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By: Evin Bachelor, Tuesday, May 21st, 2019

A jury recently returned a verdict awarding a California couple $2.055 billion (yes, billion) in damages after the couple alleged that the glyphosate in Roundup caused their cancer.  This is the third California jury to be convinced that the Monsanto herbicide, which was acquired by Bayer last year, caused or substantially contributed to a cancer diagnosis of non-Hodgkin lymphoma.  A lot has happened since we last reported on these lawsuits HERE and HERE, so it is time to look at the glyphosate lawsuits, jury verdicts, and the larger debate.

Thousands of glyphosate lawsuits have been filed against Monsanto/Bayer.  Over 13,000 cases have been filed alleging almost the same thing: that a plaintiff’s cancer was caused by the glyphosate in Roundup.  About two years ago there were only a few hundred such cases.  News stories about large jury verdicts have caught people’s attention, as have commercials that some law firms have aired to find clients for this type of litigation.  The vast majority of these cases have been brought in state courts, which have a reputation for being somewhat quicker than federal courts, but there are still over a thousand in federal courts across the country.  So far, only three of these cases have reached a jury, and all have been in California.

First California jury awarded a plaintiff $289 million.  Dewayne Johnson was a school groundskeeper who routinely used Roundup as part of his job.  He was diagnosed with non-Hodgkin’s lymphoma in 2014, and believed that his diagnosis was a result of at least two prior incidents where he was soaked with Roundup.  His lawsuit against Monsanto in California state court was chosen to be the first case to be tried before a jury because his doctors did not expect him to live for much longer.

The San Francisco jury sided with Mr. Johnson and awarded him $39 million in compensatory damages, and $250 million in punitive damages.  Compensatory damages are meant to directly compensate for harm, and can include medical expenses, lost wages, and emotional distress.  Punitive damages, on the other hand, are meant to punish the party in the wrong and deter a similar course of conduct in the future.  The judge in the case ultimately reduced the punitive damages to match the compensatory damages, leaving Mr. Johnson with a potential $78 million recovery.  However, the decision is on appeal.

Second California jury awarded a plaintiff $80 million.  Edwin Hardeman sprayed Roundup on his property for about three decades.  In 2014, he was diagnosed with non-Hodgkin’s lymphoma, and decided to file a lawsuit two years later after learning about research connecting his form of cancer to Roundup use.  His lawsuit was the first to be heard in federal court.  This San Francisco jury awarded Mr. Hardeman $5.8 million in compensatory damages, and $75 million in punitive damages.  However, the decision is also on appeal.

Third California jury awarded the plaintiffs $2.055 billion.  The first two cases certainly sent shock waves through the news, but the size of this third jury award sent more than just shock.  The plaintiffs, Alva and Alberta Pilliod, are a California couple who were diagnosed with non-Hodgkin’s lymphoma within four years of each other.  The jury awarded the couple $55 million in compensatory damages, along with $1 billion in punitive damages each.  Bayer has promised to appeal this decision as well.

Will the parties ultimately get these punitive damages?  It is hard to answer this question just yet, but it is likely that the punitive damages awards will be reduced.  Courts are often weary about awarding punitive damages absent bad intentions by the party being punished, and few verdicts result in a punitive damages award.  When they are awarded, there are constitutional limitations on how large the award can be.  The U.S. Supreme Court has said that a punitive damages award that exceeds a compensatory damages award by more than a single digit multiplier likely violates a party’s due process rights and is not likely to be upheld.  This means that if a punitive damages award exceeds nine or ten times the compensatory damages, courts are to look at that jury’s decision with a high level of suspicion.  However, such an award could ultimately be awarded if the evidence of bad intent merits such an award, and if such award is necessary to deter future bad acts.

Bayer’s first hope on appeal is to have the jury decisions invalidated altogether by arguing that the juries were incorrect in linking these plaintiff’s cancer to their prior use of Roundup.  In order to succeed, it must prove that the decisions of the three juries were against the “manifest weight of the evidence,” meaning that they relied too much on one pile of evidence leaning one way while ignoring a mountain of evidence going the other way.  If it can succeed on this, then it would not have to pay damages to the plaintiffs.  However, this can be a high burden for an appellant to satisfy because of our legal system’s deference to juries.  If Bayer cannot succeed on avoiding fault, it would still argue that the jury awards are excessive.

In the first case, the initial jury award had a single digit multiplier of roughly six; however, the judge viewed even that multiplier as excessive and reduced the punitive damages award to match the compensatory damages award.  In the second case, the initial jury award had a multiplier of over twelve, which could give Bayer a strong argument on appeal if it is ultimately determined that it must pay the plaintiffs.  However, Bayer is also challenging the basis of the jury’s decision on appeal.

The third case is simply on a different level.  The $2 billion in punitive damages is 36 times the compensatory damages awarded to the couple.  The trial judge may respond like the first trial judge and reduce the compensatory damages award; however, that is not a guarantee.  What is likely a guarantee is that Bayer will appeal.

Does glyphosate cause non-Hodgkins lymphoma?  This question will continue to be a debate for years, and we as attorneys are not in the best spot to make any sorts of determinations based on the scientific research.  The U.S. Environmental Protection Agency and a number of scientific studies say no; however, the World Health Organization said in 2015 that glyphosate was “probably carcinogenic to humans.”  It was that announcement, and some research that followed, which triggered the wave of lawsuits we see today.  Bayer is using the first set of research to defend its product, while the plaintiffs are using the second set of research to attack Roundup.  The attorneys in the first three cases tried to undercut Bayer’s use of EPA and university research by arguing Monsanto had influenced the first set of research in a manner favorable to it.

For better or worse, what matters in a jury trial is less what the science says, and more what the jury believes the science says.  So far, three California juries have been convinced that there is enough science to say that glyphosate caused or contributed to the cancer of four plaintiffs.  The first non-California cases are beginning to be scheduled for later this year, including in Monsanto’s former home in St. Louis.  As of now, it remains to be seen whether the first three cases will be the outliers or the norms for the glyphosate litigation nationwide.

By: Ellen Essman, Thursday, May 16th, 2019

In January, we wrote about state “ag-gag” laws and the trend of federal courts overturning such laws nationwide.  “Ag-gag” is the term for fraud and trespass laws that aim to prevent undercover journalists, investigators, animal rights advocates, and other whistleblowers from secretly filming or recording at agricultural production facilities. We specifically discussed a case in Iowa, where the state’s “agricultural production facility fraud law” was found to be unconstitutional on First Amendment grounds in the federal District Court for the Southern District of Iowa.  In response to that ruling, the legislature modified the law, but a group made up of animal rights, community, and food safety organizations has again sued the state.  The plaintiffs contend that the new law still violates the First and Fourteenth Amendments to the Constitution. 

Iowa law: current and former

Shortly following the aforementioned district court decision, Iowa passed a new ag-gag law with slightly different language.  The new Iowa law changes the crime from “agricultural production facility fraud” to “agricultural production facility trespass.” The legislature also changed the language from outlawing false statements or pretenses to outlawing deception.  Another important change is the focus in the new statutory language on the “intent to cause physical or economic harm or other injury” to the farm.    

The new law reads:

717A.3B Agricultural production facility trespass.

1. A person commits agricultural production facility trespass if the person does any of the following:

a. Uses deception as described in section 702.9, subsection 1 or 2, on a matter that would reasonably result in a denial of access to an agricultural production facility that is not open to the public, and, through such deception, gains access to the agricultural production facility, with the intent to cause physical or economic harm or other injury to the agricultural production facility's operations, agricultural animals, crop, owner, personnel, equipment, building, premises, business interest, or customer.

b. Uses deception as described in section 702.9, subsection 1 or 2, on a matter that would reasonably result in a denial of an opportunity to be employed at an agricultural production facility that is not open to the public, and, through such deception, is so employed, with the intent to cause physical or economic harm or other injury to the agricultural production facility's operations, agricultural animals, crop, owner, personnel, equipment, building, premises, business interest, or customer.

Iowa law defines “deception,” in part, as “knowingly…[c]reating or confirming another’s belief or impression as to the existence or nonexistence of a fact or condition which is false and which the actor does not believe to be true,” or “[f]ailing to correct a false belief or impression as to the existence or nonexistence of a fact or condition which the actor previously has created or confirmed.”

The previous Iowa law, which was struck down in a district court decision, is currently still available on the Iowa Legislature’s website.  The old law made it illegal to gain access to a facility through false pretenses and to make a “false statement or representation” in order to be employed by an agricultural production facility.  Note that the former law did not use the word “deception,” or touch on injury to the farm. 

In the district court decision overturning the previous law, Judge Gritzner agreed with the plaintiffs that the language of the law violated the First Amendment right to free speech because it was content-based, viewpoint based, and overbroad. He decided that even though the law banned false statements, such false statements are still protected under the First Amendment.  In other words, just because Iowa livestock operators do not like the speech of the activists and whistleblowers trying to gain access to their farms, it does not mean that the speech should be infringed upon. 

Animal rights groups and others challenge the new law

On April 22, 2019, shortly after the passage of Iowa’s new law, plaintiffs filed suit against the state once again in the U.S. District Court for the Southern District of Iowa.  Plaintiffs include Animal Legal Defense Fund, Iowa Citizens for Community Improvement, Bailing out Benji, People for the Ethical Treatment of Animals, Inc., and the Center for Food Safety.  In their complaint against the state of Iowa, plaintiffs contend that the new law still violates the Constitution, saying that “the only difference” between the two laws is that the new law “targets a slightly different form of speech.”  In other words, Iowa has changed its law from outlawing false statements or pretenses to outlawing deception, but the plaintiffs believe the new law basically ends up doing the same thing as the old, overturned ag-gag law; it prevents their speech based on content and viewpoint. Plaintiffs rely on the following arguments to illustrate their reasoning:

  • Iowa’s new law bans any negative speech about the agricultural industry, which creates a preference for speech favorable to the industry. 
  • Whistleblowing is not criminalized in other Iowa industries.
  • Iowa statutes already outlaw fraud, trespass, and adulteration of food products, as well as the theft of trade secrets, so agriculture already has adequate protection from economic harm. 
  • Outlawing deception “with the intent to cause…other injury” is too vague; it is not easily discernable what other kinds of speech or actions might be illegal under the statute.

As such, the plaintiffs allege that the Iowa law violates freedom of speech under the First Amendment because it is overbroad, viewpoint-based discrimination, and because it is vaguely written under the First and Fourteenth Amendments. Finally, plaintiffs contend that the law violates the Fourteenth Amendment’s Due Process clause because it “substantially burdens” their exercise of free speech.  The court must determine whether or not they agree with this assessment. 

Many “ag-gag” statutes struck down as unconstitutional, but many more decisions to go

As was mentioned in our January blog post, there is ongoing ag-gag litigation outside of Iowa, as well.  Kansas and North Carolina have both been sued for their ag-gag statutes, and both cases are still pending.  Will the federal courts find laws in Iowa, Kansas and North Carolina unconstitutional like they have previously in Iowa, as well as in Idaho, Utah and Wyoming, or will they find that they do not violate freedom of speech and due process?  Will lawsuits challenge the remaining ag-gag laws in Alabama, Arkansas, Missouri, Montana, and North Dakota? The answers may take a while to sort out.  

By: Evin Bachelor, Wednesday, May 15th, 2019

Lawsuits can be a long and drawn out process, and the Lake Erie Bill of Rights (LEBOR) lawsuit has demonstrated that.  Two and a half months after the complaint in Drewes Farm Partnership v. City of Toledo was filed by the farm, which parties will be allowed to participate in the lawsuit is becoming somewhat clearer, but it might not be over yet.  However, a conference call between the court and the current parties scheduled for the end of this week may signal that some substantive action is on the horizon.

The State of Ohio is now a party.  Judge Zouhary granted Ohio Attorney General Yost’s motion to intervene, making the State of Ohio a party to the lawsuit.  The procedural rules for federal courts permit non-parties to ask a court to allow them into a lawsuit either as of right or at the judge’s discretion.  As of right means that a statute, rule, or case gives a non-party a right to enter into a lawsuit as a party.  In contrast, a discretionary intervention allows a judge to grant a motion to intervene at his or her discretion so long as the person or entity seeking to intervene has a “common question of law or fact” with a current party to the lawsuit.  Non-parties often argue both in order to cover all of their bases, which is what the Ohio Attorney General did in this case.  Judge Zouhary focused his analysis on discretionary intervention, and found that the state has asserted the same question as the plaintiff, Drewes Farms, in that Ohio’s constitution, statutes, and administrative regulations preempt the LEBOR amendment to Toledo’s city charter.  The court also noted that the City of Toledo did not oppose the state’s intervention.  Based on these points, the court granted the motion to intervene.  The State of Ohio may now make arguments and participate in the lawsuit as a full party.

Lake Erie Ecosystem and Toledoans for Safe Water are denied party status.  Days after allowing the Ohio Attorney General’s intervention, Judge Zouhary decided that neither Lake Erie nor Toledoans for Safe Water will be allowed to intervene as parties.  Much like the Ohio Attorney General, these non-parties made arguments to support both forms of intervention.  Judge Zouhary believed that neither Lake Erie nor Toledoans for Safe Water met the requirements for either form of intervention.  As for Toledoans for Safe Water, the court found that it had no right to intervene since it does not have a substantial interest in defending the charter amendment.  Just being the group that put LEBOR on the ballot is not enough.  Further, since the group recognized that its arguments about the rights of nature are novel and not currently recognized in U.S. law, allowing the party to intervene and make these arguments would cause undue delay.  As for Lake Erie, Judge Zouhary noted that the only basis for intervention cited in the motion was LEBOR itself, and that LEBOR only gave Lake Erie the right to enforce its rights in the Lucas County Court of Common Pleas.  Therefore, neither Lake Erie nor Toledoans for Safe Water will be able to participate in the lawsuit at this time.

But Lake Erie Ecosystem and Toledoans for Safe Water still want in.  Shortly after their motions to intervene were denied, Lake Erie and Toledoans for Safe Water filed two documents with the court: a motion to stay pending appeal and a notice of appeal.  First, the motion to stay pending appeal asks the court to pause the proceedings while the non-parties ask an appellate court to review Judge Zouhary’s decision.  Their hope is that no decisions would be made in their absence should the appellate court decide that their intervention should be granted.  Drewes Farm has already filed a brief in opposition to the motion to stay, which asks the court to continue the case as quickly as possible.  Second, the notice of appeal is a required notice to the court and the parties that an appeal of a judge’s decision has been made to the U.S. Sixth Circuit.  An appeal of this sort, especially one involving a discretionary act, imposes a high burden on the appellant in order to succeed.

Conference call set for Friday, May 17th regarding a Motion for Judgment on the Pleadings.  On May 7th, Judge Zouhary issued an order stating that the parties must submit letters in a joint filing regarding a Motion for Judgment on the Pleadings.  Our case law updates often talk about motions for summary judgment, but motions for judgment on the pleadings are less frequently discussed.  Motions for judgment on the pleadings are requests for the court to make a decision after a complaint and answer (and, when allowed, a reply) have been filed.  The court can make a decision at this stage only if it finds that there is no real dispute about the facts.  The parties essentially agree about what happened, and all the court has to decide is how the law applies to the facts in the pleadings.  A motion for summary judgment generally involves the presentation of additional facts that were not included in the pleadings, but makes a similar request.  The court can grant a motion for judgment on the pleadings in part, which means that some of the case will be resolved and some will continue, but these motions can also be used to end the entire case.

It would be quite interesting to be a fly on the wall during the conference call scheduled for this Friday.  It seems likely that we will hear about it soon after.  However, this conference call does not necessarily mean that this case, or even LEBOR, will be over soon.  Stay tuned to the Ohio Ag Law Blog for more case updates.

By: Evin Bachelor, Friday, May 10th, 2019

We might be in the middle of planting season, but it’s time for another harvest!  Here’s our latest gathering of agricultural law news that you may want to know:

Hemp bill completes third hearing in Ohio House committee.  The Agriculture and Rural Development Committee in the Ohio House of Representatives completed its third hearing regarding Senate Bill 57 on Tuesday.  The bill would decriminalize hemp produced under the regulatory system proposed in the bill.  The committee heard testimony from nearly two dozen individuals and organization representatives.  None of the witnesses gave testimony in opposition to the bill.  Nearly all of the testimony, including the testimony given on behalf of the Ohio Farm Bureau Federation and Ohio Chamber of Commerce, was offered in support of the bill.  The Ohio Farmers Union submitted testimony only as an “interested party” rather than as a “proponent,” saying that it supports the principle of hemp decriminalization, but does not believe that the hemp marketing program established in the current version of the bill would be necessary.  Click HERE to view the witness testimony regarding Senate Bill 57 on the Ohio General Assembly’s webpage.

Food and Drug Administration sets public hearing on cannabis in food and drinks.  The U.S. Food and Drug Administration has set May 31, 2019 as the date of its first hearing on whether to legalize the use of cannabis derived compounds like CBD in foods and drinks.  According to the Federal Register, the hearing is open to the public, and intended for the FDA to obtain scientific data and information about the safety, manufacturing, product quality, marketing, labeling, and sale of products containing cannabis or cannabis-derived compounds.  The hearing will be held in Maryland on May 31st, but those wishing to submit written or electronic comments may do so until July 2nd.  Click HERE for more information from the Federal Register about the hearing.

Cattle ranchers file class action suit against major meatpacking companies.  The Ranchers-Cattlemen Action Legal Fund United Stockgrowers of America (R-CALF USA) and six other named parties brought suit against major meatpackers, including Tyson Foods, JBS USA, Cargill, and National Beef Packing Company.  Filed in federal court in the Northern District of Illinois, the plaintiffs’ complaint alleges that these meatpackers colluded to suppress the price of fed cattle since at least 2015, and that as a result, the plaintiffs suffered significant economic harm from the deflated prices.  When companies agree to set prices for an industry, they engage in collusion, which could violate U.S. antitrust laws.  The 121 page complaint includes a number of charts, graphs, and visuals that explain the alleged economic manipulation, along with a thorough history of an alleged pattern of collusion.  If the federal judge certifies the class as requested, other cattle ranchers will have the choice of whether to be included in the class or not.  This is important in determining whether the unnamed members of the class are bound by a final decision or able to participate in any settlement or final award.  Click HERE to view the complaint and learn more about this lawsuit.

Indiana Right-to-Farm law upheld by Court of Appeals of Indiana.  When a federal court in North Carolina decided that that state’s right-to-farm law did not protect hog barns operated by Smithfield Foods in lawsuits alleging agricultural nuisance, there was concern that right-to-farm laws in the United States may be in trouble.  However, those fears have begun to subside in other states.  As we explained in a previous blog post, Ohio’s right-to-farm law provides greater protections from a nuisance lawsuit than North Carolina’s law.  Further, the Court of Appeals of Indiana recently upheld the use of Indiana’s Right to Farm Act.  In doing so, it upheld a lower court decision that granted summary judgment in favor of the defendant livestock operators.  At the start of the case, the plaintiffs alleged that the defendants created a nuisance, acted negligently, and caused a trespass when the defendants constructed and began to operate a new concentrated animal feeding operation in 2013.  However, the defendants cited Indiana’s Right to Farm Act as a defense and won.  The plaintiffs sought to challenge the constitutionality of the Indiana’s Right to Farm Act, but the appellate court found that the law was within the legislature’s proper authority, did not constitute a taking, and did not improperly set farmers apart for preferential treatment.  The original plaintiffs have a few more days to file an appeal with the Indiana Supreme Court.  Click HERE to read the appellate court’s opinion.

State of Washington passes cage-free egg production law.  Washington is set to join states like Massachusetts and California in requiring egg-laying hens to live free of cages.  Once signed into law by the governor, Substitute House Bill 2049 would require poultry operators to use a cage-free housing system that would allow hens to roam within the confined area by 2023.  Further, hens must be “provided enrichments that allow them to exhibit natural behaviors including, at minimum, scratch areas, perches, nest boxes, and dust bathing areas.”  Farm employees must be able to provide care while standing in the hens’ usable floor space.  The bill would also make it illegal to buy, sell, or transport eggs and egg products that were not produced in compliance with the state’s cage free egg production law.  The Humane Society of the United States spearheaded the legislative effort on this bill, which initially passed the Washington House of Representatives 90-6 and the Senate 40-6.  Click HERE for more information about the bill’s status, and HERE to read the final text of the bill.

Missouri legislature considers ending local regulation of CAFOs.  The Missouri General Assembly is considering a pair of bills that would 1) limit the ability of county commissions and health boards from imposing restrictions on confined animal feeding operations that are more stringent than state law, and 2) eliminate the authority of county commissions and health boards from inspecting livestock operations.  So far, each bill has passed one chamber of the Missouri General Assembly, and is being considered in the other chamber.  Supporters argue that the bills would provide for regulatory consistency across the state in light of varying local regulations.  Opponents argue that the bills would harm local jurisdictions from enacting restrictions that better protect the environment than current state law.  This debate is similar to recent and ongoing debates in states like Tennessee and Wisconsin over which entities can regulate confined animal feeding operations, and how much.  Click HERE for more information about Missouri’s Senate Bill 391, and HERE for more information about Missouri’s House Bill 951.

By: Ellen Essman, Thursday, April 25th, 2019

A case out of the Fourth Appellate District in Gallia County serves as a lesson for farmers in Ohio who have roadside stands and sell products using the honor system.  This case involves a honey stand owned by Frederick Burdell.  He kept cash in the freezer at his stand so customers could make change for their purchases. The case, State v. Montgomery, was an appeal from the Gallipolis Municipal Court’s conviction of first-degree misdemeanor theft of honey and money from a “self-service honey stand.”

On appeal, the person convicted of theft claimed that the State of Ohio did not have enough evidence to convict her, and that her conviction was against the manifest weight of the evidence.  In other words, she argued that the State did not have enough evidence to prove, beyond a reasonable doubt, that she committed the crime.  The appellate court did not agree with the defendant’s argument; her conviction was upheld.  For owners of roadside stands, the most relevant part of this case may not be the legal arguments, but instead, the evidence that was provided by the owner of the honey stand.  Mr. Burdell’s surveillance setup around the honey stand helped the jury find the defendant to be guilty of theft.  Owners of roadside stands for honey and other agricultural products should take note of the tools Mr. Burdell had in place to surveil his stand, as well as what he might have done to better protect his business from theft. 

The appellate court’s opinion reveals that Mr. Burdell had multiple cameras set up around the honey stand, which were able to capture footage of a car driving down the driveway and a passenger exiting the car.  From another viewpoint, a camera was able to record the defendant taking two items out of the refrigerator and all the cash from the freezer.  Another shot provided a close-up, “head to toe” view of the woman walking away.  What is more, the video captured the actions in color—so the jury was able to see the color of the car and the hair color of the thief.  The appellate court found that the video evidence was sufficient enough for the trial court to reach the decision that the defendant was the perpetrator.

 Owners of roadside stands can learn from Mr. Burdell’s set-up if they want to protect themselves from theft.  Multiple color cameras placed at multiple angles around the area helped Mr. Burdell recover some of his loss from the theft.  Owners may want to test cameras to make sure they are set up at good angles.  In addition, although it is not clear from this opinion whether or not Mr. Burdell had security lights and other lighting around his stand, owners of roadside stands may want to consider the lighting around their premises—inadequate lighting might be detrimental to seeing what is happening in surveillance footage.

 The trial court ultimately awarded Mr. Burdell $20 in restitution for the theft, which was the value of the honey stolen.  Mr. Burdell was not reimbursed for the money that was stolen, apparently because he could “not state…with certainty” how much money was taken from the freezer, instead he guessed it could have been up to $50.  There are certainly numerous tools roadside stand owners can use to keep track of money in their stands more accurately.  Owners can keep detailed records of what products are in their stand at any given time and their prices, so they know exactly how much money should be in the cash box at all times, even after customers make change.  Roadside stand owners can also make sure they or an employee or family member monitors the area around the stand from time to time, counts the cash, and possibly take away excess cash not needed at the site and store it in a safer place.  Essentially, any actions an owner can take to keep track of how much cash is in a stand with more accuracy could prove helpful in recovering stolen cash if they ever find themselves in a situation like Mr. Burdell. 

While the theft from Mr. Burdell’s self-service honey stand was unfortunate, it may serve as a helpful reminder to farmers who own similar honey, produce, or other stands of what they can do to protect their businesses.  It is also timely information as farmers prepare for spring and summer sales from roadside stands.  For those interested in more information on the case, the full opinion is available here

By: Evin Bachelor, Wednesday, April 24th, 2019

Since our last legislative update in March, Ohio’s legislators and staffers have been busy introducing more legislation.  As of this morning, there are 332 bills that have been introduced by members of the Ohio General Assembly since January.  Some have already passed both the Ohio House and Senate, but most are still pending.  While we cannot write about every pending bill, the following bills relate to agricultural, local government, or natural resource law.  In addition to these bills that we have not yet covered, see the end of this post for an update about bills we mentioned in our last blog post.

Tax

  • Senate Bill 183, titled “Allow tax credits to assist beginning farmers.”  Many agricultural news outlets quickly picked up on this bill.  The bill would authorize two nonrefundable tax credits.  One is for beginning farmers who attend a financial management program, while the other is for individuals or businesses that sell or rent farmland, livestock, buildings, or equipment to beginning farmers.  The Ohio Department of Agriculture would be responsible for certifying individuals as beginning farmers and for approving eligible financial management programs.  Click HERE for more information about the bill, and HERE for the current official bill analysis.
  • House Bill 109, titled “Grant tax exemption for land used for commercial maple syruping.”  The bill would exempt “maple forest land” from having to pay property taxes.  The landowner would have to apply for the designation with the Ohio Department of Taxation.  Eligible lands are those lands bearing a stand of maple trees where 1) an average of at least thirty taps are drilled each year into at least fifteen different maple trees per acre of land, 2) the harvested sap is incorporated into a maple product for commercial sale, 3) the land is managed under a forest land maintenance plan, and 4) the property has ten or more acres or the sap harvest produces an average yearly gross income of more than $2,500.  Note that all four requirements must be met in order to qualify as an exempt maple forest land.  Click HERE for more information about the bill.

Real property

  • House Bill 103, titled “Change law relating to land installment contracts.”  Ohio’s Land Installment Contract Law, which applies to contracts involving properties with a residence but not contracts involving only open farmland, would see some significant changes under this proposed legislation.  The bill would shift the burden of paying property taxes and homeowner’s insurance from the buyer to the seller.  The seller would also be prohibited from holding a mortgage on the property.  The contract would have to include provisions stating that the seller is responsible for all repairs and maintenance on the property.  Interest rates would also be capped so that the rate cannot exceed the Treasury bill rate for loans of the same length of time by 2%.  For example, if a 5-year land installment contract is entered into on September 7th and the 5-year Treasury bill rate on that day is 2.64%, the interest rate for the land installment contract would not be able to exceed 4.64% under this bill.  Click HERE for more information about the bill, and HERE for the current official bill analysis.

Estate planning

  • House Bill 209, titled “Abolish estate by dower.”  Dower provides a surviving spouse with rights in any real property owned by a decedent spouse.  This bill would end dower estates moving forward, but any interests that vest before the change would take effect would still be valid.  Click HERE for more information about the bill.

Local government

  • Senate Bill 114, titled “Expand township authority-regulate noise in unincorporated area.”  A board of township trustees is currently limited to regulate noise coming from either areas zoned as residential or premises where a D liquor permit has been issued.  The bill would expand the township’s authority to regulate noise anywhere within the unincorporated territory of the township.  However, the bill does not affect another section of the law that exempts agriculture from noise ordinances, so agricultural activities would not be subject to any new noise ordinances, should this law pass.  Click HERE for more information about the bill, and HERE for the current official bill analysis.
  • Senate Bill 12, titled “Change laws governing traffic law enforcement.”  Notably for townships, this bill would prohibit township law enforcement officers or representatives from using a traffic camera on an interstate highway.  Click HERE for more information about the bill, and HERE for the current official bill analysis.

Regulation of Alcohol

  • House Bill 181, titled “Promote use of Ohio agricultural goods in alcoholic beverages.”  The bill would authorize the Ohio Department of Agriculture to create promotional logos that producers of Ohio craft beer and spirits may display on their products.  Specifically, the bill would authorize an “Ohio Proud Craft Beer” and an “Ohio Proud Craft Spirits promotion.  Click HERE for more information about the bill.
  • House Bill 160, titled “Revised alcoholic ice cream law.”  Under current Ohio law, those wishing to sell ice cream containing alcohol must obtain an A-5 liquor permit and can only sell the ice cream at the site of manufacture, and that site must be in an election precinct that allows for on- and off-premises consumption of alcohol.  This bill would allow the ice cream maker to sell to consumers for off-premises enjoyment and to retailers that are authorized to sell alcohol.  Click HERE for more information about the bill.
  • House Bill 179, titled “Exempt small wineries from retail food establishment licensing.”  The bill would exempt small wineries that produce less than 10,000 gallons of wine annually from having to obtain a retail food establishment license in order to sell commercially prepackaged foods.  The sales of the prepackaged foods cannot exceed more than 5% of the winery’s gross annual receipts.  The winery would have to notify the permitting authority that it is exempt, and also notify its customers about its exemption.  Click HERE for more information about the bill.

Energy

  • House Bill 20, titled “Prohibit homeowner associations placing limits on solar panels.”  The bill would prohibit homeowners and neighborhood associations, along with civic and other associations, from imposing unreasonable restrictions on the installation of solar collector systems on roofs or exterior walls under the ownership or exclusive use of a property owner.  Condominium properties would similar be prohibited from imposing unreasonable restrictions where there are no competing uses for the roof or wall space where a solar collector system would be located.  According to the bill analysis, an unreasonable limitation is one that significantly increases the cost or significantly decreases the efficiency of a solar collector system.  Individual unit owners would also have the right to negotiate a solar access easement.  Click HERE or more information about the bill, and HERE for the current official bill analysis.
  • Senate Bill 119, titled “Exempt Ohio from daylight savings time.”  The bill would require Ohio to observe Daylight Savings Time on a permanent basis effective March 8, 2020.  The state’s clocks would spring forward in March, but there would be no falling back in the fall.  Click HERE for more information about the bill, and HERE for the current official bill analysis.

As for the bills that we previously covered in our March legislative update, the following chart explains where those bills stand.  Those that have passed at least one chamber have their passage status underlined in the column on the right.  Those that have had at least one committee hearing list the number of hearings, while those that have not had any activity in committee state only the committee that the bill has been referred to from the floor.

Category

Bill No.

Bill Title

Status

Hemp

SB 57

Decriminalize hemp and license hemp cultivation

- Passed Senate

- Completed first committee hearing in House

Watershed Planning

SB 2

Create state watershed planning structure

- Referred to Senate Agriculture and Natural Resources Committee

Animals

HB 24

Revise humane society law

- Completed third committee hearing in House

Animals

HB 124

Allow small livestock on residential property

- Referred to House Agriculture and Rural Development Committee

Oil and Gas

HB 55

Require oil and gas royalty statements

- Completed first committee hearing in House

Oil and Gas

HB 94

Ban taking oil or natural gas from bed of Lake Erie

- Referred to House Energy and Natural Resources Committee

Oil and Gas

HB 95

Revise oil and gas law about brine and well conversions

- Referred to House Energy and Natural Resources Committee

Mineral Rights

HB 100

Revise requirements governing abandoned mineral rights

- Referred to House Energy and Natural Resources Committee

Regulations

SB 1

Reduce number of regulatory restrictions

- Completed three committee hearings in Senate

Business Law

SB 21

Allow corporation to become benefit corporation

- Passed Senate

- Completed first hearings in two separate House committees

Animals

SB 33

Establish animal abuse reporting requirements

- Completed fifth committee hearing in Senate

Local Gov’t

HB 48

Create local government road improvement fund

- Referred to House Finance Committee

Local Gov’t

HB 54

Increase tax revenue allocated to the local government fund

- Referred to House Ways and Means Committee

Property

HB 74

Prohibit leaving junk watercraft or motor uncovered on property

- Completed first committee hearing in House

By: Peggy Kirk Hall, Monday, April 22nd, 2019

Disagreements over how to improve the health of Lake Erie have led to yet another federal lawsuit in Ohio.   This time the plaintiff is the Board of Lucas County Commissioners, who filed a lawsuit in federal court last Thursday against the U.S. EPA.  The lawsuit accuses the U.S. EPA of failing to enforce the federal Clean Water Act, which the county believes has led to an "alarming" decline in the water quality of western Lake Erie.

The Clean Water Act requires states to monitor and evaluate water quality and establish water quality criteria, and also to designate a water body as “impaired” if it does not meet the criteria.   Once a water body is on the impaired waters list, the state must create Total Maximum Daily Loads (TMDLs) for the water body.  TMDLs determine the maximum amounts of each pollutant that can enter a water body and still allow the water to meet the established water quality criteria.  Plans for reducing a pollutant would be necessary if the pollutant exceeds the TMDLs.  The state’s efforts to establish the water quality criteria, designate impaired waters and develop TMDLs are subject to review and approval by the U.S. EPA, who must ensure that the states are taking adequate action pursuant to the Clean Water Act.

Lucas County alleges that the U.S. EPA has failed in its Clean Water Act obligations by allowing Ohio to refuse to prepare TMDLs for the western basin of Lake Erie.  Even after another court battle forced the designation of the western basin as “impaired,” the county explains, Ohio’s EPA declared the western basin to be a low priority for TMDL development and has not yet proposed either TMDLs or an alternative plan for addressing the basin’s impaired water status.   Lucas County argues that since Ohio has not established TMDLs for the impaired waters of Lake Erie, the U.S. EPA must step in and do so.

The county also contends that the lack of state and federal action on the impaired waters status of the western basin has forced Lucas County to expend significant resources to maintain and monitor Lake Erie water quality for its residents.  According to Lucas County, such actions and costs would be unnecessary or substantially reduced if the U.S. EPA had fulfilled its legal obligations to ensure the preparation of TMDLs for the western basin.

Agricultural pollution is an explicit concern in the county’s complaint.  The development of TMDLs for the western basin would focus needed attention and remedial measures on pollution from agricultural operations, Lucas County states.  The county asserts that TMDLs would establish a phosphorous cap for the western basin and methods of ensuring compliance with the cap, which would in turn address the harm and costs of continued harmful algal bloom problems in Lake Erie.

The remedy Lucas County requests is for the federal court to order the U.S. EPA to either prepare or order the Ohio EPA to prepare TMDLs for all harmful nutrients in the western basin, including phosphorous.  The county also asks the court to retain its jurisdiction over the case for continued monitoring to ensure the establishment of an effective basin-wide TMDL.  

This is not the first TMDL lawsuit over the western basin.  In early February of this year, the Environmental Law and Policy Center (ELPC) and the Toledo-based Advocates for a Clean Lake Erie filed a lawsuit that similarly alleges that the U.S. EPA has failed to require Ohio to establish TMDLs for the western basin, which is still ongoing.  See our summary of that case here.  The case followed an earlier and successful push by the ELPC to order Ohio to declare the western basin as impaired, which the state had refused to do previously.  We explain that history here.

The newest round of litigation again highlights differences in opinion on how to remedy Lake Erie’s phosphorous pollution problem.   Like the TMDL lawsuits, a successful effort by the Toledoans for Safe Water to enact the Lake Erie Bill of Rights was also predicated on claims that Ohio and the federal government aren’t taking sufficient action to protect Lake Erie.  Lucas County made it clear that it isn’t satisfied with the state of Ohio’s approach of providing funding to promote voluntary practices by farmers to reduce phosphorous pollution, despite stating that the county isn’t “declaring war on agriculture.”  In its press conference announcing the current lawsuit, the county explained that the state’s voluntary approach won’t provide the “sweeping reforms we need.”  On the other hand, the Ohio Farm Bureau has argued that the TMDL process for Lake Erie can take years longer and be less comprehensive than the voluntary practices farmers are pursuing.  Still others believe that more research will help us fully understand the phosphorous problem and identify solutions.

As battles continue over the best approach to improving Lake Erie’s water quality, maybe all could at least agree that litigation is costly, in many ways.  An alternative but perhaps more challenging path would be appreciation of the concerns on both sides of the issue and cultivation of collaborative solutions.  Let’s hope we can find that path.  In the meantime, we’ll keep you up to date on the continuing legal battles over water quality in Lake Erie.

Read the complaint in Board  of Lucas County Commissioners vs. U.S. EPA here.

By: Evin Bachelor, Friday, April 19th, 2019

Last month a lawsuit about Ohio’s Current Agricultural Use Value (CAUV) calculation showed back up on our radar.  As we explain in another blog post, the state of Ohio uses CAUV to calculate how much tax owners of land devoted exclusively to an agricultural use must pay.  The plaintiffs sought reimbursements from the state by arguing that the state failed to properly calculate CAUV in accordance with Ohio law.  The case was dismissed by the Franklin County Court of Common Pleas, and the 10th District Court of Appeals affirmed that decision as appropriate.  However, that does not necessarily spell the end for these plaintiffs.

What started the lawsuit: good times meant higher taxes

Many farmland owners likely remember what happened around the middle of this decade to property tax assessments under Ohio’s CAUV formula as it was calculated at that time.  In part because Ohio’s CAUV assessment formula takes agricultural commodity prices into account, a couple of strong years for crop prices contributed to a drastic and generally unanticipated increase in property tax bills for farmers across the state.  Those assessment increases led to a successful effort to change the CAUV formula so that drastic fluctuations would be less likely to occur moving forward.  However, some property owners wanted a reimbursement for previous assessments, not just a new formula.

What the plaintiffs wanted: equitable restitution

The case began on June 26, 2015, when three parties filed a complaint in a county court of common pleas against the state tax commissioner.  The three plaintiffs sought a class action certification to act on behalf of all owners of Ohio lands devoted to agricultural production.  The complaint alleged that the state of Ohio illegally collected more than a billion dollars of property taxes from those owners.  Therefore, the landowners first sought repayment under the legal doctrine of unjust enrichment.

Over the next few months, the plaintiffs amended their complaint twice.  The first amended complaint added a claim for repayment under the doctrine of equitable restitution.  It also added more named plaintiffs, added then-Governor Kasich as a defendant, and asked for compensatory damages.  The second amended complaint removed the Governor and tax commissioner as defendants, added the state of Ohio as a defendant, and removed all claims except for equitable restitution and a declaratory judgment.  Lots of adjustments, but what is equitable restitution?

Equitable restitution is a type of recovery under the law that says one party has improperly benefitted at the expense of another, and therefore should return the benefit to its rightful owner.  Here, the plaintiffs argued that allegedly illegal CAUV collections meant that the state of Ohio had improperly benefitted at the expense of owners of CAUV lands.  Therefore, the state of Ohio should have to return that benefit, which would mean a return of the property tax overpayments.

However, there are two types of restitution under the law: legal and equitable.  Legal restitution is available when a plaintiff cannot assert a right of possession to a particular property but is nonetheless able to shows grounds for compensation from the defendant.  When money is involved, the distinction is largely based upon whether money clearly identifiable as belonging to the plaintiff can be traced to particular funds in the defendant’s possession.  If the money can be traced to particular funds, then equitable restitution is more likely to apply.

For example, say that a plaintiff gave a defendant a five dollar bill, but something goes wrong and the plaintiff wants her money back.  The plaintiff may have an equitable remedy if she seeks the return of that specific five dollar bill.  However, she may only have a legal remedy if she simply wants five dollars back.  This distinction played an important role in the outcome of this case.

Why the case was dismissed: lack of jurisdiction

The lawsuit was ultimately dismissed because the common pleas court determined that it could not hear the case because of the nature of the remedy sought.  Instead, in ruling on the state’s motion to dismiss, the common pleas court decided, and the appellate court affirmed, that only the Ohio Court of Claims has jurisdiction for this type of case.

The Ohio Court of Claims is a special kind of state court that exists primarily to handle lawsuits against the state of Ohio.  Its existence stems from the idea in the U.S. Constitution’s Eleventh Amendment that states have immunity as sovereigns.  States may choose if and when to be sued; however, most have waived that immunity to some extent.  Ohio chose to partially waive its sovereign immunity in particular types of cases by allowing people to sue it in a special court instead of in a county court of common pleas.

When it created the Ohio Court of Claims, the Ohio General Assembly decided that people seeking relief at law must file their lawsuit with the Ohio Court of Claims, while those seeking equitable relief may file their lawsuit with a county court of common pleas.

Restitution happens to be a type of remedy that can be classified as either legal or equitable in nature.  The focus is not on what the parties call the restitution they seek, but what they actually want from it.  In this case, it was not enough that the plaintiffs called what they wanted “equitable restitution.”  The court only cared about what the plaintiffs actually sought.

In looking at the facts, the court determined that the plaintiffs sought the return of funds that could not be traceable into any state account, and therefore the remedy sought was legal in nature.  The court explained that Ohio’s property taxes are collected and held at the county level, and there was no evidence that the CAUV property tax collected by the counties ever made it to the state.  Absent this transfer, the specific tax dollars that the plaintiffs allege were wrongfully paid to the state were not traceable to any state accounts.  Without this traceable link, the plaintiffs could only seek a return of money in general, rather than the return of specific funds.  Because of this, only the Ohio Court of Claims could hear this case and award this remedy.

It was on the basis of this distinction that the Franklin County Court of Common Pleas dismissed the case, and that the Tenth District Court of Appeals affirmed the dismissal.

What are the plaintiffs’ next steps: Ohio Court of Claims or the end?

The trial court dismissed the case “without prejudice,” meaning that the parties are not barred from filing the case again in a proper court.  This can be common when the case is dismissed on a procedural basis where there could be a claim with some merit that has neither been decided on the merits nor settled.  At this time, it does not appear that the plaintiffs have refiled the case in the Ohio Court of Claims, and we cannot predict whether or not they will do so.

The case is cited as Vance v. State, 2019-Ohio-1027 (10th Dist.), and the opinion is available on the Ohio Supreme Court’s website HERE.

By: Evin Bachelor, Friday, April 12th, 2019

Here at the OSU Extension Farm Office, we get questions about all sorts of topics, but one topic in particular shows up in our inbox rather frequently.  Line fence laws regulate those fences, sometimes called partition fences, that are located on a property boundary between adjacent parcels of land.  Ohio has had laws on this topic for well over a hundred years, and these laws represent an important piece of history in the development of property rights in our state.  While one might hope that by now all the kinks and questions would be resolved, there are still some misunderstandings and gray areas about the law that we grapple with to this day.

In order to help landowners better understand their rights and responsibilities, the OSU Extension Farm Office team has complied a number of resources about Ohio’s line fence laws on our website at farmoffice.osu.edu/our-library/line-fence-law.  When the Ohio General Assembly significantly changed the line fence provisions in the Ohio Revised Code in 2008, our director, Peggy Kirk Hall, wrote a number of fact sheets that provide an overview of the changes, summaries of key elements of the law, and also guides for townships.

The Ohio Line Fence Law Fact Sheet provides an in depth look at the 2008 changes.  It explains what a line fence is, how costs are allocated, the different types of line fences addressed, special rules for line fences containing livestock, procedures for building a fence, procedures for disputes between neighbors, and more.  A shorter summary of that same information is available in the fact sheet titled, A Summary of Ohio’s Line Fence Law.

In addition to the overviews of the law, there are also resources that explain particular aspects of the law more in depth, along with guides for township officials.  These include:

Over the course of the decade following the 2008 changes, a number of questions continued to be asked by landowners across the state, so we compiled a Frequently Asked Questions law bulletin.  Instead of only explaining what the law says, this law bulletin takes a question and answer approach that goes through questions associated with scenarios such as:

  • My neighbor wants to install a new fence on a never fenced boundary
  • My neighbor wants to permanently remove an existing fence
  • My neighbor wants to replace an old fence on our property boundary

The FAQ law bulletin also looks at the role of township trustees, and what the law says about fence construction and upkeep.

While these publications cover a lot of information, sometimes we get a new question that has yet to make it into one of our publications.  The following represent a few of those questions.

Right to access neighbor’s property applies to fence construction, not removal

Ohio Revised Code § 971.08 provides a landowner with a ten foot right to access his or her neighbor’s property in order to construct a new line fence or to maintain an existing fence.  If the landowner or the landowner’s contractor causes damage to his or her neighbor’s property, the landowner will be liable for that damage, including damage to crops.  However, as there is a separate statute for removing a line fence located at Ohio Revised Code § 971.17, the right of access to construct or maintain a fence does not clearly include a right to enter onto a neighbor’s property in order to remove a line fence.  Under this statute, a landowner who enters his or her neighbor’s land could be liable for trespass.

Written notice is required prior to removing a fence

Ohio Revised Code § 971.17 requires a property owner to give written notice to his or her neighbor at least 28 days in advance of removing a shared line fence.  If a landowner or the landowner’s contractor enters the neighbor’s property to remove a fence without sufficient notice, that could constitute a trespass under Ohio Revised Code § 971.17.  This notice requirement is intended to ensure that the landowner has a chance to protest the removal or at least discuss the terms of the removal.

Trees on the property line are the shared property of the neighboring landowners

One thing not specifically addressed in Ohio’s line fence laws is the issue of trees on the property line.  Ohio Revised Code § 971.33 requires landowners to keep all fence corners and a four foot strip along the entirety of a fence clear of brush, briers, thistles, and other noxious weeds.  However, this statute specifically says that it does not apply to the planting of vines or trees for use.  Because these are specifically excluded from this noxious weeds statute, the common law as made by courts will apply.

The common law provides that trees on the property line are owned by both landowners and do not have to be cleared from the fence row.  This means that if one landowner wants to remove a tree on the property line, that landowner must seek permission from his or her neighbor.  Even though the landowner owns half of the tree, the landowner cannot interfere with his or her neighbor’s property interest in the tree.  Without his or her neighbor’s permission, the landowner could be liable for removing the tree or even cutting it in a manner that causes the tree to die.  Because of Ohio’s reckless destruction of trees and crops statute in Ohio Revised Code § 901.51, a person who cuts, destroys, or injures a tree located on the land of another could be liable for up to three times the value of the tree.

If you have a question about Ohio’s line fence law, let us know, and we will try to find an answer.  Much like we tell students and those who attend our presentations, it is likely that someone else has the same question as you.  Stay tuned to the Ag Law Blog for more updates about questions we receive about Ohio’s line fence law.

By: Peggy Kirk Hall, Wednesday, April 10th, 2019

Written by Evin Bachelor, Law Fellow, OSU Extension Agricultural & Resource Law Program

The United States Department of Agriculture (USDA) announced last week that farmers.gov will now feature two new tools.  One will help farmers navigate the application process for obtaining temporary agricultural workers under H-2A, and the second will help farmers understand and manage their USDA-backed farm loans.  The press release explained that the USDA values the experience of its customers, and that it developed these tools after hearing feedback on the need for simple, technology based resources to help farmers.  Unveiled in 2018, farmers.gov allows users to apply for USDA programs, process transactions, and manage their accounts.

Customized H-2A checklists based on the needs of an individual farmer

Many farmers need seasonal or temporary workers for planting, cultivating, and harvesting crops.  The seasonal nature of agriculture can make it difficult for farmers to find an adequate supply of domestic labor willing to fill the temporary positions.  To relieve this difficulty, the federal government created the H-2A temporary agricultural worker program to allow these farmers to hire workers from foreign countries to supplement the domestic labor market on a temporary or seasonal basis.  Farmers must demonstrate that there are not enough U.S. workers able, willing, qualified, and available for the temporary work, and that the H-2A workers will not result in reduced wages for other U.S. workers.

Understanding the H-2A process has long been complex and confusing, but a new tool focused on education for smaller producers includes a revamped website and an interactive checklist tool.  The new website explains the basics of the program, includes an interactive checklist tool to create custom checklists, and gives an estimate of the costs of hiring H-2A workers.

The interactive checklist tool is a helpful way for producers to learn about the steps they need to take to obtain the labor that they need.  In the past, websites would rely heavily on producers to sift through information and determine the requirements that they needed to follow.  Now, the interactive tool asks questions one at a time to generate a custom checklist. 

When using the tool, producers will first be asked whether this will be their first time hiring workers using the H-2A Visa Program.  If the producer answers yes, they will be asked when they need the labor.  If the producer answers no to the first question, they will be asked whether they are extending the contract of workers that they are currently employing.  Ultimately, the producer will be asked when they need the labor.  At the end of the questions, the tool will provide a checklist that the producer will use to determine what steps he or she needs to take to obtain H-2A labor.  The checklists are designed to be easy to understand and to make the process less confusing.

View information about your USDA-backed farm loan online

The USDA offers farm ownership and operating loans through the Farm Services Agency to family-size farmers and ranchers who cannot obtain commercial credit.  Farmers.gov now allows producers to view information about these USDA-backed farm loans through a secure online account.  Producers can view loan information, history, and payments from a desktop computer, tablet, or smartphone.  Producers will need to sign up for a USDA online account in order to create an account profile with a password.

At this time, the program only allows producers doing business on their own behalf as individuals to view this information through farmers.gov.  Other entities such as LLCs and trusts or producers acting on behalf of another cannot utilize this tool yet, although the USDA indicates that this is planned for in the future.

The USDA’s press release made clear that the addition of these tools represents a step toward providing better customer service and increased transparency.  As only a step, producers can expect more tools and features to be added to farmers.gov in the future.  As this happens, we will be sure to keep you up to date about the website’s new bells and whistles.

Posted In: Business and Financial, Labor
Tags: USDA, H-2A, labor law, USDA loans
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