DOJ Catch of the Week – Quality Egg

By the C|C Whistleblower Lawyer Team

This week’s Department of Justice “catch of the week” goes to Iowa-based egg producer Quality Egg. On Tuesday, this former powerhouse in the egg industry pleaded guilty to, and agreed to a $6.8 million fine for, bribing government safety inspectors and violating food safety rules which ultimately led to a nationwide salmonella outbreak in 2010. If accepted by the court, it will be one of the largest payments ever made related to food safety. Quality Egg’s owner, Jack DeCoster, and his son Peter, also pleaded guilty to one count of introducing adulterated food into interstate commerce. See DOJ press release.

According to the government and as admitted by the company as part of the plea agreement, Quality Egg engaged in the following food safety violations:

• Providing cash bribes to USDA inspectors to release for sale and distribution pallets of eggs that had been retained, or “red-tagged,” for failing to meet minimum government quality standards because too many were cracked, dirty or leaking.
• Putting false processing and expiration dates on labels to make eggs look fresher than they actually were and circumvent the laws in many states requiring eggs to be sold within 30 days of their processing dates.
• Selling in multiple states eggs contaminated with the poisonous substance salmonella enteriditis.

The salmonella outbreak led to a recall of 550 million eggs, sickened thousands of people and ultimately led to the collapse of the egg Empire Jack DeCoster had built from scratch. Government prosecutors acknowledged there was no evidence the DeCosters were aware their company was selling tainted or unsafe eggs. Nevertheless, the government held them legally responsible as officers of the company, sending notice to the food industry that its leaders can and will be held criminally responsible for the safety of the products they sell.

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