Agricultural Donation Tax Credit Proposal Stalls in Kentucky General Assembly

By: Joe Schuler, Staff Member

Last year, more than 650,000 Kentuckians accessed one of the state's charitable food banks for assistance feeding their families.[1] This represents an increase of 84% from just four years ago.[2] The growth is attributed to the financial strain created by the economic recession and slow recovery period.[3]

Anytime a need increases so rapidly, it is sure to be a challenge for nonprofit organizations to keep up with the demand. Rising food prices has also caused a reduction of as much as 50% in the amount of commodities provided to the food banks by the U.S.D.A.[4] Intensifying the problem is a simultaneous decline in charitable giving to the food banks.[5]

Kentucky food banks have been hopeful that a proposed tax credit would help bring relief. Kentucky House Agricultural Committee Chairman Tom McKee introduced the measure in hopes of increasing the supply of fruits and vegetables available to needy families.[6] If passed, farmers would be entitled to a credit equal to 10% of the amount of eligible agricultural products donated to nonprofit food programs.[7] Eligible products include fruits and vegetables and beef, poultry, pork, fish and other edible products raised or grown in Kentucky.[8]

The bill passed the House unanimously on February 21, making many hopeful that it would ultimately be approved.[9] However, it was sent to the Senate Appropriations and Revenue Committee, where it stalled.[10] With the General Assembly's remaining days planned only for the consideration of vetoes, it appears that the proposal will not be adopted this year.[11] It is unclear why the bill stalled in committee.

Food banks believe the credit would result in more food being available to needy families in Kentucky by providing farmers with a financial incentive to donate their products.[12] The incentive may be particularly effective for the estimated 1/4 of vegetable crops that are ultimately wasted.[13] Given this waste and the unmet need, it seems likely that the food banks will continue to seek support among state legislators in hopes that the credit can be adopted in future sessions. Until then, they, and the 650,000 Kentucky families who rely on them, will have to continue to rely on other charitable donations.

______________________

[1] Dan Conti,

Bill Would Give Kentucky Farmers Tax Credit for Food Bank Donations

, 

WFPL News

(Feb. 20, 2013, 1:40 PM), http://www.wfpl.org/post/bill-would-give-kentucky-farmers-tax-credit-food-bank-donations.

[2]

House Bill 141

, 

God's Pantry Food Bank,

http://www.godspantry.org/content/house-bill-141 (last visited Mar. 11, 2013).

[3]

Id.

[4]

Id.

[5]

Id.

[6] Conti,

supra

 note 1.

[7] H.B. 141, 114th Gen. Assem., Reg. Sess. (Ky. 2013),

available at

 http://www.lrc.ky.gov/record/13rs/HB141.htm.

[8]

Id.

[9]

Id.

[10]

Id.

[11]

2013 Regular Session Calendar

, 

Kentucky Legislative Research Commission,

http://www.lrc.ky.gov/sch_vist/13RS_calendar.pdf (last updated Mar. 7, 2013).

[12]

House Bill 141

,

supra

 note 2.

[13]

Id.

Monsanto v. The American Farmer

By: Max Bridges, Staff Member

On February 19, 2013, oral arguments were heard before the Supreme Court in a classic David and Goliath case,

Bowman v. Monsanto

, No. 11-796.[1] On one side, there's Vernon Hugh Bowman, a 75 year old farmer from southwestern Indiana, and the other, the agricultural giant, Monsanto.

In 1999, Vernon Hugh Bowman began purchasing Monsanto's patented Roundup Ready soybeans which have been genetically altered to resist the herbicide Roundup. As a condition of use, farmers must sign Monsanto's Technology Agreement which states that growers may only use the seed for a single season and may not sell the seeds to any other grower.[2] Bowman followed the terms of the agreement by not selling any of the seed from his main crop. However, beginning in 1999, he purchased second-generation seed from a grain elevator for his second planting and saved seeds from that purchase.[3] In 2007, Monsanto sued Bowman for violating their patent protection by purchasing the second generation GM seeds from the grain elevator.[4]

The Supreme Court only has to decide the very narrow issue of whether a patent right for self-replicating technologies expires after an authorized sale.[5] Bowman's attorneys have argued the doctrine of patent exhaustion should shield Bowman from liability. This doctrine states that the unconditioned sale of a patented article ends the patentee's monopoly right to control its use.[6] In other words, if you buy something covered by a patent you own it outright and are allowed to use it for your "ordinary pursuits of life."[7]

But Monsanto's David Snively says this argument misses the point. According to Snively, we can buy an iPhone and do whatever we want with it, "but we're not going to go out and make copies of the iPhone and put Apple out of business."[8] If farmers are allowed to plant the patented seeds (which creates copies of the patent) without paying Monsanto, the patents would be worthless.

SCOTUS is likely to agree with Monsanto. At a freewheeling and almost one-sided oral argument, the justices "seemed alert to the consequences of their eventual ruling not only for Monsanto's very lucrative soybean patents but also for modern agriculture generally and for areas as varied as vaccines, cell lines and software."[9]

Monsanto also has the case law in its favor. In 1980, the Supreme Court ruled by a 5-4 margin that living organisms could be patented,[10] and in 2001 the Court upheld the patenting of plants.[11] Finally, when suing farmers who save their seeds, Monsanto has never lost in court. Since 1997, Monsanto has filed 145 lawsuits against seed-saving farmers. Only 9 cases have gone to full trial (most settle) and Monsanto has been victorious each time.[12]

While I thoroughly believe businesses should be paid for their product and that patents encourage innovation,

Bowman v. Monsanto

 offers the Court the perfect opportunity to determine a much broader issue: is Monsanto using patent enforcement to control their monopoly on a vital resource? The answer is yes. Monsanto's patented seeds account for 93% of the soybean industry and 80% of corn.[13] To no one's surprise, the cost of farming has drastically risen. Since the introduction of GM seed, "the average cost of soybean seed to plant one acre has risen by a dramatic 325 percent, from $13.32 to $56.58. Similar trends exist for corn and cotton seeds: cotton seeds spiked 516 percent from 1995 to 2011 and corn seed costs rose 259 percent over the same period."[14]

This monopoly stifles innovation and reduces seed diversity leaving our crops more vulnerable to "superweeds."[15] Twenty years ago it was common for dealers to sell inexpensive, "public" soybeans. Nowadays, almost all soybean seeds are patented. USDA economists have found that recent seed industry consolidation has reduced research and likely resulted in fewer crop varieties.[16]

Finally,

Bowman v. Monsanto

 raises a more fundamental problem: why are we defending Goliath against David? America was founded on the backs of hard-working farmers and yet today, we are more willing to protect the immortal corporation. Do you remember the touching Super Bowl advertisement by Dodge that brought many parties to a sudden and abrupt halt?[17] It was so moving because it elucidated the sacrifices that American

farmers

, not corporations, have made to feed our nation. As Paul Harvey so eloquently said, "And on the eighth day, God looked down on his planned paradise and said I need a caretaker - so God made a farmer." I pray we don't forget this.

______________________

[1]

Bowman v. Monsanto

, 

SCOTUS Blog

, http://www.scotusblog.com/case-files/cases/bowman-v-monsanto-co/ (last visited March 4, 2013).

[2]

Bowman v. Monsanto

, 

OYEZ

, http://www.oyez.org/cases/2010-2019/2012/2012_11_796#argument (last visited March 4, 2013).

[3]

Id.

[4] Aviva Shen,

How One 75-Year-Old Farmer Could Deal a Blow to Monsanto's Empire

, 

Nation of Change

 (February 20, 2013), http://www.nationofchange.org/how-one-75-year-old-soybean-farmer-could-deal-blow-monsanto-s-empire-today-1361373405.

[5] 

OYEZ

,

supra

 note 2.

[6]

Black's Law Dictionary

, (9th ed. 2009).

[7] Dan Charles,

Farmer's Fight with Monsanto Reaches the Supreme Court

, 

NPR - The Salt

 (February 18, 2013), http://www.npr.org/blogs/thesalt/2013/02/18/171896311/farmers-fight-with-monsanto-reaches-the-supreme-court.

[8]

Id.

[9] Adam Liptak,

Supreme Court Appears to Defend Patent on Soybean

, 

The New York Times

 (February 19, 2013), http://www.nytimes.com/2013/02/20/business/justices-signal-a-monsanto-edge-in-patent-case.html?_r=0.

[10]

Diamond v. Chakrabarty

, 447 U.S. 303 (1980).

[11]

J.E.M. Ag Supply, Inc. v. Pioneer Hi-Bred Int'l, Inc.

, 534 U.S. 124 (2001).

[12]

Why Does Monsanto Sue Farmers Who Save Seeds

, 

Monsanto

, http://www.monsanto.com/newsviews/Pages/why-does-monsanto-sue-farmers-who-save-seeds.aspx (last visited March 4, 2013).

[13] Peter Whoriskey,

Monsanto's Dominance Draws Antitrust Inquiry

, 

The Washington Post

 (November 29, 2009), http://www.washingtonpost.com/wp-dyn/content/article/2009/11/28/AR2009112802471_pf.html.

[14]

Seed Giants vs. U.S. Farmers

,

Center for Food Safety and Save our Seeds (2013)

, http://www.centerforfoodsafety.org/wp-content/uploads/2013/02/Seed-Giants_final.pdf, at 8-9.

[15] Aviva Shen,

Superweed Lead to Heavier Pesticide Use on Crops

, 

Think Progress

 (October 3, 2012), http://thinkprogress.org/health/2012/10/03/946801/superweeds-pesticides/?mobile=nc.

[16]

Seed Giants vs. U.S. Farmers

,

supra

 note 14, at 9.

[17] Official Ram Trucks Super Bowl Commercial "Farmer," http://www.youtube.com/watch?v=AMpZ0TGjbWE (last visited March 4, 2013).

Red Dead Redemption: How the Use of Carbon Monoxide in Meat Packaging Benefits Consumers

By: Arthur Cook, Staff Member

In the United States, companies use carbon monoxide to enhance the color of meat.[1] This process keeps meat redder longer than it would otherwise. This process is banned in Japan,[2] Singapore,[3] and the European Union.[4] Such a practice has been deemed safe for human consumption in study[5] after study.[6]

The charge against such action is a concern that is masks spoilage; in other words, the product is so effective, it may hide the signs of decay.[7] However, the F.D.A. utilizes a system to detect spoilage based on

odor

, not color.[8] Still, fears linger about the process.

The flip side to this concern is an overall reduction in wasted meat. If meat, perfectly healthy to consumers, can remain on shelves longer, and the process by which this is achieved is harmless, there should be little incentive to challenge this. It is the most economically effective use of resources. This result could also be achieved through a massive public education campaign about why less-red meat is still fit for consumption, but here, such results may be achieved at no cost to the government and have a more environmentally-friendly impact.

______________________

[1] Julie Schmit,

Carbon monoxide keeps meat red longer; is that good?

, 

USA Today (

Oct. 30, 2007, 10:34 PM), http://usatoday30.usatoday.com/money/industries/food/2007-10-30-kalsec-meat-carbon-monoxide_N.htm.

[2]

Proof in the Pink? Meat Treated to Give It Fresh Look

, 

ABC News (

Nov. 14, 2007), http://abcnews.go.com/GMA/Consumer/Story?id=3863064&page=1.

[3]

Carbon Monoxide in Meat Packaging: Myths and Facts

, 

American Meat Institute (

March 2008), http://www.meatami.com/ht/a/GetDocumentAction/i/40141.

[4]

Proof in the Pink?

,

supra

 note 2.

[5] E.U. Health & Consumer Protectorate Directorate,

Opinion of the Scientific Committee on the Use of Carbon Monoxide as component of packaging gases in modified atmosphere packaging for fresh meat

, (Dec. 18, 2001),

PDF available at

http://ec.europa.eu/food/fs/sc/scf/out112_en.pdf.

[6] S.J. Eilert,

New Packaging Technologies for the 21st Century

, 

71 Meat Science 122 (

2005).

[7]

Id.

[8]

Id.

How Corn and Soy Are Clearing America's Grassland

Image Source

By: Raabia Wazir, Staff Member

As previously discussed on our blog, the drought of 2012 had devastating effects on the Midwest with more than 1,000 counties in 26 states declared natural-disaster areas.[1] And yet, farmers have seen business boom. Demand for food and biofuels have remained strong, pushing crop prices 20% higher in 2012 than in 2010.[2] For farmers unable to produce crops due to the drought, over $14.2 billion in crop-insurance payments have provided them a golden safety-net.[3] Overall, farm profits may rise by 14% to $128 billion, the highest numbers since 1973.[4]

Farmers are purchasing more farmland to meet this demand, leading to a 52% jump in prices of farmland in the Midwest between 2010 and 2012.[5] Additionally, many farmers are converting non-farmed land and putting it into cultivation. Typically, the federal Conservation Reserve Program pays farmers to protect wildlife by keeping land uncultivated, but funding for the program has been declining.[6] Farmers are pulling out of the program because they believe they can make more by farming than the $53 per acre average paid for conservation.[7] Unprotected by those government incentives, a recent study published in the Proceedings of the National Academy of Sciences showed that 1.3 million acres of grassland in North Dakota, South Dakota, Nebraska, Iowa and Minnesota have been converted to cropland between 2006 and 2011.[8] This grassland loss is occurring at a rate unsurpassed since the 1930s and is comparable to deforestation rates in Brazil, Malaysia and Indonesia.[9] As the author of the study, Christopher Wright, told NPR, "This is kind of the worst-kept secret in the Northern Plains."[10]

This news is problematic for a number of reasons. With respect to climate change, studies show that grassland holds carbon in their soil better than cropland.[11] This spells trouble for biofuel advocates. As one 2008 study in the journal Science explained, ethanol and soy biodiesel lose some of their carbon advantage over gasoline if the losses associated with farming on virgin grassland are accounted for.[12]

Secondly, grassland conversion causes wildlife and biodiversity to suffer. Corn and soybean fields are much less inviting for a wide range of animals, from ground-nesting birds to bees.[13] In recent years, these fields have been increasingly encroaching on the Prairie Pothole region across Minnesota and the Dakotas. The tall protective grasses in the region provide a key breeding habitat for waterfowl and other ground nesting birds in North America.[14] As grassland is converted, bird populations are dropping.[15]

Finally, Wright reports that much of this conversion is taking place on hillsides, where soil is much more likely to wash into streams and ponds, in areas that don't drain well and in areas of the region much more vulnerable to drought.[16] Some suggest that farmers are willing to take these risks because the federal government subsidizes crop insurance to such a degree that a moral hazard is created.[17] In other words, the public bears most of the burdens of crop insurance but the farmer realizes all of the benefits. In this way, farmers are incentivized to take risks and gamble on grassland.

The Environmental Work Group has suggested that the federal government should reduce crop insurance for farmers who convert grasslands and wetlands to avoid rewarding farmers for their destructive behavior.[18] Farmers are obviously opposed to this move and suggest instead that Congress expand funding for conservation programs and provide larger payment incentives to allow the land to remain uncultivated.[19] This argument is unpersuasive and unrealistic considering current federal budget cuts, the massive subsidies that the industry already receives, and the record profits that farmers have secured in recent years. In contrast, reducing crop insurance would be a no-cost and effective solution to protect the wildlife and biodiversity of the grasslands, fight climate change, and minimize unnecessarily risky behavior of Midwestern farmers.
_________________________
[1] Raabia Wazir, Drought Impacts Passage of the Farm Bill, KJEANRL (August 20, 2012), http://www.kjeanrl.com/2012/08/the-2012-drought-and-its-political.html.
[2] Fields of Gold, The Economist (Feb. 23, 2013), http://www.economist.com/news/united-states/21572212-farmers-bask-soaring-prices-fields-gold.
[3] Id.
[4] Id.
[5] Id.
[6] Bryan Walsh, As Crop Prices Rise, Farmland Expands - and the Environment Suffers, Time Magazine (Feb. 20, 2013), http://science.time.com/2013/02/20/as-crop-prices-rise-farmland-expands-and-the-environment-suffers/; The Farm Bill is a Climate Bill, AgMag Blog (Jan. 9, 2012), http://www.ewg.org/agmag/2012/01/farm-bill-climate-bill.
[7] A.G. Sulzberger, As Crop Prices Soar, Iowa Farms Add Acreage, New York Times (Dec. 30, 2011), http://www.nytimes.com/2011/12/31/us/in-iowa-farmland-expands-as-crop-prices-soar.html.
[8] Christopher K. Wright and Michael C. Wimberly, Recent land use change in the Western Corn Belt threatens grasslands and wetlands, Proceedings of the National Academy of Sciences (Feb. 19, 2013), http://www.pnas.org/content/early/2013/02/13/1215404110.abstract.
[9] Id.
[10] Dan Charles, Pictures Don't Lie: Corn And Soybeans Are Conquering U.S. Grasslands, National Public Radio (Feb. 19, 2013), http://www.npr.org/blogs/thesalt/2013/02/14/172021095/pictures-dont-lie-corn-and-soybeans-are-conquering-u-s-grasslands.
[11] Brad Plumer, Corn and soy wiping out America's grasslands at fastest pace since the 1930s, Washington Post Wonkblog (Feb. 20, 2013), http://www.washingtonpost.com/blogs/wonkblog/wp/2013/02/20/biofuel-craze-wiping-out-americas-grasslands-at-fastest-rate-since-the-dust-bowl/.
[12] Joseph Fargione et. al., Land Clearing and the Biofuel Carbon Debt, 319 Science 1235 (February 29, 2008), available at http://www.sciencemag.org/content/319/5867/1235.abstract.
[13] Walsh, supra note 6.
[14] Id.
[15] Plumer, supra note 11.
[16] Wright and Wimberly, supra note 8.
[17] Dan Charles, The CRP: Paying Farmers Not to Farm, National Public Radio (July 11, 2005), http://www.npr.org/templates/story/story.php?storyId=4736044.
[18] Scott Faber, Soren Rundquist, and Tim Male, Plowed Under: How Crop Subsidies Contribute to Massive Habitat Losses, Environmental Working Group 11 (Feb. 2012), http://static.ewg.org/pdf/plowed_under.pdf.
[19] Plumer, supra note 11; Alyssa A. Botelho, Drought puts federal crop insurance under scrutiny, Washington Post 2 (August 13, 2012), http://articles.washingtonpost.com/2012-08-13/national/35493461_1_crop-insurance-insurance-program-corn-and-soybean/2.

Instant Racing Now Before Kentucky Supreme Court

By: Ted Walter, Staff Member

In October 2011,

KJEANRL

 staff member Taryn Deveau first blogged about Kentucky Downs being the first racetrack in Kentucky to offer instant racing.[1] That post also included the Franklin Circuit Court's ruling that "instant racing is within the Commission's regulatory authority so long as it involves pari-mutuel wagering on horse races."[2] Furthermore, that same post made it clear that the opponents of instant racing, The Family Foundation of Kentucky, were going to appeal.[3] Then, in September 2012,

KJEANRL

 staff member Matt Hassen blogged that the Kentucky Court of Appeals had remanded the case to the Franklin Circuit Court in order to allow discovery for the Family Foundation, discovery which had been denied before.[4] "Because of the lack of evidentiary support for its decision, the appellate court found review of the circuit court's decision impossible and ordered further proceedings in order to determine such factual issues as the precise manner in which wagers are pooled and how the odds are calculated for instant race wagering."[5]

Now, the Kentucky Supreme Court has agreed to review the Court of Appeals ruling.[6] There is a lot of money at stake pending the outcome. Through September 2012, "almost $169 million had been wagered using instant racing machines in Kentucky."[7] And through the end of 2012, the combined handle of instant racing in Kentucky since its inception is $228.2 million.[8] Apparently due to the success, it was recently reported that the Keeneland Association has intentions of bringing instant racing to the Lexington and Corbin areas.[9] According to the article, Keeneland is interested in teaming with Full House Resorts to buy harness track Thunder Ridge and move it near Corbin.[10] The track would be for Quarter Horses "with top-level purses boosted by multibreed simulcasting and instant racing."[11] Additionally, "[i]f the legislation passes, or if the court case is decided in the racetrack's favor, Keeneland anticipates announcing plans for a Lexington instant racing facility in conjunction with the Red Mile."[12]

Instant Racing is not only a Kentucky issue. Recently the horse racing and breeding industry has been making a push for instant racing in Oregon.[13] In April 2012, the Nebraska Governor vetoed a bill that would have allowed instant racing at Nebraska racetracks.[14] In December 2012, the Michigan legislature passed a bill allowing instant racing and sent the bill to the Michigan Governor for his signature.[15] Arkansas first allowed instant racing in 2000 and makes "in excess of $100 per machine per day."[16]

With state budgets and pensions facing deficits and with little money to fix them, some are viewing instant racing as a large source of taxable income. "Expanding instant racing to more Kentucky horse racetracks should provide additional tax money to help fund the state's ailing pension system," according to House Speaker Greg Stumbo in a recent

Lexington Herald-Leader

 article.[17] In that same article, it was report that "[o]f the $247 million wagered on instant racing in Kentucky, $226.7 million was returned to the public." Should the courts come down against instant racing in Kentucky, it seems hard to believe the legislature will still say no.

___________________

[1] Taryn Deveau,

Instant Racing: A Possible Trifecta for Kentucky

, 

Ky. J. Eq. Ag. & Nat'l. Res. L. Blog

 (Oct. 21, 2011),

 http://www.kjeanrl.com/2011/10/instant-racing-possible-trifecta-for.html.

[2]

Id.

[3]

Id.

[4] Matt Hassen,

Update on Instant Racing

, 

Ky. J. Eq. Ag. & Nat'l. Res. L. Blog

 (Sept. 27, 2012),

 http://www.kjeanrl.com/2012/09/update-on-instant-racing.html.

[5]

Id.

[6] Jack Brammer,

Kentucky Supreme Court agrees to review instant racing appeal

, 

Lexington Herald-Leader

 (Jan. 11, 2013), http://www.kentucky.com/2013/01/11/2472531/kentucky-supreme-court-agrees.html.

[7]

Id.

[8] Tom LaMarra,

KY Historical Race Wagering Now at $228

, 

BloodHorse.com

 (Jan. 24, 2013), http://www.bloodhorse.com/horse-racing/articles/75770/ky-historical-race-wagering-now-at-228m.

[9] Janet Patton,

Exclusive: Keeneland aims to build prime Quarter Horse racetrack near Corbin

, 

Lexington Herald-Leader

 (Feb. 14, 2013), http://www.kentucky.com/2013/02/14/2517437/exclusive-keeneland-to-build-prime.html.

[10]

Id.

[11]

Id.

[12]

Id.

[13] Tom LaMarra,

Portland Meadows Seeking Historical Racing

, 

BloodHorse.com

 (Feb. 15, 2013), http://www.bloodhorse.com/horse-racing/articles/76238/portland-meadows-seeking-historical-racing.

[14]

Nebraska governor vetoes Instant Racing bill

, 

ThoroughbredTimes.com 

(April 10, 2012), http://www.thoroughbredtimes.com/national-news/2012/04/10/nebraska-governor-vetoes-instant-racing-bill.aspx.

[15] BloodHorse Staff,

Michigan Instant Racing Bill Goes to Governor

, 

BloodHorse.com

 (Dec. 15, 2012), http://www.bloodhorse.com/horse-racing/articles/75055/michigan-instant-racing-bill-goes-to-governor.

[16] Associated Press,

Kentucky Downs Says Instant Racing Play Good

, 

BloodHorse.com

 (Sept. 9, 2011), http://www.bloodhorse.com/horse-racing/articles/75055/michigan-instant-racing-bill-goes-to-governor.

[16] Associated Press,

Kentucky Downs Says Instant Racing Play Good

, 

BloodHorse.com

 (Sept. 9, 2011), http://www.bloodhorse.com/horse-racing/articles/64927/kentucky-downs-says-instant-racing-play-good.

[17] Beth Musgrave and Jack Brammer,

Stumbo says expansion of instant racing could help fix pension system

, 

Lexington Herald-Leader

 (Feb. 15, 2013), http://www.kentucky/com/2013/02/15/2518425/stumbo-says-expansion-of-instant.html.

UPDATE: D.C. Circuit Continues to Adjudicate E15 Case, Hurting Domestic Industries and Consumers

By: Tyler Brewer, Staff Member

My post last October concerned how the D.C. Circuit refused to adjudicate a suit where the EPA illegally authorized E15 (15% ethanol, 85% gasoline) into our domestic fuel supply (

click for link

).[1] The decision by the D.C. Circuit to dismiss the case for lack of standing led Petitioners to appeal. Unfortunately, on January 15, 2013, the D.C. Circuit in

Grocery Mfrs. Ass'n v. EPA

 denied petitions for a rehearing en banc.[2]

In his dissenting opinion, Judge Kavanaugh reiterated the fundamental flaws in denying the rehearing. Particularly, he discusses how the holding handed down last August "is problematic not only because of the erroneous standing law that it creates, but also because it is outcome-determinative in a case with significant economic ramifications for the American food and petroleum industries, as well as for American consumers who will ultimately bear some of the costs."[3] Judge Kavanaugh frames the decision as outcome-determinative because the "EPA will lose if [the case] reach[es] the merits."[4] This argument is quite persuasive when considering the E15 partial waivers' effects on the national economy, both at the industrial and consumer levels.[5]

The D.C. Circuit's denial for rehearing sparked initiative in U.S. Senators Roger Wicker (R-Miss.) and David Vitter (R-La.) to repeal the E15 partial waivers via legislation.[6] Yet, the most promising path to reign in the EPA's exercise of power is the Supreme Court. The Petitioners in

Grocery Mfrs. Ass'n

 have until April 15, 2013 (ninety days from being denied a rehearing) to seek the Supreme Court's review.[7] According to one of the Petitioners, there is anticipation for at least one of the groups affiliated with the suit to file by April 15.[8]

Until the E15 is repealed through legislation or struck down by the courts, we are at the mercy of the EPA and the ramifications E15 will have on our economy. While this may seem like an over-exaggerated statement, merely consider one of the many effects E15 imposes; many automotive manufacturers will void your vehicle's warranty if E15 is used.[9]

_____________________

[1] Tyler Brewer,

EPA Approved E15 Gasoline Does More Harm Than Good

,

Ky. J. Eq. Ag. & Nat'l Res. L. 

(Oct. 16, 2012, 8:50 PM), http://www.kjeanrl.com/2012/10/epa-approved-e15-gasoline-does-more.html.

[2] Grocery Mfrs. Ass'n v. EPA, No. 10-1380, 2013 WL 163744, at *1 (D.C. Cir. 2013).

[3]

Id.

 at *3 (Kavanaugh, J., dissenting) (footnote omitted).

[4]

Id.

at *3 (Kavanaugh, J., dissenting).

[5] 

See

 Brewer,

supra

 note 1.

[6]

Wicker, Vitter to Introduce Bill to Roll Back Ethanol Requirement for Gasoline

, 

www.wicker.senate.gov

 (Feb. 14, 2013), http://www.wicker.senate.gov/public/index.cfm?FuseAction=NewsRoom.PressReleases&ContentRecord_id=daf97f2b-c16c-053c-f435-581ca633c2fb.

[7] Reagan Haynes, 

Push to Stop E15 Could Head to Supreme Court

, 

Trade Only Today

 (February 11, 2013), http://www.tradeonlytoday.com/home/523811-push-to-stop-e15-could-head-to-supreme-court.

[8]

Id.

[9] Gary Strauss, 

AAA Warns E15 Could Cause Car Damage

, 

USA Today

 (Nov. 30, 2012, 11:40 AM), http://www.usatoday.com/story/news/nation/2012/11/30/aaa-e15-gas-harm-cars/1735793/.

The Aftermath of California's Proposition 37 and Overview of New State Proposals for Labeling Mandates on Genetically Modified Foods

By: Jocelyn Arlinghaus, Staff Member

Last November, we discussed the controversial debate surrounding proposed legislation that would mandate the labeling of food products that contain genetically modified organisms (GMOs). GMOs are produced using genetic engineering which manipulates DNA or distributes it between different organisms.[1] Through this process, crops such as corn and soybeans that are used to produce many of the food products at issue are implanted with herbicide-resistant genes so that the weeds die after the crops are sprayed and the modified crops survive.[2] Although many popular processed foods such as soy milk, cereals, and packaged food contain genetically modified ingredients, the Food and Drug Administration decided not to require labeling on genetically modified foods.[3] This decision has sparked battles in state legislatures across the nation with as many as 37 states considering passing legislation that would require products containing GMOs to be labeled.[4]

California responded with Proposition 37 which sought to require labeling on animal or plant based food products made using genetically altered material and prohibited labeling such food as "natural," subject to several exceptions.[5] Supporters argued that requiring genetically engineered foods to be labeled gives consumers essential information to make informed choices about the products they purchase.[6] Opponents argued that there is no proof that genetically modified foods pose any health risks and imposing labeling requirements on perfectly safe products is a waste of time and resources.[7] Ultimately, Proposition 37 was defeated after large corporations spent $40 million on a barrage of TV and radio ads claiming that food labels would raise grocery prices and harm the farming industry.[8] While these harsh opposition tactics led to the demise of Proposition 37, they also propelled the issue into a national debate and alienated customers of large food companies.[9] Instead of putting an end to the demand for labeling in state legislatures, the debate over Proposition 37 has sparked a ballot initiative in Washington State and proposals in several other states including Connecticut, Vermont, New Mexico, and Missouri, as well as consumer boycotts of several organic product lines made by major food companies.[10]

The next stop on the road to GMO food labeling requirements is Washington State where Initiative 522 will be considered before the state legislature this spring.[11] I-522 would require food and seeds produced through genetic engineering and sold in Washington to be labeled - with the exception of restaurant entrees, medical meals, alcohol, meat and dairy.[12] This would affect common products found on grocery shelves, such as cereal and snacks, which are often made from genetically engineered crops.[13] Aware of the outcome of Proposition 37 in California, proponents of I-522 have taken a much different approach in lobbying for the bill.[14] They argue that the failure to mandate labels will have a devastating impact on the international trade market of Washington's fish, apple, and wheat industries as foreign nations that require labeling will be much more wary of whole food compared to processed goods.[15] If the Washington legislature does not pass I-522 into law, it may send it to the ballot where it is predicted to stand a much greater chance of passing than California's Proposition 37.[16] Analysts draw distinctions between the demographics in the respective states, pointing to lower campaign costs, greater support from farmers and rural communities, and more progressive voters in Washington as compared to California, all of which work in favor of I-522.[17]

While supporters of labeling requirements in Washington anticipate a positive outcome, lobbyists in New Mexico have little to celebrate. Introduced as early as January, S.B. 18 would have required all genetically modified food products offered for sale in the state to be labeled.[18] Unlike I-522 in Washington, the bill contained no exception for food offered for sale in restaurants, which opponents argued would have a devastating impact on the restaurant industry in the state.[19] Ultimately, S.B. 18 was rejected due to a procedural issue.[20] The New Mexico Environment Department stated that such severe labeling requirements would make it impossible for many food manufacturers around the world to distribute their products to New Mexico and would place New Mexico food manufacturers at a disadvantage in distributing their products outside of the state.[21] Further, the N.M.E.D. added that the legislation may confuse consumers as it did not mandate adding any health or safety information to the products.[22]

The debate surrounding labeling requirements for genetically engineered food products is far from over. The state legislatures in Vermont and Connecticut are also considering labeling laws while a senator in Missouri has proposed legislation that would mandate the labeling of genetically modified meat and fish.[23] Meanwhile, companies such as Wal-Mart, ConAgra, and PepsiCo have abandoned their rigorous tactics in challenging these state bills and are discussing the possibility of lobbying for a national labeling program.[24] While having the largest food companies in the country lobbying for a federal labeling program may sound like a step in the right direction for GMO labeling mandates, skeptics worry that these companies are looking for federal action on GMO labeling in order to pre-empt state laws.[25] This would halt movement toward the most effective labeling requirements possible.

_______________________

[1] Daniel Imhoff & Michael R. Dimock,

The case for Prop. 37

, 

Los Angeles Times

 (Oct. 11, 2012), http://www.latimes.com/news/opinion/commentary/la-oe-imhoff-prop-37-gmo-labeling-20121011,0,7997497.story.

[2]

Id.

[3] Victoria Cavaliere,

California voters reject measure labeling genetically engineered food; supporters vow to fight on

, 

Daily News America

 (Nov. 7, 2012, 4:01 PM), http://www.nydailynews.com/life-style/health/california-voters-reject-food-labeling-measure-article-1.1198269.

[4] Gregory B. Hladky,

Connecticut Food Activists Skeptical of Wal-Mart's Apparent Switch on GMO Labeling

, 

CT.com

(Feb. 12, 2013, 1:56 PM), http://www.ct.com/blog/wtxx-connecticut-food-activists-skeptical-of-walmarts-apparent-switch-on-gmo-labeling-20130212,0,4261354.story.

[5]

California 37, Mandatory Labeling of Genetically Engineered Food (2012)

,

BallotPedia 

(Feb. 18, 2013), http://ballotpedia.org/wiki/index.php/California_Proposition_37,_Mandatory_Labeling_of_Genetically_Engineered_Food_(2012)#cite_note-0.

[6] Imhoff & Dimock,

supra

 note 1.

[7] Alexandra Le Tellier,

Prop. 37: A better idea than labeling GMOs

, 

Los Angeles Times

(Oct. 31, 2012, 11:59 AM), http://www.latimes.com/news/opinion/opinion-la/la-ol-prop-37-a-better-idea-than-labeling-gmos-20121030,0,4916751.story.

[8] Ronnie Cummins,

6 Reasons GMO Labeling Will Pass in Washington State

, 

AlterNet

(Jan. 03, 2013), http://www.alternet.org/food/6-reasons-gmo-labeling-will-pass-washington-state.

[9] Stephanie Strom,

Genetic Changes to Food May Get Uniform Labeling

, 

The New York Times

(Jan. 31, 2013), http://www.nytimes.com/2013/02/01/business/food-companies-meet-to-weigh-federal-label-for-gene-engineered-ingredients.html?pagewanted=1&ref=geneticallymodifiedfood.

[10]

Id.

[11] Melissa Allison,

Initiative to require labels on GMO foods debated

, 

The Seattle Times

(Feb. 14, 2013, 7:08 PM), http://seattletimes.com/html/localnews/2020361650_gmolabelingxml.html.

[12]

Editorial: Be skeptical of Initiative 522 on GMO labeling

, 

The Seattle Times

(Feb. 17, 2013, 4:00 PM), http://seattletimes.com/html/editorials/2020369489_edit522gmoxml.html.

[13]

Id.

[14] Strom,

supra

 note 9.

[15]

Id.

[16] Cummins,

supra

 note 8.

[17]

Id.

[18] Keith Nunes,

New Mexico legislature blocks bioengineering labeling bill

, 

Food Business News

(Feb. 01, 2013), http://www.foodbusinessnews.net/articles/news_home/Regulatory_News/2013/02/New_Mexico_legislature_blocks.aspx?ID={359B738A-B6DE-4597-9226-E603A323E2B1}&cck=1.

[19]

Id.

[20]

Id.

[21]

Id.

[22]

Id.

[23] Strom,

supra

note 9. 

[24]

Id.

[25] Hladky,

supra

 note 4.

Horse: The Other Red Meat

By: Jeremy Maynard, Staff Member

Congress recently allowed a five year ban on horse meat inspection to expire, allowing Americans to explore their culinary creativities with a new medium - horse meat.[1] For the uninitiated, horse meat can be described as a slightly gamey, sweet red meat with a flavor between beef and venison.[2]

But who could eat friendly old Mister Ed? A dish consisting of raw horse meat is known as Basashi in Japan,[3] and a similar dish is popular in Italy.[4] Americans even ate horse meat in the 1940s.[5] Historically, starving troops in Napoleon's grand army ate horse in times of hardship.[6] Horse meat may have made its way to your plate; a well-known burger chain's reputation has taken a hit after admitting that some of its burgers in the U.K. and Ireland contained horse meat.[7] Additionally, Irish food safety officials found that beef from Poland contained up to 75% horse meat.[8] Grocery stores in Sweden have pulled Findus Lasagne from their shelves for containing 60 to 100% horse meat.[9] Findus stated that it does not believe horse meat is a food safety issue.[10] However, the source of the horse meat in the above cases is unknown.[11]

The American romantic notion of horses as human companions or pets[12] has overshadowed the real issue. When horse meat is consumed, human health should be top priority. Before the expiration of the inspection ban, horse meat was unregulated because it was obtained in secret. The meat may contain dangerous deworming medicines, antibiotics such as chloramphenicols and nitroimidazoles, and growth hormones that threaten human health.[13] This is especially true when the source of the horse meat is an American horse farm because these horses are raised for sport instead of consumption.

During the inspection ban, horse meat would fetch up to $40 per pound on the black market, incentivizing owners to butcher low-potential horses or thieves to slaughter horses at night for their flesh.[14] Now that inspecting horse meat is legal, the price will drop due to increased supply. The price decrease will also reduce the incentive to steal horse meat.

Regulation of horse meat is necessary to keep consumers safe, and current federal regulations grant authority for horse meat inspection for human consumption.[15] Unfortunately, the necessary federal funding for inspection has been rescinded.[16] With federal funding, food companies would have a legal supply chain for consumer-safe horse meat. As the taboo against horse meat weakens, demand for legal, safe horse meat would create a market for raising, distributing, and selling food horses. Although thoroughbreds may not be the palatable breed of choice, demand for horse meat may even bolster the sluggish horse industry.

______________________

[1] Justin Juozapavicius,

Horse Meat Inspection Ban Lifted in the U.S.

, 

Huffington Post 

(Nov. 30, 2011), http://www.huffingtonpost.com/2011/11/30/horse-meat-consumption-us_n_1120623.html.

[2]

What Horse Meat Tastes Like

, 

Huffington Post 

(Dec. 1, 2011), http://www.huffingtonpost.com/2011/12/01/horse-meat_n_1123315.html.

[3]

Basashi (Raw Horse Meat)

, 

Japan for the Uninvited, 

http://www.japanfortheuninvited.com/articles/basashi.html

.

[4]

What Horse Meat Tastes Like

,

supra

 note 2.

[5] Juozapavicius,

supra

 note 1.

[6]

A History of Consuming Horse Meat

, 

Ban on Slaughterhouses in the United States, 

http://www.mtholyoke.edu/~napar20s/classweb/worldpolitics/Historyof.html (last visited Feb. 10, 2013).

[7] 

Findus Frozen Beef Lasagne Found To Contain Up To 100 Percent Horse Meat

, 

Huffington Post 

(Feb. 8, 2012), http://www.huffingtonpost.com/2013/02/08/findus-lasagne-horsemeat_n_2646284.html?ref=topbar.

[8] 

Shawn Pogatchnik,

Horse Meat Found in 75 Percent of 'Beef' Imported to Ireland: Government

, 

Huffington Post

(Feb. 4, 2013)

,

 http://huffingtonpost.com/2013/02/04/horsemeat-ireland-75-percent-polish-beef-ireland_n_2618501.html#slide=more266839.  

[9]

Findus Frozen Beef Lasagne Found To Contain Up To 100 Percent Horse Meat

,

supra

 note 7.

[10]

Id.

[11]

Id.

[12] Juozapavicius,

Horse Meat Inspection Ban Lifted in the U.S.

,

supra

 note 1.

[13] Suzanne Bush,

EU Bans Drug Tainted Horse Meat

, 

Pennsylvania Equestrian 

(Oct. 2009)

, 

http://www.pennsylvaniaequestrian.com/news/EU-ban-1009.php. 

[14] 

Kim Segal and John Zarrella,

Horses Being Killed in South Florida - For Their Meat?

, 

CNN 

(Aug. 10, 2009), http://articles.cnn.com/2009-08-10/justice/horses.slaughtered_1_horse-meat-south-florida-society-geronimo?_s=PM:CRIME.

[15] 

See

9 C.F.R. § 355.2;

See also

9 C.F.R. § 327.21. 

[16] 

Pat Raia,

Amendment Strips USDA Horsemeat Inspection Funding

, 

The Horse 

(June 20, 2012), http://www.thehorse.com/articles/29298/amendment-strips-usda-horsemeat-inspection-funding.

Student Comment: The Revival of the Eastern Oyster and the Regulations that Hinder Restoration Efforts 
by Collier Marsh, Editor in Chief

States deal with many difficult problems for which there are no clear solutions. They often enact regulations to solve these problems, but sometimes the regulations actually hinder their efforts. Two problems of interest, the struggling economy and the deteriorating environment, are often the subject of extensive government regulation. Meanwhile, the eastern oyster has the potential to redress both of these problems. As a valuable commodity, the oyster can boost the economy of coastal regions, and as a filter feeder, the oyster cleans water, benefitting the surrounding environment. The oyster has declined in recent years but aquaculture is a promising method to revive it. States, aware of the oyster aquaculture industry's promise, have implemented different regulatory scheme with varying degrees of success. This note will compare the successful regulatory regime of Virginia with the inefficient regime of Maryland. This note argues that although Maryland has made some recent changes to its oyster aquaculture regulations, these changes will not fix the system. This note then suggests additional changes Maryland can implement to effectively stimulate the oyster industry.

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