Between November 1992 and February 1993, the United States experienced one of the nation’s worst foodborne illness outbreaks in recent history. State health agencies, in collaboration with the Centers for Disease Control and Prevention (CDC), ultimately confirmed that more than 500 infections and 4 deaths were caused by consuming hamburgers tainted with E. coli O157:H7. This outbreak signaled the need for greater controls based on science to prevent foodborne illness and protect consumers.
The 1993 E. coli outbreak that affected hundreds of people in 4 states became the catalyst for the U.S. Department of Agriculture’s (USDA) Food Safety and Inspection Service’s (FSIS) decision to declare E. coli O157:H7, a harmful and potentially lethal strain of the bacteria, an adulterant in October 1994. Thus, under to the Federal Meat Inspection Act (FMIA), any raw ground meat that tests positive for O157 is declared adulterated and cannot be sold for human consumption.Continue Reading...
Marler Clark clients and the owners of the restaurant that sold MarlerClark's clients food they claim was contaminated with E.coli O111 joined forces against the restaurant's insurer. In the end, the peronsal injury plaintiffs and the restaurant insured convinced the United States District Court for the Northern District of Oklahoma on a Rule 56 summary judgment motion that a single E.coli outbreak constituted at least two separate "occurrences" under a commercial general liability insurance policy ("CGL") issued to the restaurant. The result was another $1 million in coverage available to pay claims. A copy of the court's opinion can be linked here.
The primary policy at issue limited the amount of insurance available to $1 million per occurrence ($2 million products-completed operations aggregrate). According to the court, the policy defined an "occurrence" as “an accident, including continuous or repeated exposure to substantially the same general harmful conditions.” According to court's summary of the state health department's findings, the outbreak at issue included 341 persons, 60 confirmed, and 94 probable. The "point source outbreak" was from the Country Cottage restaurant. Though 21 persons did not dine at the restaurant, they were believed to be exposed at a church tea catered by the restaurant.
The court concluded that under Oklahoma law there are "two distinct places of injury and thus, two separate occurrences." The court explained that:
Looking for “the same temporal and spatial parameters” of an occurrence, the Court finds that the undisputed facts at least establish two separate occurrences of E. coli-induced illness covered under the policies: that resulting from the negligent contamination of food prepared and served at the Country Cottage restaurant and that resulting from the negligent contamination of food prepared and served at the Church Tea. Regardless of any temporal overlap between these two occurrences, the geographical distinction between the physical location of Country Cottage restaurant in Locust Grove, Oklahoma, and that of the Free Will Baptist Church in Broken Arrow, Oklahoma where the Church Tea took place is appreciable and, appreciatively, concrete.
For MarlerClark clients and the injured plaintiffs, the end result is another $1 million available to settle their claims. But is this a good result for the restaurant owners? The answer is maybe. Insureds should understand that the result may be a double-edged sword. On the one hand, another $1 million in indemnity is available to protect the owners' personal assets. On the other hand, if the insured had a large deductible or self-insured retention ("SIR"), two occurrences could mean two deductibles or two SIRs that need to be paid by the insured.
So why would an insured ever have a high deductible or SIR? The answer is that many food manufacturers and retailers maintain a high deductible or SIR in order to control the defense and settlement of the case and not hand over control to the insurer at the outset. Often, the insured's objective is to resolve the case in a way that best protects the client’s business and brand going forward. A conflict with the insurer arises because the insurer's objective is to resolve the case for the fewest dollars possible (combined payment of defense costs plus indemnity paid to the allegedly injured consumer).
The FDA recently took the relatively unusual step of obtaining a court-issued warrant to seize all cheese products at Estrella Family Creamery, a small, family-owned artisan cheese maker in Washington State. According to the United States Attorney's Office for the Western District of Washington, "the FDA asked Estrella to recall all cheese products. The company refused." The FDA requested the recall after both products and the manufacturing environment at Estrella tested positive for Listeria. A copy of the FDA form 483 report immediately pre-dating the recall request is here.
As the Estrella situation illustrates, the FDA is not just focused on large-scale manufacturing. As the FDA and USDA move to more risk-based allocation of resources, they are increasingly concerned about smaller operations and retail. Below are issues any food manufacturer must tackle when it comes to Listeria (much of this also applies to other food-borne pathogens).
What is Listeria?
Listeria monocytogenes is a bacterium that causes listeriosis, which primarily affects persons of advanced age, pregnant women, newborns, and adults with weakened immune systems. Though it affects only a small portion of the population, Listeria is the most deadly food-borne pathogen in the United States, killing 20-30% of all those who become seriously ill.
What should you do if your product tests positive for Listeria?
Assemble your well-rehearsed crisis management team immediately if a product tests positive (or if a regulator believes that your product may be contaminated). Members of the crisis management team; food safety personnel; company executives; and representatives from accounting, legal, supply chain, sales and customer service all are essential in the decision making process below.
Can you trace back and isolate contamination?
Quality assurance and food safety personnel need to answer trace-back issues as soon as possible. Can you determine the source of the contamination? Is it limited to one lot or a single day of production? How often are production facilities sanitized? How often are production surfaces swabbed for Listeria? Does the production facility re-use contaminated product from shift to shift?
Will you have to issue a recall?
Both the FDA and USDA lack mandatory recall authority. Though, as Estrella learned, the agencies do have the bully pulpit and the ability to get a court order to seize products. Because of the high mortality rate, regulators (federal and state) take any positive Listeria test result in food products extremely seriously.
If the food is considered a ready-to-eat product (RTE), a positive Listeria test will almost invariably lead to the FDA or USDA requesting a class I recall.
Even for a non-RTE food, a positive Listeria test will lead to a requested recall. If the agencies believe that the cooking instructions are clear, are easily followed by consumers and, if followed, will kill the bacterium, then the recall may be considered class II.
A primary difference between class I and II is that the class I recall will result in much greater publicity. For FDA-regulated facilities, a class I recall also triggers reporting and notification requirements under the Reportable Food Registry (RFR).
What does the Reportable Food Registry require?
RFR requires FDA-registered facilities to report to the FDA portal within 24 hours when there is a "reasonable probability that an article of food will cause serious adverse health consequences." As part of the report, information must be submitted "one step back and one step forward" in the supply chain. Once a report is submitted, the FDA will promptly alert your customers of the "reasonable probability" that your product will result in "adverse health consequences or death." If suppliers and customers are also FDA facilities, the FDA will also pressure those companies to report to the portal.
The ticking of the RFR's 24-hour reporting deadline forces a company to make snap decisions that might affect its entire business. While RFR reports can be amended or withdrawn based on new information, in the world of food products, the bell can almost never be unrung. A more lengthy discussion of the RFR can be found here.
How do you marshal your case with the regulators?
Assuming that you have information showing that contamination is limited (or non-existent), how do you convince the regulators? The FDA and USDA’s concern is public health (and politics). The regulators’ concern is not for your business.
Providing information to the regulators in a manner they perceive as credible, prompt and transparent is critical. Once the regulators lose confidence in your company's credibility and competence, the game may be over. In most cases, the most effective way to marshal your evidence is a well-prepared and credentialed crisis management team (e.g., food safety, quality assurance, supply chain, accounting, sales, legal, media, etc.).
American Conference Institute (ACI) recently held its latest conference on food-borne illness litigation. The conference has been a fairly intimate gathering of the nation’s lawyers, insurers and experts involved with food-borne illness litigation.
This year, I had the privilege of moderating an in-house counsel “think tank.” The panel was composed of lawyers from a nice cross-section of food businesses: Yum Brands, Hormel, Fresh Express and SUPERVALU (though for each, food-borne illness litigation is a rare event) A slide-deck from the panel can be found here.
Also among the presenters at this year’s conference were Center for Disease Control’s (CDC) Dr. Arthur Liang and USDA/FSIS representative Dr. Dan Engeljohn. Both presentations provided fascinating insight into changes afoot in food safety enforcement and policy at the federal level. Here are some of the take-aways:
• “Outbreaks Waiting to Be Discovered” – Dr. Liang opined that, based on surveilled illnesses, most food-borne illness outbreaks are not presently discovered. He believes that recent data shows that there are perhaps 2-3 times more outbreaks nationally than what’s been uncovered over the last few years.
• Food Safety Progress Being Undone by Retail Deli Operations – FSIS says there has been a “steady increase in risky behavior at the retail level.” According to Dr. Engeljohn, budget authority is being sought to intervene with retailers, particularly smaller supermarket deli operations.
• Negative Tested Product Can Be Considered Adulterated - FSIS will be issuing a policy soon that for the first time will consider a “negative tested product to be determined adulterated” under circumstances where an associated product tested positive for pathogens.
• Non-0157 STECs - FSIS will be finalizing methodology to detect non-0157 Shiga Toxin-Producing Escherichia coli (STEC).
University of Nebraska has posted video on its website from the entire three days of the 2009 Governor’s Conference on Ensuring Food Safety. You can view my presentation on Defending Liability in Foodborne Illness Outbreaks. More important, you view the presentations of Dr. Andrew Benson and the other scientists who offer fascinating insights into the latest developments driving the science of food safety.
An important study was released this month by the Institute of Food Technologists addressing the challenge of responding to food contamination with limited scientific information. Ricardo Carvajal at Hyman, Phelps & McNamara wrote about this on the FDALawBlog last week. You can read the summary by Rosetta L. Newsome here.
Ms. Newsome summarizes the three main sections of the study as follows:
“details the U.S. legal framework that provides the foundation for U.S. food safety policy,
describes international considerations (e.g., Codex standards) that impact foods in international commerce, and addresses European Union law and standards.”
“briefly addresses structure activity relationships, surrogate compounds and metabolites,
predictions based on physical/chemical data, toxicological evaluation, use of animal studies, statistical considerations, and other aspects of risk assessment.”
“addresses why a new approach is needed to conduct a risk-based evaluation of the potential exposure, hazard, and toxicity of low levels of unwanted chemical substances in foods and how information on risk can be used to make appropriately conservative and balanced decisions[;] . . . also calls attention to the importance of evaluating benefits of the food(s) in which the component is found as well as risks.”
For lawyers and insurance adjustors, compartmentalizing food-borne illness claims is easy. They often see their jobs solely as minimizing the tort liability and legal fees. In my experience, attorneys and adjustors often fail to appreciate how outbreaks can affect a client’s (or even a whole industry’s) business going forward. Often, the long-term business losses of a food-borne illness outbreak, recall, or government alert are not insured.
There is no better example of how a nationally reported food-borne illness outbreak can affect an entire industry (or even an entire category of food products) than the 2006 E. coli spinach outbreak. Two new studies published by the Agriculture & Applied Economics Association (AAEA) in its Choices magazine analyze consumer information and studies in the wake of the spinach outbreak.
Among the highlights from the first study, “Public Response to Large-Scale Produce Contamination” by Carra Cuite and William K. Hallman, were findings that Americans were more aware of advisories beginning than ending. For example, 87% of spinach consumers knew about the outbreak, but more than six weeks after the FDA had lifted its spinach warnings “almost half (45%) of people who were aware of the spinach recall were not confident that the recall had ended.”
A second study entitled “E. coli Outbreaks Affect Demand for Salad Vegetables” was authored by Faysal Fahs, Ron C. Mittelhammer, and Jill J. McCluskey. It examines the cumulative effects that sequential outbreaks can have on consumer demand and concludes that “the empirical results suggest that the subsequent outbreaks had a greater impact on the consumption of salad vegetables than the first.”
For food companies the lesson is this:
A lawyer’s role in responding to a food product crisis is important. But the roles of others, such as public relations experts, may be as important or more important in preserving the business. Make sure your lawyer (and your insurer) understands that the world may not revolve around simply resolving the tort claims as economically as possible.
USDA’s Be Food Safe Twitter Feed circulated its Fact Sheet titled “Beef . . . from Farm to Table.” First published a few years ago, this might be of interest to businesses involved in the sale, marketing, labeling, and/or packaging of beef. The article is a helpful primer on the history of beef, current industry practices, USDA’s role in inspection, consumer trends, cooking times, storage times, and food-borne illnesses associated with beef.
This week the Obama administration announced the launch of a new website for the recently formed food safety working group. Obama announced the formation of this group in March in the wake of the high-profile food safety issues surrounding PCA peanut products.
This website will assist in tracking the efforts of the working group. As discussed previously on this blog, this group is expected to make recommendations aimed at detection, awareness and government reorganization. Possible examples include increasing funding to states to monitor food-borne illness, combining FDA and USDA food safety efforts, reexamining mandatory recall authority, increasing retail enforcement and implementing more aggressive consumer warnings.
What is not clear is whether the working group will look beyond just detection, awareness and reorganization to bolder initiatives that may result in less consumer illness and less legal exposure for food sellers. Bolder initiatives could include funding for irradiation, consumer food safety education, and fast-track development and implementation of technology that can sample food products for whole colonies of microorganisms.
The Nebraska Governor’s Conference on Ensuring Food Safety included a lively discussion on distillers grains and E. coli O157:H7. Dr. Jim Wells at USDA presented data that appears to show some correlation between certain levels of cattle-fed distillers grains and the levels of O157 that appeared in the hides of cattle. Recent research suggests that distillers grain does not increase the prevalence of O157 in cattle though it may increase the amount of the O157 in the cattle that already have the bug.
Some researchers are coming to believe that any issues surrounding distillers grains may be ameliorated by dietary supplements. Dr. Wells emphasized, however, that more research is needed. USDA believes that distillers grains are an important source of animal feed and appears committed to better understanding distillers grains and cattle nutrition.
2008 was a terrible year for makers of ethanol and biodiesel. Huge spikes in the prices of raw materials, natural gas and transportation and drops in the prices they received for their main products have driven many of them to cut back production, shutter plants or even seek bankruptcy protection. In additiion, U.S. biodiesel producers saw themselves faced with an antidumping investigation by the EU that might affect their export market.
If you thought it couldn’t get any worse, hang on.
The National Grain and Feed Association reports that at the International Feed Expo in Atlanta on January 27, Dr. Daniel McChesney of the Food and Drug Administration spoke about studies the agency has reviewed concerning distillers’ grains, the main by-product of ethanol, and glycerin, the main by-product of biodiesel. The information presented by the FDA’s Center for Veterinary Medicine is of concern to anyone in the biofuels industry, as well as anyone who feeds livestock or purchases, processes or consumes meat and poultry.
The FDA has tested 45 samples of distillers’ grains from ethanol plants and in over half of them detected antibiotics, including virginiamycin, erythromycin and tylosin. NGFA later learned that the concentration of those antibiotics exceeded the level (0.5 ppm) from a letter of no objection relating to virginiamycin issued in 1993 to the predecessor of Philbro Animal Health. There are no safe levels established for the other two antibiotics in feed grain. The FDA has 15 more samples to test and intends to make its final report available this summer.
With regard to biodiesel-derived glycerin, Dr. McChesney stated that the FDA does not consider it to be GRAS, or generally recognized as safe, for use as animal feed. Two issues raised concerns:
· Many samples contained more methanol than the 150 ppm level recognized as safe for animal feed; and
· Samples contained salt in concentrations as high as 16,500 ppm.
Accordingly, the FDA will be conducting a safety review of glycerin as a by-product of biodiesel. This will focus on the type of feedstock used, the manufacturing process and how the glycerin is introduced into feed.
Developing markets for by-products has been a significant challenge for the emerging biofuels industry. The latest news of the FDA’s concerns about both distillers’ grains and glycerin will increase those challenges in an already difficult environment.
I just returned from ACI’s Second National Forum on Food-Borne Illness, which included several interesting presentations and discussions. One was by Dan Engeljohn, Deputy Assistant Administrator of the Office of Policy and Program Development at the Food Safety and Inspection Service (“FSIS”). Mr. Engeljohn spoke about FSIS’s priorities for “2009 and beyond.” Takeaways from this presentation include:
FSIS is increasingly concerned with strains of E. coli other than O157:H7. Non-O157:H7 strains such as E.coli O121:H19 and O111 are growing more prevalent in the environment. FSIS is putting additional resources into developing methodology for detection of non-O157 STECs.
As FSIS, CDC, FDA and local health departments develop this methodology, the industry can expect more reported outbreaks and more liability exposure. Most experts believe that many non- O157:H7 outbreaks go undetected. Increased focus on detection of non-O157 E. coli strains is yet another reason to examine the sufficiency of your companies' insurance limits.
Frozen, Not Ready to Eat Meals
According to Mr. Engeljohn, because of recent salmonella scares, FSIS remains concerned about “frozen, not ready to eat” meals and specifically “frozen, not ready to eat” poultry meals. He explained that “evidence is mounting that these products cannot be safely prepared unless salmonella is controlled in the source materials.” In other words, FSIS now believes that no amount of package labeling or consumer education can prevent consumers from undercooking these meals.
FSIS jurisdiction over salmonella in poultry is limited. FSIS attempts restrict the sale of “frozen, not ready to eat” meals or impose more stringent standards against salmonella in poultry may be a reach for the agency. As discussed in Supreme Beef Processors v. USDA Salmonella, "is not an adulterant per se, meaning its presence does not require the USDA to refuse to stamp such meat 'inspected and passed.'" Absent statutory reform, FSIS action in this area may be challenged.
Mr. Engeljohn stated that FSIS is “deeply concerned” about listeria. It believes that gains made in recent years at meatpacking plants may be undone by problems at supermarket deli counters. FSIS believes that little is being done to address critical control points at the retail level, such as proper cleaning and sanitizing of meat slicers. FSIS may be exploring ways to exercise more jurisdiction to regulate supermarket delis.
No food-borne illness induces consumer fear like Bovine Spongiform Encephalopathy (BSE a.k.a. "Mad Cow Disease"). The beef industry in particular has gone to great lengths to take preventative steps against the introduction of BSE into U.S. herds. A big problem in controlling BSE is that it’s difficult to detect. The only detection method currently available involves the slaughter of a suspect animal and a series of not very reliable tests.
Harold Craighead and colleagues at Cornell University have developed nanoscale resonators, which are tiny devices that function like tuning forks by changing pitch with increased mass. When prions bind to the resonator’s silicon sensor, it changes the vibrational resonant frequency of the device. In experimental trials, the sensor detected prions at concentrations as low as two nanograms per milliliter, the smallest levels measured to date.
Though still a while away from practical application, the technology may have dramatic effects on the ability to ensure the safety of the nation’s beef supply. The BSE “tuning fork” is a good example of yet another new technology industry that the government can use to ensure food safety and consumer confidence.
Farming and safe handling practices alone cannot provide the level of assurance that consumers demand in their food supply. Tuning fork, irradiation, and better bacteria detection are all vital tools that industry, government, and consumers need to embrace.
We've previously discussed ongoing research concerning safety of distillers grains previously. An article on distillers grains and E. coli in Distillers Grains Monthly (Third Quarter 2008) suggests that the scientific debate continues, and questions remain unanswered.
Conflicting studies have now been released by Kansas State University and the University of Nebraska regarding the link between distillers grains and the presence of E. coli O157:H7. In December 2007, KSU released a study showing that E. coli O157:H7 levels were approximately two-fold higher in cattle fed dried distillers grains. In reaction to the KSU findings, researchers at Nebraska revisited their findings from an earlier distillers grains feeding trial and arrived at a conclusion different than that of KSU.
Nebraska researchers found E. coli O157:H7 produced at statistically significant levels between diets low in distillers grains and those high in distillers grains. However, neither of those diets produced E. coli O157:H7 at levels statistically significant from the control diet. The Nebraska data also showed that diets low in distillers grains may help animals to shed the microbe in feces.
Apart from the studies, the article explains that much remains unknown about the effects of distillers grains when introduced into cattle diets. For example, researchers do not know why cattle respond differently when fed dried distillers grains-spiked steam-flaked corn and dried distillers grains-supplemented dry-rolled corn. Researchers are also unaware of how distillers grains produced from different sources--sorghum, barley, and so forth--may affect cattle differently.
Hopefully, we will learn more in October 2008, when Nebraska plans to make available a study involving 480 cattle and high levels of distillers grains. Until then, it appears the link between distillers grains and the presence of E. coli O157:H7 in cattle remains unsettled.
Two weeks ago saw a significant legal decision in the raw milk debate. The superior court in San Benito County, California upheld new state regulations requiring raw milk to meet the same standards for bacteria counts as pasteurized milk. Essentially, the ruling puts the raw milk producers out of business (unless legislation introduced this week is passed overriding the regulations).
By all accounts, raw milk will always have a higher bacteria count than pasteurized milk. Higher bacteria count is exactly what advocates of raw milk point to as one of its prime benefits. Most bacteria, these advocates will remind us, is “good” bacteria that makes us healthier. Many (if not most) raw milk producers pride themselves on their farming practices and wholesomeness of the product.
State health officials contend that the risks of raw milk outweigh the benefits. Pasteurization eliminates so much of the risk from foodborne illness that nothing can outweigh its benefits.
Consumer advocates and the plaintiffs' personal injury bar usually walk lock-step when it comes to food safety. Not true with the raw milk debate. Plaintiffs’ lawyers like Bill Marler are crusading against raw milk producers. Many of Marler’s allies—small-farming advocates and those against “corporate” food production—are his prime targets.
The dividing line is drawn between a culture of consumer rights and those who believe that responsibility for food safety lies solely in the hands of the court and regulators. In the world of the later category, consumers can’t be trusted. No amount of instructions or warnings, they would tell us, is sufficient to protect against risk.
Despite my own misgivings about raw milk, I suspect that San Benito judge may not have fully appreciated the debate (admittedly, I have yet to get a hold of the opinion) . I’m not at all sure that the judge consciously intended to pick a side between consumer rights and consumer protection. He may have seen this only as an issue of the state regulating an “unsafe” product.
The USDA’s primary enforcement mechanism (as it has no mandatory recall authority) is to pull its inspectors from food processing plants, effectively shutting the plants down (a meat processing plant cannot operate by law without USDA inspectors). The USDA has no authority to remove its inspectors unless products are adulterated, so it cannot shut down a plant if it finds non-O157 E. coli.
Dr. Raymond’s announcement, therefore, raises the question of what USDA intends to do with its testing results for non-0157 E. coli. If USDA intends to request voluntary recalls for non-0157 E. coli, this is certain to generate controversy and crisis. For example, what is a food producer to do when the USDA (or another state or federal agency) asks for a large-scale recall or destruction of a product but cannot provide a sufficient scientific basis? What if the public health agency is wrong about the public health concern, and the recall threatens the viability of a business? As discussed previously on this blog, uncertainty prevails about the science, behavior, and public health effects of non-O157 shiga toxin-producing E. coli. Research (which by all means should be accelerated) may show that non-O157 E. coli justifies classification as an adulterant, but putting enforcement ahead of science is a risky business. How much confidence will the public or industry have in our public health officials when their decisions are made without scientific rationale?
Tomorrow FSIS will hold a meeting to discuss “challenges and proposed solutions in moving forward to address recalls and illnesses related to E. coli O157:H7.” The meeting will “explore proposed next steps as a means to make progress in the challenge of addressing E. coli O157:H7 and non-O157:H7 STECs.”. FSIS is also planning a “short term study to determine the extent to which non-O157 STECs may be present in FSIS-regulated products.”
Non-O157 Shiga toxin-producing E. Coli. is an important issue for food producers and sellers. Although non-O157 bugs have been implicated in food-borne outbreaks in recent years, serious questions exist concerning the scientific basis for implicating non-O157 bugs.
As discussed last October at the USDA’s conference on non-O157 E. coli, scientific challenges abound and uncertainties prevail in identifying and dealing with non-O157 Shiga toxin-producing E. coli. Little research currently exists. Often epidemiologists assume that non-O157 bugs behave and appear like E. coli O157:H7, and microbiologists looking for PFGE or genetic links between bugs apply the same run parameters and criteria. Yet many believe that comparing O157 bugs to non-O157 bugs may be like comparing apples to oranges.
Fortunately, I will have the opportunity to question many of the participants in this Friday’s FSIS meeting at Seattle University School of Law’s food law symposium. I’m looking forward to an update on the progress of non-O157 research.
Although there is no way to eliminate risk, grocers, restaurants, and produce suppliers should conduct ongoing reviews of their food safety, audit, supplier, and insurance programs to ensure that everything that can be done is being done to mitigate or shift risk.