April 3, 2019
Update-Sentences Affirmed on January 23, 2018 Corp. Executive Liability Sentence Largest Ever in Food Safety History
AFFIRMED: See: United States v. Parnell, et. al, No. 15-14400 (11th Cir. Jan. 23, 2018) Click on the link for the appellate court decision. Court of Appeals Opinion
Former Peanut Corporation of America (PCA) President and Owner Stewart Parnell received a criminal prison sentence of 28 years in connection with the 2009 salmonella poisoning outbreak of 700 reported cases in 46 states. Expert evidence presented at trial detailed that there were nine deaths linked to PCAs tainted products. Parnell’s brother Michael received a 20 year prison sentence. The Quality Assurance employee received a 5 year sentence. They were sentenced based on their roles at PCA by shipping salmonella-positive peanut products and by falsifying microbiological test results. A federal jury convicted the Parnell brothers in September 2014 on several counts of conspiracy, mail and wire fraud as well as selling misbranded food. Stewart Parnell was also convicted for introducing adulterated food into interstate commerce. Stewart Parnell and Quality Assurance Manager Mary Wilkerson were also convicted of obstruction of justice. According to U. S. Justice Attorney Moore, “The sentence that was handed down today [Sept. 21, 2015] means that executives will no longer be able to hide behind the corporate veil”. The direct link to the sentences in the Parnell Salmonella Tainted Peanut Product case is below and court of appeals opinion above.
AFFIRMED: See: United States v. Parnell, et. al, No. 15-14400 (11th Cir. Jan. 23, 2018 (affirmed)). Click on the link Court of Appeals Opinion
Corporate Executive Liability Food Safety—Felony Conviction
Peanut Corporation of America Background
The former owner of Peanut Corporation of America Peanut Corp.) Stewart Parnell was convicted on September 19, 2014 of conspiracy and other charges in connection with a deadly salmonella outbreak that occurred in 2008-2009. According to the Centers for Disease Control and Prevention, nine people died and over 700 others became ill in 2008-09 after eating peanut butter or other products prepared at the company’s plant in Georgia. Mr. Parnell, was found guilty on several counts, including wire fraud and obstruction of justice. The indictment was centered on a conspiracy to conceal that several of Peanut Corp.’s products were contaminated with salmonella. Others involved and convicted included the brother of Stewart Parnell, Michael Parnell, a food broker who worked on behalf of Peanut Corp. and the quality assurance manager, Mary Wilkerson, for obstruction of justice. Two other former Peanut Corp. employees has previously pled guilty to multiple charges.
Prosecutors alleged that Peanut Corp. not only defrauded customers but also defrauded several national food companies by failing to inform them about the presence of food-borne pathogens in laboratory tests, including salmonella. According to prosecutors, in some instances, despite these results, Peanut Corp. officials totally falsified lab results, maintaining peanut products were safe for consumption. Further, at times, the Peanut Corp. failed to even perform testing.
Corporate Liability Significance
Although for years, corporate executives have been charged with misdemeanor offenses under the strict criminal liability theory known as the Park doctrine, this case is distinguishable. The Peanut Corp. case represents a felony prosecution under the Federal Food, Drug and Cosmetic Act. The Peanut Corp. prosecution serves as a wake up call to the regulated food safety industry.
Outcome and Sentencing
Peanut Corp. filed for Chapter 7 bankruptcy protection weeks after the outbreak began. The felony convictions mean the possibility of a extensive prison sentence and fines.
POM WONDERFUL LLC v. COCA-COLA CO.
United States Supreme Court Holding: A competitor may bring a Lanham Act claim(s) that alleges unfair competition from false or misleading labels on food and beverage labels regulated under the United States Federal Food, Drug and Cosmetic Act.
Link to Supreme Court opinion is below.
Does the United States Needs a Food and Drug Administration? Year in Review—Top 5 Highlights of FDA Accomplishments in 2013
Does the United States even need a Food and Drug Administration (FDA)? The role and mission of FDA has been debated for years. The FDA role ranges from that of a regulator, watchdog and facilitator. Commentary ranges from overbearing federal regulation to lack of public protection. Yet, based on these selected accomplishments, FDA provides an important function in keeping with the mission of the Food, Drug and Cosmetic Act and the numerous amendments. Although the FDA has across the board accomplishments, the following are standouts and all involve safety—Food Safety Modernization, Drug Quality and Security, Tobacco Products, Antibiotic-Antimicrobials Use in Food Producing Animals and Dietary Supplement Enforcement.
DRUG SAFETY—DRUG QUALITY and SECURITY ACT
This necessary and milestone legislation (H.R. 3204) enacted towards the end of 2013, addresses federal regulatory authority over pharmacy compounding. Unfortunately, this legislation was enacted in response to the unnecessary deaths associated with large scale compounding. Additionally, this law contains “track and trace” provisions throughout the drug supply chain.
DIETARY SUPPLEMENT OVERSIGHT
Dimethylamylamine DMAA—Muscle Building and Performance Enhancement
Dimethylamylamine commonly known as (DMAA) provides an excellent illustration example of issues related to post-market enforcement. DMAA, a stimulant is used in supplements, promotes weight loss, muscle building and performance enhancement. DMAA, a stimulant is used in supplements, promotes weight loss, muscle building and performance enhancement. According to FDA, medical issues associated with DMAA include elevated blood pressure, potential cardiovascular problems such as heart attack, shortness of breath and tightening of the chest.
The following link contains the FDA warning letters. http://www.fda.gov/Food/DietarySupplements/QADietarySupplements/ucm346576.htm
The following link contains the response letter from FDA to USPlabs. http://1.usa.gov/1lcJC77
At the end of 2013, FDA issued a guidance and proposed rule about a phase out of antimicrobial drugs in food animals for food production purposes. According to FDA, the agency issued voluntary guidance that promotes the judicious use of antibiotics in food animal production is preferable because of resource limitations; that is, according to FDA, the agency would use fewer resources compared to withdrawing the animal drugs on an individual basis
VETERINARY ACTION—ANTIMICROBIAL VOLUNTARY PHASE OUT
Final Guidance and Proposed Rulemaking Rx Status
TOBACCO PRODUCTS REGULATION
Tobacco Product Marketing Orders
Tobacco products are regulated so differently than other FDA regulated products due to the fact they are: harmful yet still extensively used consumer products; and responsible for severe health problems in both users and non-users, including cancer, lung disease, and heart disease, which often lead to death. A company who desires to market a new tobacco product has the following options available.
There were 17 SE orders, 13, NSE orders and 162 Report Withdrawals from pre-June 2013-December. http://www.fda.gov/TobaccoProducts/Labeling/MarketingandAdvertising/ucm339928.htm
MODERNIZING FOOD SAFETY
Did you know that much of the food that Americans consume originate from countries outside of the United States? The Food Safety Modernization Act (FSMA), signed into law back in January 2011, addresses imported food as well as food produced in the United States. Major accomplishments include a final rule and five proposed rules.
Final Rule Administrative Detention of Food Criteria Used to Order Administrative Detention of Food for Human or Animal Consumption which amended the criteria for administrative detention to prevent potentially unsafe food from reaching the marketplace. A guidance was issued as well titled: Guidance For Industry on Administrative Detention was issued on March 7, 2013 FDA released revised guidance on administrative detention entitled “Guidance for Industry: What You Need to Know About Administrative Detention of Foods; Small Entity Compliance Guide.”
5 Proposed Food Safety Rules: Preventive Controls; Produce Safety; Foreign Supplier Verification, Third Party Accreditation and Intentional Adulteration Mitigation Strategies.
1. Proposed Rule: Preventive Controls for Human Food — The proposed rule issued January 2013 would implement the requirements of FSMA for covered facilities to establish and implement a food safety system that includes a hazard analysis and risk-based preventive controls.
2. Proposed Rule: Produce Safety— The proposed rule would establish science-based minimum standards for the safe growing, harvesting, packing, and holding of produce on farms. http://www.regulations.gov/#!documentDetail;D=FDA-2011-N-0921-0001
3. Proposed Rule: Foreign Supplier Verification Programs (FSVP) for Importers of Food for Humans and Animals— On July 26, 2013, FDA issued proposed regulations that would greatly strengthen the oversight of foods imported for U.S. consumers. http://1.usa.gov/1jEeD8l
4. Proposed Rule: Third Party Accreditation of Auditors or “Certification Bodies”— On July 26, 2013, the FDA published for public comment its proposed rule to establish a program for accreditation of third-party auditors, also known as certification bodies, to conduct food safety audits and issue certifications of foreign facilities and the foods for humans and animals they produce.
5. Focused Mitigation Strategies to Protect Food Against Intentional Adulteration
This proposed rule would require the food businesses in the United States and abroad to take measures to prevent facilities from being the target of intentional attempts to contaminate the food supply. http://1.usa.gov/1fVCv2p
Despite the federal government shutdown, FDA did have major accomplishments as the above examples illustrate. They illustrate the necessity for “an FDA”. Hopefully though the proposed rules will be finalized shortly and hopefully Congress will revisit FDA regulatory authority for some products such as dietary supplements where FDA can only legally exercise post-enforcement. Stay tuned for more about the role of FDA and for more food and drug law updates in 2014.