NATIONAL MEAT ASSOCIATION h 1970 Broadway, Suite 825, Oakland, CA 94612
Edited by Kiran Kernellu
March 17, 2003
BURDEN OF PROOF IN OAKLAND!
Nine jurors have arrived daily in federal district court in Oakland, CA for the last two weeks to hear the case of Veal Connection Corp. v. Roy Thompson, et al, a “civil” trial seeking damages from four USDA officials in what is known as a Bivens action arising out of the 1996 withdrawal of inspection at Velasam Corp. Concurrently, Federal District Judge Claudia Wilkens is hearing testimony in a separate case, Velasam Corp v. USDA, which seeks damages from USDA. The plaintiff company, Velasam Corp., survived a 9-week closure in 1996, and was the subject of other USDA enforcement actions in 1995 and 1996. The company was formed, according to the testimony of its owners, Simon and Hannaka Samson, in 1983 and provides high quality meat specialty items for the food service and upscale retail markets.
It is rare that a company, which has been subjected to the level of enforcement activities directed to this small processor, emerges as a viable business form. The principals, Simon and his wife Hannaka, came from Holland, where Simon learned the meat trade through apprenticeship training and practical experience. He has testified that his most valuable asset is his honor and integrity, and his pursuit of this litigation is testament to his willingness to take every possible step, regardless of cost, to redeem that honor.
This litigation is being played out thousands of miles from Washington, where apparently at least some of the challenged regulatory decisions were made. The list of witnesses, including the four defendants, is impressive. Last week, in addition to hearing from the defendants (three of whom are current USDA officials, and one retired), the court heard testimony from Carol Seymour, retired Assistant Deputy Administrator for Enforcement; Richard Van Blargan, currently Deputy Administrator for PEER at FSIS; Dr. Craig Reid, former FSIS Deputy Administrator for Field Operations; Federal Judge Charles Breyer, who was Velasam’s attorney when the litigation started, prior to his appointment as a United States District Judge in San Francisco; Patricia Gay, an FSIS inspector in the field; and third party experts including Lou Gast of the HACCP Consulting Group; a representative of a San Francisco laboratory that took samples of product for testing; and a business economist who described the financial cost to the business of the USDA actions.
The trials resume today, with more witnesses scheduled to appear. Thousands of miles from Washington and outside the orbit of Beltway media, the primary focus of all this testimony is the nine jurors who are expected to hear final arguments early this week and then be charged to make their decision.
NMA will provide the 2003 scholarship applications to participating universities tomorrow. It will be available online by Friday, March 21, 2003 at http://www.nmascholars.org./. Interested parties can obtain an application from a participating university’s financial aid office or via the Web. Contact NMA at [email protected] or 510-763-1533 for more information.
SUMMER GRILLING PROMOTION ‘03
The National Cattlemen’s Beef Association (NCBA) has unveiled details of its 2003 Summer Grilling Campaign. The focus will be on all cuts of beef, including the chuck and round, with the tagline, “Beef. It's What’s For Dinner.” The development of strategic promotional partnerships with A.1. Steak Sauce and Marinades, Kingsford Charcoal and Redwood Creek from E&J Gallo Winery is one of the most powerful elements of the 2003 Summer Grilling program.
“Our 2002 campaign resulted in a ten percent increase in beef grilling cut sales and a seven percent increase in dollar sales,” said Randy Irion, director of retail marketing services for the NCBA in a press release. “We’ve taken the most successful components and key learnings from 2002 and have built an even bigger and better promotion for 2003.”
”With our aggressive 2003 summer promotion efforts, we anticipate increased sales of all fresh beef, resulting in yet another successful summer for retailers and the beef industry,” said Irion. “The ability to build on our experiences from 2002 has allowed us to create an effective, targeted promotion for retailers, and reach a greater number of consumers across the country with our key messages.”
Some of the markets to be targeted in NCBA’s 2003 Summer Grilling Promotion include: New York, Los Angeles/San Diego, Chicago, San Francisco/San Jose, Philadelphia, Dallas/Ft. Worth, Detroit, Boston, Washington, D.C./Baltimore, Houston/Galveston, Atlanta, Miami, Phoenix, Nassau-Suffolk (Long Island), Tampa, Sacramento, Denver, Seattle, Jacksonville and Indianapolis.
For more information about the 2003 Summer Grilling Promotion, contact Randy Irion at 312-670-9403 or visit the official website at www.BeefItsWhatsForDinner.com. Read about the 2002 Summer Grilling Promotion in last week’s Lean Trimmings.
Please note the correct spelling of one of the new directors of Region 8 is Steven Nichol. The correct name of the company he represents is The Iowa Packing Company. Our apologies for this error.
Lean Trimmings and Herd on the Hill are offered electronically. If you’d like to receive the newsletter via e-mail, please contact Kiran Kernellu at [email protected] or 510-763-1533. Receive the latest news every Monday afternoon in your Inbox instead of waiting for it in the mail!
NMA reports news items that are of special interest to its readers, and provides information that they may want to be able to access. Below are links to the Federal Register, AMS, APHIS, and FSIS, respectively:
NMA has available two videotapes on animal handling, “Animal Stunning for Stunners,” and “Animal Handling in Meat Plants.” NMA members may purchase theses videos at a discounted price. Please contact Julie Ramsey at [email protected] or 510-763-1533 for more information.
GILLETT OUTLINES FUTURE FOR SWIFT
George Gillett Jr., chairman of Booth Creek Management, wowed attendees at NMA’s annual meeting in Las Vegas, NV. Introduced by NMA President Ted Miller, E.A. Miller, Hyrum, UT, Gillett bounded on stage to face his supporters, partners, and competitors. Before addressing the crowd, he thanked Miller for his efforts in helping Swift & Co. move ahead with its plans for the future. (ConAgra’s sale of its meat assets included E.A. Miller as part of the deal.)
As the driving force behind the return of the Swift name to the meat industry, Gillett definitely has a passion for his new venture in the meat industry. Warming up the crowd with a quip from his wife, he told the audience she had instructed him to tell them that he was a man “who’s frequently wrong and seldom uncertain.”
As partners with Hicks, Muse, Tate & Furst Inc., Gillett and team acquired a 54 percent ownership in ConAgra’s meat business last year, a move he describes as “a win-win” transaction. “ConAgra was able to take its meatpacking operations off its balance sheet and we were able to acquire a strong business on favorable terms,” he said.
For Swift’s management team, the initial challenge may be doing a better job with producers, a goal endorsed by Gillett. “We've got to build partnerships. Otherwise neither side wins.”
Beyond promoting greater cooperation, whether through alliances or integration, Gillett said the company would not be rushing to ship new products to the market. “First, you have to work through your customers to understand what consumers want, then you develop a brand proposition to exceed those expectations,” he said. “Only then can you put a brand on the product -- not the other way around.”
No matter how sweet the deal, challenges remain for the new Swift & Co. Gillett said the challenges for senior management are formidable. They include the cyclical nature of livestock prices, the commodity mentality of meatpackers, the industry’s production-driven mindset, the pressure of consumer critics and animal activists, the negative perceptions among mainstream media, and the lack of both clout and credibility on Capitol Hill.
As a minority part of this new business venture, this is Gillett’s fourth venture in the meat industry. He has owned Packerland Packing on two occasions and Corporate Brand Foods America, which was eventually purchased by IBP inc. Gillett, who has been called the “unsinkable Molly Brown of the meat business,” has more than 40 years of history in the industry. In addition, he has owned ski holdings in Vail, CO, the Harlem Globetrotters, the Montreal Canadiens hockey team, ranches, farms, and several television stations, among other business ventures.
Thank you to Brent Langman for his contribution to this article. He was guest editor of the Lean Trimmings daily editions during NMA’s 57th Annual Convention. The daily editions of Lean Trimmings are available at: http://www.nmaonline.org/PUBLICATIONS/Newsletters/backissues/backissues.htm.
LAWMAKERS SHOOT FROM THE HIP
Five U.S. lawmakers, in a 5-page letter to Agriculture Secretary Ann Veneman dated March 12, are claiming that managers at ConAgra Beef Co. knew of 33 positive tests for the pathogen E. coli O157:H7 late last spring, but did not take “legally required steps to end the life-threatening contamination before Americans fell seriously ill.” The lawmakers, each of whom has been an outspoken critic of the meat and poultry inspection program and the industry for years, are: Senator Dick Durbin (D-IL) and Representatives Henry Waxman (D-CA), Marcy Kaptur (D-OH), Rosa DeLauro (D-CT), and Sherrod Brown (D-OH).
The lawmakers said that they are asking Congress to: “give clear direction to FSIS to: (1) require USDA to set industry performance standards for pathogens like E. coli O157:H7; (2) require companies to turn over all pathogen testing results immediately to USDA; and (3) require companies to deliver the positive samples to USDA for DNA fingerprinting, allowing matches with cases of human illness.” While they acknowledged that USDA had taken a number of steps to improve oversight of meat production, they were critical of its testing program and its activities. Several of these same lawmakers were aggressive questioners in last week’s Appropriations hearing when USDA officials presented the 2004 food safety budget (see Food Safety Officials’ Testimony to House Ag Subcommittee in Herd on the Hill). They asked the Secretary to join them in supporting these provisions and they asked for a reply by March 21.
This week a survey on the 2002 workshops and seminars will be provided to members by fax. We would really appreciate your comments and suggestions about these courses. Kindly complete and return the forms at your earliest convenience.
FOOD SAFETY IN SCHOOLS
On March 4 Senator Richard Durbin (D-IL) introduced the Safe School Food Act of 2003 (S. 506), which would impose a number of additional testing and reporting requirements on food produced for use in the school lunch and breakfast programs. Prior to the introduction of this legislation, the American School Food Service Association (ASFSA) offered a proposal to improve the safety of school meals. Instead of establishing a separate food safety system for food used in schools, the ASFSA proposal would focus on improving food handling practices and food safety education at the school level. ASFSA believes that the most effective means of ensuring food safety is in utilization of safe food handling and preparation techniques that minimize environmental risks as well as improving school foodservice facilities that have deteriorated due to lack of resources. To promote these food safety standards, ASFSA seeks legislation that all school foodservice programs develop and implement a systemized approach to food safety, including HACCP components. Contact Kiran Kernellu at [email protected] or 510-763-1533 to request a copy of the ASFSA proposal. Some other ASFSA suggestions are as follows:
· ASFSA recommends that funds be provided for school food service staff training and assistance, through grants to state agencies and to other organizations able to provide the support needed for this purpose. For technical assistance and training, ASFSA proposes that $10,000,000 per year be made available (mandatory funds) for these grants.
· ASFSA further recommends that funds be made available to schools for rehabilitation and modernization of food storage, preparation and service facilities, as some school district facilities utilized for storing product and preparing and serving school meals have fallen into such disrepair as to pose a risk of environmental contamination.
· Finally, ASFSA recommends that a timetable for implementation of a systemized approach to food safety, including HACCP components, be developed that will provide sufficient time for design, development and training.
NATIONAL MEAT ASSOCIATION
NMA - East: 1400 - 16th St. N.W., Suite 400, Washington D.C. 20036 Ph. (202) 667-2108
NMA - West: 1970 Broadway, Suite 825, Oakland, CA 94612 Ph. (510) 763-1533 Fax (510) 763-6186
Edited by Kiran Kernellu
March 17, 2003
The 8th Federal Circuit Court of Appeals heard arguments last Monday in St. Paul, MN on the beef checkoff. You can listen to the arguments by visiting www.ca8.uscourts.gov/onestop.html, entering case number 02-2769, clicking on Search, then “Oral Argument,” and downloading and playing it. A decision is expected by July.
Most recently, district courts in Montana and the District of Columbia ruled that programs like the checkoff constitute government messages, countering the claim of checkoff opponents that the program violates the First Amendment protection of free speech. Cattle Buyers Weekly reported today that an attorney for Nebraska Cattlemen told the appeals court that the First Amendment doesn’t come into play on the program’s constitutionality. According to the report, an attorney for the checkoff opponents boiled the controversy down to two questions: Is this considered government speech? And, if it is, should a targeted group be required to pay for it?
NMA QUESTIONS COOL’S CONSTITUTIONALITY!
The subject of COOL came up frequently during NMA’s 57th Annual Convention in Las Vegas, NV two weeks ago. During discussions about COOL, NMA legal counsel Phil Olsson relayed that the legislation has serious constitutional weaknesses in that it is a form of compelled speech. The government should have a compelling reason to require that the country of origin information be placed on a commodity label. To the contrary, certain provisions in the COOL mandate allow for misleading information to be disseminated to consumers. Cattle Buyers Weekly used the example of an indigenous Mexican animal. Even if that animal leaves Mexico at an early age, it must still be labeled a product of Mexico.
NMA is asking Agriculture Secretary Ann Veneman to request that USDA counsel provide a legal opinion of the law. This will help to highlight questions of constitutionality before the regulation for mandatory COOL is to be promulgated, before September 30, 2004. In the interim, NMA advises its members to ask their livestock suppliers for full records. NMA is also seeking a comprehensive analysis of COOL’s impact.
ROUNDTABLE SEMINAR TAPES
Audio tapes of the interactive roundtable seminars at NMA’s 57th Annual Convention are now available! Don’t miss out on the thought-provoking and challenging questions and answers from experts and attendees during these twelve sessions: Preventing H7; What Works; Making RTE Products Safe; Sampling & Testing Methods; The Workplace Q&A; Industry Consolidation; Security: Business & Industry; Managing the Paper Trail; Standards for HACCP Validation; Industry-Government Working Together; COOL or NOT COOL! & Nutrition; Telling the Meat Industry Story; and Moving Forward with Branded Meats. Order forms for the tapes have been included as an insert in the mailing of this newsletter (see the reverse of the Listeria Workshop brochure). Contact NMA at [email protected] or 510-763-1533 to request an order form.
NMA TO VISIT WASHINGTON, D.C.
NMA will make its annual visit to Washington, D.C. April 8-10, 2003. We invite our members to join us in meeting with legislators and stakeholders and helping to educate them about the industry and NMA. Look for more information in coming issues of Lean Trimmings or contact us at [email protected] or 510-763-1533. We hope to see you in Washington!
Under Secretary for Food Safety Dr. Elsa Murano and FSIS Administrator Dr. Garry L. McKee testified before the House Agriculture Appropriations Subcommittee on FSIS’ FY 2004 budget request on March 12. Stephen B. Dewhurst, Director of the Office of Budget and Program Analysis, discussed food safety programs for 2004. Associate Administrator Linda Swacina, other FSIS officials and USDA Office of Budget and Program Analysis staff member Chris Zehren accompanied them. Read their testimony on the Web at:
Drs. Murano and McKee answered questions by Committee members on numerous issues, including the Agency’s Listeria directive and final rule, modernization of the FSIS workforce, FSIS homeland security efforts, the relationship between foodborne illnesses and recalls, a single food safety agency, foreign equivalency audits, and the Wampler recall. Representative Henry Bonilla (R-TX) chaired the hearing, and Ranking Member Marcy Kaptur (D-OH), and Representatives Tom Latham (R-IA), Rosa DeLauro (D-CT), Maurice Hinchey (D-NY), George Nethercutt (R-WA), Sam Farr (D-CA), Allen Boyd (D-FL), Jo Ann Emerson (R-MO), and Virgil Goode (I-VA) were in attendance.
Contact Kiran Kernellu at [email protected] or 510-763-1533 to request a memo from Olsson, Frank & Weeda on the proceedings.
FSIS’ INTERNATIONAL MEAT AND POULTRY FOOD SAFETY MEETING
FSIS will hold a public meeting on Thursday, March 27, 2003 to share views and discuss strategies for improving global food safety. The public meeting will be held from 8:30 a.m. to 5 p.m. at the Pan American Health Organization, 525 23rd Street, SW, Washington, D.C. Registration is suggested but not required. To register, please contact Sheila Johnson at (202) 690-6498 or [email protected].
IRRADIATED MEAT IN THE NATIONAL SCHOOL LUNCH PROGRAM
Reuters recently reported that USDA has asked consumer advocates and industry groups to submit comments on how to introduce irradiated meat into the national school lunch program by April 11. Last year Congress required the USDA to allow government-approved food safety technologies such as irradiation to be used in commodities purchased by the federal school lunch program.