How Harvey v. Veneman Could Change the Organic Industry

By Holly Givens, Organic Trade Association

On Wednesday, Jan. 26, the U.S. Court of Appeals for the First Circuit, based in Boston, MA, issued its decisions in a lawsuit brought by Arthur Harvey, an organic inspector and blueberry farmer, against the Secretary of Agriculture (at the time, Ann Veneman), concerning the National Organic Program (NOP) regulations. In handing down its decisions, the U.S. Court of Appeals ruled in favor of two of the seven issues Harvey raised concerning perceived technical inconsistencies between the national organic standards implemented in October 2002 and the Organic Foods Production Act (OFPA) of 1990. The court also ruled that the USDA must clarify one issue concerning commercial availability.

In its ruling, the court called for the following changes to NOP regulations:
1. NOP regulations have listed 36 synthetic materials, such as baking powder, that are allowed for use in organic processed foods on a limited basis after strict review. This list of materials can be found in the NOP Final Rule in section 205.605(b), and includes such materials as vitamin C (ascorbic acid), vitamin E (tocopherols), baking powder (ammonium bicarbonate), carbon dioxide, and chlorine materials for cleaning equipment. The court found that the U.S. Department of Agriculture (USDA), in creating this list of allowed synthetic materials, exceeded its authority under the OFPA. Therefore, most of the synthetics that have been approved up to now would no longer be allowed.

2. NOP regulations have allowed whole dairy herds transitioning to organic production to use at least 80% organic feed for the first nine months. The court made this decision because OFPA states that all organic dairy animals need to receive organic feed for 12 months prior to the sale of milk or milk products. The decision would remove the dairy transition practice of allowing 80% organic feed for the first nine months.

3. Finally, the court said that USDA needs to clarify the regulation concerning nonorganically produced agricultural ingredients that are allowed when the product is not commercially available in organic form.

This situation is evolving, and at press time there was no definitive answer about which organic products would be most affected by the situation. The USDA has indicated that they see the court decision as applicable to the use of synthetics in any post-harvest handling of organic products. This could have far-reaching consequences for anyone who produces or sells organic products, especially for dairy farmers and the farms that supply organic food processors.

At press time, it appears that neither USDA nor Harvey plan to appeal the court decision. Although there were few firm timelines known at press time, there were three possibilities for how the court’s decision’s might be implemented. In the best case, the court could assign (remand) the implementation to the USDA, which could allow a bit more leeway concerning timing and phase-in periods that would be more practical for the businesses involved. Another option is that the court could decide to oversee the USDA in how the decisions are implemented. This would entail more administrative burden on the USDA. As a worst-case scenario, the court could decide to vacate the sections of the organic regulations (the NOP Final Rule) related to their decision. If that is the case, producers of items using synthetic materials or ingredients allowed for reasons of lack of commercial availability (except items listed in section 205.606), and dairy farms in transition using 80% organic feed, would immediately need to change their practices to follow the court’s decision.

Realistic Options for Industry?
OTA is investigating every option that would mitigate the effects of the court decision and minimize any disruption to the organic business community. Options include: pursuing strategies to change USDA’s opinion that the court’s decision applies to all post-harvest handling of organic products; changing the law (OFPA) to reflect the NOP Final Rule, which was created with an unprecedented amount of public input; or changing the regulations, especially the definitions of non-synthetic and synthetic.

In order to overcome the challenges that this court decision could create, it’s important that the organic business community act in unison and in a strategic way. To help provide the association guidance, OTA has surveyed its members concerning use of the synthetic materials in section 205.605(b), and the likely economic impacts of the court’s decision.

Although final results were not available at press time, certain product categories, such as organic cheese, organic fresh meats, organic grain products, and organic carbonated beverages, appear to be especially vulnerable to negative consequences from the court’s decision as there appear to be no viable alternatives to the materials currently allowed in section 205.605(b) for those products.

It’s important for your organic business, even if it is not directly affected, to pay attention to this issue. OTA expects that as the situation evolves, there may be strong ripple effects throughout the entire organic supply chain. OTA is planning meetings on these issues at the All Things Organic Conference and Trade Show, April 30-May 3, in Chicago, IL. Visit www.organicexpo.com or the members-only section at www.ota.com for more about meeting times and locations.

Holly Givens is communications director for OTA, the membership-based business association representing all sectors of the organic industry throughout North America. She can be reached at hgivens@ota.com.