NEW YORK, FEB. 17 -- Two former executives of Beech-Nut Nutrition Corp. were found guilty today of selling apple-flavored sugar water labeled as pure apple juice for babies.
''I think it's an important victory for consumers,'' said Thomas Roche, executive assistant U.S. attorney for the Eastern District of New York, who had sought to establish the personal responsibility of the two high-ranking executives.
''Our whole trial team believes that justice has been done,'' he said.
The defendants -- former Beech-Nut president Neils L. Hoyvald and a former vice president, John F. Lavery -- faced hundreds of charges of violating federal food and drug laws, as well as conspiracy and mail fraud charges. The main count accused Hoyvald and Lavery of having conspired -- particularly with suppliers of fraudulently labeled "pure apple juice concentrate" -- to intentionally ship the processed product.
Lavery, who was in charge of manufacturing at the Beech-Nut plant where the juice was bottled, was convicted of all 448 counts in the indictment. Hoyvald was found guilty on 351 counts, all violations of federal food and drug law.
Roche said both Hoyvald and Lavery ''face substantial prison terms and substantial fines.''
Conspiracy is punishable by five years in prison and/or a $10,000 fine; mail fraud is punishable by five years and/or $1,000; food and drug law violations are punishable by three years and/or $10,000, Roche said.
The company, which also was named in the November 1986 indictments, pleaded guilty last year and agreed to pay a fine of $2 million, more than six times the largest previous fine under the Food, Drug and Cosmetic Act of 1938. Beech-Nut trails only Gerber Products Co. in the $1.8 billion baby food industry.
The indictment charged that Beech-Nut shipped adulterated and misbranded juice made from phony concentrate throughout the United States and overseas from 1978 to 1983.
The juice, labeled as 100 percent apple juice for babies, was actually made from a flavored concentrate that had little or no apple juice, the prosecution charged. It was bottled at a Beech-Nut plant in Canajoharie in upstate New York state.
There has been no evidence that the juice caused any health problems, the prosecution said.
''This case was tried not in terms of being a health hazard,'' Roche said today. ''It was tried as a fraud case. It was our view that the evidence in this case demonstrated a massive defrauding of Beech-Nut's consumers by Beech-Nut.''
U.S. District Court Judge Thomas C. Platt did not fix a specific date for sentencing, but it should be within six to eight weeks, Roche said.
The two men were allowed to remain free on bail until sentencing.
During closing arguments last Monday, Roche said that evidence presented at the three-month trial never showed Hoyvald and Lavery ''worrying about selling fake apple juice to babies,'' but that they were instead concerned about ''bad publicity and profits.''
''This is not the way we expect corporate executives in this country to operate,'' he said.
During the trial, Roche charged that the fraud enabled the company to save a substantial amount of money -- $1.75 per gallon on hundreds of thousands of gallons of apple concentrate.
Hoyvald's attorney, Brendan Sullivan Jr., argued that the government had ''fallen short by an enormous margin'' of proving his client's guilt beyond a reasonable doubt.
Steven Kimelman, Lavery's attorney, said his client was ''a man who had nothing to gain by committing a crime.''