By Burt Rutherford, Contributing Editor
For most beef producers, the old joke that, “I’m from the government and I’m here to help,” still brings a wry smile. For others, it’s not a joke at all.
Take the U.S. Department of Agriculture’s (USDA’s) recent Inclusive Competition and Market Inclusivity rule for example. According to S. Brett Offutt, chief legal officer/policy advisor with USDA’s Packers and Stockyards Division, “The rule makes it clear that undue prejudices and unjust discrimination against individuals on a prohibited basis will not be tolerated.”
During a USDA webinar announcing the specifics of the rule, Offutt said the rule prohibits discrimination based on race, color, religion, national origin, sex including sexual orientation and gender identity, marital status, age, or because of the covered producer status as a cooperative. There are three regulated entities under the rule, which are packers, swine contractors and live poultry dealers.
The rule contains some basic concepts, according to Offutt. “The first is that farmers and ranchers should not suffer discrimination on the basis of race, sex or other protected basis. Second, farmers and ranchers shouldn’t be retaliated against for exercising basic rights and third, farmers and ranchers should not be deceived or misled in any aspect of contracting.”
A broad-brush glance indicates that the rule is primarily directed at the hog and poultry industries. While that’s largely the case, beef packers also come under the rule’s umbrella.
According to Tanner Beymer, National Cattlemen’s Beef Association (NCBA) senior director of government affairs, this rule is part of a series of regulations that are substantially similar to previous rules USDA tried to finalize in 2010 and 2016. NCBA opposed those previous iterations and is opposed to this one as well, he said.
“Those are very narrow requirements. So, I’m not really envisioning too many situations where this particular rule could be used as a basis to sue a (beef) packer.”
– S. Brett Offutt
However, he said this rule is unique compared with earlier attempts and is substantially different than when first promulgated. “When the rule was first proposed, it suggested making a new category called market vulnerable producers and affording them special protections under the Packers and Stockyards Act, which gave us significant pause. That’s a difficult term to define and we are not in the business of creating undo or unfair advantages in the marketplace.”
That provision was dropped in the final rule and now it’s designed to cover those specified protected classes. “We would argue that it is already illegal to discriminate, retaliate or deceive on the basis of age, sexual orientation, nation of origin, etc. So I don’t know that this is going to have a huge effect on the beef business,” he said.
That doesn’t mean that beef packers are free and clear, however. The rule does allow for a private right of action, Beymer said. “So if you wanted to use this rule as the basis to bring litigation against a packer, you as an individual and a private citizen can do that. However, you do have to demonstrate that you have been discriminated against or deceived or retaliated against, based on your membership or identification with one of those protected classes that’s specifically called out in the statute,” he said.
“Those are very narrow requirements. So, I’m not really envisioning too many situations where this particular rule could be used as a basis to sue a (beef) packer.”
Then There’s the Other Shoe
Given the present situation, perhaps a rewrite of the old joke could be made. “I’m from the government and I’m never going to go away.” The other shoe has yet to drop.
“This is only the second rule in what we expect to be a series of three or four,” Beymer said. “The next rule that we expect to come out of USDA, which will address harm to competition, is one I think is going to create open season for trial lawyers to bring frivolous lawsuits against packers in the name of competition. So, I don’t expect this (current) rule being the genesis for that, but this upcoming rule on harm to competition most certainly will be.”
Stay tuned.
