Gerber Products Co.'s confrontation with Maryland Gov. Harry Hughes over the state's ban on sales of its strained peaches has produced a striking tableau of contrasts in corporate responsibility, as well as in the governor's responses to recent developments with potentially major impacts on consumers.
Hughes, still carrying the scars from his handling of Maryland's savings and loan industry crisis, is in a stronger position this time to emerge relatively unscathed from his handling of a problem that has broad significance for consumers. Even if he loses the legal battle with Gerber, Hughes could avoid damage to his reputation with the voters.
Gerber, on the other hand, could win its $150 million lawsuit against the governor and state officials and still lose something more valuable in the end: consumer confidence.
Gerber filed the damage suit Monday, charging Maryland officials with making inaccurate and misleading statements that resulted in public confusion and apprehension over the safety of its baby-food products. Hughes ordered a ban on sales of Gerber strained peaches last week after state health officials found pieces of glass in several jars.
A Gerber attorney characterized the reports of contamination as an "isolated instance." Maryland officials report, however, they have received at least 16 complaints and have found glass in at least eight Gerber food jars. At last report, consumers in at least 11 other states have reported finding glass fragments in jars of Gerber baby food in the last week, according to United Press International.
The U.S. Food and Drug Administration acknowledged that investigators found "minute particles" of glass in a previously unopened jar of a Gerber meat product in Dallas this week. The FDA also reported finding pieces of glass in jars that had been opened by consumers, but the agency has tacitly supported Gerber by deciding there was no need for a recall.
The dispute between Maryland and Gerber is instructive for what it says about how state and corporate officials view their respective responsibilities.
Hughes obviously feels strongly about his responsibility to safeguard the welfare of Maryland residents, even if his decision means erring on the side of caution.
Gerber obviously believes that it must protect the company's name in the marketplace and the interests of stockholders by countering Hughes' action with a lawsuit.
Equally important, by refusing a recall, Gerber is making a strong statement to consumers about its confidence in the safety of its products.
But Gerber's reaction in the wake of reports of contamination contrasts sharply with the response by Johnson & Johnson following the case of a New York woman who died after swallowing Tylenol capsules laced with cyanide.
Johnson & Johnson not only recalled all Tylenol capsules, but announced that it no longer will sell any over-the-counter drugs in capsule form.
The decision will be costly for Johnson & Johnson, but company officials elected to sacrifice short-term profits for long-term credibility among consumers. ". . . Since we can't control random tampering with capsules after they leave our plant, we feel we owe it to consumers to remove capsules from the market," said Chairman James Burke.
Gerber, like Johnson & Johnson, can't control random tampering with its products after they leave the company's facilities. There is a problem, nevertheless, somewhere along the distribution chain.
Some of the reported glass particles may be figments of consumers' imaginations, but officials in more than one state have confirmed evidence of contamination.
In the absence of any evidence explaining how glass particles might have contaminated Gerber products, no one, not even Gerber officials, can say unequivocally that the incidents are isolated.
No one has yet provided sufficient evidence showing that breakage in shipping or carelessness in opening the jars is the cause of contamination.
With so many questions unanswered, Hughes obviously believed he had to act quickly to avert a tragedy or panic.
Swift action by the governor in this instance contrasts sharply with his belated decision to launch a full-scale investigation of state-chartered S&Ls after being warned of potentially disastrous problems in that industry.
Indeed, Hughes has been sharply criticized for his handling of the S&L crisis that eventually developed.
The courts ultimately will decide whether Hughes acted properly. It's unlikely, however, that consumers will judge Hughes harshly, regardless of the outcome. Gerber can only hope that its calculated risk will solidify consumer confidence.