Thursday, April 15, 2021
Agriculture is one of the most heavily regulated industries in the United States. Almost every activity of a farmer or rancher is somehow regulated by federal or state government. For example, federal and state governments regulate the marketing and quality standards of various ag products; animal and plant health is regulated; farm programs are numerous and are often tied to crop insurance and/or soil conservation; water use is regulated; and ag products are subject to various export and import programs. This just names a few ways that ag is regulated. Such regulation can also lead a producer into tangled administrative battles with various regulatory agencies and which can end up in court.
In today’s post, I take a look at some recent examples of court cases involving the regulation of agriculture and food production. It’s just a sample of what a farmer or rancher often encounters.
Recent cases involving the regulation of agriculture – it’s the topic of today’ post.
Background – The Government’s Regulatory Power Authority
Every level of government has certain basic powers. For example, the federal government's power includes the commerce power, exercise of eminent domain, the power to tax, and the power to spend. The commerce power is the constitutionally-based power to regulate commerce between and among the states and with other countries and regulates goods and transactions “affecting” interstate commerce. The power of eminent domain is the power to acquire property for the public good. The power to tax is the power to generate revenue. While the constitution limits the federal government's exercise of these powers, much of the regulation of agricultural activities occurs in accordance with the Congress' ability to regulate commerce among the states in accordance with the Commerce Clause of Article I, Section 8 of the Constitution.
State-level governmental power to regulate agricultural activities derives largely from the police power. The states, in accordance with their police power, may regulate activities in order to promote the health, safety, and welfare of its citizens. The police power is limited only by the extent to which the regulations infringe upon constitutional guarantees, such as equal protection of the laws and by the limits on the “taking” of property value through the heavy hand of regulation. In general, a state's exercise of its police power will only be found improper if it is utilized in an arbitrary, capricious, discriminatory or confiscatory manner or results in a “taking.” But, of course, the power can be abused, as was evidenced clearly in some states during 2020.
Thus, the extent and validity of much of federal regulation of agricultural activities is measured by the Commerce Clause while state regulation is made possible by the police power.
Recent Court Decisions
In recent weeks, the courts have decided numerous cases involving the regulation of food and agriculture concerning various matters. The following is just a sampling of three cases:
Missouri Food Labeling Law Upheld
Turtle Islands Foods, SPC v. Thompson, No. 19-3154, 2021 U.S. App. LEXIS 9037 (8th Cir. Mar. 29, 2021)
Missouri law (Mo. Rev. Stat. §265.494(7)) makes it a criminal offense to misrepresent a product as meat that is not derived from the harvested production of livestock or poultry. A violation of the law could result in up to a year in prison plus up to a $1,000 fine. The law is directed at businesses that sell “alternative” protein sources such as those that are plant-based or cell-cultured and market such products as a meat-based product. The plaintiff, a maker of a vegetarian turkey substitute, challenged the law as an unconstitutional violation of free speech, due process and the Dormant Commerce Clause. The plaintiff sought a preliminary injunction preventing the state from enforcing the law. The state submitted evidence showing how the plaintiff could comply with the law, noting that a label clearly stating that the product was “plant-based,” “veggie,” “lab grown,” or something similar.
The trial court denied the plaintiff’s request for an injunction on the basis that the law only barred a company from misleading consumers into believing that a product is meat from livestock when it is not. The trial court also determined that the plaintiff had failed to prove an irreparable injury by risk of prosecution because its packaging already contained the necessary disclaimers.
On further review, the appellate court affirmed. The appellate court noted that the plaintiff admitted that its products were labeled in such a way to clearly indicate that the products did not contain meat from slaughtered animals and denoted that they were plant-based, vegan or vegetarian. The appellate court noted that, on remand at the trial court, facts could be discovered that could possibly lead to a different result on appeal.
USDA Rule Eliminating Line Speeds Vacated
United Food & Commercial Workers Union, Local No. 663 v. United States Department of Agriculture, No. 19-cv-2660, 2021 U.S. Dist. LEXIS 62656 (D. Minn. Mar. 31, 2021)
USDA inspectors, under the Federal Meat Inspection Act (FMIA), monitor port slaughter plants to ensure the safety and wholesomeness of pork products that are sold to the public. To ensure that post-mortem inspections are adequate, the Food Safety Inspection Service (FSIS) regulates the speed of evisceration lines. 9 C.F.R. §310.1(b)(3). In late 2019 the FSIS adopted as a final rule the New Swine Inspection System ("NSIS"), an optional program that implemented several reforms, including the elimination of evisceration line speed limits at pork processing plants. A labor union sued, claiming that the final rule was not properly promulgated under the Administrative Procedure Act (APA). When FSIS proposed the NSIS, it expressly identified worker safety as an important consideration and requested public comment on whether increasing line speeds would harm workers. The FSIS received many comments raising worker safety concerns before finalizing the optional rule. The court vacated the portion of the final rule pertaining to line speed limits concluding that the rule didn’t contain any discussion, analysis or evaluation of the submitted worker safety comments. The court reasoned that such failure violated the APA because worker safety was a key aspect of the rule. Thus, this part of the rule was remanded to the FSIS for review. The balance of the rule was not vacated and remains in effect. The court also stayed its order and entry of judgment for 90 days to give the FSIS time to address the issue.
Zoning Ordinance Allows for CAFO
Chambers v. Delaware-Muncie Metropolitan Board of Zoning Appeals, 150 N.E.3d 603 (Ind. Ct. App. 2020)
The petitioners owned property located in an area that was zoned as “agricultural.” The petitioners sought and eventually obtained a permit from the county building commissioner to build several hog barns configured as a concentrated animal feeding operation (CAFO) on their property. Neighbors of the petitioners asked the zoning board to review the building commissioner’s decision to issue the permit. The zoning board voided the permit and determined that the farming zone did not recognize industrial agricultural uses, such as the petitioners’ proposed CAFO. The petitioners sought a review of the zoning board’s decision. The trial court noted that the zoning ordinance specifically permitted animal husbandry, as well as raising and selling hogs and the erection of barns and similar farming building. The trial court determined that the zoning ordinance clearly indicated that hog raising operations were a permitted use. The trial court noted that the county could have excluded CAFOs or put other restrictions in place to maintain more traditional farming operations. Additionally, the trial court noted that several CAFOs were located and permitted in other agricultural zones in the county. Thus, the trial court held that the zoning board’s decision was reversed and the building commissioner’s decision to issue the permit to the petitioners was reinstated. On appeal, the neighbors of the petitioners argued that the zoning ordinance was ambiguous because it did not mention CAFOs. The appellate court agreed with the trial court and noted that the zoning ordinance set no limit on the scale of permitted uses in the agricultural zone. The appellate court determined that the plain language of the zoning ordinance was not ambiguous, and the petitioners were permitted to raise any number of hogs, subject to state and federal limitations.
The federal and state government regulation of agricultural activities seems to grow as the years go on. The government becomes more and more entangled in the daily life of a farmer or rancher. Do the benefits outweigh the costs? Probably not? Is there hope on the horizon for less governmental regulation? That tide recently changed. In any event the matter is just another reason that an experienced ag lawyer is needed more now than ever before.