"Everybody's wrong everybody's right Someone must be wrong when someone else is right.â Sham 69, Thatâs Life (1978)
In a decision handed down January 26th by the U.S. Court of Appeals (1st Circuit), three provisions of the National Organic Program (NOP) final rule were judged âinconsistent with the Organic Foods Production Act of 1990 (OFPA).â This ruling caught most of the industry by surprise and has the potential to change the organics industry as we know it today.
The ruling followed an original complaint filed by Arthur Harvey, an organic blueberry farmer and NOP organic inspector, on October 23, 2002, just two days after the final rule had become fully implemented.
In the nine counts of his original suit, Harvey challenged the validity of the final rule that the U.S. Department of Agriculture (USDA) wrote in order to implement OFPA. He asserted that various provisions of the NOP rule were âarbitrary, capricious and contraryâ to law. U.S. Magistrate Judge Margaret Kravchuk eventually dismissed all counts on January 8th, 2004.
Harvey and his teamâwhich included the Organic Consumers Association (OCA) and Public Citizenâappealed seven counts from his original nine to the First Circuit. On January 26, 2005, Harvey âwonâ on the following three counts:
- Count 1: The NOP final rule (the Rule) improperly provides for a blanket exemption of non-organic products (e.g., cornstarch, carob bean gum, kelp) ânot commercially available in organic formâ from review for inclusion in the National List.
- Count 3: the Ruleâs provisions permitting 38 (was 36) so-called synthetic substances (e.g. vitamin C, baking soda, lecithin) in processing contravenes OFPA.
- Count 7: the Ruleâs provisions allowing dairy animals being converted to organic production to be fed 80 percent organic feed for the first nine months of the year prior to the sale of their products as organic contravenes OFPA, âwhich requires dairy animals to be fed 100 percent organic feed for 12 full months prior to [their sale] as organic.â
The First Circuit remanded the first count back to the District Court, in Boston, to decide whether the blanket exemption clause should stand, and it reversed counts three (synthetic substances in organic processing) and seven (dairy herd conversion feeding requirements) in favor of Harvey.
Reaction to the ruling
Given what represents a virtual elimination of âsyntheticâ ingredients from organic food production, and aâby all accountsâdisincentive for conventional dairy farmers to convert to organic methods, I asked Katherine DiMatteo, the executive director of the Greenfield, Mass.-based Organic Trade Association (OTA) what she thought of the ruling:
âOFPA wasnât created to codify an embodiment of ideal purity in food production that would appeal only to a rarified, niche market,â DiMatteo explained. âIt also wasnât cavalierly decided what [synthetics] would be allowed.â
âWhat I feel very strongly about was that this was agreed to by allâthere was consensus. We all moved forward together in good faith to ensure that the regulations were acceptable, keeping in mind that refinements could follow through ongoing meetings and public comment.â
George Siemon, CEO of Organic Valley in LaFarge, Wisc., said that, âAlthough the law was not perfect, it was darn good.â
âWe worked very hard, and built this industry inch by inch. Now this ruling comes along, which I feel has dealt a real blow to the stability of organics.â
Ronnie Cummins, executive director of the Little Marais, Minn.-based Organic Consumers Association (OCA), had a different take: âAmericaâs 30 million organics consumers want very strict standardsâproducts that are produced with integrity. OFPA very clearly stated certain standardsâUSDA arbitrarily changed things.â
Cummins is concerned, however, about the danger for stricter standards - without more assistance to organic farmers, especially dairy farmersâto have a negative impact on the category.
Up until now, the regulations provided that, for the first nine months of the year, dairy herds being converted to organic must be fed a minimum of 80 percent organic feed, and 100% organic feed for the final two monthsâessentially a âone-time exception for conversion of a whole dairy herd from conventional to organic productionâ (USDA brief).
âIf we permanently lose the dairy herd conversion provision, it will take 400 percent more feed and cost farmers 400 percent more,â cautions Siemon. âIt will also probably force farmers to pre-commit to conversion possibly a year earlier, which could really discourage family farms from converting.â
âWe canât tighten up standards without providing real subsidies to promote organics and to help farmers,â agreed Cummins. âToday thereâs no incentive and no help for organic farmers, especially dairy farmers,â Cummins added. âWe need a solid program to encourage conversion to organic.â
The USDA now needs to determine its next steps, in consultation with the U.S. Department of Justice (DOJ) and the Solicitor General of the U.S. The USDA has until March 14th to file a re-hearing petition (typically a 15-page brief). USDA has two ways to do this. It can go back to the same panel of three judges, or it can seek an en banc hearing with all judges on the Circuit, with the latter approach (en banc) being what the government is considering at the moment, according to one DOJ attorney with whom I spoke.
If USDA does not file a petition, the First Circuit has to issue a mandate seven days after March 14th for the USDA to comply with the ruling. The mandate can be stayed for up to 90 days, however, if a writ of certiorari is filed so that the matter can be considered by the Supreme Court, an unlikely route.
When I asked Harvey if he had any regrets as to how everything has turned out, he said: âI donât disagree with the ruling but I got more than I asked forâI asked for half a loaf and I got three loaves instead.â
âOf course itâs all embarrassing, and the timing is difficult for the industry, but I didnât create the illegalities in the rule. The purpose of my lawsuit had nothing to do with hurting dairy farmers but everything to do with synthetics in processed food.â
When asked if he has reached out to industry on this, Harvey said, âWeâre talking about this thick and fast and trying to come up with a friendly compromise.â
In the meantime, notes DiMatteo, âSince the bar is now set so unfairly high, those larger companies which were entering the category will now have a disincentive to go for certified [organic] and an incentive to actually go for âMade With Organic Ingredients,â a much lower standard that only requires 70 percent organic ingredients but which may be indistinguishable from âCertified Organicâ in the eyes of most consumers. I ask you: âWho has wonâ?â
Siemon had this to say: âWeâre reaching out to see if we can build a consensus among trade and consumer groups, and I think weâre honestly not that far off. Iâm extending my hand forward, and Iâm really hoping that we can work through our differences over the next 18 to 20 months and find a solution that strengthens the category and inspires consumer confidence.â
âIf the purpose was to show the USDA that they canât step outside of the law, great--now where do we go?,â asked Siemon. âThe community has now been divided at a very dangerous time politically, not the best time to be opening up and tinkering with the [organics] law.â
So, âWho won?â and âWhat now?â are really the key questions currently, questions to which no one has a definitive answer yet, least of all the USDA, which issued âno commentâ at press time.
Few would dispute, though, that expeditiously finding common ground would be in the very best interests of all concerned, and that if Congress were to reallocate farm subsidies to help organics and farmersânot part of this suitâthat this could be the silver lining within this cloud thatâs now drifting overhead.