DOJ Resolves Two Important Food Safety Criminal Cases: Blue Bell Creameries and Chipotle Mexican Grill (Part I of II)
In an important set of criminal prosecutions for food safety violations, the Justice Department recently announced resolutions with Blue Bell Creameries and Chipotle Mexican Grill.
While these cases were not related to the COVID-19 pandemic, they are indications of DOJ’s aggressive prosecution for food safety issues and are important reminders of the need for organizations to prioritize health and safety issues. Corporate boards and senior management have to focus on health and safety issues, whether involving employees or customers, in this new COVID-19 pandemic era.
In the most recent case, Blue Bell pleaded guilty to shipping contaminated ice cream linked to a 2015 listeria outbreak and agreed to pay a fine of $19.5 million ($17.4 million criminal fine and $2.1 million to settle civil false claims act violations). Blue Bell’s former CEO, Paul Kruse, was separately indicted and charged in seven separate counts for conspiracy and wire fraud for concealing from customers information known to the company about the listeria contamination.
The 2015 listeria outbreak linked to Blue Bell resulted in the deaths of three persons and the illness of a number of customers. Blue Bell acknowledged that it distributed ice cream products that were manufactured under unsanitary conditions and contaminated with listeria in violation of the Food, Drug and Cosmetic Act.
In February 2015, Texas state officials notified Blue Bell that two ice cream products from the company’s Brenham, Texas factory had tested positive for listeria. DOJ noted that listeria can cause serious illness or death, especially in vulnerable populations – the elderly, pregnant women and those with compromised immune systems.
In response to the notice of contamination, Blue Bell instructed its delivery drivers to remove remaining stock of the two products from store shelves, but the company made no effort to recall the products or issue any formal communications to inform customers about the potential listeria contamination.
Two weeks later, Texas state officials notified Blue Bell that a third product had tested positive for listeria contamination. Again, Blue Bell did not notify the public and customers of the contamination.
The FDA and the Center for Disease Control (“CDC”) tested Blue Bell products in March 2015 and specifically linked the products to a strain of listeria that caused five patients in Kansas to become ill from ingestion of the listeria-contaminated ice cream. On March 13, 2015, the FDA, CDC and Blue Bell issued public recall notifications. Subsequent testing confirmed additional listeria contamination from a Blue Bell product made in another facility at Broken Arrow, Oklahoma.
FDA inspections in March and April 2015 revealed sanitation issues at both the Brenham and Broken Arrow facilities, including problems with the hot water supply needed to properly clean equipment and deteriorating factory equipment that lead to unsanitary conditions.
In late April 2015, Blue Bell closed its plants to clean and update the facilities. Since re-opening in late 2015, Blue Bell has enhanced its sanitation processes and enacted a new testing program.
With respect to the criminal charges against Blue Bell’s former CEO Paul Kruse, the indictment alleges that Kruse orchestrated a scheme to deceive certain ice cream customers after he learned to Blue Bell’s Texas facility tested positive for listeria.
Krause allegedly directed other Blue Bell employees to remove potentially contaminated products from store freezers without notifying retailers or customers about the real reason for the removal of the products from the stores. Krause also instructed employees to tell customers that the products were removed for an unspecified issue with a manufacturing machine instead of the real reason – samples of the product had tested positive for listeria.
During the period 2009 to 2014, regulators identified a number of compliance failures and health safety risks. According to the indictment, in 2011, Krause instructed quality-control employees to stop testing certain products for listeria. Following this instruction, a Blue Bell employee destroyed records showing products had tested positive for listeria.