The Department of Agriculture posted new documentation Tuesday that will serve as guidance for how it regulates livestock markets while USDA develops more detailed rules.
The new Frequently Asked Questions webpage made available by USDA's Agricultural Marketing Service specifies how the agency would view a wide variety of situations under its regulations around the Packers and Stockyard Act's prohibition on "undue and unreasonable preferences."
The FAQ signals USDA’s “intent to use every weapon in its arsenal to ensure that growers and producers are protected from harm, even while the agency engages in the rulemaking process to update its rules," the agency said in a release
The move is the latest development in a long-running saga over the approach the federal government should use to ensure fairness in relationships between livestock and poultry producers and the processors that purchase and process animals into meat for consumers. A key issue is the threshold producers must clear to bring a claim of unfair treatment.
Agriculture Secretary Tom Vilsack is no stranger to the issue; one of his last acts as secretary during the Obama administration was finalizing rulemaking that meat industry groups said went too far in its broadening of the ability for producers to bring claims. At the time, the National Pork Producers Council said that the rule would be “a boon to trial lawyers.”
The Trump administration withdrew the Obama administration’s rule and wrote a new version that was released in 2020. That Trump-era rule will be updated in upcoming rulemaking called for by an executive order signed by President Joe Biden in July, USDA said Tuesday.
“The proposed rules will strengthen USDA’s enforcement of unfair and deceptive practices and undue preferences, address the poultry grower tournament system, and make it easier for USDA to bring enforcement actions under the Act,” USDA said. “The FAQs will help strengthen Packers & Stockyards Act enforcement while USDA completes those new rulemakings.”
The FAQs include specific language on a wide swath of issues that might arise in the producer-packer relationship, including the possibility of discrimination based on race, color, national origin, or other factors. There’s also language on retaliation for speaking out about what the producer feels are unfair practices, whether producers might have sufficient information to determine if discrimination is taking place, and clarity on beef packers and the use of cash or formula contracts in cattle markets.
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Sarah Little, a spokesperson for the North American Meat Institute, said the new FAQs “are not regulations and highlight two flaws in the regulations published in December 2020.
“First, the FAQs remain at odds with the decisions of eight different federal appellate courts. No FAQs can change the well-established precedent in those courts that a plaintiff must show injury, or the likelihood of injury, to competition to win a Packers and Stockyards lawsuit,” she said. “Second, the FAQs highlight the vagueness inherent in the rule by asserting one could be found liable for violating the law based on criteria the agency cannot or will not articulate.
“The members of the Meat Institute — and their livestock suppliers — benefit from, and depend on, a fair, transparent and competitive market,” Little said. “The North American Meat Institute is prepared to work with the Administration on proposed rules.”
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