Screen Shot 2015-05-16 at 8.11.29 AMRemaining with reduced pay

A couple of questions:

1.  Regarding pay, does that include CEO Kruse?

2.  Will a U.S. Attorney in Texas, Oklahoma or Alabama file criminal charges – (see below)?

The Austin American Statesman reports this morning that Blue Bell Creameries is laying off 1,450 employees and furloughing 1,400 others (remaining workers will see their pay cut) in light of a Listeria outbreak that has idled operations at its four production facilities and sparked a nationwide recall of eight million gallons of its ice cream, frozen yogurt, sherbet and frozen snacks along with 10 Listeria illnesses – including three deaths.

Blue Bell will also have to deal with increased regulatory pressures in light of the revelation last week that the company knew listeria was present in its Broken Arrow, Oklahoma facility as far back as 2013. The U.S. Food and Drug Administration said it wasn’t told about the positive test results — 17 in all between 2013 and 2015 — until this year. In a deal reached Thursday with the Texas Department of State Health Services, Blue Bell agreed to stepped-up testing of its products. Any positive listeria test results will have to be reported to the state within 24 hours, among other new requirements. A similar agreement was reached with the state of Oklahoma, and talks are reportedly underway with state health officials in Alabama, where the company has a production line in Sylacauga.

Bill Marler, a Seattle-based food-borne illness lawyer who has been watching the Blue Bell case, said Friday’s announcement was another reminder of a mess that could have been averted. Marler said he believes that Kruse and his food safety workers are to blame.

“This is very sad all the way around,” Marler said. “I feel bad for these employees. I feel bad for the victims. I don’t feel bad for Mr. Kruse and his food safety people. They should have been on top of this. It’s a completely preventable disaster.”

Regarding criminal charges:  Congress passed the Federal Food, Drug, and Cosmetic Act in 1938 in reaction to growing public safety demands.  The primary goal of the Act was to protect the health and safety of the public by preventing deleterious, adulterated or misbranded articles from entering interstate commerce.  Under section 402(a)(4) of the Act, a food product is deemed “adulterated” if the food was “prepared, packed, or held under insanitary conditions whereby it may have become contaminated with filth, or whereby it may have been rendered injurious to health.” A food product is also considered “adulterated” if it bears or contains any poisonous or deleterious substance, which may render it injurious to health.  The 1938 Act, and the recently signed Food Safety Modernization Act, stand today as the primary means by which the federal government enforces food safety standards.

Chapter III of the Act addresses prohibited acts, subjecting violators to both civil and criminal liability. Provisions for criminal sanctions are clear:

Felony violations include adulterating or misbranding a food, drug, or device, and putting an adulterated or misbranded food, drug, or device into interstate commerce.  Any person who commits a prohibited act violates the FDCA.  A person committing a prohibited act “with the intent to defraud or mislead” is guilty of a felony punishable by years in jail and millions in fines or both.

A misdemeanor conviction under the FDCA, unlike a felony conviction, does not require proof of fraudulent intent, or even of knowing or willful conduct.  Rather, a person may be convicted if he or she held a position of responsibility or authority in a firm such that the person could have prevented the violation.  Convictions under the misdemeanor provisions are punishable by not more than one year or fined not more than $250,000, or both.