May 14, 2014 - Blogs
The U.S. Justice Department has secured the cooperation of two key witnesses in a felony criminal prosecution against executives of the defunct Peanut Corporation of America, a peanut processor and manufacturer whose gross annual sales once totaled $30 million.
Daniel Kilgore and Samuel Lightsey served as operations managers at a peanut plant in Blakeley, Georgia, which was tied to a Salmonella outbreak that caused more than 700 illnesses and nine deaths in 2008 and 2009.
Last week, Lightsey pleaded guilty to a number of charges filed against him and faces several years behind bars under a plea agreement with federal prosecutors. He and Kilgore have agreed to cooperate with the government in a criminal trial that is pending against three other defendants, two of whom are brothers: Stewart Parnell, the owner and president of PCA; and his sibling, Michael, who worked as a food broker on behalf of the company.
In a 76-count indictment unveiled last year, federal authorities contend the former officials mislead customers about the presence of Salmonella in peanut products that were sold to them, fabricating documents that stated shipments of peanut products contained no pathogens when no tests were conducted or lab results showed the presence of Salmonella. The former officials also have been accused of lying to U.S. Food and Drug Administration (FDA) inspectors following a widespread outbreak that caught lawmakers' attention.
The Salmonella Typhimurium outbreak was traced back to PCA's plant in Blakeley, and was linked to 714 reported illnesses in 46 states and nine deaths in Idaho, Minnesota, North Carolina, Ohio and Virginia, according to the Centers for Disease Control and Prevention (CDC). The government contends the PCA officials failed to ensure the plant was sanitary and prevent cross-contamination between raw and cooked products.
Jury Trial Pending
W. Louis Sands, a U.S. District Judge, is scheduled to preside over a jury trial on July 14 in Albany, Georgia against the Parnells, who each have been charged with mail and wire fraud, the introduction of adulterated and misbranded food into interstate commerce with the intent to defraud or mislead and conspiracy. The U.S. Attorney’s Office for the Middle District of Georgia also charged Stewart Parnell with obstruction of justice. A third defendant, Mary Wilkerson, a former PCA receptionist, officer manager and quality assurance manager, is set to go to trial alongside the Parnells on several charges, including obstruction of justice.
The criminal case could go to a jury five years after lawmakers with the House Energy and Commerce Committee looked into the cause of the outbreak. Documents obtained by the Subcommittee on Oversight and Investigations tended “to show a company that was more concerned with its bottom line than the safety of its customers," said Rep. Henry Waxman, the California Democrat, at the outset of the Feb. 11, 2009 hearing.
For instance, Waxman referenced an email from Stewart Parnell that stated, in part, “the cost is costing us huge $$$$$". That email was fired off to Lightsey and another PCA official, David Voth, on Oct. 6, 2008 after Lightsey revealed the previous month that products tested positive for Salmonella, including 320 cases of a lot that had been shipped to two customers, Fieldbrook and Kerry Ingredients.
“In this case, the scope of the outbreak is not as important … as the conduct of the people who were involved and that’s what really is at question," said David Plunkett, a senior staff attorney with the Food Safety Program for the Center for Science in the Public Interest, in a phone interview.
Prosecutors have painted the defendants as participants in a long-standing scheme to defraud their customers, who ranged in size from small, family-owned operations to multibillion-dollar food giants.
If the Parnells decide to roll the dice before a jury, they will be tried together. The brothers requested separate trials, arguing that their defenses were “antagonistic and mutually exclusive," according to prosecutors. But a judge denied the request, said Pam Lightsey, a spokeswoman for the U.S. Attorney’s Office.
Former Plant Managers Witnesses for Prosecution
The defendants who pleaded guilty aren’t exactly getting a sweetheart deal.
The government agreed to recommend a prison sentence of no more than six years for Lightsey and no more than 12 years for Kilgore. The potential prison sentences are staggering especially in a case of foodborne illness. For instance, Lightsey faces a maximum prison sentence of 20 years each on three counts, five years each on two other counts and three years each on two remaining counts.
Both men agreed to cooperate with the government and conceded that a number of allegations leveled against them in the indictment are true. The admissions of guilt put the remaining defendants, particularly the Parnells, in a difficult spot. As an example, Kilgore admitted the government’s allegation in Paragraph 29 that he and the brothers shipped peanut paste to a customer without submitting a sample from the lot for microbiological testing but instead submitted a false certificate of analysis. Among the allegations that Lightsey acknowledged are true: that Stewart Parnell had directed him to release a product that had originally tested positive for Salmonella but tested negative on a retest.
Such allegations, if corroborated on the witness stand by Kilgore and Lightsey, could persuade a jury that the brothers intended to defraud their customers and could care less whether or not their peanut products contained pathogens like Salmonella.
Proving intent is a necessity—and a highly contested matter—in a case of fraud. Thanks to the plea agreements with Kilgore and Lightsey, the government knows it can call the former plant managers and obtain their testimony demonstrating such bad intent, said Ronald Friedman, a former criminal federal prosecutor for 22 years and current co-chair of Lane Powell’s White Collar Criminal Defense, Regulatory Compliance and Special Investigations Practice Group.
“They [Kilgore and Lightsey] are going to mouth all those bad allegations about bad intent. ‘This was intentional. We meant to do this. This was a conspiracy,’" said Friedman, who examined the indictment and other court documents before commenting.
Friedman, who has no connection to the case, thinks it’s less likely the Parnells will deny the falsification of documents and other evidence of fraud that the indictment references. Instead, they may testify the fraud occurred without their knowledge.
“Yah this happened. Yah false tests were provided. Yah this was a terrible thing," Friedman anticipates the defendants arguing, “but we didn’t know about it."
That could be a hard sell to the jury particularly for Stewart Parnell, who owned and ran the company as president. Especially when considering allegations in the indictment under the title “Overt Acts", which if corroborated by the plant managers, tend to show his knowledge and participation in the scheme. Consider a Sept. 15, 2004 shipment of peanut products by Stewart Parnell and Kilgore to a customer; lab results later indicated the products tested positive for Salmonella, yet neither man notified the customer about the pathogen, according to the indictment. If Kilgore affirms the veracity of that allegation in open court, and testifies that Parnell was notified that the products tested positive for the pathogen, it’s going to be hard for PCA’s president to plead ignorance.
But he may raise a separate defense at trial other than simply being in the dark about the illicit operations in Blakeley. A purported expert for the defense, Joseph Conley, claims Parnell suffered from ADHD or attention deficit hyperactivity disorder. According to court documents filed on March 11, 2014, Parnell has sought to offer Conley’s testimony to show he “did not commit the alleged crimes because he never factually acquired the knowledge necessary to form any intent about the actions alleged by the government." The prosecution, through a separate expert, claims Conley’s methods are unreliable and he shouldn’t be allowed to testify.
Sands, the federal judge, hasn’t yet ruled on whether or not Conley can testify at trial as an expert.
Government’s Cites Lies
The Justice Department claims this is not your run-of-the-mill case of foodborne illness.
Not only did some PCA officials fabricate documents upon which customers relied, they lied to or misled FDA inspectors who visited the plant in January 2009 following the outbreak, according to prosecutors.
“When those responsible for producing or supplying our food lie and cut corners, as alleged in the indictment, they put all of us at risk," said Stuart F. Delery, who heads the Justice Department’s Civil Division, in a statement at the time the indictment was announced.
At least some victims want the Parnells to be held accountable for the outbreak.
Bill Marler, a renowned food-safety lawyer who represented five of the nine individuals who died and dozens of victims who fell ill from contaminated peanut products, remembers a congressional investigation in which two of his clients who had lost parents to the outbreak testified.
“It was a time when Mr. Lightsey and Mr. Parnell took the 5th Amendment," Marler said. “It was pretty powerful."
Marler said a number of his clients communicated with the U.S. Attorney’s Office from spring 2009 through 2012. “My clients were frustrated that Parnells weren’t being prosecuted," he recalled.
Then on Feb. 21, 2013, prosecutors announced the 52-page indictment against the brothers, Lightsey and Wilkerson.
Plunkett of the Center for Science in the Public Interest expressed hope that the case would send a message to the food industry and serve as a deterrent against egregious behavior that compromises food safety.
“You want that deterrent effect and I would hope certainly that would be one of the outcomes of this," he said. “I think by and large the industry gets that … If they are not keeping safety as their No. 1 priority, there are consequences."
The U.S. Justice Department has secured the cooperation of two key witnesses in a felony criminal prosecution against executives of the defunct Peanut Corporation of America, a peanut processor and manufacturer whose gross annual sales once totaled $30 million.
Daniel Kilgore and Samuel Lightsey served as operations managers at a peanut plant in Blakeley, Georgia, which was tied to a Salmonella outbreak that caused more than 700 illnesses and nine deaths in 2008 and 2009.
Last week, Lightsey pleaded guilty to a number of charges filed against him and faces several years behind bars under a plea agreement with federal prosecutors. He and Kilgore have agreed to cooperate with the government in a criminal trial that is pending against three other defendants, two of whom are brothers: Stewart Parnell, the owner and president of PCA; and his sibling, Michael, who worked as a food broker on behalf of the company.
In a 76-count indictment unveiled last year, federal authorities contend the former officials mislead customers about the presence of Salmonella in peanut products that were sold to them, fabricating documents that stated shipments of peanut products contained no pathogens when no tests were conducted or lab results showed the presence of Salmonella. The former officials also have been accused of lying to U.S. Food and Drug Administration (FDA) inspectors following a widespread outbreak that caught lawmakers' attention.
The Salmonella Typhimurium outbreak was traced back to PCA's plant in Blakeley, and was linked to 714 reported illnesses in 46 states and nine deaths in Idaho, Minnesota, North Carolina, Ohio and Virginia, according to the Centers for Disease Control and Prevention (CDC). The government contends the PCA officials failed to ensure the plant was sanitary and prevent cross-contamination between raw and cooked products.
Jury Trial Pending
W. Louis Sands, a U.S. District Judge, is scheduled to preside over a jury trial on July 14 in Albany, Georgia against the Parnells, who each have been charged with mail and wire fraud, the introduction of adulterated and misbranded food into interstate commerce with the intent to defraud or mislead and conspiracy. The U.S. Attorney’s Office for the Middle District of Georgia also charged Stewart Parnell with obstruction of justice. A third defendant, Mary Wilkerson, a former PCA receptionist, officer manager and quality assurance manager, is set to go to trial alongside the Parnells on several charges, including obstruction of justice.
The criminal case could go to a jury five years after lawmakers with the House Energy and Commerce Committee looked into the cause of the outbreak. Documents obtained by the Subcommittee on Oversight and Investigations tended “to show a company that was more concerned with its bottom line than the safety of its customers," said Rep. Henry Waxman, the California Democrat, at the outset of the Feb. 11, 2009 hearing.
For instance, Waxman referenced an email from Stewart Parnell that stated, in part, “the cost is costing us huge $$$$$". That email was fired off to Lightsey and another PCA official, David Voth, on Oct. 6, 2008 after Lightsey revealed the previous month that products tested positive for Salmonella, including 320 cases of a lot that had been shipped to two customers, Fieldbrook and Kerry Ingredients.
“In this case, the scope of the outbreak is not as important … as the conduct of the people who were involved and that’s what really is at question," said David Plunkett, a senior staff attorney with the Food Safety Program for the Center for Science in the Public Interest, in a phone interview.
Prosecutors have painted the defendants as participants in a long-standing scheme to defraud their customers, who ranged in size from small, family-owned operations to multibillion-dollar food giants.
If the Parnells decide to roll the dice before a jury, they will be tried together. The brothers requested separate trials, arguing that their defenses were “antagonistic and mutually exclusive," according to prosecutors. But a judge denied the request, said Pam Lightsey, a spokeswoman for the U.S. Attorney’s Office.
Former Plant Managers Witnesses for Prosecution
The defendants who pleaded guilty aren’t exactly getting a sweetheart deal.
The government agreed to recommend a prison sentence of no more than six years for Lightsey and no more than 12 years for Kilgore. The potential prison sentences are staggering especially in a case of foodborne illness. For instance, Lightsey faces a maximum prison sentence of 20 years each on three counts, five years each on two other counts and three years each on two remaining counts.
Both men agreed to cooperate with the government and conceded that a number of allegations leveled against them in the indictment are true. The admissions of guilt put the remaining defendants, particularly the Parnells, in a difficult spot. As an example, Kilgore admitted the government’s allegation in Paragraph 29 that he and the brothers shipped peanut paste to a customer without submitting a sample from the lot for microbiological testing but instead submitted a false certificate of analysis. Among the allegations that Lightsey acknowledged are true: that Stewart Parnell had directed him to release a product that had originally tested positive for Salmonella but tested negative on a retest.
Such allegations, if corroborated on the witness stand by Kilgore and Lightsey, could persuade a jury that the brothers intended to defraud their customers and could care less whether or not their peanut products contained pathogens like Salmonella.
Proving intent is a necessity—and a highly contested matter—in a case of fraud. Thanks to the plea agreements with Kilgore and Lightsey, the government knows it can call the former plant managers and obtain their testimony demonstrating such bad intent, said Ronald Friedman, a former criminal federal prosecutor for 22 years and current co-chair of Lane Powell’s White Collar Criminal Defense, Regulatory Compliance and Special Investigations Practice Group.
“They [Kilgore and Lightsey] are going to mouth all those bad allegations about bad intent. ‘This was intentional. We meant to do this. This was a conspiracy,’" said Friedman, who examined the indictment and other court documents before commenting.
Friedman, who has no connection to the case, thinks it’s less likely the Parnells will deny the falsification of documents and other evidence of fraud that the indictment references. Instead, they may testify the fraud occurred without their knowledge.
“Yah this happened. Yah false tests were provided. Yah this was a terrible thing," Friedman anticipates the defendants arguing, “but we didn’t know about it."
That could be a hard sell to the jury particularly for Stewart Parnell, who owned and ran the company as president. Especially when considering allegations in the indictment under the title “Overt Acts", which if corroborated by the plant managers, tend to show his knowledge and participation in the scheme. Consider a Sept. 15, 2004 shipment of peanut products by Stewart Parnell and Kilgore to a customer; lab results later indicated the products tested positive for Salmonella, yet neither man notified the customer about the pathogen, according to the indictment. If Kilgore affirms the veracity of that allegation in open court, and testifies that Parnell was notified that the products tested positive for the pathogen, it’s going to be hard for PCA’s president to plead ignorance.
But he may raise a separate defense at trial other than simply being in the dark about the illicit operations in Blakeley. A purported expert for the defense, Joseph Conley, claims Parnell suffered from ADHD or attention deficit hyperactivity disorder. According to court documents filed on March 11, 2014, Parnell has sought to offer Conley’s testimony to show he “did not commit the alleged crimes because he never factually acquired the knowledge necessary to form any intent about the actions alleged by the government." The prosecution, through a separate expert, claims Conley’s methods are unreliable and he shouldn’t be allowed to testify.
Sands, the federal judge, hasn’t yet ruled on whether or not Conley can testify at trial as an expert.
Government’s Cites Lies
The Justice Department claims this is not your run-of-the-mill case of foodborne illness.
Not only did some PCA officials fabricate documents upon which customers relied, they lied to or misled FDA inspectors who visited the plant in January 2009 following the outbreak, according to prosecutors.
“When those responsible for producing or supplying our food lie and cut corners, as alleged in the indictment, they put all of us at risk," said Stuart F. Delery, who heads the Justice Department’s Civil Division, in a statement at the time the indictment was announced.
At least some victims want the Parnells to be held accountable for the outbreak.
Bill Marler, a renowned food-safety lawyer who represented five of the nine individuals who died and dozens of victims who fell ill from contaminated peanut products, remembers a congressional investigation in which two of his clients who had lost parents to the outbreak testified.
“It was a time when Mr. Lightsey and Mr. Parnell took the 5th Amendment," Marler said. “It was pretty powerful."
Marler said a number of his clients communicated with the U.S. Attorney’s Office from spring 2009 through 2012. “My clients were frustrated that Parnells weren’t being prosecuted," he recalled.
Then on Feb. 21, 2013, prosecutors announced the 52-page indictment against the brothers, Lightsey and Wilkerson.
Plunkett of the Center for Science in the Public Interest expressed hope that the case would send a message to the food industry and serve as a deterrent against egregious behavior that compromises food safety.
“You want that deterrent effect and I would hope certainly that would be one of the outcomes of this," he said. “I think by and large the industry gets that … If they are not keeping safety as their No. 1 priority, there are consequences."
No comments:
Post a Comment