The National Chicken Council (NCC) on Wednesday strongly urged USDA’s Agricultural Marketing Service (AMS) to withdraw its proposed rule, “Fair and Competitive Livestock and Poultry Markets,” which reflects an impermissible attempt to make an end-run around established judicial precedent requiring a showing of injury to competition to sue and win under Section 202(a) or (b) of the Packers and Stockyards Act (PSA).
“Worse than a solution in search of a problem, the proposed rule would cause widespread confusion and inflict staggering costs on the meat and poultry industries, ultimately to the detriment of American consumers,” said NCC Interim President Gary Kushner.
In detailed comments, NCC highlighted the many flaws and costs associated with the proposed rule, including:
- The fact that the proposed rule would try to fundamentally alter the nature of PSA Section 202(a) and (b) violations in a manner that exceeds AMS’s authority;
- That eliminating the injury to competition requirement from PSA Sections 202(a) and (b) is a major question that must be addressed by Congress;
- Grossly underestimating the costs the industry will incur and ignoring entirely the staggering litigation costs that the proposed rule would impose;
- AMS relying on misinterpretations of the relevant case law addressing the PSA’s injury to competition requirement;
- The fact that the proposed rule is vague, unworkable, arbitrary and capricious as it is not supported by the record;
- Failing to establish that anticompetitive behavior is occurring in the poultry market; and
- The fact that, contrary to the assertions in the proposed rule, data show the current poultry grower contracting system is profitable and works well for growers.
Kushner pointed out that all eight different federal circuit courts of appeal to have considered the issue unanimously concluded that PSA Section 202(a) and (b) violations require a showing of injury to competition and have uniformly and resoundingly rejected the position advanced by AMS in this proposed rule.
“This proposed rule is ill-advised, unconstitutionally vague, would inflict billions of dollars of economic harm on American agriculture, line the pockets of plaintiffs’ lawyers, and increase costs for consumers who are already struggling with inflation in most of their everyday lives,” Kushner concluded.
A full copy of NCC’s comments can be found here.
