John Block: Bird Flu

By John R. Block

There is no industry more volatile or more uncertain than agriculture. The drought came and Texas and Oklahoma ranchers had to sell their cattle – not enough feed. Beef prices shot up. We still don’t have enough beef. The pork industry was hit with a swine disease. Thousands of baby pigs died. That resulted in a pork shortage and those prices shot up.

Now, we have bird flu. Who would have predicted? The H5N2 virus has killed 47 million chickens. We should be producing enough eggs to meet domestic demand and be able to export more than 30 million eggs per month. Not now. Iowa has been hurt the most – losing 30 million birds. That’s half the laying hens in the state.

The price of eggs has doubled. Egg processors making cakes, cookies, Krispy Kreme donuts, etc. are crying for eggs. For the first time in 10 years, we have authorized imports. Seven European countries have been approved to import shell eggs. Government officials say it will take as long as 2 years to get our production of eggs back to where it was before the virus.

This is not the first time we have been hit with a bird flu virus. When I was Secretary of Agriculture in the early 80s, we had our last bad bout with bird flu. That was a disaster then. But this time is much worse.

The Department of Agriculture oversees these problems. Farmers are compensated for the birds that die or are destroyed. According to Secretary Vilsack, the cost could exceed a half billion dollars. We are losing a lot of birds, including egg-laying hens, broilers, and turkeys. It will take a lot of money and time to rebuild the business.

Stopping the spread of the virus will not be so easy. Canadian geese in the state of Michigan have tested positive. They fly everywhere. In the meantime, the industry is looking for a vaccine to protect against the virus. None approved as of yet.

There is no industry more essential to mankind than food production. There is no industry more uncertain. And yet, our farmers and ranchers persist and get the job done. Did you know that this spring world food prices fell to their lowest level since 2009?

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.

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.

Phil Olsson and Rick Frank on 35 Years of Life at OFW

By Philip C. Olsson and Richard L. Frank

Phil: Rick, it’s hard to believe that 35 years have passed since we started this firm as a two-lawyer shop in 1979.

OFW Logo 35th AnniversaryRick: It sure is. I remember working with you at the law firm I joined fresh out of the University of Michigan Law School, and which you had joined several years earlier out of the USDA, where you had been Deputy Assistant Secretary for Marketing and Consumer Services.

In 1979, I was 28, with little experience. You were 40, and a well-known fixture in the agriculture and FDA bar. We decided to take a giant leap of faith and started Olsson and Frank. We persuaded Anita Harris to join us as our all-purpose support staff.

Phil: Our initial clients were food and agriculture companies and trade associations, including American Feed Manufacturers Association [now American Feed Industry Association], National Turkey Federation, Pacific Coast Meat Association [now North American Meat Association], The Quaker Oats Company, and Pueblo International.

Rick: Amazingly, many of those clients from 35 years ago are all still our clients today. We appreciate their loyalty and support over the years.

Phil: Today, food and agriculture are still a major part of our practice. But our practice has evolved and grown to include a wide range of industries regulated by USDA and FDA. We are still primarily a regulatory and counseling practice, with litigation capability.

Rick: We have had some notable successes from the outset.

Phil: Our first big challenge involved the National Turkey Federation, defending recently adopted USDA labeling regulations for “turkey ham,” which was allowed as a product name as long as it was qualified by the phrase “cured turkey thigh meat.” Two meat industry associations challenged that regulation. Before the District Court in Norfolk, we had a particularly unsympathetic judge, who began his opinion with an excerpt from Lewis Carroll about “when pigs have wings.” Fortunately for our client, the Fourth Circuit agreed with us and upheld USDA’s regulation. That win showed that our small firm was a feisty advocate. No one has ever doubted that Rick can be feisty, but that victory showed that our small firm had been inoculated with his feisty DNA.

Rick: The “turkey ham” case was important for the food industry, because it allowed product innovation to proceed without artificial constraints on product names. Along the same vein, for years we successfully fought off efforts by the dairy industry to demonize “imitation cheese” used as an ingredient in a wide variety of refrigerated and frozen meat-topped pizzas regulated by USDA.

Two other victories come to mind. We successfully got “Fresh Choice” orange juice and “Fresh Italian” pasta sauce off the market. Those products, which were made from previously processed, heat-treated concentrates, were anything but “fresh.” We also helped get approvals for lean, finely textured beef, a highly innovative, nutritious, and lower cost meat component widely used in ground beef and related products. (Note: Unfortunately, a disgruntled USDA employee, a “mommy blog,” and a national TV network disparaged this wholesome product as “pink slime” several years ago.)

Phil: One of my favorite clients was an egg distributor. On a trip with him to Cuba, we got to spend about five hours with just Fidel Castro, Castro’s trade director, and Castro’s interpreter. We heard Castro talk at length about improvements in Cuban literacy and life expectancy that had taken place since he took power in 1958. I have a treasured photo of me with El Presidente in my office.

Rick: It’s been a great 35 years, with lots of interesting matters. From the beginning, we always worked hard, tried to develop “creative solutions to difficult problems,” and fought to win our cases. We charged fairly for our services and worked in a very collegial environment. We still follow those guiding principles, which have served us well.

Phil: Indeed, those principles have worked well for us, as we have grown and prospered over the years.

Rick: In our early days, I was usually the youngest person in the room; Phil, you were the tallest. Today, I am often the oldest person in the room, but you are still the tallest. Some things change; some things don’t.

Thirty-five years have sped by. You, Anita, and I are all grandparents. The firm has grown, slowly but steadily, from two lawyers to almost 40 lawyers and Policy Advisors today.

Phil: In the beginning, you and I quickly realized we needed someone with more FDA expertise. In 1981, we were extremely fortunate to be joined by David Weeda, who had worked in FDA’s Office of Chief Counsel. David’s practice focused on drugs and biologics.

Next, Dennis Johnson joined us in 1982 after completing a Food and Drug Law Institute internship with FDA’s Office of Chief Counsel. He rapidly developed a practice representing packing and processing firms on their individual issues with USDA’s Food Safety and Inspection Service. Despite government warnings on each cigarette package, DJ has never been able to give up his Lucky Strikes, and he developed close friendships with a number of FSIS decisionmakers while sharing their smoking breaks.

Rick: David was responsible for recruiting his former FDA Office of Chief Counsel colleagues, Arthur Tsien and Steve Terman, to join us. Both have fit in very nicely. Today, Arthur is the head of our drug practice and our animal food and animal drug practice, while Steve heads our medical device practice.

Phil: Marshall Matz and I have known each other since the days when he was counsel for Senate George McGovern’s Hunger Subcommittee and I was working on hunger issues for the Nixon Administration at USDA. Marshall joined us in 1992 and has built a world-class policy and lobbying practice.

Rick: Marshall’s practice fit in neatly with the non-lawyer Senior Policy Advisors that have joined us over the years. The first was John Block, President Reagan’s first Secretary of Agriculture and the youngest member of the Reagan Cabinet. Jack is to-this-day a corn and hog producer and before coming to Washington he had been the Illinois Secretary of Agriculture. We also have former Congressman Charles Stenholm. Charlie had been the leader of the Blue Dog Coalition in the House, a group of moderate Democrats who worked to build bipartisan consensus.

We are also pleased to have Dr. Barbara Masters, a veterinarian and a former (non‑smoking) Administrator of FSIS. Barb began working for USDA straight out of vet school and burst through several (age and gender) glass ceilings to become FSIS Administrator before she was 40.

Phil: And we’re privileged to have had many other talented individuals join us over the years.

Rick: Absolutely. We have the O’Flaherty Brothers from Chicago. Michael heads our food practice. Neil is a stalwart in our medical device practice. David Durkin and Tish Pahl are an important part of our drug practice. Brett Schwemer and Jolyda Swaim are part of our meat and poultry practice, while Evan Phelps works on medical device matters. Jon Weinrieb is our resident maven on medical privacy. We added Gary Baise and his team to work on agriculture-related litigation. Bob Hahn works on food matters. There are others, of course.

Phil: David Weeda is an “almost founder” of this firm. Unfortunately, David succumbed to lymphoma at an all-too-early age in 2001. We are now fortunate to have a next generation Weeda, David’s son Mason, as one of our up-and-coming associates.

Just as we were in the process of moving our offices to The Watergate in 2011, Marshall persuaded his old friend and mentor Senator McGovern to join us as a Senior Policy Advisor. Marshall liked to point out that we had brought Senator McGovern back to The Watergate. The Senator remained one of us until he passed away.

Rick: In 35 years, much has changed, but much remains the same. We are still a relatively small, quirky boutique, specializing in food, agriculture, drugs, devices, and related litigation.

Phil: Along the way, we’ve done many different kinds of things. Rick has been heavily involved in community activities as the founder of the Lawyers Have Heart 10K foot race and fundraiser, which has raised millions of dollars for the American Heart Association during the 25 years of its existence. He has also worked closely with a number of consumer organizations, building credibility to obtain consumer support for some of our client causes.

In the 35 years since 1979, our country has been led by six presidents. We have seen many of the national and international mega-law firms stumble and disappear. From the beginning, our firm has been fortunate to have had Rick’s prudent management skills, which I believe he absorbed while watching his parents and grandparents run a small family business. Thirty-five years at OFW has been a great ride with a great group of people, both those within the firm and those on the outside, the clients who have made it all possible.

Rick: It sure has been a great ride and it’s not over. We are in the process of grooming tomorrow’s leaders. I still love my view of the Potomac from my office in the Watergate Building – the planes and helicopters and boats coming and going. Our cases were and are challenging and interesting. Washington is a wonderful place to work and raise a family.

On to the future!

Export Certificates for FDA-Regulated Foods Containing Egg Products as an Ingredient

By Michael J. O’Flaherty

The USDA’s Food Safety and Inspection Service (FSIS) plans, effective November 10, 2014, to halt issuing export certificates for FDA-regulated foods that contain an egg product(s) as an ingredient because USDA’s Agricultural Marketing Service (AMS) now provides this service.

FDA regulates the safe production, sanitary processing, and labeling of food products containing egg products.  Nevertheless, since it assumed responsibility for conducting the federal egg products inspection program from AMS on May 28, 1995, FSIS has been issuing export certificates of wholesomeness for prepared or manufactured food products that contain egg products as an ingredient.

On April 3, 2013, AMS announced the establishment of the Processed Egg and Egg Products Export Program.  The AMS program pertains to FDA-regulated, further processed eggs and egg products and composite foods containing egg products.  Pursuant to a Letter of Agreement between USDA’s Foreign Agricultural Service and the Office of International Affairs at FDA, AMS was provided with the authority to perform onsite verification of public health certification statements and issue export certificates on a fee for service basis.  The extent of the onsite verification process is directly related to the complexity of the certification statements required by the foreign country of destination for the food product.

Establishment of the export certification program is intended to allow U.S. processors access to expanding global markets, supporting AMS’ goal of promoting the marketing of U.S. agricultural products.  Companies interested in requesting the service should file an application with AMS.  Once the application is submitted, AMS will determine the import requirements of the foreign authority(s) for the food product(s) identified in the application.  AMS has established a program for verification of the source of the eggs and egg products used in the production of the food products identified for certification.  Additionally, AMS will verify that the product was produced in a processing facility in accordance with good manufacturing practices under sanitary conditions to certify that the products are fit for human consumption, as well as that the product meets the foreign government import requirements.  The verification of a product will require a minimum of two onsite visits per year.  If AMS determines that a company meets the established certification requirements, the company will be listed as eligible for export by product and country.  An eligible company then may contact AMS for an export certificate covering an accepted product(s) and identifying the foreign country.

Prior to shipping certified food products, exporters should have their importers confirm that the foreign country will accept AMS’ certification statements.  Additional packaging and labeling requirements also may need to be addressed with the importer before the food product will be allowed into the foreign country.

If you are an exporter of a FDA-regulated food that contains an egg product as an ingredient and need an export certificate(s), you should engage the AMS soon.  Please feel free to come to us with any questions related to AMS’ new verification and export certification program.