August 17, 2010

Center for Food Safety v. Vilsack: Court Follows Geertson Seed Farms in Declining to Issue Injunction

In the first post-Geertson decision dealing with the environmental impact of genetically modified crops and the remedies available to impacted plaintiffs, a federal district judge in the Northern District of California recently vacated the Animal and Plant Health Inspection Service's (APHIS) decision to deregulate (or approve for planting) genetically modified sugar beet seeds. See Center for Food Safety et al. v. Vilsack, Court No. 08-CV-00484 (N.D. Cal).

The vacatur order once again makes the GM sugar beet seeds a "regulated" article under the Plant Protection Act which precludes their planting until APHIS complies with the National Environmental Policy Act (NEPA) and prepares a valid environmental impact statement (EIS), or issues permits or other partial deregulation that would allow planting.

The decision reflects an increasing judicial willingness to limit and restrict the planting of GM seeds until the environmental impact has been fully assessed, which can place significant regulatory hurdles on the GM seed pipeline. The court, however, ruled that the Supreme Court's recent decision in Geertson Seed Farms precluded the issuance of an injunction that would place further restrictions on APHIS's ability to regulate the planting of GM seed prior to the completion of the EIS.

No Preliminary Injunction, But Defendants Advised to Use Conventional Seed

In September 2009, the court ruled that APHIS's approval for planting of the GM sugar beets violated NEPA because APHIS failed to perform the requisite environmental impact analysis, but declined to provide a remedy to the impacted plaintiffs. Consequently, the plaintiffs sought a preliminary and permanent injunction against the future planting of the GM sugar beet seeds.

In March of 2010, the court ruled on the plaintiffs' motion for a preliminary injunction and held that despite their success on the merits and their demonstration that they would likely be irreparably harmed from seed contamination if an injunction was not issued, a preliminary injunction was not warranted in light of the plaintiffs' five-year delay in seeking an injunction and the industry's overwhelming conversion to GM sugar beet seeds. The court, however, warned defendants that its decision on the preliminary injunction was not to be viewed as indicative of its determination on the request for a permanent injunction as they should "take all efforts, going forward, to use conventional seed."

District Court Vacates APHIS Deregulation Order

As the plaintiffs had prevailed on the merits and the court had declined to issue a preliminary injunction, the remaining issues for resolution were: (1) whether APHIS's approval of the GM sugar beets for planting should be vacated, or only remanded back to APHIS (i.e. whether planting of the GM sugar beets would be allowed during the environmental review period); and (2) whether to issue a permanent injunction against the planting of the GM sugar beets.

Between the March denial of plaintiffs' motion for a preliminary injunction and the August 2010 hearing on remedies, the Supreme Court announced its opinion in Monsanto Co. v. Geertson Seed Farms. In Geertson Seed Farms, the Supreme Court faced a similar dispute in which district court had vacated APHIS's approval for planting a GM alfafa seed and also permanently enjoined its future planting. In reviewing the relief provided, the Supreme Court held that a permanent injunction was unnecessary because the re-regulation of the seed sufficiently protected the plaintiffs from genetic drift and it inappropriately preempted APHIS's authority to consider interim measures.

In light of the Geertson Seed Farms ruling, the district court vacated APHIS's deregulation order and remanded the case back to APHIS for further consideration.

The court held that although it potentially had the discretion to leave the invalid deregulation order in effect while APHIS conducted an EIS, the court declined to exercise its discretion because it found that the current case did not meet the high standards required for remand without vacatur (a standard principally met only in those cases involving "serious irreparable environmental injury."). In so ruling, the court declined to recognize Monsanto's claim that the vacatur would cause it significant economic harm as a factor. The court did, however, limit the vacatur to the planting of GM sugar beet seeds planted after the date of the order to avoid the destruction of GM sugar beet crops already planted.

The federal district court also refused to grant APHIS a nine-month stay of the vacatur because it found that APHIS had already had sufficient time to implement any necessary interim measures. The court also expressed concern that APHIS's position that the deficiencies associated with its review were minimal, and that it would only be a matter of time before the order was reinstated, indicated that APHIS was not taking the process seriously enough.

Next Fight: Partial Approval of GM Seed Planting During Review

On the issue of the permanent injunction, however, the district court held that a permanent injunction preventing the planting of the genetically modified seeds was unnecessary and inappropriate. Specifically, the court held that Geertson prevented the issuance of an injunction when a "less drastic remedy" was sufficiently able to redress the plaintiffs' injury. In so ruling, the court rejected the plaintiffs' argument that APHIS would be unable to sufficiently prevent growers from violating deregulation order as too speculative to warrant an injunction—particularly after Geertson.

In sum, this decision reflects the increasing willingness of courts to require APHIS to prepare a formal EIS in advance of deregulating GM seeds—which could potentially slow down the approval process during the pendency of this review. As it stands to date, however, APHIS is not barred from partially approving for planting the GM sugar beet seeds pending final agency approval. As in Geertson, the next likely battle in the GM seed context will center on whether a partial approval for planting can adequately protect conventional farmers from exposure while the environmental reviews are conducted—a decision which will ultimately have a significant impact on the agricultural biotechnology sector.

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