The U.S. Court of Federal Claims two years ago ruled that food safety warnings are not “regulatory takings” by the government, and, therefore, Uncle Sam does not have to compensate tomato growers who lost money when the public was told tomatoes might have been responsible for a 2008 Salmonella outbreak.
Now the 4th U.S. Circuit Court of Appeals has agreed, turning down a $15 million claim from Seaside Farm, located on South Carolina’s St. Helena Island. The farm sought the money because the FDA’s public health warning, issued during an emergency, was erroneous and caused the public stop purchasing tomatoes, according to the tomato grower.
The 4th Circuit ruling was based on the Federal Tort Claims Act, the same law that came into play two years ago when the ruling also went against a group of growers, packers and shippers from Florida, Georgia and South Carolina.
The lawsuits followed the mistake made by the U.S. Food and Drug Administration when the nation’s biggest food safety agency was dealing with an elusive outbreak of Salmonella Saintpaul. It was later determined the culprit was contaminated peppers imported from Mexico.
The 4th Circuit found FDA was well within its authority by communicating to the public what it knew about the outbreak during the emergency.
“We refuse to place FDA between a rock and a hard place,” wrote Judge J. Harvie Wilkinson for the Richmond-based court. “On the one hand, if FDA issued a contamination warning that was even arguably overbroad, premature, or of anything less than perfect accuracy, injured companies would plague the agency with lawsuits.
“On the other hand, delay in issuing a contamination warning would lead to massive tort liability with respect to consumers who suffer serious or even fatal consequences that a timely warning might have averted.”
Joining in the unanimous ruling were Judges Paul Niemeyer and Dennis Shedd.
The outbreak and warning
The New Mexico Department of Health first notified the Centers for Disease Control and Prevention about the outbreak. A number of state residents had been diagnosed as having Salmonella Saintpaul, a strain of the pathogen that causes fever, diarrhea, nausea and, if left untreated, death. Texas was the next state to report illnesses and by June 1, 2008, CDC’s case count was 87.
CDC reported “strong statistical” evidence pointed to raw tomatoes as the source of the outbreak. On that basis, FDA issued a public health warning for residents of New Mexico and Texas. CDC would eventually confirm 1,220 cases of Saintpaul as Seaside Farm and other growers were harvesting a large crop of tomatoes.
Seaside filed its lawsuit in May 2011, well after it knew imported jalapeño and serrano peppers imported from Mexico were responsible for the 2008 outbreak.
The three-judge appeal ruling upholds the district court judge who dismissed the Seaside lawsuit in December 2015. In backing up the trial court, the 4th Circuit found FDA has broad authority in responding to food safety emergencies.
The previous case was dismissed by Senior Judge Lynn J. Bush after hearing Department of Justice attorneys argue that “takings claims” based on government pronouncements are routinely rejected.
The grower-distributors said major buyers like McDonald’s and Wal-Mart immediately cancelled orders when FDA blamed raw tomatoes for the outbreak. They collectively claim to have lost more than $100 million.
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