Before salmonella outbreak, egg firm had long record of violations
Sunday, August 22, 2010
The Iowa egg producer that federal officials say is at the center of a salmonella outbreak and recalls of more than a half-billion eggs has repeatedly paid fines and settled complaints over health and safety violations and allegations ranging from maintaining a "sexually hostile work environment" to abusing the hens that lay the eggs.
In the past 20 years, according to the public record, the DeCoster family operation, one of the 10 largest egg producers in the country, has withstood a string of reprimands, penalties and complaints about its performance in several states.
In June, for instance, the family agreed to pay a $34,675 fine stemming from allegations of animal cruelty against hens in its 5 million-bird Maine facility. An animal rights group used a hidden camera to document hens suffocating in garbage cans, twirled by their necks , kicked into manure pits to drown and hanging by their feet over conveyer belts.
Hinda Mitchell, a spokeswoman for the company, declined to answer questions about its record. She said in an e-mail, "We are focused on doing the right thing with the recall and on our continued cooperation with FDA."
DeCoster owns Wright County Egg in Iowa, which last week recalled 380 million eggs distributed nationwide. A federal investigation into 26 outbreaks of salmonella enteritidis, the second-leading cause of food-borne illness, found that 15 of the outbreaks pointed to Wright County Egg.
The DeCoster family also has close ties to Hillandale Farms of Iowa, which on Friday recalled 170 million eggs distributed to 14 states in the Midwest and West after scientists in Minnesota linked one salmonella outbreak to Hillandale. Wright County Egg and Hillandale share suppliers of young chickens and feed, and the DeCoster family put up the money for Hillandale's founder to purchase Ohio Fresh Eggs, the largest operation in that state.
Federal and state officials are still trying to pinpoint the cause of the outbreaks, which started in May and so far have not involved any reported deaths. But the investigation and recalls already represent the biggest challenge yet to a family empire that has continued to thrive, often with the support of local residents and officials grateful for the jobs and tax dollars it provides.
"Wright County Egg recognizes the significant consumer concern about the potential incidence of Salmonella Enteritidis," Mitchell, the company spokeswoman, said in a statement. "That is why we continue to work cooperatively with FDA after our voluntary recalls . . . of shell eggs. This measure is consistent with our commitment to egg safety, and it is our responsibility."
As family legend has it, the company got its start in Turner, Maine, when Austin "Jack" DeCoster was 15: His father died, leaving him responsible for his siblings and the family's 125 chickens. DeCoster -- a born-again Christian who, according to Maine officials, once fired a manager because he was an atheist -- expanded the family's holdings to more than 15 million chickens. Now in his 70s, he runs the company with his sons Peter, in Iowa, and Jay, in Maine.
Growing list of violations
As the family's holdings have expanded, so has the list of allegations against it:
-- In 1996, DeCoster was fined $3.6 million for health and safety violations at the family's Turner egg farm, which then-Labor Secretary Robert Reich termed "as dangerous and oppressive as any sweatshop we have seen." Regulators found that workers had been forced to handle manure and dead chickens with their bare hands and to live in filthy trailers.
-- In 1999, the company paid $5 million to settle a class-action lawsuit involving unpaid overtime for 3,000 workers.
-- In 2001, the Iowa Supreme Court ruled that DeCoster was a "repeat violator" of state environmental laws, citing violations involving the family's hog-farming operations. The family was forbidden to expand its hog-farming interests in the state.
-- Also in 2001, DeCoster Farms of Iowa settled, for $1.5 million, a complaint brought by the Equal Employment Opportunity Commission that the company had subjected 11 undocumented female workers from Mexico to a "sexually hostile work environment," including sexual assault and rape by supervisors.
-- In 2002, the Occupational Safety and Health Administration fined the family's Maine Contract Farming branch $345,810 for an array of violations. The same year, DeCoster Egg Farms of Maine paid $3.2 million to settle a lawsuit filed in 1998 by Mexican workers alleging discrimination in housing and working conditions.
-- In 2003, Jack DeCoster paid the federal government $2.1 million as part of a plea agreement after federal agents found more than 100 undocumented workers at his Iowa egg farms. It was the largest penalty ever against an Iowa employer. Three years later, agents found 30 workers suspected of being illegal immigrants at a DeCoster farm in Iowa. And in 2007, raids at other DeCoster Iowa farms uncovered 51 more suspected undocumented workers.
-- In 2006, Ohio's Agriculture Department revoked the permits of Ohio Fresh Eggs because its new co-owners, including Hillandale founder Orland Bethel, had failed to disclose that DeCoster had put up $126 million for the purchase, far more than their $10,000, and was heavily involved in managing the company. By playing down DeCoster's role, the owners had avoided a background check into DeCoster's "habitual violator" status in Iowa. An appeals panel overturned the revocation, saying the disclosure was adequate.
-- In 2008, OSHA cited DeCoster's Maine Contract Farming for violations that included forcing workers to retrieve eggs the previous winter from inside a building that had collapsed under ice and snow.
Bill Marler, a Seattle lawyer who specializes in food safety cases and has already filed one suit in the current outbreak and expects to file another Monday, said the recalls would deal a huge financial blow to the company. But he noted that several companies involved in other major recalls in recent years -- for peanuts, spinach and other products -- have seen their sales bounce back.
"This may be the straw that breaks the camel's back, but there are lots of companies with massive recalls . . . that go on their merry way," he said.
Fewer U.S. outbreaks
Howard Magwire of the United Egg Producers, a trade group, said the incidence of salmonella outbreaks in the country's egg industry, which produces 80 billion eggs a year, has dropped in the past decade, thanks to improved industry practices, better state oversight and consumer education. A new egg safety law that went into effect last month is geared toward preventing outbreaks like the ones that began in May by, among other things, requiring more testing for salmonella in chicken barns.
Despite the DeCosters' record, some state regulators say the company has improved its approach in recent years. Kevin Baskins, a spokesman for Iowa's Department of Natural Resources, said the agency, which shares oversight of egg producers with the state's agriculture department, had brought no enforcement actions against the company's egg operations.
"One of the things I've always said about DeCoster is that when there's a problem at his facilities, he acts fast," he said. "They're not going to sit around and question you, 'Do we really need to do that?' If we see a spill that needs to be stopped, they do it."
The company also gets warm reviews from local officials in the towns where it operates. In Turner, where it provides $4.8 million in taxes per year -- 8.6 percent of the total -- Town Manager Eva Leavitt said the company is "very easy to work with," despite the problems that arose there. "The facility is neat and clean and has a pleasant view," she said.
In Galt, Iowa, Wright County Supervisor Stan Watne said the DeCosters have "done good things for the town," such as giving money to the library. He worries about what will happen if the company goes into a decline, given how much local corn growers depend on it as a buyer of chicken feed and a source of cheap fertilizer. But he is still hopeful that the DeCosters would survive intact given how many egg buyers depend on them.
"Who else are those people going to go to?" Watne said. "He's the big guy. He can fill an order no one else can."
Rosella Bear, for one, has found another source for her eggs. A neighbor of a big Ohio Fresh Eggs operation in Marseilles, Ohio, she has long complained about problems there. While the smell and flies aren't as bad as they used to be, she recently reported to state officials another case of egg wash water flowing from the farm and filling roadside ditches with a reddish foam.
She said she makes sure to buy her eggs from a local Mennonite family.
"I went just last night and got some nice big brown ones from them," she said. "I don't think I'm going to get salmonella from their flock."
The recalls involve more than a dozen brand names. Most of the recalled eggs are presumed to have been eaten. See http:/