Canadian, U.S. meat industry groups take COOL to court

U.S. and Canadian meat industry and producer groups seeking a “preliminary injunctive relief” against revised COOL rules were denied Sept. 11 at the U.S. District Court for the District of Columbia. (DCD.USCourts.gov)

Rather than wait for the World Trade Organization or the U.S. Congress to fix mandatory country-of-origin labelling on meat sold in the U.S., Canada’s cattle and hog producer groups have signed on to take Washington’s rules to court.

The Canadian Cattlemen’s Association (CCA) and Canadian Pork Council (CPC) said Tuesday they’ve filed as co-plaintiffs seeking an injunction against COOL Monday at the U.S. District Court of the District of Columbia.

The six U.S. plaintiffs in the court challenge are the American Association of Meat Processors, American Meat Institute, National Cattlemen’s Beef Association, National Pork Producers Council, North American Meat Association and Southwest Meat Association.

The U.S. plaintiffs fear “a serious economic impact on their industry, leading to plant closures and lost jobs as well as reduced international cost competitiveness of the entire North American meat industry,” CPC chair Jean-Guy Vincent said in a release. “This will likely lead to increased prices for consumers.”

The groups’ U.S. District Court filing predicts other challenges to COOL — such as Canada’s challenges of the COOL rule and its recent revisions at the WTO — are “likely to succeed.”

But because the groups’ members face “irreparable harm” from the revised COOL in the meantime, the groups want the court to provide “preliminary injunctive relief” against COOL and its enforcement.

Since the U.S. Congress has missed its opportunity to legislate changes to COOL in its recent Farm Bill negotiations, the court challenge is meant to “quickly resolve this dispute as legislative options for the U.S. to come into compliance with its WTO obligations become fewer,” Vincent said.

The suit names the U.S. Department of Agriculture, USDA’s Agricultural Marketing Service (AMS), U.S. Agriculture Secretary Tom Vilsack and AMS administrator Anne Alonzo as defendants.

COOL, in place in the U.S. since 2008, was ruled out of order by the WTO’s Dispute Settlement Body (DSB) in 2011 and WTO Appellate Body in 2012 for discriminating against Canadian and Mexican livestock and meat.

But USDA in May, up against a deadline to make COOL WTO-compliant, revised COOL’s labeling provisions for muscle cuts of meat, requiring labels to include even more specific information about where each of the production steps (born, raised, slaughtered) took place. USDA’s new rule also removes the previous rule’s allowance for commingling of muscle cuts.

Thus, where the COOL regulations since 2008 have allowed “Product of the U.S.” labels on cuts from animals born, raised, and slaughtered in the U.S., the new rule requires such cuts’ labels to read “Born, Raised, and Slaughtered in the U.S.”

But if an animal is born in Canada, but raised in both Canada and the U.S. before slaughter, the shortest label allowed under the new rule would read “Born in Canada, Raised and Slaughtered in the U.S.”

Dropping the allowance for commingling of muscle cuts of different origin, meanwhile, will stop processors from labelling cuts of animals from the U.S., Canada and Mexico with the less-specific “Product of the U.S., Canada and Mexico.”

“Montana, Manitoba or Mazatlan”

The groups’ court filing says the defendants concede there’s “no health or safety reason” to distinguish among meat from the U.S., Canada or Mexico. COOL, they note, only covers some commodities at retail and “exempts significant categories of meat products from any labeling requirements at all.”

Beef sold in the U.S., the groups argue, is all subject to the same U.S. inspection and grading rules, meaning “whether the steer or heifer was born in Montana, Manitoba or Mazatlan. The same goes for hogs, chickens and other livestock.”

And by forcing packers to segregate livestock by country of origin, the new ban on commingling will “choke the supply chain at the point of importation,” the groups said. “The costs associated with this new inefficient process will drive some processors dependent on imports out of business and destroy the market for meat from imported livestock.”

Thus, the CCA is quoted as saying in the court filing, “Canadian livestock producers would have to accept steep discounts to make up for the downstream production costs faced by processors and retailers.”

COOL, the groups said, also violates the First Amendment to the U.S. Constitution, which “prohibits compelled-speech regimes in the absence of a substantial governmental interest.”

Even AMS conservatively acknowledges COOL could cost the meat industry as much as US$192.1 million, the groups said, but “(w)hen it came to justifying those millions upon millions of dollars in costs, AMS offered an anemic defense.”

AMS, they said, claims the new COOL rule “will benefit consumers by providing them with more specific information on which to base their purchasing decisions.”

However, they added, AMS “did not explain how production-step information (on meat labels) influences those purchasing decisions, and it did not endorse the notion that the information should have an influence at all.”

Also, the groups quote AMS as saying “evidence suggests that market mechanisms could ensure that the optimal level of country-of-origin information would be provided to the degree valued by consumers” — but AMS is still required to carry out its “statutory obligation” to COOL.

In other words, the groups said, “absent what (AMS) thought to be its ‘statutory obligation,’ there was no need at all for COOL labeling in general or for ‘Born, Raised, and Slaughtered’ information in particular.” — AGCanada.com Network

Related stories:
Canadian cattle producers, U.S. packers dread COOL revisions, June 14, 2013
Potential COOL tariff targets shortlisted, June 7, 2013
Last-minute COOL changes a burn for Canada, May 24, 2013

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