The Ag Law Harvest

By: Jeffrey K. Lewis, Esq. Program Coordinator Income Tax Schools at The Ohio State University

Spring has officially sprung, and so have a few interesting legal updates. In this edition of the Ag Law Harvest we cover aggravated vehicular assault in a farm utility vehicle, “Made in the USA” labels, the Corporate Transparency Act’s legal woes, USDA’s Dairy Margin Program, and the U.S House Committee on Agriculture’s Agricultural Labor Working Group’s final report. 

Driver of Farm Utility Vehicle Cannot be Found Guilty of Aggravated Vehicular Assault. 
The Supreme Court of Ohio ruled that a driver of a farm utility vehicle involved in a crash cannot be convicted of a felony for injuring passengers because the vehicle does not meet the definition of a “motor vehicle” under Ohio’s criminal code. Joshua Fork of Sandusky County crashed his Polaris utility vehicle while driving under the influence at a party in 2020. Two of Fork’s passengers sustained serious injuries as a result of the accident. Fork was convicted of operating a vehicle under the influence (OVI), and two counts of aggravated vehicular assault. Fork did not contest his OVI conviction but did appeal his aggravated vehicular assault conviction to the Sixth District Court of Appeals. The case eventually made its way to the Supreme Court of Ohio. 

In its decision, the Court found that Ohio law has two definitions of “motor vehicle.” One definition applies strictly to traffic laws and the other applies more broadly to Ohio’s “penal laws.” The Court held that the definition of “motor vehicle” that applies to penal laws, such as aggravated vehicular assault, exempts utility vehicles. The Court concluded that because of the utility vehicle exemption and the fact that the utility vehicle’s principal purpose is for farm activities, Fork cannot be found guilty of vehicular aggravated assault. To read more on the Supreme Court’s decision, visit: https://www.courtnewsohio.gov/cases/2024/SCO/0321/230356.asp

USDA Announces Final Rule on “Made in the USA” Labels. 
The U.S. Department of Agriculture (“USDA”) announced the finalization of a rule to align the voluntary “Product of USA” label claim with consumer understanding of what the claim means. The USDA’s final “Product of USA” rule permits the voluntary use of the “Product of USA” or “Made in the USA” label claim on meat, poultry, and egg products. However, these labels can only be used if the products are derived from animals that were born, raised, slaughtered, and processed in the United States. The rule aims to prevent misleading U.S. origin labeling, ensuring that consumers receive truthful information about the origins of their food.

Under the final rule, the “Product of USA” or “Made in the USA” label claim will remain voluntary for meat, poultry, and egg products. It will also be eligible for generic label approval, meaning it won’t require pre-approval by the USDA’s Food Safety and Inspection Service (“FSIS”) before use, but establishments must maintain documentation supporting the claim. Additionally, the rule permits other voluntary U.S. origin claims on these products, provided they include a description on the package of the preparation and processing steps that occurred in the United States upon which the claim is made. 

Corporate Transparency Act Loses First Federal Court Battle. 
As we have previously reported (here), the Corporate Transparency Act (“CTA”) requires certain business entities to file Beneficial Ownership Information (“BOI”) with the Financial Crimes Enforcement Network (“FinCEN”) or face civil and criminal penalties. However, an interesting twist in the CTA saga has occurred. A federal court in Alabama issued an opinion ruling the CTA unconstitutional, concluding that the CTA exceeds the U.S. Constitution’s limits on Congress’s power, and issued an injunction against the U.S. Government from enforcing the CTA against the named plaintiffs in the case.  Therefore, the named plaintiff, Isaac Winkles, and companies for which he is a beneficial owner or applicant, the National Small Business Association, and the approximately 65,000 members of the National Small Business Association are currently not required to report beneficial ownership information to FinCEN. Everyone else must still comply with the CTA and the BOI reporting requirements. 

FinCEN released a statement acknowledging the court’s ruling but emphasized that only the named plaintiffs are excused from reporting beneficial ownership information to FinCEN at this time. On March 11, 2024, the U.S. Government filed a notice of appeal of the lower court’s ruling, hoping to reverse the injunction and the court’s decision. We will continue to monitor the situation and keep you informed of any updates to the CTA and BOI reporting requirements.

USDA Announces 2024 Dairy Margin Coverage Program. 
The U.S. Department of Agriculture (“USDA”) announced that starting February 28, 2024, dairy producers in the United States can enroll in the 2024 Dairy Margin Coverage (“DMC”) program. Enrollment for the 2024 DMC coverage ends on April 29, 2024. 

The USDA’s Farm Service Agency (FSA) has made revisions to the DMC regulations to allow eligible dairy operations to make a one-time adjustment to their established production history. This adjustment involves combining previously established supplemental production history with DMC production history for dairy operations that participated in Supplemental Dairy Margin Coverage in previous coverage years. DMC has also been authorized through the calendar year 2024 as per the 2018 Farm Bill extension passed by Congress.

FSA Administrator Zach Ducheneaux encourages producers to enroll in the 2024 DMC program, citing its importance as a risk management tool. The program has proven effective, with over $1.2 billion in Dairy Margin Coverage payments issued to producers in 2023. Ducheneaux highlights the program’s affordability, noting that it offers a sense of security and peace of mind to producers.

DMC is a voluntary risk management program that provides protection to dairy producers when the margin between the all-milk price and the average feed price falls below a certain dollar amount selected by the producer. In 2023, DMC payments were triggered in 11 months, including two months where the margin fell below the catastrophic level of $4.00 per hundredweight, marking a significant development for the program.

House Committee Releases Final Report Recommending Changes to H-2A Program. 
On March 7, 2024, the U.S. House Committee on Agriculture’s Agricultural Labor Working Group (“ALWG”) released its final report containing policy recommendations for U.S. agricultural labor. The report includes significant reforms to the H-2A program, many of which, as announced by the ALWG, received unanimous support from the bipartisan working group. The recommended policies encompass creating a single H-2A applicant portal, implementing H-2A wage reforms, establishing a federal heat standard for H-2A workers, and granting year-round industries such as livestock, poultry, dairy, peanuts, sugar beets, sugarcane, and forestry access to the H-2A program.

The Ag Law Harvest

By: Jeffrey K. Lewis, Esq. Attorney/Program Coordinator, Income Tax Schools at The Ohio State University

Happy 2024! We hope your new calendar year has gotten off to a delightful start. As we close out the first of twelve months, we bring you another edition of the Ag Law Harvest. In this blog post, we delve into the intricate world of employment contracts and noncompete agreements, classifying workers as independent contractors or employees, Ag-Gag laws, and agricultural policy. 

Ohio Man Violates Employer’s Noncompete Agreement. 

Kevin Ciptak (“Ciptak”), an Ohio landscaping employee, is facing legal trouble for allegedly breaching his employment contract with Yagour Group LLC, operating as Perfection Landscapes (“Perfection”). The contract included a noncompete agreement, which Ciptak is accused of violating by running his own landscaping business on the side while working for Perfection. Perfection eventually discovered the extent of Ciptak’s side business, leading to Perfection filing a lawsuit.

During the trial, Ciptak testified that Perfection was “too busy” to take on the jobs he completed. Additionally, Ciptak stated that the profits from his side jobs amounted to over $60,000. Perfection countered that they would have been able to perform the work and, because of the obvious breach of the noncompete agreement, Perfection lost out on the potential profits. The trial court ruled in favor of Perfection, ordering Ciptak to pay the $60,000 in profits along with attorney’s fees and expenses, exceeding $80,000. Ciptak appealed, arguing that, according to Ohio law, Perfection could only recover its own lost profits, not Ciptak’s gains from the breach. He also claimed that Perfection was not harmed as they were “too busy,” and Perfection failed to provide evidence of lost profits. 

The Eighth District Court of Appeals ultimately found in favor of Perfection.  The court reasoned that “[t]his case came down to a credibility determination.” The court held there was no dispute that Ciptak had violated the noncompete agreement. What was in dispute was whether Perfection could have and would have performed the work. The Eighth District held that the trial court’s finding that Perfection could have performed the work was not unreasonable. The Eighth District noted that although Ciptak claimed that Perfection was “too busy” to do any of those jobs, Ciptak “provided no other evidence to support this assertion.” The Eighth District ruled that the evidence presented at trial showed that Perfection would have realized approximately the same amount of profit on those jobs as Ciptak did and, therefore, Perfection was damaged as a result of Ciptak’s breach of the noncompete agreement. 

New Independent Contractor Rule Announced by Department of Labor. 

The U.S. Department of Labor (“DOL”) has published a final rule to help employers better understand when a worker qualifies as an employee and when they may be considered an independent contractor. The new rule gets rid of and replaces the 2021 rule. As announced by the DOL, the new rule “restores the multifactor analysis used by courts for decades, ensuring that all relevant factors are analyzed to determine whether a worker is an employee or an independent contractor.” Thus, the new rule returns to a “totality of the circumstances” approach and analyzes the following six factors: (1) any opportunity for profit or loss a worker might have; (2) the financial stake and nature of any resources a worker has invested in the work; (3) the degree of permanence of the work relationship; (4) the degree of control an employer has over the person’s work; (5) whether the work the person does is essential to the employer’s business; and (6) the worker’s skill and initiative. The new rule goes into effect on March 11, 2024. 

Federal Appeals Court Reverses Injunctions on Iowa “Ag-Gag Laws.” 

On January 8, 2024, the U.S. Court of Appeals for the Eighth Circuit issued two opinions reversing injunctions against two Iowa “ag-gag laws”. At trial, the two laws were found to have violated the First Amendment of the United States Constitution. In its first opinion, the Eighth Circuit Court of Appeals analyzed Iowa’s “Agricultural Production Facility Trespass” law which makes it illegal to use deceptive practices to obtain access or employment in an “agricultural production facility, with the intent to cause physical or economic harm or other injury to the agricultural production facility’s operations . . .” The Eighth Circuit found that the intent element contained within the Iowa law prevents it from violating the First Amendment. The court reasoned that the Iowa law “is not a viewpoint-based restriction on speech, but rather a permissible restriction on intentionally false speech undertaken to accomplish a legally cognizable harm.” 

In its second opinion, the Eighth Circuit reviewed an Iowa law that penalized anyone who “while trespassing, ‘knowingly places or uses a camera or electronic surveillance device that transmits or records images or data while the device is on the trespassed property[.]’” The court found that the Iowa law did not violate the First Amendment because “the [law’s] restrictions on the use of a camera only apply to situations when there has first been an unlawful trespass, the [law] does not burden substantially more speech than is necessary to further the State’s legitimate interests.”  The court noted that Iowa has a strong interest in protecting property rights by “penalizing that subset of trespassers who – by using a camera while trespassing – cause further injury to privacy and property rights.” 

Both cases have been remanded to the trial courts for further proceedings consistent with the forgoing opinions. 

USDA Announces New Remote Beef Grading Program.

Earlier this month, the U.S. Department of Agriculture (“USDA”) announced a new pilot program to “allow more cattle producers and meat processors to access better markets through the [USDA’s] official beef quality grading and certification.” The “Remote Grading Pilot for Beef” looks to expand on the USDA’s approach to increase competition in agricultural markets for small- and mid-size farmers and ranchers. The pilot program hopes to cut expenses that otherwise deter small, independent meat processors from having a highly trained USDA grader visit their facility. 

Under the pilot program, trained plant employees capture specific images of the live animal and the beef carcass. These images are then sent to a USDA grader that will inspect the images and accompanying plant records and product data, who then assigns the USDA Quality Grade and applicable carcass certification programs. The “Remote Grading Pilot for Beef” is only available to domestic beef slaughter facilities operating under federal inspection and producing product that meets USDA grading program eligibility criteria. More information can be found at https://www.ams.usda.gov/services/remote-beef-grading. 

USDA Accepting Applications for Value-Added Producer Grants Program. 

On January 17, 2024, the U.S. Department of Agriculture (“USDA”) announced that it is “accepting applications for grants to help agricultural producers maximize the value of their products and venture into new and better markets.” These grants are available through the Value-Added Producer Grants Program. Independent producers, agricultural producer groups, farmer or rancher cooperatives, and majority-controlled producer-based business ventures are all eligible for the grants. The USDA may award up to $75,000 for planning activities or up to $250,000 for working capital expenses related to producing and marketing a value-added agricultural product. For more information, visit the USDA’s website or contact your local USDA Rural Development office.

Ag Law Harvest

By: Jeffrey K. Lewis, Esq., Program Coordinator, OSU Income Tax Schools & ANR Extension

It’s getting hot! And we are here to bring you even more heat. This month’s Ag Law Harvest takes you across the country and even across our northern border as we highlight some interesting court cases, a petition to the USDA, and some legislation coming across the desks of Governors from Maine to Oregon.

Ohio Court Determines That Dairy Farm Did Not Intentionally Harm Employee. In 2019, a dairy farm employee sustained serious injuries after getting caught in a PTO shaft while operating a sand spreader. After his injury, the employee filed a lawsuit against his employer for failing to repair or replace the missing safety guards on the PTO shaft and sand spreader. In his lawsuit, the employee alleged that the dairy farm’s failure to repair or replace the missing safety guards amounted to a “deliberate removal” of the equipment’s safety features making the dairy farm liable for an intentional tort. In other words, the employee was accusing his employer of intentionally causing him harm. Normally, workplace injuries are adjudicated under Ohio’s workers’ compensation laws, unless an employee can prove that an employer acted intentionally to cause the employee harm. 

For an employer to be held liable for an intentional tort under Ohio law, an employee must prove that the employer acted with the specific intent to injure an employee. An employee can prove an employer’s intent in one of two ways: (1) with direct evidence of the employer’s intent; or (2) by proving that the employer “deliberately removed” equipment safety guards and/or deliberately misrepresented a toxic or hazardous substance. Because there was no direct evidence to prove the dairy farm’s intent, the employee could only try his case under the theory that the dairy farm deliberately removed the safety guards, intentionally causing him harm. 

The case went to trial and the jury found the dairy farm liable and ordered it to pay over $1.9 million in damages. The dairy farm appealed to the Twelfth District Court of Appeals arguing that its failure to repair or replace does not amount to a “deliberate removal” of the safety guards from the PTO shaft and sand spreader. The appellate court agreed. 

The Twelfth District decided to apply a narrow interpretation of the term “deliberate removal.” The court held that a “deliberate removal” is defined as the “deliberate decision to lift, push aside, take off, or otherwise eliminate.” The evidence presented at trial showed that the shaft guard may have simply broken off because of ordinary wear and tear. Additionally, the evidence could not establish who removed the connector guard or if the connector guard did not also break off due to ordinary wear and tear. Thus, the Twelfth District found that the evidence presented at trial did not support a finding that the dairy farm made “a careful and thorough decision to get rid of or eliminate” the safety guards. Furthermore, the Twelfth District reasoned that an employer’s “failure to repair or replace a safety guard is akin to permitting a hazardous condition to exist” and that the “mere knowledge of a hazardous condition is insufficient to show intent to injure. . .” The Twelfth District vacated and reversed the $1.9 million judgment and entered summary judgment on the dairy farm’s behalf.  

USDA Receives Petition Over “Climate-friendly” Claims. 
The Environmental Working Group (EWG) has petitioned the U.S. Department of Agriculture (“USDA”), asking the USDA to: (1) prohibit “climate-friendly” claims or similar claims on beef products; (2) require third-party verification for “climate-friendly” and similar claims; and (3) require a numerical on-pack carbon disclosure when such claims are made. The core legal issue is whether such “climate-friendly” labels and numerical carbon disclosures are protected and/or prohibited by the legal doctrine of commercial speech, which is protected under the First Amendment of the U.S. Constitution. EWG argues that the USDA has the authority to regulate such speech because commercial speech is only protected if it is not misleading. Additionally, EWG claims that requiring numerical carbon disclosures advances a substantial governmental interest by protecting consumers from fraud and deception. Although EWG has the legal right to petition the USDA, the USDA does not have to grant EWG’s petition, it must only consider the petition and respond within a reasonable time. 

Maine Governor Vetoes Ag Wage Bill.
Earlier this month Maine Governor, Janet Mills, vetoed Legislative Document 398 (“LD 398”) which required agricultural employers to pay their employees a minimum wage of $13.80 and overtime pay. Governor Mills stated that she supports the concept of LD 398 but was concerned about some of the bill’s language. The Maine legislature had the opportunity to override the Governor’s veto but failed to do so. After the legislature sustained her veto, Governor Mills signed an executive order establishing a formal stakeholder group to develop legislation that will establish a minimum wage for agricultural workers while also addressing the impacts the future legislation will have on Maine’s agriculture industry. 

A Big Thumbs Up! 
A Canadian judge recently found that a “thumbs-up” emoji is just as valid as a signature to a contract. In a recent case, a grain buyer, South West Terminal Ltd. (“SWT”), sent through text message, a deferred grain contract to a farming corporation owned and operated by Chris Achter (“Achter”). The contract stated that Achter was to sell 86 metric tonnes of flax to SWT at a price of $17 per bushel. SWT signed the contract, took a picture of the contract, and sent the picture to Achter along with a text message: “Please confirm flax contract”. Achter texted back a “thumbs-up” emoji. When the delivery date came and passed, Achter failed to deliver the flax to SWT which prompted SWT to file a lawsuit for breach of contract. SWT argued that Achter’s “thumbs-up” meant acceptance of the contract. Achter, on the other hand, claimed that the use of the emoji only conveyed his receipt of the contract. 

The Canadian court ultimately ruled in favor of SWT. The court relied on evidence that Achter and SWT had a pattern of entering into binding contracts through text message. In all previous occurrences, SWT would text the terms of the contract to Achter and Achter would usually respond with a “looks good”, “ok”, or “yup”. This time, Achter only responded with a “thumbs-up” emoji and the court concluded that an objective person would take that emoji to mean acceptance of the contract terms. Achter was ordered to pay over C$82,000 ($61,442) for the unfulfilled flax delivery. As the old saying goes: “a picture is worth a thousand words or tens of thousands of dollars.”  

Oregon Governor Signs Agriculture Worker Suicide Prevention Bill into Law. Earlier this month, Oregon Governor Tina Kotek signed a bill that creates a new suicide prevention hotline for agricultural producers and workers into law. Senate Bill 955 (“SB 955”) provides $300,000 to establish an endowment to fund an AgriStress Helpline in Oregon. Proponents of the bill believe the AgriStress Helpline will be able to specifically address the needs of agricultural producers and workers which “[s]tatistically . . . have one of the highest suicide rates of any occupation.” Oregon becomes the 7^th state to establish an AgriStress Hotline joining Connecticut, Missouri, Pennsylvania, Texas, Virginia, and Wyoming. 

Carbon credit market assistance program now in the hands of USDA

Sometimes a legislative proposal stalls, appears dead, then emerges in another piece of legislation in a slightly different form.  That’s exactly what happened with the Growing Climate Solutions Act and its plan to help farmers with carbon and environmental credit markets.  First introduced in 2020, the bill gained some momentum and passed the U.S. Senate before coming to a standstill in the House. But Congress added the bill, with some negotiated changes, into the Consolidated Appropriations Act it passed in the final days of 2022. The USDA is now charged with implementing its provisions.

Purpose of the bill

The bill aims to reduce barriers for farmers, ranchers, and foresters who want to enter into voluntary markets that establish environmental credits for greenhouse gas emission reductions resulting from agricultural or forestry practices (also known as carbon credits).  It allows the USDA to create the “Greenhouse Gas Technical Assistance Provider and Third-Party Verifier Program” if it appears, after an initial assessment, that the program would accomplish these purposes for farmers, ranchers, and private forest landowners:   

• Facilitate participation in environmental credit markets
• Ensure fair distribution of revenues
• Increase access to resources and information on environmental credit markets

Advisory Council

If the USDA determines that the program would meet the above purposes, it must establish an Advisory Council to help guide the program.  At least 51% of the Advisory Council must be farmers, ranchers, and private forest landowners, including beginning, socially disadvantaged, limited resource, and veteran members.  Other members on the Advisory Council would include representatives from agencies, the agricultural and forestry industries, the scientific research community, non-governmental organizations,  and professionals and private sector entities involved in credit markets.

Protocols

A primary concern with the environmental credit market is uncertainty and variations in how to establish, quantify, and value environmental credits.  An important component of the new program is for USDA to publish lists of widely accepted protocols that are designed to ensure consistency, reliability, effectiveness, efficiency, and transparency of the markets along with documents relating to the protocols.  The act directs the USDA to include protocol documents and details on calculations; sampling methodologies; accounting principles; systems for verification, monitoring, measurement, and reporting; and methods to account for issues such as additionality, permanence, leakage, and double counting of credits.

Vendor registry

Another concern for landowners who want to participate in environmental credit markets is knowing who to turn to for technical assistance.  To address this issue, the program would require the USDA to create a registry of third-party vendors of environmental credits who can help farmers, ranchers, and forest landowners measure the carbon reduction benefits of different types of practices.  Unlike an earlier version of the bill, the USDA would not establish a certification program for these vendors, although the agency must ensure that the vendors possess demonstrated expertise in practices that prevent, reduce, or mitigate greenhouse gas emissions. 

Assessments

The USDA, in concert with the Advisory Council, must submit an initial and ongoing assessments to the agricultural committees in the Senate and House.  The initial assessment must examine ways to ensure certainly for farmers, ranchers and forest landowners in the marketplace.  Ongoing assessments would examine the environmental credit market itself, including actors in the market, participation, credits generated and sold, barriers to entry, opportunities for other voluntary markets, and more.

Program funding

The act provides an appropriation of at least $1 million per year to fund the program through 2027 and another $4.1 million of potential unobligated American Rescue Plan Act funds.  It specifically prohibits the USDA from using funds from the Commodity Credit Corporation for the program, a demand of the House Agriculture Committee Chairman Glenn Thompson, who states that those funds are obligated for Farm Bill program payments.

What’s next?

Farm Bill negotiations this year and other climate initiatives recently undertaken by the Biden administration, such as the USDA’s Partnerships for Climate-Smart Commodities, could reduce the focus the Growing Climate Solutions Act would have received if it had passed when first introduced back in 2020.  Even so, the timeclock has started for the USDA to make its initial determination of whether the program would meet the intended purposes. Secretary Vilsack must make that determination by late September, and the expectation is that the program will proceed.  We should then see the Advisory Council established by fall and and can expect program outputs such as protocols and the third-party registry as early as 2024. 

Read the provisions of the new law beginning on page 1,512 of the Consolidated Appropriations Act of 2023, H.R. 2617.

The Ag Law Harvest

By: Jeffrey K. Lewis, Attorney and Research Specialist, OSU Agricultural and Resource Law

Did you know that a male moose loses its antlers every year? Moose usually lose their antlers every winter and grow new ones in the spring.  Additionally, because of the lack of antlers during the winter months, a moose’s first line of defense is its sharp hooves, which can mortally wound a wolf or bear.  This edition of the Ag Law Harvest kicks around a few USDA announcements and FDA rule proposals and sheds some light on overtime compensation for California’s agricultural workers.      

USDA announces new micro-farm insurance policy.  The U.S. Department of Agriculture’s (“USDA”) Risk Management Agency (“RMA”) announced that the USDA has developed a new micro farm insurance policy for agricultural producers with small-scale farms who sell locally.  The new insurance policy seeks to simplify recordkeeping and introduces insurance coverage for post-production costs and value-added products.  Farm operations that earn an average allowable revenue of $100,000 or less, or for carryover insureds, that earn an average allowable revenue of $125,000 or less are eligible for the policy.  The new insurance policy will be available for the 2022 crop year.  Crop insurance is sold and delivered sole through private crop insurance agents, a list of which can be found at the RMA Agent Locator.

USDA accepting applications to help rural communities get access to internet.  The USDA announced that it has begun accepting applications for up to $1.15 billion in loans and grants to help rural communities gain access to high-speed internet.  The announcement follows the recently enacted infrastructure bill, which provides another $2 billion in additional funding for USDA’s ReConnect Program.  According to the USDA, the funding will be available for projects that serve rural areas where at least 90% of the households lack broadband service at speeds of 100 megabits per second (Mbps) (download) and 20 Mbps (upload).  The USDA will give funding priority to projects that will serve people in low-density rural areas and areas lacking internet service speeds of at least 25 Mbps (download) and 3 Mbps (upload).  In making the funding decisions, the USDA will consider the economic needs of the community to be served and the extent to which a provider will offer affordable service options to the community.  

FDA proposing changes to testing requirements of pre-harvest agricultural water.  The Food and Drug Administration (“FDA”) published a proposed rule that would change some provisions of the FDA’s Produce Safety Rule.  The proposed rule seeks to replace the microbial criteria and testing requirements for pre-harvest agricultural water for covered produce other than sprouts.  Some of the proposed changes include: 

• Replacing the microbial quality criteria and testing requirements with new provisions for conducting pre-harvest agricultural water assessments for hazard identification and risk management purposes; 
• A new testing option for certain covered farms that elect to test their pre-harvest agricultural water for generic Escherichia coli (“E. coli”);
• Providing additional flexibility in responding to findings from pre-harvest agricultural water assessments; 
• Expedited implementation of mitigation measures for known or reasonably foreseeable hazards related to certain adjacent and nearby land uses; and 
• Required management review of pre-harvest agricultural water assessments. 

The FDA is accepting comments on the proposed rule until April 5, 2022.  

California’s overtime compensation for agricultural workers. In 2016, California passed Assembly Bill No. 1066 that slowly implemented overtime wages for California’s agricultural workers.  Beginning in 2022, agricultural employees are entitled to one-half times their regular rate of pay for all hours worked over eight hours in any workday or over 40 hours in any workweek.  However, the law only affects agricultural employers with 26 or more employees.  Agricultural employers with 25 or fewer employees will be required to follow the same overtime compensation structure beginning in 2025.  California will also begin to require that any work performed by an agricultural employee in excess of 12 hours in any workday be paid twice their regular rate of pay.  Again, this provision only effects agricultural employers with 26 or more employees but will go into effect for all agricultural employers in 2025.

The Ag Law Harvest

By: Jeffrey K. Lewis, Attorney and Research Specialist, OSU Agricultural and Resource Law Program

Did you know that white sturgeon are North America’s largest fish?  The largest white sturgeon on record was caught in 1898 and weighed approximately 1,500 pounds. Sturgeon is the common name for the species of fish that belong to the Acipenseridae family. The largest sturgeon on record was a Beluga sturgeon weighing in at 3,463 pounds and 24 feet long.  Talk about a river monster!  Swimming right along, this edition of the Ag Law Harvest brings you some intriguing election results from across the country, pandemic assistance for organic producers, and a lesson in signatures. 

Maine first state to have “right to food.”  Earlier this month, Maine voters passed the nation’s first “right to food” constitutional amendment.  The referendum asked voters if they favored an amendment to the Maine Constitution “to declare that all individuals have a natural, inherent and unalienable right to grow, raise, harvest, produce and consume the food of their own choosing their own nourishment, sustenance, bodily health and well-being.”  Supporters of the new amendment claim that the amendment will ensure the right of citizens to take back control of the food supply from large landowners and giant retailers.  Opponents claim that the new amendment is deceptively vague and is a threat to food safety and animal welfare by encouraging residents to try and raise their own products in their backyards without any knowledge or experience.  The scope and legality of Maine’s new constitutional amendment is surely to be tested and defined by the state’s courts, but until then, Maine citizens are the only ones the in the United States that can claim they have a constitutional right to food.  

New York voters approve constitutional environmental rights amendment.  New Yorkers voted on New York Proposal 2, also known as the “Environmental Rights Amendment.”  The proposal passed with overwhelming support.  The new amendment adds that “[e]ach person shall have a right to clean air and water, and a healthful environment” to the New York constitution.  New York is one of a handful of states to have enacted a “green amendment” in its state constitution.  Proponents of the amendment argue that such an amendment is long overdue while opponents argue that the amendment is too ambiguous and will do New York more harm than good. 

USDA announces pandemic support for certified organic and transitioning operations.  The U.S. Department of Agriculture (“USDA”) announced that it will be providing pandemic assistance to cover certification and education expenses to agricultural producers who are currently certified or to those seeking to become certified.  The USDA will make $20 million available through the Organic and Transitional Education and Certification Program (“OTECP”) as part of the USDA’s Pandemic Assistance for Producers initiative. OTECP funding is provided through the Coronavirus Aid Relief, and Economic Security Act (“CARES Act”).  Producers can apply for expenses paid during the 2020, 2021, and 2022 fiscal years.  For each fiscal year, OTECP will cover 25% of a certified operation’s eligible certification expenses, up to $250 per certification category.  Crop and livestock operations transitioning to organic production may be eligible for 75% of eligible expenses, up to $750 for each year.  Both certified organic operations and transitioning operations are eligible for 75% of eligible registration fees, up to $200, per year for educational events to help operations increase their knowledge of production and marketing practices.  Applications are now open and will be available until January 7, 2022.  Producers can apply through their local Farm Service Agency office.  For more information on OTECP visit https://www.farmers.gov/pandemic-assistance/otecp.    

A signature case.  In 2018 Margaret Byars died intestate survived by her 5 children.  After Byars’s death, one her sons, Keith, revealed that Margaret had allegedly executed a quitclaim deed in 2017 giving her Dayton home to Keith.  The other siblings brought this lawsuit claiming that the deed was invalid and unenforceable because the facts surrounding the execution of the deed seemed a little odd.  In 2017, Margaret was diagnosed with breast cancer and moved into a nursing facility.  Shortly after entering the nursing home, Sophia Johnson, a family friend and the notary on the deed, showed up to notarize the quitclaim deed.  Trial testimony revealed that the quitclaim deed was prepared and executed by a third party.  Margaret did not physically sign the deed herself.  In fact, the trial court noted that the signature looked like the handwriting of the person that prepared the deed and that no one saw Margaret authorize another to sign the deed for her.  Sophia testified that when she showed up to notarize the deed, the deed was already completed and signed.  Sophia also testified that Margaret seemed to intend to transfer the house to Keith and understood the nature and consequences of the deed.  After hearing all the testimony, the trial court concluded that the deed was enforceable, and the house belonged to Keith.  However, on appeal, the Second District Court of Appeals found the deed to be invalid.  The Second District stated that in Ohio a grantor need not actually sign a deed in order to be valid, however, the court concluded that the “signature requirement may be satisfied by another affixing a grantor’s signature on a deed so long as the evidence shows that the grantor comprehend the deed, wanted its execution, and authorized the other to sign it.”  The court concluded that the evidence showed that Margaret comprehended the deed and perhaps even wanted its execution.  But the evidence did not show that Margaret authorized anyone to sign the deed for her.  Because it could not be established that Margaret authorized the preparer or anyone else to sign the deed for her, the Second District court held that that deed was invalid under Ohio law.  This case demonstrates the importance of attorneys and the work they do to make sure all asset transfers and estate planning documents are in compliance with the law to help avoid unnecessary lawsuits and prevent any unintended outcomes.

The Ag Law Harvest

By:Jeffrey K. Lewis, Attorney and Research Specialist, OSU Agricultural & Resource Law 

Did you know that the Nile Crocodile has the strongest bite of any animal in the world?  The deadly jaws can apply 5,000 pounds of pressure per square inch, which is about 10 times more powerful than the crunch of the Great White Shark. Humans?  Well, they can apply about 100 pounds of pressure per square inch.  

This edition of the Ag Law Harvest takes a bite out of some federal lawsuits, Department of Labor developments, and USDA announcements affecting agriculture and the environment. 

Animal advocates lack standing to sue poultry producer.  In 2020, animal advocacy groups In Defense of Animals (“IDA”) and Friends of the Earth (“FoE”) (collectively the “Plaintiffs”) filed a lawsuit against Sanderson Farms (“Sanderson”), a Mississippi poultry producer, alleging that Sanderson engaged in false advertising as it relates to its chicken products.  According to Plaintiffs, Sanderson advertises that its chickens are “100% natural” with no “hidden ingredients.”  However, Plaintiffs allege that Sanderson has been misleading the public after many of Sanderson’s products tested positive for antibiotics and other unnatural substances.  This however is not the first court battle between FoE and Sanderson.  In 2017, FoE sued Sanderson for the same false advertising.  However, the 2017 case was dismissed because the court held that FoE did not have standing to bring the lawsuit.  The 2017 case was appealed to the Ninth Circuit Court of Appeals where the decision to dismiss the lawsuit was upheld.  Fast forward to 2020, FoE joined forces with a new plaintiff, IDA, hoping to file a lawsuit that would finally stick.  Recently however, a federal district court in California dismissed the most recent lawsuit because FoE was precluded, or prohibited, from suing Sanderson again on the same claims and because IDA lacked the standing to bring the lawsuit.  The California district court found that FoE could not bring its claims against Sanderson because those same claims were litigated in the 2017 lawsuit.  This legal theory, known as issue preclusion, prevents the same plaintiff from a previous lawsuit from bringing the same claims against the same defendant in a new lawsuit, when those claims were resolved or disposed of in a prior lawsuit.  Issue preclusion did not affect IDA, however, because it was a new plaintiff.  But the California district court still found that IDA lacked standing to bring this lawsuit against Sanderson.  IDA argued that because it expended resources to launch a campaign against Sanderson to combat the allegedly false advertising, it had organizational standing to bring the lawsuit.  Standing requires a plaintiff to show they suffered an “injury-in-fact” before they can maintain a lawsuit.  Organizational standing is the theory that allows an organization like IDA to establish an “injury-in-fact” if it can demonstrate that: (1) defendant frustrated its organizational mission; and (2) it diverted resources to combat the defendant’s conduct.  IDA argued that because it diverted resources including writing letters to Sanderson and the Federal Trade Commission, filing a complaint with the Better Business Bureau, publishing articles and social media posts, and diverting staff time from other campaigns to focus on countering Sanderson’s advertising, it had the organizational standing to bring the lawsuit.  The Court disagreed.  The Court reasoned that the diverting of resources by IDA was totally voluntary and not a result of Sanderson’s advertising.  The Court determined that in order to obtain organizational standing, IDA must have been forced to take the actions it did as a result of Sanderson’s advertising, the diverting of resources cannot be self-inflicted.  The Court held that Sanderson’s advertising did not ultimately frustrate IDA’s organizational mission and that any diverting of resources to counter Sanderson’s advertising was the normal course of action taken by a group like IDA.  

Joshua trees, a threatened species?  WildEarth Guardians (“Plaintiff”), a conservation organization, brought suit against the U.S. Secretary of the Interior and the U.S. Fish and Wildlife Service (“Defendants”) for failing to list the Joshua tree as a threatened species under the Endangered Species Act (“ESA”).  Plaintiff argued that the Defendants’ decision not to list the Joshua tree as threatened was arbitrary, capricious, contrary to the best scientific and commercial data available, and otherwise not in line with the standards set forth by the ESA.  In 2015 Plaintiff filed a petition to have the Joshua tree listed as a threatened species after Plaintiff provided scientific studies showing that climate change posed a serious threat to the continued existence of the Joshua tree.  The U.S. Fish and Wildlife Service (“FWS”) issued a 90-day finding that Plaintiff’s petition presented credible information indicating that listing the Joshua tree as threatened may be warranted.  However, the FWS’s 12-month finding determined that listing the Joshua tree as threatened or endangered under the ESA was not necessary due to the Joshua tree’s long lifespan, wide range, and ability to occupy multiple various ecological settings.  That’s when Plaintiff decided to bring this lawsuit asking the federal district court in California to set aside the 12-month finding and order the Defendants to prepare a new finding, and the Court agreed.  The Court held that Defendants’ decision was arbitrary, capricious, and contrary to the ESA and ordered the Defendants to reconsider Plaintiff’s petition.  The Court reasoned that the FWS’s climate change conclusions were arbitrary and capricious because it failed to consider Plaintiff’s scientific data and failed to explain why in its 12-month finding.  Further, the Court noted that the FWS’s findings regarding threats to the Joshua tree posed by climate change and wildfire were unsupported, speculative, or irrational.  And finally, the Court determined that the FWS’s conclusion that Joshua trees are not threatened in a significant portion of their range was arbitrary and capricious.  The FWS must now prepare a new finding that addresses all the above deficiencies.  

Department of Labor announces expanded measures to protect workers from extreme heat.  The U.S. Department of Labor (“DOL”) announced that the Occupational Safety and Health Administration (“OSHA”) is working on ways to protect workers in hot environments and reduce the dangers associated with exposure to high heat.  According to the DOL, OSHA will be implementing an enforcement initiative on heat-related hazards,  developing a National Emphasis Program on heat inspections, and launching a rulemaking process to develop a workplace heat standard.  Current and future extreme heat initiatives and rules apply to indoor and outdoor worksites in general industry, construction, agriculture and maritime where potential heat-related hazards exist. 

Deadline to apply for pandemic assistance to livestock producers extended.  The USDA announced that it is providing additional time for livestock and poultry producers to apply for the Pandemic Livestock Indemnity Program (“PLIP”).  Producers who suffered losses during the Covid-19 pandemic due to insufficient access to processing may now apply for relief for those losses through October 12, 2021.  Payments are based on 80% of the fair market value of the livestock and poultry and for the cost of depopulation and disposal of the animals.  Eligible livestock include swine, chickens, and turkeys.  For more information on PLIP, and how to apply, visit farmers.gov/plip.

The Ag Law Harvest

By:Jeffrey K. Lewis, Attorney and Research Specialist, Ohio State Agricultural & Resource Law Program

Did you know that the “wise old owl” saying is a myth?  Generally speaking, owls are no wiser than other birds of prey.  In fact, other bird species like crows and parrots have shown greater cognitive abilities than the owl.  An owl’s anatomy also helps dispel the myth because most of the space on an owl’s head is occupied by their large eyes, leaving little room for a brain. 

This week’s Ag Law Harvest brings you EPA bans, Ohio case law, USDA announcements, and federal case law which could make your head spin almost as far as an owl’s.  

EPA banning use of chlorpyrifos on food crops.  The EPA announced that it will stop the use of the pesticide chlorpyrifos on all food to better protect producers and consumers.  In its final rule released on Wednesday, the EPA is revoking all “tolerances” for chlorpyrifos.  Additionally, the EPA will issue a Notice of Intent to Cancel under the Federal Insecticide, Fungicide, and Rodenticide Act (“FIFRA”) to cancel all registered food uses of chlorpyrifos.  Chlorpyrifos is an insecticide used for a variety of agricultural uses, including soybeans, fruit and nut trees, broccoli, cauliflower, and other row crops, in addition to non-food uses.  The EPA’s announcement comes in response to the Ninth Circuit’s order directing the EPA to issue a final rule in response to a petition filed by opponents to the use of chlorpyrifos.  The petition requested that the EPA revoke all chlorpyrifos tolerances because those tolerances were not safe, particularly because of the potential negative effects the insecticide has on children.  For more information about chlorpyrifos and the EPA’s final rule, visit the EPA’s website.

Trusts aren’t to be used as shields.  An Ohio appeals court recently reinforced the concept that under Ohio law, trusts are not be used as a way to shield a person’s assets from creditors.  Recently, a plaintiff filed a lawsuit against a bank alleging breach of contract and conversion, among other things.  Plaintiff, an attorney and real estate developer, claimed that the bank removed money from his personal account and a trust account in violation of Ohio law and the terms of the loan agreement between the parties.  Prior to the lawsuit, plaintiff established a revocable trust for estate planning purposes and to acquire and develop real estate. This dispute arose from a $200,000 loan from the bank to the plaintiff to help establish a restaurant.  A provision of the loan agreement, known as the “Right to Setoff” provision, allowed the bank to “setoff” or effectively garnish all accounts the plaintiff had with the bank.  The setoff provision explicitly prohibited any setoff from any IRA or trust accounts “for which setoff would be prohibited by law.”  Plaintiff made all monthly payments but failed to make the final balloon payment on the loan.  Plaintiff argued that the bank broke the loan contract and violated Ohio law by taking funds from the trust account to pay off the remaining balance of the loan.  The court disagreed.  The court noted that under Ohio law, a settlor’s property in a revocable trust is subject to the claims of the settlor’s creditors.  A settlor is a person who creates or contributes property to a trust.  In this case, plaintiff was the creator, settlor, and sole beneficiary of the revocable trust.  Because of that, the court concluded the bank did not violate Ohio law when using the trust account to setoff the balance of the loan.  Additionally, the court found that the bank did not violate the terms of the loan agreement because a setoff from the trust account was not prohibited by law.  The court noted that Ohio law did not intend to allow a settlor who is also a beneficiary of the trust to use a trust as a “shield” against creditors.  Although trusts can be a useful estate planning tool, there are limits to what a trust can do, as evidenced by this case. 

Renewable fuel supporters file appeal on E15 summer sales. Corn farmers have joined forces with the biofuel industry (“Petitioners”) to ask the D.C. Circuit Court of Appeals for a new hearing on a ruling that struck down the EPA’s 2019 decision to allow year-round E15 sales.  Earlier this year, the same D.C. Circuit Court of Appeals issued an opinion that ruled the legislative text in the law supporting the biofuel mandate does not support the Trump administration’s regulatory waiver that allowed E15 to be sold during the summer months. In their petition, Petitioners argue that the D.C. Circuit Court made “significant legal errors.”  Petitioners contend that the court should rehear the case because the intent behind the nation’s biofuel mandate is better served by the sale of E15 through the summer months because it is less volatile, has less evaporative emissions, and is overall better for the environment than other fuel sources.  Petitioners also believe the court’s original decision deprives American drivers the choice of lower carbon emitting options at the gas pump.

Monsanto asks Supreme Court to review Ninth Circuit’s Roundup Decision.  In its petition to the Supreme Court of the United States Monsanto Company (“Monsanto”) asked the Supreme Court to review the $25 million decision rendered by the Ninth Circuit Court of Appeals.  In that decision, the Ninth Circuit held that the Federal Insecticide Fungicide and Rodenticide Act (“FIFRA”) did not preempt, or otherwise prevent, the plaintiff from raising California failure-to-warn claims on Roundup products and allowed plaintiff to introduce expert testimony that glyphosate causes cancer in humans.  In trial, the plaintiff argued that Monsanto violated California’s labeling requirements by not including a warning on the Roundup label that glyphosate, which is found in Roundup, causes cancer.  Monsanto argues that FIFRA expressly preempts any state law that imposes a different labeling or packaging requirement.  Under FIFRA, Monsanto argues that the EPA did not require Monsanto to include a cancer warning on its Roundup label.  Therefore, Monsanto maintains, that because California law differed from FIFRA, Monsanto was not required to follow California law when it came to labeling its Roundup product.  Secondly, the Ninth Circuit allowed plaintiff to present expert evidence that glyphosate could cause non-Hodgkin’s lymphoma in the general public and that glyphosate caused the plaintiff’s lymphoma.  Monsanto contends that the lower courts have distorted established precedent by allowing the expert testimony because the testimony is not based on generally accepted scientific principles and the scientific community has consistently found that glyphosate does not cause cancer in humans.    

USDA working to protect nation’s dairy industry.  The USDA’s Agricultural Marketing Service (“AMS”) has struck a deal with the European Union (“EU”) to satisfy the EU’s new import requirements on U.S. dairy.  The EU will require new health certificates for U.S. dairy products exported to the EU to verify that the U.S. milk used for products exported to the EU is sourced from establishments regulated under the Grade “A” Pasteurized Milk Ordinance or the USDA AMS Milk for Manufacturing Purposes.  Officials representing the U.S. Dairy Export Council and International Dairy Foods Association claim that the deal will allow U.S. producers to comply with the EU’s mandates while also satisfying the concerns within the American dairy industry.  The deal pushes back the EU’s deadline for new health certificates to January 15, 2022, to allow U.S. producers and exporters enough time to bring their products into compliance.  The USDA also announcedthat it is providing around $350 million to compensate dairy producers who lost revenue because of market disruptions due to the COVID-19 pandemic and a change to the federal pricing formula under the 2018 farm bill.  Additional details are available at the AMS Dairy Program website.

Tale as old as time.  An Ohio appeals court recently decided a dispute between neighbors about a driveway easement.  The driveway in dispute is shared by both neighbors to access their detached garages. Defendants used the driveway to access their garage and then the driveway extends past the Defendants’ garage onto Plaintiff’s property and ends at Plaintiff’s garage.  The dispute arose after Defendants built a parking pad behind their garage and used parts of the driveway they never used before to access the parking pad.  The original easement to the driveway was granted by very broad and general language in a 1918 deed, when the property was divided into two separate parcels.  In 1997, a Perpetual Easement and Maintenance Agreement (“Agreement”) was entered into by the two previous property owners.  The Agreement was much more specific than the 1918 deed and specifically showed how far the easement ran and what portions of the driveway could be used by both parties.  The 1997 Agreement did not allow for Defendants to use the portion of the driveway necessary to access their parking pad.  Plaintiffs argue that the 1997 Agreement controls the extent of the easement, whereas Defendants argue that the broad general language in the 1918 deed grants them authority to use the whole length of the driveway.  The Court found the more specific 1997 Agreement to be controlling and ruled in favor of the Plaintiffs.   The Court reasoned that the 1918 deed creates an ambiguity as to the extent of the easement and there is no way of knowing what the original driveway looked like or how it was used.  The Court concluded that the 1997 Agreement does not contradict or invalidate the 1918 deed, rather the 1997 Agreement puts specific parameters on the existing easement and does not violate any Ohio law.  The Defendants were found liable for trespass onto the Plaintiffs’ property and is expected to pay $27,500 in damages.  The lesson to be learned from all of this?  Make sure your easements are as specific and detailed as possible to ensure that all parties are in compliance with the law.

The Ag Law Harvest

By:Jeffrey K. Lewis, Attorney and Research Specialist, Agricultural & Resource Law

Did you know that elephants can’t jump?  In fact, it’s impossible for elephants to jump because, unlike most mammals, the bones in an elephant’s leg are all pointed downwards, which eliminates the “spring” required to push off the ground.  

Unlike elephants, we have jumped all over the place to bring you this week’s Ag Law Harvest.  Below you will find agricultural and resource law issues that include, among other things, conspiracy, preemption, succession planning support, ag spending and disaster relief, and Ohio’s broadband and salmon expansion. 

Poultry price fixing conspiracy.  According to a press release from the Department of Justice (“DOJ”) a federal grand jury has decided to indict Koch Foods and four former executives of Pilgrim’s Pride for allegedly engaging in a nationwide conspiracy to fix prices and rig bids for broiler chicken products.  These indictments combine to make a total of 14 individuals charged in the conspiracy that allegedly started in 2012 and lasted until 2019.  The indictments allege that the defendants and co-conspirators conspired to suppress and eliminate competition for sales of broiler chicken products sold to grocers and restaurants.  The DOJ reiterated its commitment to prosecuting price fixing and antitrust violations.  These indictments come on the heels of President Biden’s Executive Order seeking to promote competition within the American Economy, which focused heavily on the agriculture industry.  In addition to Koch Foods, additional companies have been indicted in the conspiracy.  So far, Claxton Poultry and Pilgrim’s Pride have both been indicted in the conspiracy with Pilgrim’s Pride agreeing to pay a $107 million fine.  Koch Foods denies any involvement in the price fixing scheme.  

FIFRA giving Monsanto a little relief.  About a week before the trial of another lawsuit against the Monsanto Company (“Monsanto”) and its Roundup products, a California judge dismissed some of the claims filed by the plaintiff.  According to the judge, some of the claims asserted by the plaintiff were preempted by the Federal Insecticide, Fungicide, and Rodenticide Act (“FIFRA”) and therefore could not be pursued.  The plaintiff claimed that Monsanto had a state-law duty to warn that Roundup causes cancer.  The judge noted that under FIFRA, a state cannot impose or continue to impose any requirement that is “in addition to or different from” those required by FIFRA.  At the time, federal regulations did not require Monsanto to place a cancer warning on its Roundup products.  The judge reasoned that since federal law is supreme (i.e. preempts state law) California cannot impose a state-law duty on Monsanto to warn that Roundup causes cancer.  The judge, therefore, found that the plaintiff cannot pursue her claims against Monsanto for failure to warn under California law.  This ruling is in contrast to a recent 9th Circuit Court of Appeals decision which concluded that the failure to warn claims brought by the plaintiff in that suit were not preempted by FIFRA.  Plaintiff has time to appeal the judge’s decision, even beyond the start of the trial and could rely on the 9th Circuit’s opinion to help her argue that her claims should not have been dismissed.

Competitive loans now available for land ownership issues and succession planning.  The USDA announced that it will be providing $67 million in competitive loans through the new Heirs’ Property Relending Program (“HPRP”).  The HPRP seeks to help agricultural producers and landowners resolve land ownership and succession issues.  Lenders can apply for loans up to $5 million at 1% interest through the Farm Service Agency (“FSA”) once the two-month signup window opens in late August.  Once the lenders are selected, heirs can apply to those lenders for assistance.  Heirs may use the loans to resolve title issues by financing the purchase or consolidation of property interests and for costs associated with a succession plan.  These costs can include buying out fractional interests of other heirs, closing costs, appraisals, title searches, surveys, preparing documents, other legal services.  Lenders will only make loans to heirs who: (1) look to resolve ownership and succession of a farm owned by multiple owners; (2) are a family member or heir-at-law related by blood or marriage to the previous owner; and (3) agree to complete a succession plan.  The USDA has stated that more information on how heirs can borrow from lenders under the HPRP will be available in the coming months.  For more information on HPRP visit https://www.farmers.gov/heirs/relending.  

House Ag Committee approves disaster relief bill.  The House Agriculture Committee approved an $8.5 billion disaster relief bill to extend the Wildfire and Hurricane Indemnity Program (“WHIP”).  The bill, known as the 2020 WHIP+ Reauthorization Act, provides relief for producers for 2020 and 2021 related to losses from the ongoing drought in the western half of the United States, the polar vortex that hit Texas earlier this year, wildfires that tainted California wine grapes with smoke, and power outages, like the one seen during the polar vortex in Texas, which caused dairy farmers to dump milk.  The bill makes it easier for farmers to recover for losses related to drought, now only requiring a D2 (severe) designation for eight consecutive weeks as well as allowing disaster relief payments for losses related to power outages that result from a qualified disaster event.  With the Committee’s approval the bill makes its way to the house floor for a debate/vote.  Whether it’s a standalone bill or a bill that is incorporated into an appropriations bill or a year-end spending measure remains to be seen.  

Senate Appropriations Committee approves ag spending bill.  The Senate Appropriations Committee voted in favor of a fiscal year 2022 spending bill for the USDA and FDA that includes about $7 billion in disaster relief and $700 million for rural broadband expansion.  The Committee approved $25.9 billion for the FY2022 ag spending bill, which is an increase of $2.46 billion from the current year.  In addition to disaster relief funds and rural broadband, the bill increases research funding to the USDA, increased funding for conservation and climate smart agricultural practices, and increased funding for rural development including infrastructure such as water and sewer systems and an increase in funding to transition rural America to renewable energy.  The ag spending bill is now set for debate and vote by the full Senate. 

Ohio to be the second site for AquaBounty’s genetically engineered salmon.  Land-based aquaculture company AquaBounty has selected Pioneer, Ohio as the location for its large-scale farm for AquaBounty’s genetically engineered salmon.  The new farm will be AquaBounty’s first large-scale commercial facility and expects to bring over 100 jobs to northwestern Ohio.  According to AquaBounty’s press release, the plan for the new farm is still contingent on approval of state and local economic incentives.  Ohio is still finalizing a package of economic incentives for the new location and AquaBounty hopes to begin construction on the new facility by the end of the year.  AquaBounty has modified a single part of the salmon’s DNA that causes them to grow faster in early development.  It raises its fish in what it calls “Recirculating Aquaculture Systems,” which are indoor facilities that are designed to prevent disease and protect wild fish populations.  According to AquaBounty, its production methods offer a reduced carbon footprint and no risk of pollution of marine ecosystems as compared to traditional salmon farming.  AquaBounty anticipates commercial production to begin in 2023. 

DeWine orders adoption of emergency rules to speed up the deployment of broadband in Ohio. Governor Mike DeWine signed an executive order which will help speed up the launch of the Ohio Residential Broadband Expansion Grant Program (the “Program”) which was recently signed into law by Governor DeWine.  The Program is Ohio’s first-ever residential broadband expansion program which grants the Broadband Program Expansion Authority the power to review and award Program grant money for eligible projects.  The Program requires a weighted scoring system to evaluate and select applications for Program grants.  Applications must be prioritized for unserved areas and areas located within distressed areas as defined under the Urban and Rural Initiative Grant Program.  The Program hopes to provide high-speed internet to Ohio residences that do not currently have access to such services.  With DeWine’s executive order, the Program can start immediately rather than waiting until the lengthy administrative rule making process is complete.  Normally, rules by a state agency must go through a long, drawn out process to ensure the public has had its input on any proposed rules and those affected the most can challenge or argue to amend the rules.  However, the Governor does have the ability to suspend the normal rule making process when an emergency exists requiring the immediate adoption of rules.  According to Governor DeWine’s executive order, the COVID-19 pandemic, the increase in telework, remote learning, and telehealth services have created an emergency that allows DeWine to suspend the normal rule making process to allow the Program to be enacted without delay.  Although emergency rules are in place, they are only valid for 120 days.  New, permanent rules must be enacted through the normal rule making procedure.  

The Ag Law Harvest

By: Jeffrey K. Lewis, Attorney and Research Specialist, Ohio State University Agricultural & Resource Law 

Did you know that Giant Panda Cubs can be as small as a stick of butter?  A panda mother is approximately 900 times bigger than her newborn cub, which can weigh less than 5 ounces.  This is like an 8-pound human baby having a mother that weighed 7,200 pounds – this size difference may explain why so many panda cubs die from accidentally being crushed by their mothers.  However, not everything is doom and gloom for the Giant Panda.  Chinese officials have officially downgraded pandas from “endangered” to “vulnerable.”  Although the International Union for Conservation of Nature re-labelled, the Panda as “vulnerable” in 2016, China wanted to make sure that the population of its national treasure continued to grow before downgrading the panda’s classification.  

Although it seems as though pandas are thriving thanks to conservation efforts in China, not all animal species in China are so lucky.  This week’s Ag Law Harvest takes a trip around the world to bring you domestic and international agricultural and resource issues.  We take a look at court decisions, Congress’ latest actions, China’s struggle with African Swine Fever, and President Biden’s latest executive order. 

Iowa Supreme Court Dismisses Raccoon River Lawsuit.  Environmental organizations (“Plaintiffs”) filed a lawsuit against the state of Iowa and its agencies (“Defendants”) asking the court to compel Defendants to adopt legislation that would require Iowa farmers to implement practices that would help reduce the levels of nitrogen and phosphorus in Raccoon River.  The Plaintiffs argued that Defendants violated their duty under the Public Trust Doctrine (“PTD”), which is a legal doctrine that requires states to hold certain natural resources in trust for the benefit of the state’s citizens.  Defendants argued that Plaintiffs lacked standing to bring the lawsuit.  The Iowa Supreme Court agreed with Defendants and found that a ruling in Plaintiffs’ favor would not necessarily remediate Plaintiffs’ alleged injuries, and therefore the Plaintiffs lacked standing to bring the lawsuit.  The Iowa Supreme Court also found that Plaintiffs’ issue was a nonjusticiable political question.  The political question doctrine is a principle that helps prevent upsetting the balance of power between the branches of government.  Under the doctrine, courts will not decide certain issues because they are better suited to be decided by another branch of government.  In this case, the court reasoned that Plaintiffs’ issue was better suited to be resolved through the legislative branch of government, not the judicial branch.  The Iowa Supreme Court decision is significant because, as it stands, agricultural producers in the Raccoon River Watershed will not be required to adopt any new practices but the decision leaves it up to Iowa’s legislature to determine whether farmers should be required to adopt new practices under the PTD to help reduce nitrogen and phosphorus in Raccoon River.  

U.S. House of Representatives’ spending bill increases focuses on climate action and environmental protection.  Before the July 4th break, the United States House Appropriations Committee approved the first of its Fiscal Year 2022 (“FY22”) funding bills.  Included in these bills is the agriculture funding bill, which will be sent to the House floor for full consideration.  The bill provides $26.55 billion in the discretionary funding of agencies and programs within the USDA, FDA, the Commodity Futures Trading Commission, and the Farm Credit Administration – an increase of $2.851 billion from 2021.  In total, the agriculture funding bill includes $196.7 billion for both mandatory and discretionary programs.  The bill focuses on: (1) rural development and infrastructure – including rural broadband; (2) food and nutrition programs to help combat hunger and food insecurity; (3) international food assistance to promote U.S. agricultural exports; (4) conservation programs to help farmers, ranchers, and other landowners protect their land; (5) ag lending; (6) climate-related work to help research and remedy the climate crisis; and (7) enforcement of environmental programs.  The agriculture spending bill will, however, have to be reconciled with any spending bill produced by the U.S. Senate.  

U.S. House Agriculture Committee advances rural broadband bill.  The House Agriculture Committee (the “Committee”) unanimously voted to advance the Broadband Internet Connections for Rural America Act(the “Act”), which would authorize $4.5 billion in annual funding, starting in fiscal year 2022, for the Broadband ReConnect Program (the “Program”) through fiscal year 2029.  The existing Program is set to expire on June 30, 2022.  To demonstrate Congress’ commitment to expanding rural broadband, the Program was only given $742 million in 2021.  It is unclear whether the Act will be included in the infrastructure package that is currently being negotiated between Congress and the White House.  Under the Act, the USDA must give the highest priority to projects that seek to provide broadband service to unserved communities that do not have any residential broadband service with speeds of at least 10/1 Mbps.  The USDA will then prioritize communities with less than 10,000 permanent residents and areas with a high percentage of low-income families.

Small hog farmers in China no longer required to seek environmental approval.  China is the world’s largest pork producer and over the past few years, its hog herds have been decimated.  A deadly African Swine Fever (“ASF”) has wiped out about half of China’s hog herds, especially affecting small farmers.  According to Reuters, China relies heavily on small farmers for its pork output, but because of ASF, small farmers have been left with little to no product and mass amounts of debts.  Further, Chinese farmers are hesitant to rebuild their herds because ASF is an ongoing risk and farmers stand to lose everything if they continue to raise diseased hogs.  Addressing these concerns, China’s agriculture ministry will no longer require small hog farmers to get environmental approval from the government before breeding their hogs.  China hopes to reduce the costs and red tape for small farmers as China tries to incentivize small farmers to rebuild their hog herds.  African Swine Fever is a highly contagious and deadly viral disease affecting both domestic and feral swine.  The ASF poses no threat to human health but can decimate domestic hog populations.  Germany has recently reported its first two cases of ASF in domestic hogs.  Currently, ASF has not been found within the United States, and the USDA hopes to keep it that way.  To learn more about ASF, visit the USDA’s Animal and Plant Health Inspection Service website.  

President Biden signs executive order to reduce consolidation in agriculture.  President Biden’s recent Executive Order on Promoting Competition in the American Economy seeks to address inadequate competition within the U.S. economy that the administration believes holds back economic growth and innovation.  The Order includes more than 70 initiatives by more than a dozen federal agencies to promote competition.  With respect to agriculture, the Order seeks to break up agricultural markets “that have become more concentrated and less competitive.”  The Biden Administration believes that the markets for seeds, equipment, feed, and fertilizer are dominated by a few large companies which negatively impacts family farmers and ranchers.  The Biden Administration believes that the lack of competition increases the costs of inputs for family farmers all while decreasing the revenue a family farmer receives.  The Order directs the USDA to consider issuing new rules: (1) making it easier for farmers to bring and win lawsuits under the Packers and Stockyards Act; (2) prohibiting chicken processors from exploiting and underpaying chicken farmers; (3) adopting anti-retaliation protections for farmers who speak out about a company’s bad practices; and (4) defining when meat producers can promote and label their products as a “Product of the USA.”  The Order also requires the USDA to develop a plan to increase opportunities for small farmers to access markets and receive a fair return and encourages the Federal Trade Commission to limit when equipment companies can restrict farmers from repairing their own farm machinery.  Follow this link to learn more about President Biden’s recent Executive Order.