A plaintiffs’ firm has announced a $25 million partial settlement in an antitrust class action “brought on behalf of direct purchasers of shell eggs and egg products.” In re: Processed Eggs Antitrust Litigation, MDL No. 2002 (E.D. Pa.). According to Hausfeld LLP, plaintiffs alleged “a near industry-wide, price-fixing conspiracy among egg farmers which raised the price of shell eggs and egg products in violation of the Sherman Antitrust Act.” The lawsuit specifically claimed that the United Egg Producers, United States Egg Marketers and other trade associations coordinated a conspiracy “to restrict egg supply through cage space requirements, as well as coordinated molting schedules and hen reductions, and exported eggs at a loss in order to reduce domestic supplies and raise prices.” The three settling defendants—Land O’Lakes, Inc., Moark, LLC, and Norco Ranch Inc.—have reportedly agreed “to provide significant cooperation to the plaintiffs as they pursue their claims against the remaining, non-settling…
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The U.S. Department of Agriculture’s (USDA’s) Food Safety and Inspection Service (FSIS) has issued a directive that revises its list of suitable ingredients that can used in the production of meat, poultry and egg products. FSIS will update the directive quarterly by issuing revisions as opposed to amendments. FSIS has added hypobromous acid and oat filler as suitable ingredients for certain processes. Hyporomous acid, which can kill the cells of many pathogens, may be used in water or ice under specific conditions to process meat and poultry products. Oat filler can be used in various meat products where binders are permitted and in whole muscle meat products “not to exceed 3.5 percent of the product formulation.” Oat filler must be listed as an “isolated oat product” or “modified oat product” in the ingredients statement and whole muscle meat products must be descriptively labeled.
The Food and Drug Administration (FDA) has announced two public meetings to discuss the prevention of Salmonella enteritidis (SE) during the production, storage and transportation of shell eggs. Slated for September 30, 2009, in Chicago, Illinois, and November 5, 2009, in Atlanta, Georgia, the meetings will explain an FDA final rule that requires shell egg producers “to implement measures to prevent SE from contaminating eggs on the farm and from further growth during storage and transportation, and requires these producers to maintain records concerning their compliance.” The agency has anticipated that the rule will prevent 79,000 illnesses and 30 deaths attributed to SE, a leading bacterial cause of foodborne illness in the United States. See Federal Register, August 31, 2009.
The Food Safety Working Group (FSWG) created by President Barack Obama (D) has unveiled a “new, public health-based approach to food safety based on three core principles: prioritizing prevention; strengthening surveillance and enforcement; and improving response and recovery,” according to a July 7, 2009, White House press release. Chaired by Health and Human Services (HHS) Secretary Kathleen Sebelius and U.S. Department of Agriculture (USDA) Secretary Tom Vilsack, FSWG has set in motion several new strategies to advance these principles, including plans to (i) tighten standards governing the safety of eggs, poultry and turkey; (ii) increase inspections at beef facilities; (iii) issue new industry guidance for leafy greens, melons and tomatoes; (iv) build a trackback and response system incorporating “clearer industry guidance, a new unified command system and improved use of technology to deliver individual food safety alerts to consumers”; and (v) strengthen the organization of federal food safety functions. FSWG…
The U.S. Food Policy blog has posted a response to the announcement that Disney Food, Health & Beauty would begin marketing a line of “farm fresh” eggs branded with a rotating cast of cartoon characters. According to Disney Food, the available products will include Large, Extra Large, 18-pack Large, Disney Cage Free, and Disney Organic eggs, all produced by hens raised without hormones, steroids or antibiotics and fed Eggland’s Best patented feed containing “healthy grains, canola oil, and an all-natural supplement of rice bran, alfalfa, sea kelp, and vitamin E.” But the marketing plan has drawn criticism from one blog contributor, who blamed the egg supplier for furthering “the agrarian myth that people’s food is coming from an idealistic farm with a red barn” and who questioned the motives behind Disney’s foray into food marketing. “I side with Marion Nestle on the point that kids don’t need special ‘kid-friendly’ foods…
The Federal Circuit Court of Appeals has determined that a U.S. Department of Agriculture (USDA) Salmonella rule, which interfered with an egg producer’s sales for about two years, was not a compensable taking under the Fifth Amendment. Rose Acre Farms, Inc. v. U.S., No. 07-5169 (Fed. Cir., decided March 12, 2009). The case involved emergency regulations adopted in 1990 that restricted the sale of eggs from farms identified as infected with a type of Salmonella bacteria. The regulations diverted the eggs from three of Rose Acre’s farms from the table to other uses, such as in cake mixes, for 25 months and thus purportedly reduced the company’s profits. The company brought several lawsuits against the government, and the various issues raised were appealed several times. This appeal involved the “takings” issue only and was before the Federal Circuit for the second time. Under the Fifth Amendment, the government must compensate private…
A federal court in Washington recently approved a class action settlement in a case filed against egg farmers who allegedly engaged in unfair, deceptive and improper conduct in the marketing and sale of omega-3 fortified eggs. Schneider v. Wilcox Farms, Inc., No. 07-01160 (W.D. Wash., filed January 12, 2009). As we reported in issue 226 of this Update, the complaint alleged that the eggs the defendant marketed and sold contained omega-3 fatty acids “without proven cardiovascular benefits” and charged a premium for them, while taking advantage of consumers’ limited knowledge about different kinds of omega-3 and “artificially inflating the perceived amount of beneficial omega-3 fatty acids” in their product. Without conceding liability, the defendants agreed to pay $2,500 to each of the two named plaintiffs and attorney’s fees of $160,000. The order dismisses the plaintiffs’ claims with prejudice and bars members of the settlement class, defined as “[a]ll persons who…
The Chinese government has reportedly arrested the owner of a poultry feed operation implicated in a nationwide scandal involving melamine-tainted animal products. The manufacturer apparently confessed to using the industrial chemical in 212 tons of chicken feed sold to Dalian Hanovo Enterprise Group, which then distributed adulterated eggs to Chinese consumers. The government also destroyed an additional 75 tons of contaminated feed seized from the owner as part of its crackdown on the widespread practice of adding melamine to feed and dairy products to artificially boost protein counts. State media sources have indicated that inspectors have shuttered 238 illegal farms and 130 dairy farms since melamine-laden infant formula first sickened thousands of children. The scandal has closed approximately 20 percent of China’s dairy industry. See What Not To Eat: Marion Nestle, November 12, 2008. Meanwhile, the U.S. Food and Drug Administration (FDA) has apparently issued a detention order for milk-containing products imported…
California residents this week voted overwhelmingly in favor of Proposition 2 (Prop. 2), an animal welfare measure banning the use of some crates for hens, pregnant pigs and veal calves that do not allow the animals to turn around, lie down or extend their limbs. In addition, the law will require farmers to build pens and cages allowing full range of motion in an effort to eliminate high-density battery cages and reduce Salmonella outbreaks. Prop. 2, which takes effect in 2015, also levies fines of $1,000 or six months in jail for violations. Because most of the state's pork and veal producers have already prohibited confined cages, some agricultural economists expect Prop. 2 to have a disproportionate impact on the $323-million egg industry. The industry-backed California for Safe Food group spent $8.5 million to oppose the measure, as egg farmers expressed concern that the cost of retrofitting their operations will…
