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Path to Illnesses and Deaths Began Five Years Before Salmonella Outbreak

The 52-page Grand Jury indictment of Stewart and Michael Parnell, Samuel Lightsey and Mary Wilkerson tells us a lot more than we knew about now-liquidated Peanut Corporation of America (PCA).

The indictment of the four former PCA officials marks a new chapter in the four-year-old drama. It turns to a new page, one involving conspiracy and fraud, in a story that up until now has been about Salmonella Typhimurium and pulsed-field gel electrophoresis (PFGE)–a method of “fingerprinting” bacteria.

The indictment does not mention the nine who died among the 714 who were sickened in the 2008-09 Salmonella Typhimurium outbreak in 46 states and Canada.  It does, however, document 11 food companies that were victims of fraudulent actions practiced by PCA.  The indictment is important because it tells us what we did not know.

Previously, PCA looked like a regular peanut industry business that met its demise after having to recall years worth of product linked to the deadly outbreak.

The indictment tells a different story,  one that started at least five years earlier. And U.S. attorneys are saying PCA was not a business in the normal sense, but a conspiracy that existed to defraud its customers and obtain money “by means of false and fraudulent pretense, representations and promises.”

Thomas J. Bondurant, Jr., the federal defense attorney representing Stewart Parnell, promised “a vigorous defense” against the charges.  He says his client never intentionally shipped or intentionally caused any tainted food products capable of harming PCA’s customers to be shipped.

We knew before the indictment that doing business with PCA did turn out to be a costly mistake for the food industry. During the outbreak, more than 3,900 products containing peanut butter or peanut paste from PCA were eventually recalled by more than 200 companies.

Food industry experts in 2009 estimated the cost of those massive recalls to be $1.5 billion.

To its customers, including some of the world’s largest food companies, PCA sold its “remarkable food safety record” and “commitment to continuous training and state of the art techniques.”

We’ve known since the FDA’s investigation into the nationwide Salmonella Typhimurium outbreak that conditions at both PCA’s Blakely, GA and Plainview, TX plants were nothing short of horrible. The indictment also goes over these findings, including the roof leaks, roasting conditions that were never properly validated for time and temperature to ensure an effective “kill step” for foodborne pathogens, rodent and insect infestations, generally unsanitary conditions and lack of protection against cross-contamination.

As dangerous as those conditions were, the indictment makes a strong case that what put PCA at fault was its fraudulent practices that left no space for food safety.

The indictment portrays a company that was too busy lying to its customers, pretty much day-in and day-out.

Fraud was being practiced by PCA as early as June 2003, more than five years before people started getting sick, according to information contained in the indictment. The picture U.S. attorneys paint in the indictment is one where PCA promised to deliver on food safety standards and customer specifications while putting a system in place to do neither.

Take Customer No. 1 in the indictment as an example. It’s an un-named mutli-international food company based in Battle Creek, MI. (Kellogg’s would be a good guess).

PCA supplied the Battle Creek company with peanut paste, and not just a little peanut paste, but two to three tanker trucks of peanut paste a week with 44,000 pounds per load. (The specialized tanker trucks were provided by P.P. Sales, owned by Michael Parnell).

One of the specifications the Battle Creek company had for its paste was that it be produced from U.S. peanuts. PCA largely supplied Mexican paste and lied about it. PCA was also lying about the microbiological specifications the Michigan company had asked that it meet.

The Battle Creek company ended up getting 118 lots of peanut paste during 2008 and 2009, of which 69 percent came from Mexican or Argentine paste. And 63 percent of it was never tested.

PCA’s “schemes to defraud” were achieved by numerous “manner and means,” according to the indictment. The former company did not provide customers with original lab reports, but rather copied what it wanted customers to know onto its falsified certificates of analysis (COAs).

Among its practices:

  • Peanut products were shipped  before results of microbiological testing were received from testing labs, and customers not told of positive test results.
  • Peanut products were shipped after testing positive for Salmonella, and customers were not notified that they had received such product.
  • Shipped peanut products were accompanied by false COAs that cited microbiological tests from previously manufactured lots, incomplete test results or otherwise false and fictitious information.
  • PCA would routinely order re-testing of lots found positive for Salmonella, often by another laboratory, and it would not tell customers of the former positive test results.
  • The company falsely represented to customers the plant that manufactured some peanut product, delivering products from plants that were on a customer’s “unapproved “ list.
  • Peanut products were shipped that did not meet customer specifications, such as foreign peanuts that had been substituted for U.S. grown peanuts when the domestic product was ordered.
  • Peanuts that were previously rejected were sent to unsuspecting customers.

The first “overt act” of fraud documented by the indictment occurred on June 19, 2003 when Stewart Parnell is said to have ordered Dan Kilgore, the Blakely, GA operations manger, to ship Chinese Extra Large peanuts to a customer who wanted Blanched Jumbo Runners without the customer’s knowledge or consent.

Another 52 separate “overt acts” are included in the indictment, including one as late as Dec. 10, 2008 when rainwater was leaking into the tanker of paste going to Battle Creek, which was also accompanied by a doctored up COA.

The indictment also includes specific instances of the shipping of adulterated and misbranded food. It also cites a dozen instances of wire fraud. In one case, Steward Parnell orders PCA personnel to lie to the U.S. Food and Drug Administration (FDA) about why a product was rejected by a customer.

The customer rejected it because it contained metal fragments. PCA told FDA that the customer had problems with the sizes of the peanuts in the lot.

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See also, “Peanut Corporation of America:  From Inception to Indictment

© Food Safety News
  • Oginikwe

    Why are they not charged with manslaughter/murder?  They had to know that people would get sick and some would die.

    I look forward to more articles like this as more information comes out. This is very frightening information about our supply chains.

  • riverdivine

    Excellent job reporting, and very informative! Have not seen these details anywhere else.