AAI Files Comments on USDA’s Proposed Rulemaking on Fair and Competitive Livestock and Poultry Markets

The American Antitrust Institute (AAI) filed public comments in support of the United States Department of Agriculture’s (USDA) Proposed Rulemaking on Fair and Competitive Livestock and Poultry Markets (Proposed Rule). The Proposed Rule defines “unfair practices” under § 202(a) of the Packers & Stockyards Act (PSA), which applies to livestock, meat, and poultry markets, as both conduct that harms the market and conduct that harms individual market participants.

AAI’s comments explain how competition laws and fairness laws are complementary tools for ensuring that markets work the way they should. In promulgating the PSA, Congress used both tools to ameliorate longstanding market failures in livestock and poultry markets. By defining “unfair” practices to include both conduct that harms the market and conduct that harms individual market participants, the Proposed Rule complies with the plain meaning of the PSA, its legislative history, and Supreme Court precedent, all of which support a finding that § 202(a) is concerned with market abuses in addition to and apart from competitive injury. The comments also examine court opinions which have imposed a competitive-injury requirement in § 202(a) cases, explaining how they conflict with Supreme Court precedent and core principles of statutory interpretation.

The comments further suggest that the agency draw from lessons learned in antitrust enforcement by providing additional guidance on the use of business justifications in § 202 cases. USDA should specify that business justifications cannot excuse per se offenses or deceptive practices. To the extent efficiencies may justify other types of unfair conduct, USDA should specify that they are a defense on which defendants carry a burden of persuasion and that they must be specific, verifiable, and cognizable. USDA should also take steps to insulate judges from engaging in multi-market balancing.

The comments were written by AAI President Randy Stutz and AAI Senior Counsel David O. Fisher.

Read the comments here: AAI Comments on USDA’s Proposed Rulemaking on Fair and Competitive Livestock and Poultry Markets