18 August 2018 | Online since 2003


1 July 2014

United States fines egg producer for salmonella outbreak


A United States egg baron and his son could be jailed for up to a year after admitting their part in an egg scandal that left 62,000 consumers ill with salmonella poisoning.

Austin “Jack” DeCoster, his son Peter DeCoster and their company, Quality Egg LLC, which was one of the biggest producers of eggs in the United States, were charged with a series of offences following investigations into a nationwide salmonella outbreak in 2010. The company has admitted that eggs were falsely labelled to disguise their age and that a US Department of Agriculture inspector was bribed to approve poor quality eggs for sale.


The US Department of Justice says that the defendants have entered guilty pleas as part of a plea agreement. It is understood that the company has agreed to pay a $6.8 million fine under the plea deal. However, the judge dealing with the case could yet decide to reject the deal when it comes to sentencing. The DeCosters could face up to a year in jail. The judge could also decide to award compensation to the victims of the salmonella outbreak.

In a statement issued following the plea deal, the Department of Justice said, “Quality Egg LLC (Quality Egg), Austin “Jack” DeCoster and Peter DeCoster pleaded guilty today in federal court in Sioux City, Iowa, in connection with the distribution of adulterated eggs in interstate commerce. As part of their plea agreements, the company and the two individuals admitted the company’s shell eggs were adulterated in that they contained a poisonous and deleterious substance, salmonella enteriditis, that may have rendered the eggs injurious to health.”


The statement was issued by assistant attorney general Stuart F. Delery of the Justice Department’s Civil Division and US attorney Kevin W. Techau of the Northern District of Iowa. It said that Quality Egg had pleaded guilty to one count of bribery of a public official, one count of introducing a misbranded food into interstate commerce with intent to defraud, and one count of introducing adulterated food into interstate commerce. The statement said that Austin DeCoster, 79, of Turner, Maine, and Peter DeCoster, 51, of Clarion, Iowa, each pleaded guilty to one count of introducing adulterated food into interstate commerce.

“As part of its plea agreement, Quality Egg acknowledged that, on at least two occasions in 2010, its employees gave a cash bribe to an inspector of the US Department of Agriculture (USDA).

The USDA inspector’s job responsibilities included inspecting shell eggs at one or more of Quality Egg’s production facilities in Iowa,” said the statement. “Quality Egg admitted its employees provided the bribe to the USDA inspector (now deceased) in an attempt to corruptly influence the inspector to exercise his authority to release pallets of retained eggs for sale without re-processing the eggs as required by law and USDA standards. The eggs had been retained or ‘red tagged’ for failing to meet minimum USDA quality grade standards.”

The Department of Justice said that Quality Egg admitted that between 2006 and 2010 its employ-ees attached labels to egg shipments that indicated false expiration dates with the intent to mislead state regulators and retail egg customers about the true age of the eggs. “Quality Egg acknowledged that there were a number of ways that the company mislabeled older eggs with newer processing and expiration dates prior to shipping the eggs to customers in California, Arizona and other states,” it said. “Sometimes Quality Egg personnel did not put any processing or corresponding expiration dates on the eggs when they were processed. The eggs would be kept in storage for several days or up to several weeks. Then, just prior to shipping the eggs, Quality Egg personnel labeled the eggs with processing dates that were false.”

The Department of Justice said Quality Egg admitted that it had sold shell eggs that were “adulter-ated in that they contained a poisonous and deleterious substance, salmonella enteriditis. The com-pany acknowledged that it produced, processed, held, and packed the contaminated eggs
in Iowa and sold and caused the distribution of the eggs to buyers in states other than Iowa.”

The Department of Justice said Austin DeCoster admitted that he was the trustee of a trust that owned Quality Egg (also doing business as Wright County Egg, and Environ) and that he exercised substantial control over the operations of Quality Egg and related entities and assets in Iowa.
De-Coster acknowledged that he was the person ultimately responsible for the operations of Quality Egg and the various egg facilities in Iowa associated with Quality Egg.

Peter DeCoster had admitted that as the chief operating officer of Quality Egg he exercised some control over the production and distribution of shell eggs by Quality Egg and related entities and assets in Iowa. He had acknowledged he was one of the people responsible for running the opera-tions of Quality Egg and the various egg facilities in Iowa associated with Quality Egg.

The DeCosters both admitted that between about the beginning of 2010 and in or about August 2010 Quality Egg introduced and caused
to be introduced into interstate commerce shell eggs that “were adulterated, in that they contained a poisonous and deleterious substance, salmonella en-teriditis.”

Sentencing has been put off for the preparation of pre-sentence reports. The DeCosters have been released on bail pending sentencing. Each faces a maximum sentence of up to one year imprisonment or a term of probation of not more than five years; a fine equal to the greater of twice the gross gain or the gross loss resulting from the offence, or $100,000; and a term of supervised release after any imprisonment for up to one year.

On the bribery count, Quality Egg faces a sentence of probation for at least one and up to five years and a fine equal to the greater of three times the monetary equivalent of the thing of value given, offered, or promised as part of the offense, or $500,000. Quality Egg has agreed to forfeit a money judgment of $10,000 representing proceeds of the bribery offence.

For introducing misbranded eggs into interstate commerce with the intent to defraud, Quality Egg faces a maximum sentence of probation for at least one and up to five years and a fine equal to the greater of twice the gross gain resulting from the offence, twice the gross loss resulting from the offence, or $500,000.

For introducing adulterated eggs into interstate commerce, Quality Egg faces a sentence of probation for up to five years and a fine equal to the greater of twice the gross gain resulting from the offence, twice the gross loss resulting from the offence, or $100,000.

In 2012, a former Quality Egg employee, Tony Wasmund, 63, pleaded guilty to one count of con-spiracy to bribe a public official, sell restricted eggs with intent to defraud, introduce misbranded food into interstate commerce with intent to defraud and mislead. He is due to be sentenced in Sep-tember this year.

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