Animal Identification:
Liability Exposure and Risk
Management
Prepared by:
Doug O’Brien, Senior Staff Attorney
Michael Roberts, Director
National Agricultural Law Center
University of Arkanas School of Law
Email: [email protected]
Western Extension
Marketing Committee
Western Center for
Risk Management
Education
Overview
• Concerns that NAIS will make it easier to
trace cattle in lawsuits.
• NAIS does not require that carcass and
meat be traced through packing plant.
• NAIS is one more step toward traceability
throughout the supply chain.
• Liability is different than confidentiality.
General Liability and NAIS
• Livestock producers have always been liable for
practices they employ that injure someone else.
• Practices include treating animals with illegal
drugs, ignoring withdrawal times, leaving a
broken needle in muscle, or other poor
management practices.
• NAIS may help identify which producer
implemented the practice if the meat is
traceable through the plant.
NAIS and Negligence
• Negligence is failure to exercise reasonable
care.
• In negligence action, the plaintiff must show
that producer failed to exercise reasonable care
and caused the harm.
– If a plaintiff suffered E-coli poisoning and sued
feeder, plaintiff would need to show that feeder’s
management practices were not reasonable and that
something the feeder did caused the E-coli
contamination.
NAIS and Strict Liability
• Strict liability is imposed when one has introduced a
defective product that is unreasonably dangerous into
the stream of commerce.
• Strict liability is different than negligence because strict
liability is not concerned with duty of care or
reasonable behavior.
• Unclear whether animals would be defined as
“unreasonably dangerous product”, but probable that
some courts would so find.
– It is likely that a plaintiff that is infected by meat tainted with
BSE could sue a feeder using a strict liability theory, even
though farmer had no way of knowing that the feed that caused
BSE was tainted.
• The critical issue for strict liability is whether the
plaintiff establishes that the defendant caused the harm.
• If third party altered the product between the feeder and
the consumer, the feeder would not be liable.
Practical Litigation Concerns
• In a food safety lawsuit, consumer may attempt to sue
everyone in the stream of commerce, although plaintiffs
may avoid ranchers and feeders who have little money.
• Even if found not liable, lawsuits can be very expensive.
• Cases where farmer or rancher is found liable for
consumer harm is very rare because:
– Farmers and ranchers lack deep pockets;
– Meat usually not traceable through packing plant; and
– Farmers or ranchers rarely do anything that causes harm to
consumer.
• The ability to identify a particular animal may shield a
livestock producer from being unnecessarily included in
a lawsuit.
Ways to Limit Risk of Liability
• Liability insurance.
• Keep thorough records of your best management
practices.
• Structure business to limit liability.
– Move ownership of livestock into a limited liability company.
• State laws that exempt livestock production from implied
warranty laws.
– Would protect ranchers and feeders from strict liability claims
involving diseased animals.
– Many states have some version of this law.
– Does not protect one from negligence claims.
Conclusion
• NAIS by itself not likely to increase
risk of liability because meat must be
traceable through plant.
• Farmers and ranchers can deal with risk
of liability through employing sound
management practices, keeping good
records, and exploring insurance
possibilities.
Contact Information
Doug O’Brien
University of Arkansas School of Law
National Agricultural Law Center
479.575.7642
[email protected]