Washington Insider -Wednesday

Egg Salmonella Case to Supreme Court

Here's a quick monitor of Washington farm and trade policy issues from DTN's well-placed observer.

Supreme Court to Decide WOTUS Rule Challenge Venue

The U.S. Supreme Court agreed to decide whether challenges to the Environmental Protection Agency (EPA) Waters of the U.S. (WOTUS) rule, which seeks to clarify Clean Water Act jurisdiction, properly lie in federal district courts or a specific federal appeals court.

The high court on January 13 granted a request filed by the National Association of Manufacturers, which asked the court to determine whether the U.S. Court of Appeals for the Sixth Circuit erred when it claimed exclusive jurisdiction to decide petitions to review the Obama administration's WOTUS rule.

Several states and industry groups argue that the waters of the U.S. rule, jointly released by the EPA and U.S. Army Corps of Engineers on June 29, 2015, improperly expands federal authority. In February 2016, the Sixth Circuit ruled in favor of the Obama administration in a 1-1-1 opinion that essentially said the appeals court, not the district courts, was the proper venue to hear challenges to the rule.

States and industry groups also challenged the rule in district courts across the country, under Section 704 of the Administrative Procedure Act, to preserve review should the U.S. Supreme Court eventually conclude the Sixth Circuit is not the proper venue for the challenges. The Sixth Circuit stayed the rule nationwide on October 9, 2015, while it studied the challenges.

The Supreme Court is likely to rule during this court term, which will end by early July, said Ellen Steen, an attorney for the American Farm Bureau Federation, one of the plaintiffs and petitioners challenging the rule. The Supreme Court justices who agree to take a case often do so because they have doubts about an appellate court's decision. That does not mean the Supreme Court will overturn the Sixth Circuit jurisdiction ruling, but it puts the odds a little more in favor of a decision to overturn, Steen said. Steen suggested the court agreed to hear the case because this area of the Clean Water Act is legally confusing. The court's decision could help clarify the legal route for many future cases, she said.

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US To Lift Ban on Beef Imports From France

The U.S. will lift the ban on beef imports from France, which have been shut out of the market for 19 years, according to the European Commission. "This is excellent news for French producers," three European Union commissioners said in a joint statement. The three commissioners were Cecilia Malmstroem for trade, Phil Hogan for agriculture and Vytenis Andriukaitis for food safety.

French beef producers will be able to start exporting to the U.S. as soon as France has sent a list of certified establishments to U.S. agencies.

The U.S. closed its market to beef imports in the 1998 following the bovine spongiform encephalopathy (BSE) crisis. BSE, also known as mad cow disease. Ireland was the first EU member state that got its beef products readmitted, followed by Lithuania and the Netherlands.

"This shows that the European Union's efforts to eradicate BSE from its territory have borne fruit. The decision of the United States clearly demonstrates what we can achieve when we have an open and constructive relationship with one of our most important trading partners," the commissioners said in the statement.


Washington Insider: Egg Issue to Supreme Court

While livestock and meat products are scrutinized closely by USDA inspectors during slaughter, the Food and Drug Administration (FDA), which is responsible for the safety of other food products, manages a much lighter inspection footprint, but is using new authorities to push company executives to manage much more rigorous safety inspection efforts. In several cases, company executives have been charged and imprisoned for shipping products that did not meet safety criteria.

Now, a pair of Iowa executives are pushing back, and are taking their case to the Supreme Court, Bloomberg BNA is reporting this week. They claim that prison terms imposed on two egg company executives over a large-scale salmonella outbreak are unconstitutional.

Austin and Peter DeCoster contend their three-month sentences, based on a "responsible corporate officer" doctrine that requires no proof of criminal intent, violated their due process rights and should be abolished. The doctrine makes executives criminally liable by virtue of their oversight of company activities, without proof of intent to commit the company's underlying crimes.

The closely watched appeal stems from salmonella-tainted eggs, traced to the DeCosters' commercial farm in Iowa, that sickened thousands in 2010. Food Safety News has been following this case for some time, especially the role criminal prosecutions may play in future food safety policies, and called the DeCoster case one of the top five food safety stories of 2016.

FSN said that DeCoster was "a family business name also linked to environmental, labor, and food safety violations from Iowa to Maine." Each DeCoster pled guilty to allowing adulterated food from their egg production facilities in Iowa into interstate commerce, and each agreed to pay $100,000 fines along with a near-record $6.8 million fine paid by their Quality Egg Corp. Quality Egg Corp., which pled guilty to two felonies and the same misdemeanor with which each DeCoster was charged.

The DeCosters were sentenced under the Federal Food, Drug and Cosmetic Act in 2014, but recently appealed the prison terms to the Eighth Circuit. They argued the prison terms deprived them of their liberty without proof they intended to commit a crime.

A split Eighth Circuit panel rejected that argument last July. It held the DeCosters weren't convicted based on the actions of their employees, but rather were negligent in failing to prevent the unsanitary conditions that resulted in the outbreak.

That might be enough to impose a fine, but doesn't justify a jail sentence, the DeCosters argue.

They also say the sentences under the responsible corporate officer doctrine — which stems from a pair of Supreme Court cases decided in 1943 and 1975—conflict with an Eleventh Circuit decision, as well as rulings of state supreme courts of Pennsylvania, Georgia and Minnesota.

The DeCosters argue that the doctrine should be abolished because it will "criminalize a broad range of innocent conduct, invite arbitrary enforcement, and fail to give fair warning of what is forbidden" in food, drug, tobacco and other FDA-regulated industries.

FSN noted that while the new Food Safety Modernization Act's rules went into effect when the President signed it into law in 2011, it has only recently begun tackling nationwide food safety problems during 2016 "after all seven of foundational rules to implement the new law were finished."

The program's "actual starting point" remains where it has been for been for a while, focused on helping reduce the "about 48 million illnesses or 1 in 6 Americans sick from foodborne diseases each year." The federal Centers for Disease Control and Prevention says 128,000 people require hospitalization and 3,000 die.

FSN says the message in the increased litigation is that government efforts to improve food safety by requiring private firms to manage and pay for the costly tests and inspections necessary, are succeeding.

So, the DeCosters' case is being watched carefully as an important test of federal policy, especially in light of the incoming administration's interest in pulling back at least some of the impacts of government programs. Clearly, there can be little doubt of the seriousness of the food safety problems in the United States. How effective FDA's relatively new "enforcement" approaches will prove to be and how it could affect the credibility of the food supply should be watched closely by producers as the industry responds, Washington Insider believes.


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