2011 Food Defense Summit: Legal Risks and Responsibilities for Producing Safe Food


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Bill Marler of Marler Clark, The Food Safety Law Firm gives a presentation at the 2011 Food Defense Summit in Denver about the legal aspects of food safety in food production and reducing foodborne illness.

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2011 Food Defense Summit: Legal Risks and Responsibilities for Producing Safe Food

  1. 1. <ul><li>Food Defense Summit </li></ul><ul><li>Denver, Colorado </li></ul><ul><li>March 22, 2010 </li></ul><ul><li>Legal Risks and Responsibilities for Producing Safe Food – Are we doing enough? </li></ul>
  2. 2. How Big is the Problem <ul><li>CDC reports that yearly 48,000,000 are sickened, 125,000 are hospitalized and 3,000 die as a result of eating food </li></ul><ul><li>Recent estimates $152,000,000 in cost to victims </li></ul><ul><li>Not counting Business Loss </li></ul>
  3. 3. Civil Litigation – How it Really Works <ul><li>Strict liability </li></ul><ul><ul><li>It is their fault – Period! </li></ul></ul><ul><li>Negligence </li></ul><ul><ul><li>Did they act reasonably? </li></ul></ul><ul><li>Punitive damages </li></ul><ul><ul><li>Did they act with conscious disregard of a known safety risk? </li></ul></ul>
  4. 4. Strict Liability for Food – a Bit(e) of History “… a manufacturer of a food product under modern conditions impliedly warrants his goods… and that warranty is available to all who may be damaged by reason of its use in the legitimate channels of trade…” Mazetti v. Armour & Co ., 75 Wash. 622 (1913)
  5. 5. Who is a Manufacturer? <ul><li>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….” </li></ul>RCW 7.72.010(2); see also Washburn v. Beatt Equipment Co ., 120 Wn.2d 246 (1992)
  6. 6. The Legal Standard: Strict Liability <ul><ul><li>STRICT LIABILITY IS LIABILITY WITHOUT REGARD TO FAULT. </li></ul></ul><ul><li>The focus is on the product; not the conduct </li></ul><ul><li>They are liable if: </li></ul><ul><ul><li>The product was unsafe </li></ul></ul><ul><ul><li>The product caused the injury </li></ul></ul>
  7. 7. Why Strict Liability? <ul><li>Puts pressure on those (manufacturers) that most likely could correct the problem in the first place </li></ul><ul><li>Puts the cost of settlements and verdicts directly onto those (manufacturers) that profit from the product </li></ul><ul><li>Creates incentive not to let it happen again </li></ul>
  8. 8. Litigation In Action – A History Lesson Jack in the Box-1993 Odwalla - 1996
  9. 9. Jack in the Box <ul><li>1992 and 1993 </li></ul><ul><li>Nearly 600 people sickened in six States – most children - 50 HUS – 4 deaths </li></ul><ul><li>Two Class Actions - Hundreds of Individual Suits </li></ul><ul><li>Shareholders Litigation, Congressional Investigation </li></ul><ul><li>Settlements in Excess of $100,000,000 </li></ul><ul><li>Cause - knowingly undercooking </li></ul>
  10. 13. Odwalla <ul><li>1998 </li></ul><ul><li>Over 70 people sickened 5 HUS, 1 death </li></ul><ul><li>Multiple lawsuits </li></ul><ul><li>Criminal Investigation and Plea </li></ul><ul><li>Knowingly sold contaminated Apple Juice </li></ul><ul><li>Settlements over $20,000,000 </li></ul><ul><li>Stock Price fell and they were purchased </li></ul>
  11. 15. Odwalla
  12. 16. Leafy Greens <ul><li>25 E. coli outbreaks since 1995 with at least 1,000 reported illnesses and 7 deaths </li></ul><ul><li>Fresh or fresh-cut lettuce or spinach implicated as outbreak vehicle - 8 outbreaks traced back to produce from Salinas, California </li></ul><ul><li>In 2006 alone, Dole Spinach, Taco Bell and Taco Johns - between 400 - 750 ill </li></ul>
  13. 17. Prior FDA Warnings <ul><li>1998 – FDA “Guide to Minimize Microbial Food Safety Hazards for Fruits and Vegetables” </li></ul><ul><ul><li>Specifically designed to assist growers and packers in the implementation of safer manufacturing practices </li></ul></ul><ul><li>2004 – FDA letter to the lettuce and tomato industries </li></ul><ul><ul><li>To “make them aware of [FDA’s] concerns regarding continuing outbreaks associated with these two commodities and to encourage the industries to review their practices” </li></ul></ul>
  14. 19. Imports - Hepatitis A <ul><li>Chi-Chi ’ s restaurant in Pennsylvania – 660 people sickened, 4 deaths, 100 hospitalized, 1 liver transplant </li></ul><ul><li>Bankruptcy </li></ul><ul><li>Settlements - $50,000,000 </li></ul><ul><li>Green Onions imported and grow “in conditions of squalor” </li></ul>
  15. 20. Chi-Chi ’s Hepatitis-A Outbreak “ The ice water in the bucket became, essentially, &quot;hepatitis soup,&quot; said Dr. Michael Osterholm, an epidemiologist at the University of Minnesota who has investigated many hepatitis outbreaks.” “ Government Makes It Official: Blame Scallions for Outbreak,” by Denise Grady, NEW YORK TIMES, November 22, 2003
  16. 22. What is the Problem? <ul><li>Industrialization of our food supply? </li></ul><ul><li>Technological Advances in Surveillance? </li></ul><ul><li>Bugs are bigger, stronger, faster? </li></ul>
  17. 23. When Products Are Manufactured Overseas
  18. 24. <ul><li>Free Market? </li></ul><ul><li>Regulation? </li></ul><ul><li>Litigation? </li></ul><ul><li>Criminalize? </li></ul>How to Solve the Problem?
  19. 25. Free Market <ul><li>What made you ill? </li></ul><ul><li>Does poisoning 1 or 1,000 customers cause you to lose market share? </li></ul><ul><li>Can you buy - advertise your way out? </li></ul><ul><li>Does it depend on the size of the company? </li></ul>
  20. 26. Restaurant Hospitality Magazine – July 2004 <ul><li>“ We don't have to tell you that operating a restaurant is a risky proposition.  But if you want to ascertain just how sensationally risky it really is, connect to the Internet, swallow hard, and type www.marlerclark.com into your browser's address line.” </li></ul>
  21. 27. Regulation <ul><li>Does “Big Brother” have the answers? </li></ul><ul><li>Are the standards correct? </li></ul><ul><li>What Political Influences? </li></ul>
  22. 28. Litigation <ul><li>Lawsuits would seem to provide important feedback to these firms about how much they should invest in food safety. ” </li></ul><ul><li>“ [However,] much of the costs of illness borne by people who become ill … are not reimbursed by food firms responsible for an illness.” </li></ul><ul><li>“ In short, the legal system provides limited incentives for firms to produce safe foods.” </li></ul>
  23. 29. Criminalization <ul><li>Again, getting caught is an issue </li></ul><ul><li>In 17 years only a handful of people have been fined and only two jailed </li></ul><ul><li>Where is the incentive to produce safe food? </li></ul>
  24. 30. My Top Eleven with Help from FSMA <ul><li>Improve surveillance </li></ul><ul><li>Government Agencies work together </li></ul><ul><li>Train, certify, vaccinate food handlers </li></ul><ul><li>Increase food inspections </li></ul><ul><li>Whistleblower Protection - add Sarbanes Oxley </li></ul>
  25. 31. My Top Eleven <ul><li>Reform agencies at every level to be more proactive </li></ul><ul><li>Legal consequences </li></ul><ul><li>Technology to make food more traceable </li></ul><ul><li>Promote research </li></ul><ul><li>Provide tax breaks </li></ul><ul><li>Improve consumer and business understanding </li></ul>
  26. 32. What Will a Jury Think? A Jury = 12 Consumers
  27. 33. Questions?
  28. 34. For More Information <ul><li>Marler Clark, The Food Safety Law Firm </li></ul><ul><li>1301 Second Ave, Suite 2800 </li></ul><ul><li>Seattle, WA 98101-3808 </li></ul><ul><li>206-346-1888 </li></ul><ul><li>www.marlerclark.com </li></ul><ul><li>www.marlerblog.com </li></ul>