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USDA Proposes Sweeping Changes in Undue Preferences Rule Mandated by 2008 Farm Bill

Friday, June 18, 2010

(American Meat Institute)

USDA today unveiled a proposed rule that, if adopted, would result in sweeping changes to how livestock are marketed and procured by meat packers.  The proposed rule, characterized by Agriculture Secretary Tom Vilsack as “aggressive,” was mandated by the 2008 Farm Bill.


The proposed rule includes several new provisions:

AMI expressed strong concern about the potential impact of these changes. 

“USDA is attempting to turn the clock back on the livestock and meat marketing practices that have made the U.S. meat production system the envy of the world and that have delivered the most abundant and affordable meat products available to the American consumer,” said AMI Senior Vice President of Regulatory Affairs and General Counsel Mark Dopp.  “Courts have affirmed that our industry is dynamic and competitive and have rejected USDA’s arguments repeatedly.  Now, in the face of repeated judicial rejection of their arguments, USDA is engaging in a regulatory end-run and attempting to change the law through administrative fiat.  This is not an appropriate role for the Department to play and could potentially cause harm and enormous disruption.”

In an outline of the rule, USDA wrote that a number of U.S. circuit courts of appeals have not given “deference” to USDA’s interpretation of various sections of the Packers & Stockyards Act.  USDA asserts that the proposed regulations would constitute “a material change in circumstances that would warrant judicial reexamination of this issue.”  The outline ignores, however, the fact that USDA has presented these same arguments to several federal appellate courts and they have been repeatedly rejected, including rulings as recently as December 2009 and again in May 2010.

GIPSA will consider comments on the proposed rule until August 23, 2010.  Comments may be sent via email to comments.gipsa@usda.gov  or sent by mail to Tess Butler, GIPSA, USDA, 1400 Independence Avenue, SW, Room 1643-S, Washington, D.C. 20250-3604.  Copies of the proposed rule and additional information can be found at: http://click.icptrack.com/icp/relay.php?r=39934748&msgid=240006&act=36YG&c=590864&destination=http%3A%2F%2Fwww.gipsa.usda.gov%2F  by clicking on Federal Register.


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