Ensuring Quality And Avoiding Bad Eggs: Food Executives, Food Safety And Criminal Sanctions

MJLST Guest Blogger, Tommy Tobin

[Editor’s Note: This post is last and #4 in a series on current FDA issues. You can find the previous post herehere and here.]

Food can—and all too often does—make people sick. Anyone who has suffered from food-borne illness would be unlikely to want to repeat the experience. The safety of our food relies in large part on compliance with food safety protocols. From Upton Sinclair’s The Jungle to today, the processing and manufacturing of food is rife with stories of poor practices leading to public health problems.

Maintaining the safety of the nation’s food supply is an ongoing challenge for regulators and businesses. The FDA requires that food be processed or produced using good manufacturing practices, or else risk food being labeled “adulterated” as it was produced under “unfit” conditions. Producing food in such a way as to avoid being “contaminated with filth” seems like a worthwhile goal.

Ensuring food safety sometimes means throwing away product, but it can be a matter of life and death. For example, Listeria concerns prompted Blue Bell Ice Cream to remove all of its product from store shelves in 2015. Three deaths were reported from the ice cream. In the midst of its food safety issues, Chipotle closed all locations across the US on February 8, 2016 to focus improving food safety protocols.

What happens when individuals upend the delicate balance of food safety? In the wake of several high-profile trials, food executives charged with food safety violations may be walking on eggshells. As Food Safety News put it, “Not so long ago, errant food industry managers and executives did not have to worry about going to jail. But they do now.”

What changed? In part, peanut butter, cantaloupe, and eggs. These products might seem like an unlikely combination, but these foods—or rather some of the companies behind them—demonstrate the “New Normal” in food safety enforcement.

Taking peanut butter first, a nationwide Salmonella outbreak sickened hundreds of Americans and killed nine. Stewart Parnell, the executive behind the Peanut Corporation of America, approved shipments of peanut butter that his company had tested positive for Salmonella and those that were known to be “partially covered in dust and rat crap.” Instead of jettisoning product for public safety, he instead demanded, over email, that “[expletive deleted], just ship it. I can’t afford to loose [sic] another customer.” According to the Washington Post, prosecutors sought a life sentence, but he was ultimately sentenced for 28 years. One man, quoted by the Post, whose mother had died due to the peanut butter said, “As far as I’m concerned, he’s a murderer.”

As for cantaloupe, Eric and Ryan Jensen—two Colorado brothers—pled guilty to six counts arising from their role in a 2011 Listeria outbreak. According to the FDA, the Jensen brothers knew they were putting the public at risk by not sufficiently washing their produce and maintaining the fruit in “unsanitary conditions.” As a result, the deadly cantaloupes were linked to 147 hospitalizations and 33 deaths. You read that right; 33 lives were ended due to contaminated cantaloupe.

With regard to eggs, the DeCosters of Quality Egg, LLC may have presented the courts with the most significant responsible corporate officer liability ruling in over forty years, according to the venerable FDA Law Blog. Jack DeCoster and his son Peter, the owner and COO of the company, respectively, were sentenced to three month’s imprisonment for their part in food safety outbreaks that caused an estimated 56,000 Americans to fall ill.

As noted in the Eighth Circuit opinion upholding the prison sentence, the company pled guilty to bribing a food safety inspector and introducing misbranded and adulterated eggs into interstate commerce. The opinion details the conditions at Quality Egg’s Iowa operations in August 2010:

The FDA inspected the Quality Egg operations in Iowa from August 12–30, 2010. Investigators discovered live and dead rodents and frogs in the laying areas, feed areas, conveyer belts, and outside the buildings. They also found holes in the walls and baseboards of the feed and laying buildings. The investigators discovered that some rodent traps were broken, and others had dead rodents in them. In one building near the laying hens, manure was found piled to the rafters; it had pushed a screen out of the door which allowed rodents into the building. Investigators also observed employees not wearing or changing protective clothing and not cleaning or sanitizing equipment.

The FDA concluded that Quality Egg had failed to comply with its written plans for biosecurity and salmonella prevention. One government expert reported that “there were minimal to no records from the poultry [ ] barns to indicate that company personnel [had] implemented the written plans [to eliminate salmonella].” The agency also discovered that the company’s eggs tested positive for salmonella at a rate of contamination approximately 39 times higher than the current national rate, and that the contamination had spread throughout all of the Quality Egg facilities. In October 2010 the FDA instructed Quality Egg to euthanize every hen, remove the manure, repair its facilities, and disinfect its barns to prevent the risk of another outbreak.

As responsible corporate officers, the DeCosters pled guilty to misdemeanor violations of the Food, Drug, and Cosmetic Act (FDCA). In their plea agreements, they stipulated that they “had not known that the eggs were contaminated at the time of shipment, but stipulated that they were in positions of sufficient authority to detect, prevent, and correct the sale of contaminated eggs had they known about the contamination.”

An important question before the Eighth Circuit panel was the requisite knowledge required for imposing criminal penalties, particularly imprisonment, on responsible corporate officials. In the cantaloupe and peanut butter cases reviewed above, each executive knew of food safety violations, but the record in this case did not reveal that the DeCosters had actual knowledge. The three judge DeCoster panel issued a three-opinion ruling, with the majority advancing a concept of responsible corporate officer liability arising from the FDCA and the Supreme Court’s ruling in United States v. Park, 421 U.S. 658 (1975). Under Park, responsible corporate officials were prosecuted under a lower standard than normally used for criminal cases, whether under theories of negligence or strict liability.

The DeCoster majority noted that the FDCA and Park enabled criminal sanctions for responsible corporate officials for their own failure to prevent or remedy the conditions giving rise to the food safety claim. The judges in the majority agreed that vicarious liability was not applicable here, instead it was the executives’ own duty to be aware of, to prevent, and to address potential violations of the FDCA that gave rise to criminal penalties. Writing in concurrence, Judge Gruender reasoned that the DeCosters “are responsible for their own failures to exercise reasonable care to prevent the introduction of adulterated food.” In the absence of actual knowledge, the DeCoster majority ascribed constructive knowledge to the DeCosters in running their operation. They “knew or should have known” of the unsanitary conditions and failed to address or prevent them.

Writing in dissent, Judge Beam reasoned that the DeCoster’s sentence was inappropriate. Judge Beam would reject negligence as an appropriate standard for corporate officer liability under the FDCA, substituting a mens rea requirement similar to that found elsewhere in criminal law. The dissent noted, “there is no precedent that supports imprisonment without establishing some measure of a guilty mind on the part of these two individuals, and none is established in this case” and that “no person associated with Quality Egg had knowledge of salmonella contamination at any relevant time.”

Given the three-opinion decision, the DeCoster case was appealed for an en banc rehearing within the Eighth Circuit, which was denied in September 2016. Petition for certiorari was filed in January 2017, and the case may make it to the Supreme Court.

Public health requires vigilance, especially on the part of those involved with producing and processing the nation’s food supply. The FDA and other food safety regulators work with businesses to maintain public health and safety. Unfortunately, all too often there are bad eggs whose decisions, or lack of awareness, may put the public at risk. Time will tell whether the Supreme Court weighs in on the proper standard for criminal liability for food safety violations in the wake of several recent high-profile cases.

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