dog or other animal whether alive or dead for research, teaching, exhibition, or use as a pet, or (2) any dog for hunting, security, or breeding purposes. Such term does not include a retail pet store (other than a retail pet store which sells any animals to a research facility, an exhibitor, or another dealer).

7 U.S.C. § 2132.

Another section does authorize the Secretary of Agriculture to promulgate regulations related to auction standards:

§ 2142. Humane standards and recordkeeping requirements at auction sales

The Secretary is authorized to promulgate humane standards and recordkeeping requirements governing the purchase, handling, or sale of animals, in commerce, by dealers, research facilities, and exhibitors at auction sales and by the operators of such auction sales. The Secretary is also authorized to require the licensing of operators of auction sales where any dogs or cats are sold, in commerce, under such conditions as he may prescribe, and upon payment of such fee as prescribed by the Secretary under section 2153 of this title.

7 U.S.C. § 2142.

The Animal Welfare Act requires auction dealers to be licensed by the United States Department of Agriculture. The USDA licensing requirements are laid out by the AWA and are very broad, essentially the auction just needs to obtain a license, maintain accurate records, pay a fee, submit to inspections and have someone over the age of 18 apply. 7 U.S.C. § 2133, 9 C.F.R. § 2.1. The specific license the auction must obtain is a Class B license which pertains to dealers (auctioneers fall here because they arrange and negotiate for the sale or purchase of dogs). Questions and Answers: Activities with Dogs Requiring a USDA License/Registration, USDA (April 2018), available at https://www.aphis.usda.gov/animal_welfare/downloads/breeders/dogs/TechNote-QA-Dog-Activities-Requiring-a-USDA-License-or-Registration_04-16-2018.pdf. The purpose of licensing under the AWA, or the real bite of it, can be seen as the requirement of inspections. Anyone licensed is required to submit to a pre-licensing inspection and unannounced compliance inspections by Animal Care personnel. The inspectors also respond and investigate complaints. Animal Welfare Act Inspections, USDA (November 2017), available at https://www.aphis.usda.gov/aphis/ourfocus/animalwelfare/sa_awa/ct_awa_inspections.

Notably, since the USDA redacted records on their public website in early 2017, neither auction site has any inspections listed within the last three years available through their public search tool, meaning there either has been no inspections in the last three years or they are unavailable to the public, potentially in violation of the Freedom of Information Act. Animal Legal Def. Fund v. United States Dep’t of Agric., No. 17-CV-00949-WHO (D. Cal. filed May 31, 2017), available at https://www.aphis.usda.gov/animal_welfare/downloads/acis/ALDF-PI-Decision.pdf; Animal Legal Def. Fund v. United States Dep’t of Agric., No. 17-CV-00949-WHO (D. Cal. filed August 14, 2017), available at https://www.aphis.usda.gov/animal_welfare/downloads/acis/Orrick-Order-Granting-MTD-in-ALDF.pdf

The issue with dog auctions is that inspections would have to be timed during the auction, and the auction itself is not really the target of the complaints, although it is the facilitator of where millers and breeders are permitted to conduct such business. There are also very few inspectors kept on staff with the USDA that oversee thousands of facilities, which makes oversight a nice word but an unrealistic practice. The inspections are best suited for the sellers and buyers at the auctions, and while both are usually subject to licensing requirements, the same issues ring true. There is simply a lack of personnel available to oversee all of the necessary inspections. The dog auctions are public events and the dogs being auctioned off are often shown in their most “sellable” condition, so their true quality of life is not highlighted in this setting. The applicable AWA sections or regulations have no effect on breeders exploiting puppies on a regular basis or the issues with the high prices rescues are paying to secure these dogs.

There is one published administrative decision dealing with dog auction violations under the AWA, Schmidt, d/b/a Top of the Ozark Auction, 65 Agric. Dec. 60 (U.S.D.A. Feb. 10, 2006). The order was the result of a complaint against an auction based violations regarding the enclosures, sanitation, pest control and refusal to allow a USDA inspector onto the premises. The administrative judge found that the inspector had made multiple unnecessary visits to an auction, which was only open about a dozen times a year, and reported the auction for mostly trivial and inconsistent violations. The complaint against the auction was therefore dismissed and the Agency was instructed to revisit its procedures for inspections to come into compliance with the AWA. Again, the primary concern with dog auctions highlight the limited ability of the AWA to address the underlying issues with dog auctions and the puppy mill trade.

B. State Dog Auction Laws

To add to the scant application of federal law, very few states even mention the term “auction” is it relates to dogs and fewer still provide any substantive requirements (North Carolina (N.C. Gen Stat. Ann. § 19A-23(14)) and Rhode Island (R.I. Gen. Laws § 4-19-2(26)) merely provide definitions with no specific licensing provisions).

In Minnesota, a dog auction is included under the definition of “kennel” for purposes of the state’s Dog and Cat Law:

Subd. 2. Kennel. “Kennel” means any place, building, tract of land, abode, or vehicle wherein or whereupon dogs or cats are kept, congregated, or confined, if the dogs or cats were obtained from municipalities, pounds, auctions, or by advertising for unwanted dogs or cats, or dogs or cats strayed, abandoned, or stolen. “Kennel” does not include a pound owned and operated by any political subdivision of the state or a person's home where dogs or cats are kept as pets.

Minn. Stat. Ann. § 347.31.

The punishment for violating these provisions is merely a misdemeanor. The question really is are there regulations in place in the states where the dog auctions are held? While puppy mills are a nationwide issue, dog auctions are more densely located in states such as Pennsylvania, Oklahoma, Arkansas, Iowa, Kansas, Nebraska, South Dakota and Missouri. Puppy Mill Auction, Siggy’s Paradise (n.d), available at http://siggysparadise.com/what-is-a-puppy-mill-auction/

Similarly, Pennsylvania’s provision that mentions dog auctions, only makes it illegal to operate an auction without first becoming a licensed kennel:

(c) Illegal for certain persons to transfer dogs.--It shall be unlawful for any person to buy, sell, offer to sell, transfer, barter, trade, raffle, auction or rent a dog at any public place in this Commonwealth other than a kennel licensed pursuant to this act, or a dog show, performance event or field trial sponsored by a recognized breed or kennel association or transfer by a rescue network kennel within its own network or to another rescue network kennel. If a purchase, sale, transfer, barter, trade, raffle, auction or rental of a dog occurs at or on the premises of a kennel, the transaction shall be unlawful unless one of the parties to the transaction is an employee, volunteer or other person acting as an authorized representative of the kennel.

3 Penn. Stat. § 459-603.

Again, these provisions merely provide minimum standards for dogs prior to the auction and do not directly impact the supply of dogs.

In the state where two of the largest dog auctions occur, Missouri, these auctions are regulated by both the Missouri and United States Departments of Agriculture because, under the AWA, any person seeking to obtain a license to run a dog auction must also be licensed by their state. In Missouri, the guiding legislation is the Animal Care Facilities Act (ACFA). Mo. Rev. Stat. § 273.327 (2011). The director of the Missouri Department of Agriculture is responsible for carrying out the ACFA. To be in compliance the requirements are mostly identical to those laid out by the AWA; one must be 18 years old, subject to an initial inspection and then yearly ones, and pay an annual per capita fee for every dog sold up to $2,500. Mo. Code Regs. Ann. tit. 2, § 30-9.020 (2016). The same issue that arises on the federal level can also be seen on the state level. There are too many organizations for the number of state inspectors to make oversight a useful tool. There are certainly measures in place that require standards of care and subject the organization to inspection, but enforcement is likely lax at best in most states.

Even some state laws that touch upon dog auctions may inadvertently fuel the process. Ohio recently amended its law on dog breeders and brokers with regard to sales at pet stores. This was a reaction to the state being ranked second in the country for having the worst puppy mills. Ohio Legislature Passes Dog Breeder Regulation Bill to Crack Down on Puppy Mills, Cleveland.com (June 2018), available at https://www.cleveland.com/open/index.ssf/2018/06/ohio_legislature_passes_dog_br.html. Pet stores in Ohio must now only sell dogs and puppies coming from breeders who have met new welfare standards, but enforcement is unclear with only a few inspectors and hundreds of mills and only a signed declaration of compliance is required.

IV. The Solution to Puppy Mills that Became the Problem: Commercially Bred Pet Store Ban

A. Pet Store “Bans”

Recently, over 250 municipalities and a couple of states have enacted bans that prohibit pet stores from selling puppies and dogs that have been purchased from puppy mills or breeders. The bans are a reaction to the realization that most pet store puppies come from puppy mills and other questionable commercial breeders. States with Retail Pet Sale Bans, Best Friends (n.d.), available at https://bestfriends.org/resources/states-retail-pet-sale-bans. The ordinances are typically worded using similar and uniform language. The model is something along the lines of:

a. No pet shop shall display, sell, deliver, offer for sale, barter, auction, give away, broker or otherwise transfer or dispose of a dog, cat or rabbit, except for a dog, cat or rabbit obtained from:

1. An animal shelter or animal rescue organization;

2. An animal shelter or animal rescue organization that operates out of or in connection with a pet shop.

d. Each pet shop shall maintain records sufficient to document the source of each dog, cat or rabbit the pet shop acquires for at least one year following the date of acquisition. Such records shall be made available, immediately upon request, to any officer of the Inspectional Services Department, its Animal Care and Control Unit, and/or the Boston Police Department.

Boston, Mass., Ordinance 16-1.9G, An Ordinance Regarding the Sale of Animals in the City of Boston (Mar. 2, 2016).

The two main things the ordinances usually do are require that pets come from rescues and that the animals come with a certificate showing where they were obtained from. The idea behind the laws and ordinances was to curb the ability of millers and breeders to profit from practices many deem abhorrent and to clear shelters by forcing pet stores to only sell puppies and dogs obtained from a shelter, humane society or registered nonprofit.

California and Maryland have both implemented statewide bans, while other states have gotten the bans through significant steps of the legislative process but not formally enacted. California was the first state to successfully implement a statewide ban and it will take effect January 1, 2019. This ban prohibits “… a pet store operator from selling a live dog, cat, or rabbit in a pet store unless the dog, cat, or rabbit was obtained from a public animal control agency or shelter, society for the prevention of cruelty to animals shelter, humane society shelter, or rescue group…” The new law also requires each animal have the requisite documentation to ascertain its original source and makes a violation of these provisions a civil penalty punishable by a $500 penalty per animal. A.B. 2445, 2017-2018 Regular Session (Ca. 2017). Maryland followed suit this year and became the second state to adopt a statewide ban which will go into effect January 1, 2020. The Maryland ban is not as strong as the California one as it does permit some breeders to sell to pet stores if they meet certain requirements. Md. H.B. 1662, 438th Gen. Assemb. (Md. 2018).

The findings in each bill and ordinance list the noble goals these bans are hoping to curb. A recent article highlights the issues with these bills and the loopholes that have been exploited. “As it turns out, local stores are still able to sell those upmarket dogs. They just don’t come from typical rescue groups. A Tribune investigation found that a loophole in the city ordinance allows three Chicago pet stores to sell puppies supplied by rescues that are closely linked to longtime commercial dealers. In an arrangement that is not an express violation of the ordinance but runs counter to the spirit of the ban, records show these rescues provide city shops each year with hundreds of purebred and designer-mix puppies — all of which come through kennels and properties owned by for-profit businesses or dealers.” Designer and Purebred Puppies from Other States Sold as Rescue Dogs in Chicago, Outsmarting City Ordinance, Chicago Tribune (May 2018), available at http://www.chicagotribune.com/news/local/breaking/ct-met-pet-store-rescue-puppies-20180430-story.html. The only requirement for these type of “rescues” is that they are registered 501(c)(3) organizations.

B. Regulation by Recordkeeping Laws

Ohio went a different way with their new law that aims to protect dogs. Instead of outright banning the sale of dogs obtained from breeders, the law sets clear guidelines for record keeping that must be done in order to ensure dogs and puppies are obtained from reputable breeders or rescue organizations. The law is laid out below.

956.051 Restrictions on dog brokers

(A) No dog broker shall negligently sell, deliver, barter, auction, broker, give away, or transfer a live dog to a pet store in this state unless the dog was obtained from one of the following sources:

(1) An animal rescue for dogs;

(2) An animal shelter for dogs;

(3) A humane society;

(4) A qualified breeder as defined in section 956.19 of the Revised Code.

 * * *

(5) A dog acquired from a qualified breeder as defined in section 956.19 of the Revised Code unless the dog broker provides to the person acquiring the dog, at a time prior to the transaction for the acquisition of the dog, a written certification that includes all of the following information [:]

* * *

(C) No dog broker shall recklessly alter or provide false information on a certification provided in accordance with division (B)(5) of this section.

(D) This section does not apply to any dog that is being sold, delivered, bartered, auctioned, given away, brokered, or transferred from the premises where the dog was bred and reared.

R.C. § 956.051. The law first establishes record and welfare requirements for dogs to be sold within the state by requiring dog brokers to obtain dogs from an animal rescue, animal shelter, human society, or qualified breeder, and requires that all dogs be at least eight weeks old with an accredited veterinarian signed health certificate. The law further requires the keeping of strict records to track the dogs coming from breeders including, the name, USDA license number, and address of the breeder. While the law attempts to protect the consumer by forcing brokers to provide health information on the dog, it does nothing to limit any financial exploitation by the breeder.

C. “Retail Rescue” Loophole

All of these new laws and ordinances have a similar goal: cutting off the demand side of puppy mills. And, while they have laudable goals, the end result is that the very problem the laws are aimed at preventing are being circumvented.

What has begun to occur in many of these places is an uptick in the amount of registered “rescues." Often this is not because more rescues have actually started sprouting up, but rather because breeders and millers will also register themselves as a nonprofit since there are no restrictions on the type of dogs these entities must provide to the pet stores with bans in place. They are able to do this because, as outlined above, rescues are mostly unregulated. There are no specific standards that differentiate a rescue and a breeding facility in the law, and they are subject to the same licensing requirements in most states and as long as they obtain 501(c)(3) status they may sell to pet stores in places with a ban.

Another loophole also exists where a breeder is selling directly to a buyer. In fact, Ohio makes this an exemption under its new law: "(D) This section does not apply to any dog that is being sold, delivered, bartered, auctioned, given away, brokered, or transferred from the premises where the dog was bred and reared." R.C. § 956.051.

To add to that, there is no federal or state oversight where a transaction takes place online due to the difficulty in choice of law and monitoring the authenticity of the online business.

Rescuers may unwittingly become the new conduit of the same puppy-mill bred dogs. Often, puppies from the same litter, who have experienced the exact same breeding conditions, may be sold in pet stores without a ban in place through the breeders’ normal business, and then through pet stores where the ban is in place through the “rescue” side of the breeders’ operation. This is clearly not the intended purpose of the law and is not only an unfortunate loophole, but it essentially renders the bans pointless and misleading. Many of these “rescues” are providing purebred or designer-mix puppies to pet stores with bans in place. A report from the Chicago Tribune highlights the problem after the ordinance there went into effect. About 65% of the pet shop’s inventory are purebred puppies, which is a highly unlikely occurrence in the world of rescue. Designer and Purebred Puppies from Other States Sold as Rescue Dogs in Chicago, Outsmarting City Ordinance, Chicago Tribune (May 2018), available at http://www.chicagotribune.com/news/local/breaking/ct-met-pet-store-rescue-puppies-20180430-story.html. The normal rescue dog is hardly ever a purebred or designer-mix and is not usually also a puppy. The intent of the bans is to find homes for homeless animals, not to sell breeder dogs with a fancy rescue label on them so that an adopter believes they are saving an animal when in fact they are contributing to the commercial breeding trade under the guise of rescue. This is the other side of the phenomena called “retail rescue." Consumers are paying much more money than is typical for a rescue dog in order to secure a certain breed with a “rescue” certificate and are led to believe they have saved the dog.

V.  Problems with the Current “Rescue” Operation Model

While consumer demand and well-intentioned pet store bans are a huge part of the dog auction problem, the structure of the rescue itself may also factor in. As noted in the Washington Post article, rescuers can register as a charitable organization, raise funds through Go Fund Me, and then pay thousands to provide purebred and designer mix puppies to “adopters." In a disturbing revelation, breeders admitted they are now breeding specifically for the auction because it is a whole new underground seller’s market. Dog Rescuers, Flush with Donations, Buy Animals From the Breeders They Scorn, Washington Post (April 2018), available at https://www.washingtonpost.com/graphics/2018/investigations/dog-auction-rescue-groups-donations/?utm_term=.ce6858f54324. Part of the problem is that it does not take much to become a non-profit rescue in most states. To become an animal rescue, an organization just needs to obtain 501(c)(3) status. This status exists so that groups can obtain certain tax benefits for their charitable work. Exempt Purposes – Internal Revenue Code Section 501(c)(3), IRS (n.d), available at https://www.irs.gov/charities-non-profits/charitable-organizations/exempt-purposes-internal-revenue-code-section-501c3; Exemption Requirements – 501(c)(3) Organizations, IRS (n.d), available at https://www.irs.gov/charities-non-profits/charitable-organizations/exemption-requirements-section-501c3-organizations. The process is fairly simple: essentially organize people to run the rescue; select a name and write a mission statement; draft articles of incorporation which includes a board of directors and an address, (one could look at other rescues’ articles of incorporation to get a sense of what to say here); draft and file bylaws if there is a requirement by the state; apply for a business license and a kennel license if your state requires; file all relevant paperwork with the IRS to obtain tax-exempt status; and then register as a charitable organization with the state. As long as a rescue can make the argument that it is operating for a charitable purpose and it is not overpaying any staff, then the IRS and the federal and state governments are likely to approve its non-profit status.

Almost no state defines animal rescues in terms of corporate structure, let alone addresses the issues with over-funding for dog rescue purchases. For more on the laws addressing dog rescues, see Detailed Discussion of the Laws Regulating Rescue and Foster Care Programs for Companion Animals, Kristen Pariser (2014). In the case of a dog rescue, there are licensing requirements but they are often the same as for breeders. So, if one is registered as a breeder and then re-registers as a rescue, they are likely to be in compliance unless there is a differentiation between breeders and rescuers in the law.

VI. Proposed Solutions and Conclusion

A. Federal

1. Puppy Protection Act of 2017

A federal proposal, put before the House of Representatives but not yet enacted, would require that owners of dogs in dealer facilities “… make all reasonable efforts to find humane placement for retired breeding dogs (such as with an adoptive family, rescue organization, or other appropriate owner for that dog, and not including selling at auction or otherwise placing a retired breeding dog with another breeder for breeding purposes).” H.R. 4693, 115th Cong. (2017). Advocates feel that this would be a step in the right direction, but the bill has yet to pass because of pushback. Selling dogs at auction contributes money into the puppy mill trade as opposed to adopting dogs which is a nominal amount of money which does not go to the millers or breeders.

2. Federal Oversight of Rescue Groups

A common proposal is more federal oversight of rescue groups. This would supposedly help crack down on fraudulent groups and ensure there is compliance with welfare laws. The proposal would mean that rescuers who buy at auction would be considered “pet dealers” as they are buying and selling dogs under the guise of rescue, this would mean they are subject to licensure and inspection by the USDA. Americans Were Misled About Their Dogs – USDA Should Make Sure It Doesn’t Happen Again, The Hill (April 2018), available at http://thehill.com/opinion/energy-environment/382716-americans-were-misled-about-their-dogs-usda-should-make-sure-it. One issue with this is, as stated above, there is already a shortage of inspectors available on the federal level. With thousands of licensed breeders, dealers, etc. there just are not enough resources. And if the issue is truly the puppy mills and commercial breeders, it seems more ideal that the inspectors time would be spent inspecting those operations more frequently than attempting to locate fraudulent rescue group, because while it is a serious issue, it is not the normal rescue group. This proposal would address part of the problem of the reselling of the dogs though, as it would require certificates of where dogs are obtained from when they are given to adopters. The issue with this, however, is that most of these rescues are up front with the fact that the dogs are obtained from dog auctions; they are just less up front about the price paid per dog and how they are fueling the industry.

B. State

Another possible solution is reworking the pet shop bans. Officials could craft language that specifies a percentage of dogs must not be purebred or designer mix and must be over one year old. This would more closely align with the typical nature of a dog in need of rescue, but would allow breathing room for purebred and designer mixes or puppies that are in fact in need of a home. It seems that if the local and state governing bodies are looking to curb the practice, they are in the best position to rework the language to actually make the bans effective and prevent these commercial breeders from rebranding themselves as rescues.

C. “Model Act”

There are many moving parts in the dog rescue world. Laws change, campaign are successful, supply and demand change, and viewpoints on best practices change. What has remained constant is the notion that rescuers disapprove of puppy mills and commercial breeding because of the nature of these practices and the effects they have on the dogs. Rescuers who find themselves at dog auctions, paying more for a dog than another miller or breeder, may find it best practice to ask themselves if they are saving dogs or funding the practices of the millers or breeders. There are well-founded arguments pushed by both sides; officials and legislators trying to curb abusive animal practices by enacting pet store bans must think about loopholes and the intended goals of the legislation to determine if the pet store bans are effective as written or if there may be a more effective way to draft the language in the bans. Whether or not more oversight of rescue groups is a viable or responsible solution comes with its own issues - mainly cost and efficiency -  and also are the resources best spent combing over rescue groups or are they better spent with more inspections at suspected puppy mills and commercial breeding facilities?

A model act to address this issue would be implemented on the federal level and would involve a significant amount of transparency. It is important for adopters to know price paid per dog. It is equally as important for there to be oversight of these rescues and for there to be monitoring price paid per dog. Once a rescue starts consistently spending a significant amount of money at dog auctions they should be flagged and it should affect their charitable status. The ideal federal solution to eliminating puppy mills would of course be to limit the breeders ability to hold stock and prevent the creation and sustaining of puppy mills, but until that day, transparency and cost limiting is the most viable option. The issues surrounding puppy mills are vast, and tackling the organizations that enable mills to profit and flourish is a key step to cutting off the ability for puppy mills to exist, since they rely on the premise of supply and demand.


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