A federal court on Friday, March 28, rejected a legal challenge of the U.S. Mandatory Country-of-Origin-Labeling (COOL) law by the American Meat Institute and other meat and livestock DC Circuit Court denies COOL appealindustry stakeholders. The industry groups appealed a decision of a lower court and requested a preliminary injunction over COOL rules while the lawsuit proceeds.

The groups argued that COOL requirements violate First Amendment rights and go beyond the intent of Congress with requirements to label points of production, including where an animal was born, where it was raised, and where it was slaughtered. According to AMI, the MCOOL rules constitute compelled speech because under the Constitution, commercial speech can be compelled only where it serves a substantial government interest. They say the rules to not directly advance government interest and will impose significant regulatory and financial costs on the industry.

Judge Stephen F. Williams of the U.S. Court of Appeals for the District of Columbia affirmed the lower court’s Sept. 11, 2013, decision and denied the request for the preliminary injunction, which will allow COOL to remain in place while the case is pending.

In addition to AMI, plaintiffs include the American Association of Meat Processors, Canadian Cattlemen’s Association, Canadian Pork Council, National Cattlemen’s Beef Association, National Pork Producers Council, North American Meat Association, and Southwest Meat Association.

In response to the assertion that COOL “merely satisfies consumers’ curiosity,” the court said “We can see non-frivolous values advanced by the information. Obviously it enables a consumer to apply a patriotic or protectionist criteria in the choice of meat. And it enables one who believes that United States practices and regulations are better at assuring food safety than those of other countries, or indeed the reverse, to act on that premise.” The court said it believed those goals are worthy of ‘minimal intrusion’ of First Amendment rights.

In response, AMI interim president James Hodges said, “We disagree strongly with the court’s decision and believe that the rule will continue to harm livestock producers and the industry with little benefit to consumers.”

AMI is now reviewing its options as it moves forward.

COOL went into effect in March 2009. Canada and Mexico challenged the U.S. law’s legality under international trade rules established by the World Trade Organization. The WTO ruled that certain COOL requirements discriminated against foreign livestock and were not consistent with trade obligations, and required the U.S. to comply with the findings by May 2013. The U.S. response was to require details of each production step, including where the animal is born, raised and slaughtered, to be on the MCOOL label. Additionally, the final rule prohibited the use of the multi-country label and eliminated the mixed-origin label.

Canada and Mexico, the United States’ two largest trading partners, objected to the U.S. changes, and the WTO process continues today. Oral arguments were heard earlier this spring and a ruling from the WTO is expected in June.

If the WTO again rules in favor of Canada and Mexico, the countries could impose retaliatory tariffs on a broad range of U.S. products, from beef and pork to wine, produce, baked goods, furniture and more, totaling more than $2 billion per year.