1. 1. A Bite of Litigation History William D. Marler, Esq. Marler Clark LLP PS The Food Safety Law Firm
2. 2. Food Production is a Risky Business Competitive Markets Stockholder Pressures for Increasing Profits over Long-term Safety Lack of Clear Reward For Marketing and Practicing Food Safety Brand Awareness Risks
3. 3. It is a Global Food Economy
4. 4. Strict Product Liability Negligence Are you a product seller? Did you act reasonably? Strict Liability Are you a manufacturer? Was the product unsafe? Did product cause injury? Punitive Damages /Criminal Liability Did you act with conscious disregard of a known safety risk?
5. 5. Who is a Manufacturer? A manufacturer is defined as a product seller who designs, produces, makes, fabricates, constructs, or remanufactures the relevant product or component part of a product before its sale to a user or consumer. RCW 7.72.010(2); see also Washburn v. Beatt Equipment Co., 120 Wn.2d 246 (1992)
6. 6. The only defense is prevention It does not matter if you took all reasonable precautions If you manufacture a product that makes someone sick you are going to pay Wishful thinking does not help Its called STRICT Liability for a Reason
7. 7. Pathway of a Foodborne Illness Investigation
8. 8. Pathway of a Foodborne Illness Investigation If there are more ill persons than expected, an OUTBREAK might be underway.
9. 9. Pathway of a Foodborne Illness Investigation
10. 10. Litigation as Incentive Odwalla Jack in the Box
11. 11. How Are Things are Different Today?
12. 12. Now Guilty After Two Month Trial Stewart Parnell, the former owner of Peanut Corp. of America Michael Parnell, who is Stewart Parnells brother and a former supervisor Samuel Lightsey, a onetime plant operator Mary Wilkerson, a former quality-assurance manager Daniel Kilgore, plant manager Allegations Included: Mail Fraud Wire Fraud Introduction of Adulterated and Misbranded Food into Interstate Commerce with Intent to Defraud or Mislead Conspiracy
13. 13. 1938 Federal Food, Drug & Cosmetic Act 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.
14. 14. And, It Does Not Always Require Intent 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.
15. 15. Planning AGAINST Litigation What Is Really Important Identify Hazards HACCP Do you have qualified and committed people? What is the Culture? Involve Vendors and Suppliers Do they really have a plan? Ever visit them?
16. 16. Planning AGAINST Litigation Establish Relationships They are your best friends!
17. 17. Lessons Learned From Litigation You can insure the brands and the companys reputation 1. Arm yourself with good, current information 2. Since you have a choice between doing nothing or being proactive, be proactive 3. Make food safety part of everything you, your suppliers and customers do 4. Treat your customers with respect
18. 18. Questions?