Oct 2, 2014
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Ag in the Courtroom

RSS By: John Dillard, AgWeb.com

John Dillard grew up on a beef cattle farm and now works as an agricultural and environmental litigation attorney with OFW Law. His blog analyzes legal issues and court decisions that affect America’s farmers and ranchers.




HSUS Settles Racketeering Lawsuit for $15.75 million

May 16, 2014

 The Humane Society of the United States and 12 other animal rights groups have reached a historic settlement in a lawsuit with Feld Entertainment, the parent company of Ringling Brothers Circus Co. The lawsuit was filed under a citizen suit  provision of the Racketeer Influenced and Corrupt Organizations Act, a law generally used to target organized crime and drug kingpins. In exchange for settling the suit, HSUS and the other organizations agreed to pay Feld Entertainment $15.75 million. This settlement comes on top of the $9.3 million that ASPCA has already paid to Feld arising from their alleged racketeering activity.

This dispute first arose nearly 14 years ago when ASPCA and several other organizations filed a suit against Feld under the Endangered Species Act (ESA) alleging that the circus mistreated its Asian elephants. This suit was tossed out of court because it was "frivilous, unreasonable, and groundless."

HSUS was not even a party to the suit. It's involvement in the suit began when it joined other animal rights groups in secretly funding the star plaintiff and witness in the case, Tom Rider. Mr. Rider, was an unemployed former Feld employee. In exchange for serving as a plaintiff and a witness in the case, HSUS, ASPCA and other organizations paid him $200,000 - his sole source of income. Professional plaintiffs are a big no-no in the court system for obvious reasons. 

Without secretly funding Mr. Rider, the plaintiffs would not have been able to carry out their litigation, which cost Feld nearly $20 million to defend. In their public statement on the settlement agreement, HSUS states that Feld should devote the settlement money towards saving the lives of Asian elephants. I am not Feld's accountant, but I imagine a good chunk of this settlement will go towards the legal costs necessary to defend against this frivolous suit. If HSUS wishes to protect endangered elephants, it should look into devoting its funds towards actually protecting elephants instead of perpetuating fraud on the federal court system.

John Dillard is an attorney with Olsson Frank Weeda Terman Matz P.C. (OFW Law), a Washington, DC-based firm that serves agricultural clients and clients with issues before federal and state courts, EPA, FDA, USDA, and OSHA.  John focuses his practice on agricultural and environmental law.  He occasionally tweets at @DCAgLawyer.  This column is not a substitute for legal advice.

Can EPA Regulate Animal Operations as Landfills?

May 01, 2014

 [This post originally appeared on OFW Law's blog, AgFDABlog.com]

Four Washington State dairies are the targets of environmental activists in lawsuits that could have far-reaching consequences for animal agriculture in the United States. In these cases, the environmentalists assert that the dairies’ manure storage and application practices violate the Resource Conservation and Recovery Act (RCRA), the federal statute that regulates the disposal of solid and hazardous waste. The crux of the environmentalists’ argument is that manure is a "solid waste" under RCRA if it is not strictly used as a fertilizer applied at agronomic nutrient uptake rates.

The Case

The plaintiffs, Community Association for the Restoration of the Environment ("CARE") and Center for Food Safety ("CFS"), brought suit against the dairies under RCRA’s "citizen suit" provision. RCRA is generally enforced in the context of sanitary landfills and industrial waste disposal, not agricultural operations. However, the plaintiffs allege that the dairies are violating Section 7002(a) of RCRA by storing, handling, and disposing of manure in a manner that endangers health and the environment. Furthermore, the plaintiffs contend that the dairies’ manure handling activities amount to "open dumping" of solid waste, which violates Section 4005(a) of RCRA.

In additional to seeking recovery of their attorneys’ fees, CARE and CFS are seeking an injunction that would require the dairies to undertake several remedial and preventive actions. Some of these actions include installing synthetic liners in all existing storage lagoons, undertaking an extensive soil and water quality monitoring program, funding independent study to develop a remediation plan, and providing an alternative drinking water source for neighbors within a three-mile radius of the dairies.

Is Manure a Solid Waste?

Manure is generally not considered a "solid waste" for the purposes of RCRA. RCRA defines solid waste as "garbage, refuse . . . and otherdiscarded materials" resulting from commercial and community activities. Manure is not typically discarded, but is instead a useful by-product of animal agriculture. In fact, EPA regulations specifically exempt manure from RCRA if it is "returned to the soil as fertilizers and soil conditioners."

While recognizing the exemption for manure as a fertilizer, the plaintiffs alleged that manure is a solid waste if it is applied at levels beyond agronomic uptake rates or leaks into groundwater. In other words, the plaintiffs’ case rests on the theory that any manure that is not strictly used as a fertilizer is "discarded" and thus, a solid waste. Using this theory, the plaintiffs alleged that the dairies violated RCRA due to excessive application of manure to agricultural fields that resulted in runoff or leaching into the soil. Furthermore, the plaintiffs alleged that millions of gallons of liquid manure leaked out of the dairies’ lagoons and entered groundwater supplies.

This is not the first time a case has been litigated under this theory. In 2006, EPA sought to hold a swine operation liable under RCRA on the basis that manure applied in excess of agronomic uptake rates was a "solid waste" for RCRA purposes. However, EPA and the swine producer entered into a consent decree, which avoided establishing precedent on the matter. In a separate matter, Oklahoma v. Tyson Foods, Inc., the state of Oklahoma applied the same theory to poultry litter. In that case, the court held that manure applied as a useful fertilizer did not transform into solid waste simply because its entire contents were not absorbed by crops as nutrients. 2010 WL 653032 at *10.

Plaintiffs Have Cleared a Hurdle

The dairies sought to have the cases dismissed on the basis that manure intended for use as fertilizer is not transformed into solid waste in the event it is over-applied to fields or leaked from lagoons. However, in a setback to the dairies, the court rejected this argument. The court did acknowledge that Congress did not intend for manure that is applied as fertilizer to be regulated as a solid waste under RCRA. However, the Court held that it was "untenable" that manure could never transform into solid waste through unintentional excess application or leaking from lagoons.

By surviving the motion to dismiss, the plaintiffs cleared a substantial legal hurdle. The case now rests on whether the plaintiffs can demonstrate that the dairies’ manure storage and application activities actually led to manure runoff and leaching as well as leakage into the groundwater. Whether the facts of the case match the plaintiffs’ claims remains to be seen. For instance, USDA’s Natural Resources Conservation Service was highly critical of EPA’s methodology and conclusions in a study of the dairies’ impact on drinking water; the plaintiffs rely, in part, on this study for their own claims.

Parallel EPA Enforcement

These Washington state dairies are also the subjects of EPA enforcement actions under the Safe Drinking Water Act. EPA targeted the dairies because it believed they were the cause of elevated nitrate levels in drinking water in the vicinity of the operations. EPA initially served Notices of Violation to five Yakima Valley dairies. Rather than face enforcement, one dairy decided to cease operations and sell off its herd. The other four entered into onerous consent decrees, which require the dairies to provide alternative drinking water sources for neighbors within a one-mile radius, install multiple monitoring wells on the property, and conduct a comprehensive assessment that identifies ways to reduce or minimize the impact of the dairies on surrounding water quality.

Implications for Agriculture

Activists often seek to bring ordinary agricultural practices under the purview of RCRA. For instance, in Safe Air for Everyone v. Meyer, several of my OFW Law colleagues represented a group of Idaho bluegrass farmers in another RCRA citizen suit brought by activists over the practice of "open burning" fields, which promotes regeneration of bluegrass and maintains yields after seeds are harvested. In Meyer, the Ninth Circuit held that an agricultural "waste," such as grass residue, is not a solid waste under RCRA if the generators of the residue (farmers) reuse it  in a continuous system that improves crop yields and is in accordance with established farming practices.

The Washington dairy cases could have major implications for livestock, dairy and poultry operations in the United States. Manure is a valuable by-product and a critical component for ecological and economic sustainability in animal farming operations. Animal agriculture is accustomed to regulation under the Clean Water Act. However, shoehorning livestock, dairy and poultry operations into RCRA, a statute intended to regulate waste storage and sanitary landfills, has the potential to create confusion and possibly duplicative regulations.

I will be following this case and will provide updates as necessary.

John Dillard is an attorney with Olsson Frank Weeda Terman Matz P.C. (OFW Law), a Washington, DC-based firm that serves agricultural clients and clients with issues before federal and state courts, EPA, FDA, USDA, and OSHA.  John focuses his practice on agricultural and environmental law.  He occasionally tweets at @DCAgLawyer.  This column is not a substitute for legal advice.


Lawyer Up! Vermont legislature passes GMO labeling bill

Apr 24, 2014

Yesterday, Vermont's legislature became the first state in the Union to pass a GMO labeling bill that is not contingent on other states passing similar legislation. Vermont's governor, Peter Shumlin, who has expressed reservations about the bill, is expected to sign the legislation into law. The law, which will not go into effect until July 1, 2016, requires food packages containing genetically-engineered ingredients sold at retail to contain a label indicating the presence of such ingredients. The law exempts meat, poultry and dairy products from animals fed GMO feed from its labeling requirements. It also exempts alcohol and food sold by restaurants and cafeterias.

The proponents of the legislation believe that this law is necessary because consumers have the right to know whether their food contains GMO ingredients. They also believe that the labeling initiative is important to protect organic farms from cross-pollination (although the bill does nothing to prevent cross-pollination). To support their argument that labeling is necessary, the legislature pointed to the fact that FDA does not conduct its own studies on the health effects of GMOs, nor does it conduct epidemiological studies on these crops. However, the legislation fails to mention that FDA does not conduct independent studies on the safety of any other new food product it approves. Also, my research efforts have also failed to find any evidence that FDA conducts long-term epidemiological studies on carrots.

Vermont has a history of passing labeling legislation that is ultimately rejected by federal courts for violating the First Amendment. For instance, when the anti-corporate cause du jour was labeling milk that contained rBST hormones, Vermont passed a first-in-the-nation labeling law. However, this law was promptly overturned because the state could not demonstrate that rBST milk differed from conventional milk in terms of health or safety effects, and accordingly, the state had no substantial interest in requiring a label.

Vermont's legislature is once again on vulnerable legal ground with its GMO labeling legislation. It has no science on its side indicating that GMO products are less healthy or safe than their conventional counterparts. Furthermore, labeling cannot advance the legislature's stated interest in protecting organic farms from cross-pollination with GMO crops. Even the state's Attorney General has expressed concern that his office may not be able to defend the legislation in court. 

Due to the law's tenuous legalality and near certainty that it will face a constitutional challenge, the legislature appropriated $1.5 million to Vermont's Attorney General office to defend the law. Additionally, the legislature is allowing private donors to contribute to the cost of defending the law. Those with a financial stake in stigmatizing GMOs, including large organic food companies, will likely open their coffers to the fund.

The litigation that will result from this law will be drawn out and likely go through at least one round of appeals. At this point, its impossible to absolutely guarantee which side of the issue will come out on top. But with this much at stake on both sides of the labeling issue, I can predict one group that will walk away winners - lawyers.

John Dillard is an attorney with Olsson Frank Weeda Terman Matz P.C. (OFW Law), a Washington, DC-based firm that serves agricultural clients and clients with issues before federal and state courts, EPA, FDA, USDA, and OSHA.  John focuses his practice on agricultural and environmental law.  He occasionally tweets at @DCAgLawyer.  This column is not a substitute for legal advice.

Appeals Court to Re-hear COOL Case

Apr 04, 2014

 The suit brought by livestock and meatpacking groups against USDA's mandatory Country-of-Origin Labeling (mCOOL) rule lives to fight another day. A panel of the active judges (known in the legal world as an "en banc" panel) sitting on the D.C. Circuit Court of Appeals entered an order today (4/4/14) to vacate the D.C. Circuit's decision to uphold USDA's COOL Rule. The entire panel of the active judges on the D.C. Circuit will re-hear the case on May 19th.

As I mentioned in my assessment of the Circuit Court's original decision on the case, the original panel of judges suggested that the issue of whether mCOOL violated the First Amendment should be heard before an en banc panel. This unprecedented suggestion tipped off the reader that the Court was not confident that their fellow judges necessarily agreed with their findings.

The issue that the en banc panel will re-hear pertains to whether the government has a sufficient justification under the First Amendment to require mCOOL. The Court's original mCOOL decision departed from D.C. Circuit precedent, which had held that mandatory labeling regimes similar to mCOOL were only allowed to prevent or remedy consumer deception. Even though mCOOL is not designed to prevent or remedy consumer deception, the Court held that it is valid because it enables consumers to make purchasing decisions on the basis of protectionism.

The en banc panel's order requests the parties to submit briefs on the issue of whether the mCOOL decision should be governed by the Central Hudson standard or the Zauderer standard. Under the Central Hudson standard, the government is only allowed to compel commercial speech if the mandate serves a "substantial" governmental interest. As the name indicates, substantial governmental interests are not a dime a dozen. Substantial governmental interests generally involve protection of health and safety, and certainly do not involve "empowering" consumers to make protectionist choices.

The Zauderer standard is much easier to achieve, but it is only available to the government in certain circumstances. Under Zauderer, a goverment can require labeling of "factual and non-controversial" information. However, the D.C. Circuit has only allowed Zauderer to be used as a justification in instances where the mandatory disclosure prevents or remedies consumer deception. 

Drawing inferences from a Court's actions in circumstances like this is a risky proposition. However, it is clear that a majority of the D.C. Circuit's judges believe this issue needs a second look. I'll be following up on this issue as developments unfold.

A copy of the D.C. Circuit's order is below:

PER CURIAM ORDER, En Banc, filed [1487010] that this case will be heard en banc. It is FURTHER ORDERED that the judgment filed March 28, 2014, be vacated. It is FURTHER ORDERED that oral argument before the en banc court be heard at 9:30 a.m. on Monday, May 19, 2014. It is FURTHER ORDERED that, by 4:00 p.m. on April 18, 2014, the parties and amici refile each brief and the appendix initially filed in this case. It is FURTHER ORDERED that, by 4:00 p.m. on April 21, 2014, the parties file simultaneous supplemental briefs, not to exceed 7,500 words each, addressing the following issue: Whether, under the First Amendment, judicial review of mandatory disclosure of "purely factual and uncontroversial" commercial information, compelled for reasons other than preventing deception, can properly proceed under Zauderer v. Office of Disciplinary Counsel, 471 U.S. 626, 651 (1985), or whether such compelled disclosure is subject to review under Central Hudson Gas & Electric v. PSC of New York, 447 U.S. 56 (1980). 

John Dillard is an attorney with Olsson Frank Weeda Terman Matz P.C. (OFW Law), a Washington, DC-based firm that serves agricultural clients and clients with issues before federal and state courts, EPA, FDA, USDA, and OSHA.  John focuses his practice on agricultural and environmental law.  He occasionally tweets at @DCAgLawyer.  This column is not a substitute for legal advice



Appeals Court Upholds mCOOL

Apr 01, 2014

On Friday, a unanimous panel of the D.C. Circuit Court of Appeals upheld USDA’s controversial mandatory Country-of-Origin Labeling (mCOOL) rule. The mCOOL rule requires that fresh muscle cuts of beef, pork, lamb and chicken sold at grocery stores must display a label indicating where the source animal was born, raised, and slaughtered. Although this ruling is a setback for the meat and livestock industry, the mCOOL rule is by no means settled. The WTO’s Dispute Settlement Board is in the process of deciding whether the labeling rule violates the United States’ treaty obligations.

Compliance with this labeling regime has created a substantial burden for meat packing operations located near our northern and southern borders because animals must be slaughtered, packaged, and stored separately based on their country of origin categorization. Several packing plants have cited mCOOL compliance as the one of the reasons for shuttering their plants, costing thousands of jobs and causing feedlots to search farther afield to find packing plants to slaughter their cattle.

Several livestock and meat organizations, such as NAMA (Disclosure: OFW Law represents NAMA in this matter), AMI, SMA, NCBA, NPPC as well as Canadian and Mexican livestock groups challenged the regulation in federal court in July 2013, seeking a preliminary injunction against USDA from enforcing the "born, raised, and slaughtered" rule. Several anti-animal agriculture groups, such as HSUS and Food and Water Watch, joined sides with anti-trade agricultural groups, such as U.S. Cattlemen, R-CALF, and National Farmers Union to support USDA’s efforts to defend the labeling regime. USDA and its supporters prevailed on the first round of litigation in September 2013. The plaintiffs immediately appealed the matter to the D.C. Circuit Court of Appeals.

The plaintiffs did not fare any better on the appeal to the D.C. Circuit. The plaintiffs argued that the mCOOL regulation violated Congress’s intent when it banned the practice of commingling products with different country of origin categorizations. Furthermore, the plaintiffs argued that the mCOOL rule violated the First Amendment by compelling commercial speech. The Court ultimately held that USDA had adopted a permissible interpretation of Congress’s intent when it banned the practice of commingling. Furthermore, the Court held that USDA had the authority to require a simple label so long as it contained factual and non-controversial information.

The Court’s ruling was a departure from previous labeling decisions in the D.C. Circuit. In prior decisions, the Court would only allow a government to require a label in instances where the government had a substantial interest (such as health or safety regulation) or to prevent consumer deception. Neither such interests were implicated in mCOOL. The Court, recognizing that its decision to expand the universe of permissible justifications for mandatory labels does not enjoy universal support, took the unprecedented step of suggesting that the case be re-heard anew by the entire panel of active judges on the D.C. Circuit.

Whether the parties will seek a rehearing remains to be seen. Nonetheless, mCOOL still faces a substantial hurdle in the WTO. In fact, mCOOL is no stranger to the WTO.  The first time around, the WTO determined that the prior mCOOL labeling regime, which allowed commingling, needed to be re-written because it discriminated against Canadian and Mexican livestock. Instead of heeding the WTO’s advice, USDA doubled down and eliminated the practice of commingling, which causes further discrimination against Canadian and Mexican livestock. We can expect the WTO to issue its initial decision in this dispute in June 2014.

I’ll be following this matter and posting updates as they occur.

John Dillard is an attorney with Olsson Frank Weeda Terman Matz P.C. (OFW Law), a Washington, DC-based firm that serves agricultural clients and clients with issues before federal and state courts, EPA, FDA, USDA, and OSHA.  John focuses his practice on agricultural and environmental law.  He occasionally tweets at @DCAgLawyer.  This column is not a substitute for legal advice



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