Recent USDA Food Labeling Rules Spawn Litigation

September 24, 2013 | Christopher R. Barondeau* and Roger A. McEowen**

The U.S. Department of Agriculture (“USDA”) has finalized rules calling for mandatory labels indicating a meat's country of origin and production steps. The new rules, effective May 23, 2013, call for additional requirements concerning mandatory country-of-origin labeling (“COOL”) for meat products. The final rules modify previous COOL requirements that took effect in 2009.  Congress originally passed COOL legislation in 2002 and amended it in 2008, after which USDA implemented the law for meat products in three incremental steps, beginning September 30, 2008.  The latest implementation occurred on May 23, 2013.  USDA announced, however, that it would not enforce the final rule until November 24, 2013.

Under the final rules, specified meat products must specifically identify a product’s country of origin and provide specific details regarding where the meat product was raised and processed (born, raised and processed information).  The prior rule required a covered meat product to only identify its country of origin (e.g., “Product of Mexico”), the new labeling requirements take it a step further and require production/process labeling requirements as well (e.g.,. “Born in Mexico, raised and slaughtered in the U.S.”).  Because the final rules require production/process labeling information, they effectively end the previous practice of applying a mixed-country label even on meat products that were exclusively of U.S. origin, a practice that the USDA argued was not the intent of the COOL statute.

The final COOL rules are opposed by various meat packers and related industry organizations.  They claim that the final rules will increase distrust of foreign meat products and damage U.S. producers because other foreign meat importers could institute retaliatory tariffs or other authorized trade sanctions.  Indeed, Canada and Mexico have already challenged the law arguing that mandatory COOL requirements currently in place present a barrier to trade by providing an incentive for U.S. meatpackers to buy American livestock that is born, raised and slaughtered in the United States.  But, the USDA has stated that the rule brings the U.S. into compliance with the WTO ruling that sided with Canada and Mexico.  The WTO does not expect to resolve issues related to Canada and Mexico’s new challenge to the final COOL rules until sometime in 2015.

Despite the fact that the USDA said it would not enforce the final rules until Nov. 24, 2013,  meatpackers and their associated industry groups sued the USDA on July 8, 2013, seeking an injunction to to block implementation of the rules. The complaint alleges that the final rules compel speech in the form of costly and detailed labels on meat products that do not directly advance a government interest and, therefore, violates the United States Constitution.  The complaint also alleges that the final rules exceed the scope of the statutory mandate.  The meatpacking industry claims that the statute does not permit the kind of detailed and onerous labeling requirements the final rules put in place, and that the rules are arbitrary and capricious, and imposes vast burdens on the industry with little to no countervailing benefit.  Specifically, the complaint alleges that:

  • The final rules violate the plaintiffs’ free speech rights by compelling them to “speak” (inform consumers where the animal from which a covered meat cut was  born, raised and slaughtered) when they don’t want to “speak;”
  • The underlying statute does not allow the final rules to state where animals were born, raised and slaughtered and does authorize a mixed-country label; and
  • USDA exceeded its rulemaking authority by requiring inaccurate labels and that will worsen situations deemed to be in violation of international trade laws by the WTO.

However, the Court rejected the plaintiffs’ request for a preliminary injunction with a ruling issued on September 11, 2013. The Federal District Court for the District of Columbia, on Sept. 11, rejected the injunction request.  The court determined that while the balance of the interests “tipped slightly” in the meatpacking industry’s favor, the plaintiffs could not show that they would likely win the case on the merits because the rules only require meatpackers to provide factual information and that current mixed-country labeling was misleading consumers.  The court also noted that USDA’s interpretation of the underlying COOL statute was correct in that it reasonably allows labels to specify where an animal was born, raised and slaughtered.  The court also noted that the intent of the Congress when passing the COOL law was to ensure that consumers were provided with accurate information when purchasing meat, and that a mixed-label was not statutorily authorized.  The court noted that the final rules that eliminate the mixed-label improved the accuracy of COOL, and that USDA had done its best to comply with the WTO ruling.  The court also noted that the plaintiffs had done nothing but provide speculation concerning their potential “injury” and that fell far short of the “irreparable injury” that the plaintiffs had to show to receive an injunction. 

The plaintiffs have appealed the court’s denial of their injunction request.  On September 16, 2013, the U.S. Circuit Court of Appeals for the D.C. Circuit issued an order establishing a briefing schedule that will terminate on November 1, 2013.

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*Attorney-at-Law, Goosmann Law Firm, Sioux City, Iowa.
**Director, Center for Agricultural Law and Taxation