Will Congress Act to Protect All Big Ag Whistleblowers?

Will Congress Act to Protect All Big Ag Whistleblowers?

Photo via Steven Depolo on Flickr

By David Muraskin
Food Safety & Health Attorney

Congress is poised to pass into law a bill that will provide unique protections for industrial agricultural companies to hide their harms to consumers, competition, and workers.

The Senate recently passed S. 1599, the Criminal Antitrust Anti-Retaliation Act of 2015, without providing protection for whistleblowers who speak out about the anticompetitive practices of food companies.

This highlights the regulatory purgatory faced by poultry growers and other meat producers. Because of judicial activism and congressional inaction, the protections currently provided to growers and producers against meat companies largely exist under provisions of the Packers and Stockyards Act of 1921 that courts have interpreted as being antitrust statutes.

As billed, S. 1599 is intended to protect employees, contractors, and others from retaliation when they provide the government information regarding violations of the antitrust laws. This concept is so uncontroversial the legislation passed the Senate by unanimous consent. As detailed in an article by Public Justice Member David Marshall and his partner Debra Katz, the bill is in response to a 2011 Government Accountability Office report which, unsurprisingly, explained that whistleblowers on antitrust violations will be reluctant to come forward if they lack protection from retaliation as “past reported cases suggest [such] retaliation occurs.”

However, while broadly framed, S. 1599 defines antitrust laws to mean Sections 1 and 3 of the Sherman Act. The bill excludes from its protection individuals who report violations of the PSA, a statute that has been interpreted to be an antitrust statute applicable to animal agriculture.   This may merely be an oversight.  Senators Grassley and Leahy, the sponsors of S. 1599, are traditionally champions of whistleblowers and both come from important agricultural states.  It could also be a product of the GAO’s narrow focus on criminal antitrust violations. Unlike the Sherman Act, which makes the covered conduct criminal, the PSA, which was drafted to prohibit a wider-range of conduct, only creates civil liability.

Regardless, if Congress truly believes that “[w]histleblowers who call attention to violations of antitrust laws play an important role in correcting misconduct that may harm businesses, consumers and the economy” and that it must “sheld[] these brave individuals from retaliation and intimidation” (as Senator Grassley stated in support of the bill) then omitting protections for whistleblowers who report violations of the PSA is a unacceptable loophole.

Indeed, the PSA was passed in response to the collusive acts of meat packers who controlled the purchase and sale of meat in the early 1900s. As the Supreme Court explained the year after the statute’s passage, at that time there were five companies that controlled the meat market from the producer to the consumer. The “Big Five” used this power to advantage their allies and punish those who would not do their bidding. Through the PSA, among other objectives, Congress sought to prohibit the harms the Big Five caused to farmers, consumers, and other businesses.

A recent suit by Public Justice, its member firm Whitfield Bryson & Mason, and the Butler Farm and Ranch Law Group, highlights that the same practices continue today. Morris v. Tyson alleges that Tyson is the only company with whom the plaintiff-poultry growers can do business. As a result, Tyson can and does discriminate among its growers, advantaging favorites and taking money from others.

For example, the Morris v. Tyson plaintiffs allege that while Tyson committed to providing plaintiffs’ birds medical care, hiding behind its pledge to produce “antibiotic free meat,” it refused to provide one plaintiff’s flock any medically necessary antibiotics, resulting in the death of more than 21,000 birds. All the while Tyson provided other growers prophylactic antibiotics. When certain Plaintiffs complained about these practices, Tyson sought to intimidate them.

The PSA is designed to be a broad protection from conduct like Tyson’s. By its plain terms, the statute prohibits any unfair, unjustly discriminatory, deceptive, undue, or unreasonable practices. This language is commonplace in consumer statutes and well understood to not only prohibit the anticompetitive practices at issue in Morris v. Tyson, but a wide range of abuses, regardless of whether the company has anticompetitive market power.

Yet, in the words of seven Fifth Circuit judges—including some of the most conservative circuit judges in the country—to-date the courts have largely “forsake[n] the plain language” and instead employed a “methodology [] directly opposed to our case law and the case law of the Supreme Court,” grafting onto the statute requirements of antitrust law.

As previously highlighted on this blog and by HBO’s John Oliver, in 2008 Congress authorized the U.S. Department of Agriculture to draft regulations that would ensure the conduct prohibited by the PSA is defined in a manner consistent with the PSA’s language. While the PSA’s text and prior agency interpretations should have been (and should be) sufficient to establish that the PSA is not an antitrust law, formal regulations would have proven an important tool to fight against courts’ importation of antitrust concepts into the PSA. However, once those regulations were ready, industrial agriculture’s champions in Congress passed a new law preventing those rules from taking effect. As a result, courts continue to treat the PSA as an antitrust statute.

Amending S. 1599 will not fix the judiciary’s decision to defy core tenets of statutory interpretation and rewrite the PSA to serve agricultural companies. However, it would ensure that farmers are provided the same protections against corporate abuse as other workers, enabling them to secure the full extent of the protections they are currently provided.

Such a change would also be incredibly simple. Utilizing the current text of the bill, all Congress would have to do is:

(1)   Add one clause to the statute’s current definition of “Antitrust laws”—“The term ‘antitrust laws’ means section 1 or 3 of the Sherman Act (15 U.S.C. 1 and 3) and the Packers and Stockyards Act of 1921 (7 U.S.C. § 181 et seq.)”; and

(2)   Delete section (a)(4), which limits the statute’s protection to whistleblowers who report antitrust violations that also constitute crimes. 

Failing to make these amendments insulates industrial agriculture’s anticompetitive practices, undermining the protections Congress claims it intended and the GAO indicated are necessary. The safety and health of the public and the integrity of the marketplace are at stake. 

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