No Horsing Around – Nevada Federal Judge Dismisses Burro Suit Against Interior Dept.

By Stewart D. Fried

The serious environmental problems caused by unchecked wild horse populations on western rangelands are well known to state and local governments, Native American tribes, ranchers and farmers.  Efforts, however, to prompt the U.S. Department of Interior (“Interior Dept.”) and its Bureau of Land Management (“BLM”) to address widespread environmental damage and other impacts caused by wild horse overpopulation have been largely unsuccessful.  Environmental and other issues caused by thousands of wild horses on federal lands are perhaps most pronounced in Nevada.  The Silver State is estimated to be home to nearly half of the country’s wild horse population.   Because BLM is not doing enough to address exponential population growth, wild horse herd sizes are increasing by 20% annually.

The Wild Free-Roaming Horse and Burros Act, 16 U.S.C. §1331 et seq., (“Wild Horse Act”) governs the Interior Dept.’s duties with respect to wild horses on federal lands.  The Wild Horse Act mandates that the Interior Dept. protect and manage wild horses and burros, including the responsibility to “maintain a current inventory of wild free-roaming horses and burros on given areas of the public lands.” 16 U.S.C. §1333(b)(1).  Under the Wild Horse Act, a “natural ecological balance” among wild horse and burro populations, domestic livestock, wildlife and vegetation must be achieved.

In order to achieve that balance, the Interior Dept. determines whether Appropriate Management Levels (“AMLs”) should be achieved by the removal or destruction of excess animals.  BLM describes as “the number of wild horses and burros which can graze without causing damage to the range.”  In establishing AMLs, BLM relies on studies of grazing utilization, trends in range condition, weather data and other factors.  BLM also takes into consideration populations of wildlife, permitted livestock and wild horses and burros in the area. Id.  BLM sets AMLs following public involvement through an in-depth environmental analysis and decision process. Id.  In enacting the Wild Horse Act, Congress expressly required the Interior Dept. to “immediately remove excess animals” from the range so as to achieve AMLs when it is determined that “an overpopulation exists on a given area of the public lands and that action is necessary to remove excess animals.”  16 U.S.C. §1333(b)(2).

With these seemingly clear statutory mandates in mind, several Nevada counties, farming and ranching associations and other interested parties have attempted, with limited success, to prompt BLM to address the problem of wild horse overpopulation on Nevada rangelands.  Based on BLM’s inaction and ever-worsening damage to public resources and increased threats to private water rights, the Nevada Association of Counties and the Nevada Farm Bureau (“Counties”) sued the Interior Dept. in federal court in Reno during December 2013, alleging constitutional violations and seeking judicial review under the Administrative Procedures Act (“APA”).

On February 12, 2015, Federal District Court Judge Miranda Du issued her opinion in Nevada Association of Counties v. Interior Dept., dismissing the Counties’ complaint with prejudice.  Judge Du concluded that she lacked subject matter jurisdiction over the case because the Plaintiffs’ amended complaint “failed to identify a final agency decision” by BLM that was being challenged.  The Court noted that the Wild Horse Act does not provide for a private cause of action and that any challenge to federal action brought under the APA must be based either on “final agency action that warrants judicial review or any inaction that may be compelled.”  Order, at 4.

The crux of the Court’s decision was founded on its determination that the plaintiffs “sought review of flaws in the entire program” to “compel compliance with the Act and refashion [BLM’s] management of wild horses and burros in Nevada.” Id., at 7.  In describing the Counties’ lawsuit as a “programmatic attack” on the entire BLM program, the Court focused on the Plaintiffs’ failure to allege that BLM failed to set “a single AML or inventory” or any another specific final agency action.  Judge Du also dismissed the Counties’ constitutional claims because the amended complaint failed to allege a property interest that was taken or otherwise affected by BLM’s mismanagement of wild horses, or how BLM’s responses to the Plaintiffs’ notices that wild horses were outside designated management areas or were interfering with water access fell short of due process.

The dismissal of the Counties’ lawsuit is the latest chapter in a lengthy and still unfinished book about wild horses on the Western range.  Although BLM has removed over 100,000 wild horses during the past decade from federal lands, the equine overpopulation problem continues to expand in every state and most tribal lands from the Cascades to the Mexican border.  Congress has again foreclosed horse slaughter as an option for reducing herd size, despite a thriving market abroad and several domestic facilities that received (or were eligible to receive) FSIS grants of inspection during 2012.  While an appeal of the decision is possible, this is likely an uphill battle it would need to be filed in the generally unfriendly Ninth Circuit Court of Appeal.

In light of the District Court’s decision, states, tribes and other stakeholders may need to go back to the drawing board.  Because Judge Du took issue with the Plaintiffs’ failure to identify particular BLM decisions with respect to specific inventories or AMLs, next steps could include identification of specific herd management areas where BLM has failed to conduct inventories or set AMLs or identifying herd management areas where severe erosion and other ecological damage exists, conducting wild horse herd population surveys in those areas (assuming data does not already exist), and then filing petitions with BLM seeking the establishment of inventories or AMLs and demanding that the Bureau conduct removal activities in accordance with the Wild Horse Act.  This will take considerable time and effort, all while wild horse populations will continue to increase and environmental and other harms from equine foraging, especially to water quality, will not be addressed.  What is clear is that there likely will be no swift resolution to the environmental and animal welfare problems associated with this hotly-debated symbol of the West.

A copy of the District Court’s decision in Nevada Association of Counties v. U.S. Department of Interior can be found here.

So Which USDA Regulations Would You Like to Change?

By Roger R. Szemraj

We know that people often disagree with any number of the different regulations that have been put in place for the administration of USDA’s programs – agricultural program operations, nutrition programs, rural development programs, energy programs, conservation programs, and the list goes on.

Well, now is the chance to speak up.

In the Federal Register for Tuesday, March 17, USDA asks for “…public comment to assist in analyzing its existing significant regulations to determine whether any should be modified, streamlined, expanded, or repealed.”   The notice does go on to suggest several questions for consideration:

  • Which regulations have become outdated, and how can they be modernized to accomplish the regulatory objectives better?
  • Do agencies currently collect information that they do not need or use effectively to achieve regulatory objectives?
  • Which regulations, reporting requirements, or regulatory submission or application processes are unnecessarily complicated or could be streamlined to achieve regulatory objectives in ways that are more efficient?
  • Which regulations, submission and application processes, or reporting requirements have been overtaken by technological developments?
  • Can new technologies be used to modify, streamline, or do away with existing regulatory or reporting requirements?
  • Which regulations provide examples of how regulatory flexibility techniques have worked well? In general, who has benefited from the regulatory flexibility?
  • What types of regulatory flexibility have worked well?
  • What regulations would be improved through the addition of regulatory flexibility techniques?
  • How would regulatory flexibility lower costs and burden? How would regulatory flexibility improve benefits?

USDA goes on to say, “This is a non-exhaustive list that is meant to assist in the formulation of comments and is not intended to limit the issues that commenters may choose to address,” and part of a “continuing process of scrutiny of regulatory actions.”

Comments are requested on or before May 18, 2015.  So have at it!

Trade is Critical to Rural America; Agriculture is Key to TPA

By Marshall L. Matz and former USDA Secretary John R. Block

Trade policy may present an opportunity for the Obama Administration and the Congress to work together in a bipartisan manner but it is sure not unanimous.   While Agriculture Secretary Vilsack and U.S. Trade Representative’s Chief Agriculture Negotiator Darci Vetter are making the case for Trade Promotion Authority (TPA), Senator Ron Wyden, the Senior Democrat on the Senate Finance Committee, is arguing for more negotiating transparency to be required by TPA before signing on.  In addition, while there is very strong support for TPA in the agriculture community, it is not unanimous.

TPA is a critical tool in the effort to complete the 12-country Trans-Pacific Partnership (TPP), and down the road the European Union Transatlantic Trade and Investment Partnership (TTIP) negotiations.  These trade agreements support U.S. jobs while helping American agriculture compete more successfully in the global marketplace. TPA will help ensure that America’s farmers, ranchers, and food processors receive the greatest benefit from the TPP, TTIP, and future trade negotiations.

These agreements could have an important economic impact on specific commodities and American agriculture more generally.  Secretary Tom Vilsack recently spoke out on the importance of trade to agriculture:

“It is no surprise that agricultural producers are joining the chorus of voices calling on Congress to renew Trade Promotion Authority. The past six years were the strongest period for agricultural exports in the history of our nation, despite the fact that many other countries’ markets are not as open to American products as our markets are to theirs. New trade agreements that help level the playing field for agriculture will build on the success we’ve seen in the agricultural economy since 2009 and help producers create more new jobs across the country. What makes the agricultural economy stronger makes our entire nation’s economy stronger. It is imperative that Congress act on Trade Promotion Authority early this year.”

Fiscal years 2009 to 2014 represented the strongest six years in history for U.S. agricultural trade, with U.S. agricultural product exports totaling $771.7 billion. Agricultural exports last fiscal year reached $152.5 billion, the highest level on record and supported nearly one million jobs here at home, a substantial part of the nearly 11.3 million jobs supported by exports all across our country.

USTR’s Office of Agricultural Affairs has overall responsibility for U.S. government trade negotiations and policy development and coordination regarding agriculture.  Darci Vetter and other USTR officials, works closely with relevant U.S. government agencies, particularly USDA, as appropriate.

In a recent letter to Congress a broad range of groups outlined the benefits of trade as follows:

“As a result of trade agreements implemented since 1989, when the U.S. began using bilateral and regional trade agreements to open foreign markets to our goods, U.S. agricultural exports have nearly quadrupled in value and now stand at a record $152.5 billion (fiscal 2014).  During that period, earnings from U.S. agricultural exports as a share of cash receipts to farmers have grown from 22 percent to over 35 percent.

“These farm and food exports have a positive multiplier effect throughout the U.S. economy.  Every $1 in U.S. farm exports is estimated to stimulate an additional $1.27 in business activity.  Off-farm activities and services include purchases by farmers of fuel, fertilizer, seed and other inputs as well as post-production processing, packaging, storing, transporting and marketing the products we ship overseas.  Exports of $152.5 billion in fiscal 2014 therefore generated another $194 billion in economic activity in the U.S., bringing the total benefit to the economy to $347 billion.”

The chart below shows the percentage of production that was exported, by commodity, in the most recent year for which there are numbers:

Commodity Percent
Wheat 50%
Corn 11%
Soybeans 62%
Beef 14%
Pork 26.5%
Diary 15.4%

In short:

1. Exports are critical to the agriculture economy; and

2. Agriculture’s political power may be the key to passage of TPA and the trade agreements being negotiated.

While only one percent (1%) of all Americans farm and the conventional wisdom is that agriculture has lost power, production agriculture still has an important role to play in making the case for expanded trade and TPA, as the farm economy has a major impact on all those who live in rural America.  From farm implement dealers to car dealers to rural bankers and the local coffee shops, what is good for farmers is good for rural America.

TPA gives us an opportunity to put economics before politics.  The farm groups who have signed the TPA letter to Congress are well positioned to make the case for expanded trade with both Democrats and Republicans bridging the urban-rural divide in America.

Marshall Matz specializes in agriculture policy at OFW Law.  He was formerly (Democratic) Counsel to the Senate Committee on Agriculture, Nutrition and Forestry.  John R. Block was Secretary of Agriculture under President Reagan.

The Drones are Coming! FAA Releases Proposed Rule on Small Unmanned Aircraft Systems

By John G. Dillard

Mention the word “drone” and most people think of our nation’s military activities in the Middle East. However, over the last few years, unmanned aircraft is finding its way into new civilian applications. Small drones, which are also known as unmanned aerial vehicles (UAVs) or small Unmanned Aircraft Systems (sUAS), when equipped with sophisticated cameras, can be invaluable surveying tools.

Agriculture is one such industry that is particularly suited to benefit from drone technology. The rise of precision agriculture and prescriptive planting places a high premium on accurate, real-time data. Farmers and crop consultants have typically relied on satellite technology or images gathered by airplanes to assist their precision agriculture needs. UAVs equipped with multi-spectral cameras can deliver images that are much more precise than satellite data at a fraction of the cost of manned aircraft flight.

Many in agriculture are taking advantage of this technology. Farmers and crop consultants are using drones to monitor crop health, survey irrigation systems, and spot-check problem areas in fields that can often be missed by on-the-ground scouting. However, these UAV operators have been operating in what can most generously be described as a legal “gray area.” Since 2007, FAA has taken the position that any commercial use of unmanned aircraft is unlawful.

In 2012, Congress passed the FAA Modernization and Reform Act. One of the provisions of this Act required FAA to integrate unmanned aircraft into the national airspace system by September 30, 2015. The agency is taking an incremental approach to this mandate, and will certainly miss Congress’ deadline.

FAA’s first proposed rule on unmanned aircraft, “Operation and Certification of Small Unmanned Aircraft Systems,” was published in the Federal Register on February 23, 2015. The proposed rule would govern how sUAS (the agency’s preferred terminology) could be operated and the certification requirements for operators.  Major components of the proposed rule include:

  • Operation of sUAS. FAA proposes allowing the operation of sUAS flown within the visual line-of-sight of an operator. Operations must be conducted while maintaining a constant visual line-of-sight. Visual observers may be used to assist the operator in maintaining a visual line-of-sight, so long as the operator is capable of seeing the sUAS. sUAS may be operated with an altitude ceiling of 500 feet in unrestricted (Class G) airspace and with Air Traffic Control approval in some classes of restricted airspace.
  • Certification of sUAS operators. sUAS flights must be operated by a certified airman. FAA is proposing the creation of a sUAS rating for its existing airman certification program. Pilot licenses will not be required for sUAS operators. Certification will primarily be based on passage of an initial aeronautical knowledge exam. Operators will need to renew their certification every two years.
  • Registration and display of registration markings. FAA’s proposal requires sUAS to be registered with the agency. FAA also proposes to require sUAS to display their registration number.
  • Exemptions for airworthiness certificates. Section 332(b)(2) of the 2012 FAA Reauthorization Act enables FAA to consider whether the airworthiness certification requirements applicable to manned aircraft should also apply to sUAS. Based on the relatively lower risks that accompany sUAS, the agency decided to exempt sUAS from the airworthiness certification requirement.
  • Micro UAS. The agency is requesting comments on whether it should create a subclass of sUAS known as Micro UAS. Micro UAS would weigh less than 4.4 pounds and be subject to less stringent requirements for operating conditions and operator certification. Many agricultural drones would fall under this Micro UAS category.

To assist in understanding this rule and the potential implications for agricultural drone use, OFW has prepared a complimentary memorandum. This memorandum provides a comprehensive analysis of FAA’s proposed rule and how it will impact agricultural applications of UAV technology.

Click here for a free copy of OFW Law’s analysis of FAA’s proposed sUAS rule.

GM Opponents are Science Deniers

Climate change is real and GM technology is safe, but those in denial want to undermine the public understanding of science with misinformation and pseudo-debate

By Nina Fedoroff, Peter Raven and Phillip Sharp, as published in The Guardian

The authors are former presidents of the American Association for the Advancement of Science (AAAS)

Barely a week goes by, it seems, without some new attack on science. For years, oil and coal lobbies have orchestrated assaults on climate scientists, while the religious right continues to oppose the teaching of evolution in US schools, questioning the basic tenets of evolutionary biology.

Denialism does its damage by driving a wedge between science and society, undermining public understanding of science with misinformation and confusing pseudo-debate. The effects can be seen not just in climate change mitigation efforts, but in peoples’ health – witness the recent US upsurge in childhood measles concentrated in areas where there is opposition to vaccines. No wonder the latest survey of scientists by the Pew Research Center found scientists increasingly pessimistic about how their work is viewed in the wider society.

In the latest organised attack on science, 14 senior US scientists are being targeted by anti-GM lobby group US Right to Know (USRTK), an offshoot of the failed California GM labelling campaign Yes on 37. USRTK is using the Freedom of Information Act (FoIA) to demand access to years of private emails and other correspondence of these scientists, undoubtedly aiming to undermine their credentials and sully their names in public.

As three former presidents of the American Association for the Advancement of Science, we know how important it is for scientists to engage meaningfully in societal debates about their work. But we also know how important it is for scientists to be able to speak freely in conducting their work, both publicly and privately. USRTK’s attack is reminiscent of ‘Climategate’, where the release of private emails did immense, unwarranted damage to the reputations of climate scientists. Now the vocal anti-GM lobby appears to be taking a page out of the Climategate playbook.

The facts are clear: the scientific consensus on the safety of foods derived from GM plants is equivalent to that on global climate change driven by human activities. The AAAS has issued statements on both subjects, underscoring that climate change is real and that GM technology is safe. Numerous other learned societies and public bodies have reached the same conclusions and continue to be attacked by science deniers on both issues.

USRTK’s statements are unambiguous – it views any scientist with the temerity to speak out in public on biotechnology as part of “the PR machine for the chemical-agro industry.” Hence its FoIA requests focus on any email exchanges with biotech companies such as Monsanto, Syngenta, and DuPont, as well as other organisations, including the Grocery Manufacturers Association and the Council for Biotechnology Information. These researchers have denied receiving hidden funding from these groups, yet a good deal of damage can be done with private communications quoted out of context.

Ironically, USRTK is less eager to reveal its own agenda and funding. Its website reveals only one donor, the Organic Consumers Association (OCA), a group that seeks to turn US agriculture 100% organic and eliminate GM crops. It is clearly promoting the interests of the organic food business, now a $63bn (£42bn) dollar industry.

The OCA has a clear game plan – to drive increased sales of higher-priced organic produce by convincing consumers that conventionally farmed foods are swimming in pesticide residues, that GM crops are dangerous, and that biotechnology companies that sell GM seeds are evil. But OCA does not restrict its anti-science activities to agriculture. Its website is also riddled with anti-vaccine misinformation, for example that “it is important to know how to protect your children and yourself with homeopathic and natural alternatives to vaccines to build your natural immunity” and other such dangerous nonsense.

Moreover, OCA’s assertion that we can feed the world organically and without modern technology is nothing short of delusional. We live on a finite planet with a human population of 7.2bn, a number that is increasing by almost 100,000 per day. Our ability to minimise the effects of famine has depended on the application of science and technology to agriculture since the time of the Industrial Revolution two centuries ago. The key innovations have been in genetics and plant breeding, synthetic fertilisers, and farm mechanisation.

A recent meta-analysis concluded that adoption of GM crops since 1996 has reduced chemical pesticide use by 37%, increased crop yields by 22% and increased farmer profits by 68%. Moreover, the gains were larger for developing countries than developed countries. We need more science, not less, if we are to feed the coming world of 9.5bn in 2050 without further destroying fragile ecosystems and driving more species to extinction.

Hostile challenges to intellectual enterprises such as universities and the people who practice science within them are hugely detrimental to our ability to make rational, evidence-based decisions in free societies.

If we allow ideologically-motivated campaigners to harass and threaten our leading thinkers and intellectual institutions, there will be less progress than we could otherwise achieve. Our civilisation can do better than that. We want to be able to vision a healthy, sustainable and vibrant future. But we can’t get there without science.

Nina Fedoroff is an Evan Pugh Professor at Penn State University; Peter Raven is Director Emeritus of the Missouri Botanical Garden and Phillip Sharp is Institute Professor in the Koch Institute for Integrative Cancer Research at the Massachusetts Institute of Technology

Privacy Update: White House Drops Draft Consumer Privacy Bill . . . Splat!

By Jonathan M. Weinrieb

The White House (via the Department of Commerce) has released a “discussion draft” of consumer privacy legislation intended to codify President Obama’s 2012 Consumer Data Privacy In A Networked World: A Framework For Protecting Privacy And Promoting Innovation In The Global Digital Economy.  The 2012 Framework included a Consumer Privacy Bill of Rights and called for baseline protections for consumers and greater certainty for businesses founded on the following principles:

  • Individual control over personal data;
  • Transparency regarding an entity’s privacy and security practices;
  • Respect for context in which consumers provide/businesses collect the data;
  • Security and responsible handling of personal data;
  • Consumer access to data to ensure accuracy;
  • Focused collection to ensure reasonable limits on the data collected and retained; and
  • Accountability for companies handling that data.

Although each of those laudable notions is reflected in the Bill, in the view of the FTC and many privacy advocates, the draft Consumer Privacy Bill of Rights Act of 2015 (the “Bill” or “Act”) comes up short of the consumer protection–minded goals of the 2012 framework.  We see other problems as well.

Ostensibly, the Bill is intended to “establish baseline protections for individual privacy in the commercial arena and to foster timely, flexible implementations of these protections through enforceable codes of conduct developed by diverse stakeholders.”  Act, § 1.  In other words, those subject to the Act would be permitted a safe harbor by establishing (and adhering to) their own codes of conduct.  See generally Act, § 301 (Safe Harbor Through Enforceable Codes of Conduct).

For its part, the FTC would enforce the Act via civil fines; however, those fines are contingent on the number of days over which a violation occurs – not the number of affected individuals or monetary impact.  A one-day violation could not exceed $35,000 in fines, regardless of whether the violation affected ten, 10,000, or 10,000,000 individuals.  See Act, § 203(a)(1).  A compounding issue is that the Act would apply to non-profit entities, Act, § 4(b), however, the FTC can only bring an action against a for-profit enterprise.

Of particular concern, the draft raises a number of issues given HHS’s Office for Civil Rights’ (OCR) recent and ongoing implementation of the HITECH Act and regulation of medical privacy under the HIPAA Privacy Rule.  Following are a smattering of the issues that we see.

First and foremost, the Bill’s preemption language is confusing in the context of HIPAA.  It provides that “[t]his Act preempts any provision of a statute, regulation, or rule of a State or local government, with respect to those entities covered pursuant to this Act, to the extent that the provision imposes requirements on covered entities with respect to personal data processing.”  Act, § 401(a) (emphasis added).  It goes on to state, however, that “[n]othing in this Act may be construed to modify, limit, or supersede the operation of privacy or security provisions in Federal laws . . . .”  Act, § 404(d)(1).  The federal HIPAA Privacy Rule does not preempt more stringent state laws and regulations that are otherwise consistent with the federal rule.  Accordingly, it appears that the Act would preempt an otherwise permissible (and arguably “stronger”) state medical privacy law – yet leave HIPAA alone.  Such a result would seemingly be at odds with the underlying intent of the federal Privacy Rule.

In certain respects, the draft Bill appears incredibly broad.  As alluded to above, it applies to a “covered entity” – i.e., anyone who “collects, creates, processes, retains, uses, or discloses ‘personal data’.”  Act, § 4(b).  That suggests that both HIPAA Covered Entities and Business Associates would be subject to the Act.

“Personal data” includes, but is not limited to: a first name (or initial) and last name; a postal or email address; a telephone or fax number; a social security number; any biometric identifier; or any other “unique persistent identifier.”  Act, § 4(a)(1).  It specifically excepts, however, “de-identified data” from the definition of personal data, but fails to square the concept of de-identified data with HIPAA.  Whereas the Privacy Rule sets forth two very specific methods by which to de-identify data (see Statistical and Safe Harbor methods), the Bill simply allows a covered entity to “alter . . . personal data . . . such that there is a reasonable basis for expecting that the data could not be linked as a practical matter to a specific individual or device . . . .”  Act, § 4(a)(2)(A)(i).  It is unclear how such a standard would be consistently and reliably implemented.

The Act also introduces a similarly amorphous concept in “Respect for Context.”  In a rather confusing bit of draftsmanship, the Bill calls for a covered entity to perform a risk analysis when it “processes personal data in a manner that is not reasonable in light of context . . . .”  Act, § 103.  If it determines that the manner is not reasonable in the particular context, it would appear to contemplate affirmative consumer opt-in – as opposed to opt-out – for such processes.  Such provisions could be read to stand at odds with HIPAA’s authorization requirements and broad exceptions for face-to-face communications and refill reminders (an exception to the definition of “marketing”).

By way of further example, and particularly with respect to reconciling the Act with HIPAA, a covered entity would not include one that collects, creates, processes, retains, uses, or discloses the personal data of fewer than 10,000 individuals in a 12-month period, or has fewer than 5 employees.  That exception alone would likely sever the world the HIPAA Covered Entities in two.

The Bill also exempts seemingly broad categories of data (e.g., “customary business records”) from certain requirements such as data minimization and individual control.  “Customary business records” include data “typically collected in the ordinary course of conducting business and that is retained for generally accepted purposes for that business . . . .”  Act, § 4(j).  Put bluntly, it is difficult to conjure categories of data that would not fit comfortably into that exemption.

Furthermore, in somewhat striking contrast to HIPAA’s concept of Breach, the Bill defines “privacy risk” in subjective fashion – i.e., as that which could “cause emotional distress, or physical, financial, professional or other harm to an individual.”  Act, § 4(g).  OCR did away in 2013 with its similar subjective “risk of harm” standard in favor of a more objective risk assessment: “[a]n impermissible use or disclosure of protected health information is presumed to be a breach unless the covered entity or business associate, as applicable, demonstrates that there is a low probability that the protected health information has been compromised based on a [formal] risk assessment . . . .”  45 C.F.R. § 164.402 (emphasis added).

Finally, there is no provision in the Bill that would require FTC rulemaking.  As written, and without agency regulation and guidance, the Bill will almost assuredly spawn significant consumer and stakeholder confusion.

In our view, which appears largely consistent with various media reports and fellow bloggers, the current Bill is unlikely to go anywhere in Congress.

OFW Law Launches FDA DevicEd Training Initiative

OFW Law is proud to announce the launch of its FDA DevicEd Training Initiative.  The initiative is devoted to providing high quality FDA regulatory training to foreign and domestic medical device companies and the advisors who assist them.  Interactive in-person seminars will be developed and presented by OFW Law attorneys specializing in FDA regulation of medical devices.  These attorneys have a combined total of over 80 years of experience practicing FDA medical device law.

“The scope and complexity of FDA’s regulation of medical devices have only increased in recent years, with the swirl of new or revised statutory provisions and draft and final regulations and guidance documents growing all the time.  The OFW Law FDA DevicEd Training Initiative seeks to help device firms and their advisors navigate the often tricky FDA regulatory landscape in which they must conduct business or provide advice,” says Steve Terman, the head of OFW Law’s Medical Device Practice Group.

Besides communicating the regulatory information that companies and their advisors need, the initiative also is intentionally geared at providing practical insights which can be applied on a daily basis by company employees and firms in the medical device industry.  “While knowing what the law and guidance literally say is important, it doesn’t necessarily help you understand what they truly mean in practice so you can avoid regulatory pitfalls.  This is where the initiative can be of practical assistance,” says Neil O’Flaherty, an OFW Law principal attorney specializing in FDA device regulation.

The initiative will offer seminars for those new to the area of FDA medical device regulation as well as seminars targeting a specific area of FDA device regulation or a new regulatory initiative by FDA’s Center for Devices and Radiological Health.  The initiative also offers the opportunity for device firms and their advisors to work with OFW Law to develop and plan customized seminars to meet their specific needs.  “Not all firms need or want training and education on the same topics.  The OFW Law initiative allows them to design and implement training activities which are tailored to their interests and goals,” according to Evan Phelps, another principal attorney specializing in FDA device matters at OFW Law.

Trained and experienced professionals within and outside FDA are critical to a medical device industry which produces and markets safe and effective products.  OFW Law hopes its FDA DevicEd Training Initiative will be beneficial to industry professionals.

Please contact Neil O’Flaherty for more information about the OFW Law FDA DevicEd Training Initiative.

Please note that OFW Law FDA DevicEd Training Initiative sessions are for general informational purposes only.  They are not intended to and do not constitute legal advice and do not establish an attorney/client relationship.  Please contact an attorney and establish an attorney/client relationship if you need legal advice.

John Block: Chickens and Eggs

By John R. Block

The State of California has a reputation for leading in many ways – especially in the area of government regulations. Now, they have bit off almost more than they can chew. Certainly, the disadvantaged will not be chewing on many eggs since the State has more than doubled the price of eggs. A dozen eggs now costs more than $3.00. One year ago, you could get a dozen for a little over $1.00.

All of this happens just at the time nutritionists are raving about how healthy eggs are for the diet.

California voters did this to themselves. In 2008, they passed a law that required that cages housing their laying hens had to be much larger. Then, it dawned on the politicians that that kind of costly requirement imposed upon their egg farmers would put them out of business. Less expensive eggs would be streaming into the State. So in 2010, they passed legislation that would not allow eggs coming into California from other states unless their cages were as big as the California cage standards. The cages have to be twice the size as the industry norm.

The cost of new cages can cost 1 million dollars for 25,000 chickens. As you might imagine, some California farmers are giving up on the egg business. California egg production has taken a 25% dive since the law was passed. Other states are not willing to pay the extra cost to expand their cages. So, California is short on eggs. The poorest consumers pay the price.

Here we are talking about free trade agreements with other countries. Do we need to negotiate a free trade agreement between states? Perhaps the California crate law violates the Commerce clause. States are not supposed to interfere with interstate trade.

All of this costly burden has been pushed upon California consumers by the animal rights organizations. They are never satisfied.

John Block was Secretary of the U.S. Department of Agriculture from 1981-1985, where he played a key role in the development of the 1985 Farm Bill.

FDA Announces National Kick-Off Meeting on FSMA Implementation

By Robert A. Hahn

FDA will hold a “National Kick-Off Meeting on Implementation of the Food Safety Modernization Act (FSMA)” on April 23-24, 2015, in Washington, D.C.

The agency has sent out a save-the-date notice to subscribers to its FSMA webpage, but the notice contains few details.  FDA says that meeting specifics, including registration information, will be made available in March via a Federal Register notice and an announcement on FDA’s FSMA webpage.

We have learned that the public meeting will include opening presentations by the FDA implementation teams for the major pending FSMA rulemakings (including Preventive Controls, Produce Safety, Foreign Supplier Verification Programs, and Intentional Adulteration), as well as breakout sessions during which FDA will seek input from stakeholders.

Despite the use of the word “kick-off” in the meeting title, don’t worry that you somehow missed publication of the FSMA final rules and that FDA is about to “kick-off” implementation.  That is not the case.  FDA has not issued any of the 7 foundational FSMA final rules.  The agency remains under the following court-ordered deadlines for publication of the final rules:

August 30, 2015

  • Preventive Controls for Human Food
  • Preventive Controls for Animal Food

October 31, 2015

  • Produce Safety
  • Foreign Supplier Verification Programs
  • Accreditation of Third Party Auditors

March 31, 2016

  • Sanitary Transportation of Food

May 31, 2016

  • Intentional Adulteration

Although we won’t know the compliance dates until FDA actually publishes the final rules, it is likely that the earliest date that any businesses would need to comply with any of the final rules would be August 2016.  To help you make plans, a rough compliance timeline appears below.

FDA’s decision to hold such a public meeting while it is still drafting the final rules is interesting.  It suggests that the agency is finding certain issues challenging and is willing to present its current thinking and seek feedback before proceeding with the final rules.

Projected Timeline for Compliance with FSMA Final Rules*



  • All businesses (except for small and very small businesses) must comply with Preventive Controls for Human Food rule
  • All businesses (except for small and very small businesses) must comply with Preventive Controls for Animal Food rule



  • Businesses (except small businesses) must comply with Sanitary Transportation of Food rule


  • Importers must comply with FSVP rule (However, if the imported food is subject to the Preventive Controls for Human Food rule or the Preventive Controls for Animal Food rule, the importer must comply with the FSVP rule 6 months after the date that its foreign supplier is required to comply with the relevant preventive controls rule. If the imported food is a raw agricultural commodity (RAC) that is subject to the Produce Safety rule, the importer must comply with the FSVP rule 18 months after the date of publication of the FSVP rule or 6 months after the foreign supplier is required to comply with the Produce Safety rule, whichever is later.  If the imported food is a RAC that is not subject to the Produce Safety rule, the importer must comply with the FSVP rule 18 months after the date of publication of the FSVP rule or 6 months after the effective date of the Produce Safety rule, whichever is later.)


  • Businesses (except small and very small businesses) must comply with Intentional Adulteration rule



  • Small businesses must comply with Preventive Controls for Human Food rule
  • Small businesses must comply with Preventive Controls for Animal Food rule


  • Farms (except for small and very small farms) must comply with Produce Safety rule (However, such farms have an additional two years to comply with the water quality testing, monitoring and recordkeeping provisions of the rule.)



  • Small businesses must comply with Sanitary Transportation of Food rule


  • Small businesses must comply with Intentional Adulteration rule


  • Very small businesses must comply with Preventive Controls for Human Food rule
  • Very small businesses must comply with Preventive Controls for Animal Food rule


  • Small farms must comply with Produce Safety rule (However, small farms have an additional two years to comply with the water quality testing, monitoring and recordkeeping provisions of the rule.)



  • Very small businesses must comply with Intentional Adulteration rule


  • Very small farms must comply with Produce Safety rule (However, very small farms have an additional two years to comply with the water quality testing, monitoring and recordkeeping provisions of the rule.)

*This timeline contains projections or estimates of FSMA compliance dates based on the following assumptions: (1) FDA will publish the final rules on or around the court-ordered deadlines listed above; and (2) the final rules will contain the same compliance dates as the proposed rules.  This timeline may need to be updated as each final rule is issued.

Drug Supply Chain Security Act – What’s Next? A whole lot.

By Tish Eggleston Pahl

The passage of the Drug Supply Chain Security Act (DSCSA) in November 2013 led to a very busy 2014 as FDA and manufacturers, wholesale distributors, and dispensers began the statute’s complex 10-year implementation.  2015 promises to be equally busy.

A Surge Of Activity At Year-End In 2014

2014 closed in a flurry of DSCSA action.  As we reported here, FDA posted a Draft Guidance on Standards for the Interoperable Exchange of Information for Tracing of Certain Human, Finished, Prescription Drugs: How to Exchange Product Tracing Information (the Standards Draft Guidance) on November 26.  Then, just days later, FDA opened a web portal and issued guidance so that wholesale distributors and third-party logistics providers (3PLs) could begin submitting licensure information (as we discussed here).  Finally, FDA issued a Draft Guidance setting out its interpretation of the extent to which the agency believes the DSCSA displaces and preempts state law.  We took issue with the legal analysis in that preemption Draft Guidance, which you can read about here.

On January 1, 2015, one of the DSCSA’s big milestones arrived.  Among other things, the statute required that, on that date, manufacturers begin sending, and wholesale distributors begin receiving and transmitting, transaction information, histories, and statements for human prescription drug products.  At the end of December, FDA issued a Guidance stating that the agency intended to temporarily exercise enforcement discretion with regard to these product tracing information requirements.  FDA stated that it did not intend to take action against manufacturers, wholesale distributors, and repackagers who do not, prior to May 1, 2015, provide or capture the transaction information, transaction history, and transaction statement required by the DSCSA.

So, What’s Next? 

First is that the agency’s enforcement discretion expires on May 1 and, thereafter, manufacturers, wholesale distributors, and repackagers must be transmitting and receiving the transaction data the DSCSA requires.  Closely thereafter, beginning July 1, dispensers must begin receiving this transaction data – though, given the enforcement discretion FDA provided to manufacturers, wholesale distributors, and repackagers, the agency may be asked to extend enforcement discretion for a period of time to dispensers.

The HHS semi-annual regulatory agenda, the CDER Guidance Agenda, and the DSCSA itself provide clues as to what else is coming in 2015.

By November 27, FDA must issue final regulations setting out national standards for the licensure of wholesale distributors and 3PLs.  According to this entry in HHS’s semi-annual regulatory agenda, FDA hopes to have a proposed rule issued in April.  Meeting these deadlines, however, will be challenging, both for the agency and stakeholders.  This will be a significant rulemaking and the DSCSA’s provisions for establishing national standards for licensure of wholesale distributors and 3PLs are new, a bit vague, and, in some places, appear internally inconsistent.

FDA must issue two guidances within 2 years of enactment on the DSCSA (i.e., by November 27, 2015).  First, the agency must establish by guidance a process for the review and granting of exceptions, waivers, and exemptions from the DSCSA.  Second, the statute also mandates issuance of a guidance on grandfathering – that is, continued distribution – of product that is not affixed with a product identifier by November 27, 2017.

The statute specifically requires that the grandfathering guidance be “finalize[d].”  As this language is not present in the section of the DSCSA mandating guidance on waivers, exemptions, and exceptions, it is reasonable to conclude that the grandfathering guidance will need to be finalized by November 27 and the guidance on waivers, exemptions, and exceptions need only be in draft by that date.  However, the waivers, exemptions, and exception guidance must have an effective date that is not later than 180 days prior to the date on which manufacturers must begin affixing product identifiers to products; as such, that guidance will need to be finalized on or about May 26, 2017.

In addition to what must be issued in 2015, the CDER Guidance Agenda published in January sets out an ambitious list of other DSCSA guidances the agency intends to promulgate.  Notably, FDA appears poised to finalize the current Draft Guidance on Annual Reporting by Prescription Drug Wholesale Distributors and Third-Party Logistics Providers.

In the Standards Draft Guidance released in November, the agency stated it intended to issue additional guidance to facilitate the interoperable exchange of product tracing information through standardization of data and documentation practices.  This planned guidance on standardizing data and documentation appears on the 2015 Guidance Agenda.  Numerous questions and requests for clarification have been posed to the agency, and it is possible that FDA will use this guidance to answer some of those queries.

The agency also intends to issue two other guidances:

  • DSCSA Implementation: The Product Identifier for Human, Finished, Prescription Drugs
  • DSCSA: Verification Systems for Prescription Drugs

As manufacturers must begin affixing product identifiers by November 27, 2017, guidance on these subjects, soon, would plainly aid that activity.  What the verification guidance might be is curious – the term is used in several ways in the DSCSA.  Given that it is also addressing product identifier requirements in guidance, this may mean the agency intends to provide guidance on how to determine whether the product identifier affixed to, or imprinted upon, a drug package or homogeneous case corresponds to the standardized numerical identifier or lot number and expiration date assigned to the product by the manufacturer or the repackager.

2014 was a busy year for DSCSA implementation; 2015 promises to be even busier.