USDA seeks dismissal of puppy-laundering case involving Iowa breeders

Yahoo

12-02-2025

Steve Kruse's Stonehenge Kennels in West Point, Iowa, has been repeatedly cited for failure to provide adequate veterinary care, and the USDA suspended Kruse's license in 2023. The dog pictured here is one of those that federal inspectors alleged was in need of veterinary care. (Aerial photo courtesy of Bailing Out Benji. Inset photo taken by USDA inspector, courtesy of Bailing Out Benji)
The federal government is seeking the dismissal of a lawsuit brought by animal-welfare activists over an Iowa puppy-mill operator.
The American Society for the Prevention of Cruelty to Animals filed the lawsuit last year in U.S. District Court for the District of Columbia against the U.S. Department of Agriculture.
The lawsuit alleges that the USDA has violated the federal Animal Welfare Act by repeatedly renewing the license of Steve Kruse, an Iowa-based breeder who operates a large-scale breeding operation in West Point called Stonehenge Kennels. The business has a long history of animal welfare violations.
The ASPCA claims the USDA routinely licenses dog breeders and dealers such as Kruse despite the agency's direct knowledge of practices that fall far below the standards required by the Animal Welfare Act. The lawsuit seeks a court order that would force the USDA to void all current licenses issued to Kruse and his associates and prevent the agency from renewing them.
In recent court filings, the USDA claims the ASPCA lacks standing to sue the federal agency, arguing that the courts have only rarely held that individuals or organizations can sue for the unlawful regulation of third parties.
The USDA says the ASPCA 'is not in the dog-dealing industry, so it obviously can suffer no physical injuries from the department's dog-dealing licensing decisions.' In court filings, attorneys for the USDA go on to say they 'have little doubt that (the ASPCA) has sincere legal, moral, ideological, and policy objections to the alleged mistreatment of dogs by Kruse and his agents, but these concerns do not suffice on their own to confer standing to sue in federal court.'
Citing past U.S. Supreme Court rulings, the federal agency argues that an organization may not establish standing based 'on the intensity of the litigant's interest, or because of strong opposition to the government's conduct.'
The ASPCA has responded to that argument by claiming the USDA has long recognized that the ASPCA is one of the very few animal-welfare organizations that has the ability to assist the government with large-scale confiscations of dogs from violators.
'While it is true that the ASPCA is not in the 'dog-dealing industry,'' the ASPCA told the court, the federal agency has 'previously relied on the ASPCA to assist with the rescue of hundreds of dogs when a previous associate of Kruse amassed so many violations of the Animal Welfare Act that the Department of Justice took the unprecedented step of seeking injunctive relief in federal court to halt that licensee's operation.'
That assertion is an apparent reference to Daniel Gingerich, an Iowa breeder who operated a puppy mill in connection with Kruse and who was cited for more than 200 violations of the Animal Welfare Act before the U.S. Department of Justice intervened and negotiated the surrender of more than 500 dogs.
Such cases have a direct impact on the ASPCA's ability to pursue its mission, the organization says, costing hundreds of thousands of dollars to assist with rescue and relocation efforts and forcing the APSCA to divert staff and other resources from lobbying and traditional animal-welfare initiatives.
The USDA has countered that it has done nothing to 'force' the ASPCA to assist with animal rescues and other USDA-led operations. Those were 'calculated and voluntary choices' made by the ASPCA, the federal agency argues.
As part of its lawsuit, the ASPCA takes issue with the USDA's admitted, long-standing practice of automatically renewing breeder licenses once a fee is paid — even if the licensee is a serial violator or is in violation of the Animal Welfare Act at the moment the license is renewed.
In 2022, for example, the USDA approved Kruse's application for a three-year license despite an extensive history of violations, including violations that were observed and documented by the USDA's own inspectors that same day.
Much of the lawsuit centers on Kruse's ties to two other licensed breeders in Iowa, Brian Lichirie and Wuanita Swedlund. USDA inspection records show that the dogs housed at kennels licensed to Lichirie and Swedlund are actually owned by Kruse. The records refer to Lichirie as 'one of Mr. Kruse's employees' and notes that dogs are 'regularly transported' between Swedlund's kennel and that of Kruse.
In theory, such arrangements are normally prohibited by the USDA since they can result in 'puppy laundering' –- the process of routing dogs from a serial violator to a different licensee with a relatively clean record, in order to facilitate sales to retailers in the rapidly growing number of jurisdictions that prohibit the sale of dogs sourced from questionable operators.
In 2016, the USDA informed Kruse it was aware of his arrangement with Lichirie and Swedlund and informed him the three must all be operating under a single license. Since then, however, the arrangement has continued with no action taken by the USDA to revoke any of the three licenses – even after Kruse was alleged to have thrown a bag of dead puppies at a USDA official.
The USDA's licensing of repeat offenders has been an issue for more than a decade. In 2014, on the same day the federal agency cited Cricket Hollow Zoo of Manchester, Iowa, for 11 violations, it renewed the controversial roadside zoo's license for one year. It did so despite a federal law that says no license shall be issued to a zoo that fails to comply with minimum standards.
At the time, the agency defended its actions by noting that the law applied only to the initial issuance of a license, arguing that renewals should be automatically approved upon the payment of a fee.
The zoo was eventually shut down, but only after the Animal Legal Defense Fund, which is a private organization, and a group of Iowans sued the operators in state court.