Court denies meat industries' COOL injunction request

Sep 16, 2013

Last week, U.S. District Judge Ketanji Brown Jackson denied a request from U.S. and Canadian meat packers and livestock growers for a preliminary injunction (PI) blocking a final USDA regulation mandating country-of-origin labels (COOL) on meat sold in retail stores.

In her 80 page ruling, Jackson rejected the preliminary injunction request, filed July 8, saying the USDA is basically stuck between “a rock and a hard place,” with implementing labeling rules mandated by the farm bill, and following international trade obligations.

The coalition includes the American Meat Institute (AMI), the American Association of Meat Processors, Canadian Cattlemen’s Association (CCA), Canadian Pork Council, Confedaracion Nacional de Organizaciones Ganaderas, National Cattlemen’s Beef Association, National Pork Producers Council, North American Meat Association and the Southwest Meat Association.

AMI President and CEO J. Patrick Boyle expressed his disappointment in the ruling adding that the groups will seek an expedited appeal.

“We disagree strongly with the court’s decision and believe that several aspects of the ruling are susceptible to challenge,” said Boyle. “We intend to pursue them on appeal.”

In their complaint, AMI and the meat and livestock organizations explained that the final rule violates the U.S. Constitution by compelling speech in the form of costly and detailed labels on meat products that do not directly advance a government interest. They also explained that the 2013 regulation exceeds the scope of the statutory mandate, because the statute does not permit the kind of detailed and onerous labeling requirements the final rule puts in place, and that the rule is arbitrary and capricious, because it imposes vast burdens on the industry with little to no countervailing benefit.

“The parties’ arguments for and against the issuance of a preliminary injunction have focused primarily on the likelihood of success and irreparable harm factors, and the Court rests its conclusion regarding the requested preliminary injunction primarily on its evaluation of those two factors,” Jackson wrote in her final ruling.

In addition, the Judge said the groups’ “failure to demonstrate either a likelihood of success on the merits or irreparable injury” was another deciding factor in her decision.

CCA echoed AMI’s appeal plan in a press release. Unless reversed, the district court ruling will allow USDA to fully implement and enforce the May 23 COOL rule in November.

CCA President Martin Unrau viewed the ruling as another step in the ongoing battle over COOL. “The CCA has a compelling case and we look forward to the appeal” he said. “The cost of COOL to Canadian producers and industry is unacceptable and we will continue until a viable remedy is reached.”

According to CCA, COOL discrimination costs Canadian cattle producers around $640 million per year in losses. The coalition predicts that USDA’s May 23 regulatory change will necessitate additional segregation which will nearly double the impact of COOL from the current $25 to $40 per head.

CCA’s position remains that the only outcome that would bring the U.S. into compliance with the World Trade Organization (WTO) ruling of July 2012 is to amend the COOL legislation to allow either a single mandatory label for all meat produced in the U.S. or to allow for voluntary labeling.

Canada and Mexico have asked for another WTO compliance hearing, and both have threatened trade sanctions. Canada said it would ask the WTO for permission to impose up to $1 billion in tariffs on a variety of U.S. products.

Supporters of COOL, the U.S. Cattlemen’s Association (USCA), along with National Farmers Union (NFU), American Sheep Industry Association (ASI) and the Consumer Federation of America, intervened in the lawsuit on August 19, and shared their relief on the ruling and gratitude to those contributing to the U.S. COOL Defense Fund. “We, of course, are pleased with the court’s decision to deny the preliminary injunction requested by the plaintiffs. If the injunction had been granted it would have ensured that the United States would be in violation of its trade obligations under the WTO and also would have further delayed consumers having the type of information Congress has long intended them to have. The revised USDA regulations announced on May 23 of this year will certainly reduce consumer confusion and will allow cattle producers the ability to differentiate their product from foreign beef,” Jon Wooster, USCA President, San Lucas, CA, said in a release. “USCA, NFU, ASI and CFA are committed to a strong defense of COOL and, on behalf of all four organizations, I want to extend our gratitude to all those who are contributing to the U.S. COOL Defense Fund. This is an expensive undertaking but it is a necessary one if we are to ensure the most effective defense.”

The full ruling can be read at https://ecf.dcd.uscourts. gov/cgi-bin/show_public_ doc?2013cv1033-48 — Traci Eatherton, WLJ Editor