Below is a very interesting perspective on “food crimes.” We need to have a broad discussion on how regulation, civil and criminal litigation can make our food supplier safer. With respect to whether a food executive would not recall a product because it could put him or her in jail – I think the opposite is true. Although, most recalls are “voluntary” – they are not really – once a product is found to be adulterated, there really is nothing voluntary about recalling the product. I submit the executive would be in far greater hot water if the product was not recalled and it caused harm.
In Peanut Food Poisoning Case, Punishment Doesn’t Fit the Crime
Jenna Greene, The Litigation Daily
July 26, 2015
It’s hard to feel sorry for Stewart Parnell.
The former owner and CEO of Peanut Corporation of America and his brother Michael, a peanut broker, were convicted last year of multiple counts of conspiracy and fraud for selling peanut-based products tainted with salmonella.
Thousands of people in 46 states were sickened-the kind of sick where, as one plaintiff described it, her bowel movements were pure blood. Nine people died.
According to federal prosecutors, the Parnells “knew that salmonella could cause great harm, knew that their products tested positive for salmonella, and knew that they were selling those products anyway, all the while lying to their customers about the safety of those products.”
The question is, what’s the appropriate punishment?
In a July 22 court filing, Justice Department lawyers said that based on federal sentencing guidelines, Stewart Parnell should get life in prison, Michael Parnell should serve 17.5 to 21.8 years and Mary Wilkerson, the quality assurance manager at the company’s peanut processing plant in Blakely, Ga., should get 8 to 10 years.
Such lengthy sentences are without precedent for food safety violations, which are rarely subject to criminal prosecution. But perversely, the punishment may have a detrimental effect on food safety. That’s because the length of the sentence is tied to the amount of money lost in the fraud-in this case, a recall covering 3,918 peanut products. It resulted in $144 million in direct losses and more than $1 billion in lost sales.
For example, the company was one of three peanut paste suppliers for Kellogg Co., for use in products like Keebler peanut butter sandwich crackers and Famous Amos peanut butter cookies. Peanut Corp. falsely told Kellogg that its paste had been microbiologically tested and determined to be safe.
Kellogg then inter-mingled the peanut paste from all of its suppliers, according to E. Scott Austin, a partner at Gentry Locke Rakes & Moore who represents Stewart Parnell, ballooning the size of the recall. Austin argues that sentencing guideline calculations don’t fit a case like this. “When you have hundreds of millions of dollars lost through a food recall, that makes any food recall potentially a life sentence in prison,” he said.
The result: food executives will be afraid to issue broad-based voluntary recalls-and virtually all recalls are voluntary-if it means they could spend the rest of their lives in jail. It’s an outcome that doesn’t seem likely to lead to safer food, even if it sends an unequivocal message that food safety matters.
Sentencing is set for Sept. 21 before U.S. District Judge W. Louis Sands in the Middle District of Georgia.
The case also underscores how idiosyncratic criminal prosecutions are for food safety violations. That there are civil consequences for food poisoning is all but certain-plaintiffs lawyers like William Marler of Marler Clark in Seattle see to that.
Indeed, Marler filed 41 lawsuits against Peanut Corp. on behalf of salmonella victims. In 2010, U.S. Magistrate Judge Michael Urbanski in Lynchburg, Va. awarded victims $12.75 million, payable from the company’s insurance policy.
Marler notes that federal prosecutors are inconsistent about seeking criminal penalties under the Federal Food, Drug and Cosmetic Act. Because there was evidence that the Parnells knew their products were probably contaminated, the charges against them were not so surprising.
But in other instances, Marler said it’s hard to tell why some food producers, like the Jensen brothers, whose cantaloupe was tainted with listeria, were prosecuted, but the family members who own Bidart Bros., linked to listeria in caramel apples, were not-or at least not yet.
“If you’re going to prosecute some, you damn well ought to prosecute others who are similarly situated,” Marler said. “Otherwise, it undercuts the rule of law.”