Blue Bell Creameries Must Pay $17 Million in Criminal Penalties for Listeria Outbreak

(Pixabay image via Courthouse News)

AUSTIN, Texas (CN) — Blue Bell Creameries must pay $17.25 million in criminal penalties for the sale of ice cream products relating to a listeria outbreak in 2015 that killed three people, a federal judge Thursday ordered. 

U.S. District Judge Robert Pitman in Austin ordered a $9.3 million fine and $7.9 million forfeiture under a plea agreement. The Brenham-based company pleaded guilty on May 1 to two misdemeanor counts of distributing adulterated ice cream products. Federal prosecutors say the fine and forfeiture is the largest-ever criminal penalty following a conviction in a food safety case.

“American consumers must be able to trust that the foods they purchase are safe to eat,” Acting Assistant Attorney General Jeffrey Bossert Clark of the Justice Department’s Civil Division said in a statement.  “The sentence imposed today sends a clear message to food manufacturers that the Department of Justice will take appropriate actions when contaminated food products endanger consumers.”

Health officials in Texas and South Carolina first informed Blue Bell that its ice cream products tested positive for listeria on February 13, 2015. Prosecutors said Blue Bell was aware of several sanitation issues at its Brenham plant before the positive test results.

“Blue Bell was aware that the Brenham facility periodically had an inadequate supply of sufficiently hot water,” the 16-page plea agreement states. “The periodic lack of sufficiently hot water in the Brenham facility created instances in which the plant environment could harbor and grow bacteria. Blue Bell was aware of leaks in the Brenham facility roof that were patched or otherwise repaired over time … Blue Bell was aware that leaks could introduce bacteria into the manufacturing facility.”

Prosecutors said that one month after the positive test results, Food and Drug Administration inspectors observed pipe condensation inside the plant “dripping directly onto ice cream mix” during manufacturing.

“Blue Bell directed its delivery route drivers to remove remaining stock of the two products from store shelves, but the company did not recall the products or issue any formal communication to inform customers about the potential listeria contamination,” prosecutors said in a statement. “Two weeks after receiving notification of the first positive listeria tests, Texas state officials informed Blue Bell that additional state-led testing confirmed listeria in a third product.  Blue Bell again chose not to issue any formal notification to customers regarding the positive tests.”

Blue Bell temporarily shuttered all of its plants in April 2015 and recalled over 8 million gallons of ice cream products. It reopened its facilities in late 2015 and agreed to pay Texas officials $850,000 in penalties one year later.

Blue Bell said Thursday’s sentencing “closes a difficult chapter” in the company’s history.

“We learned hard lessons and turned them into determination to make the safest, most delicious ice cream available, with upgraded production facilities, training, safety procedures, and environmental and product testing programs,” Blue Bell said in a statement. “Food safety is our highest priority, and we know we must continue to be vigilant every day.”

Blue Bell’s chief executive at the time, Paul Kruse, was charged in May in Austin federal court with one count of conspiracy and six counts of wire fraud for his role in the outbreak. Kruse pleaded not guilty and faced up to 20 years in federal prison and a $250,000 fine for each count.

In July, however, Kruse’s defense team successfully had the case against him dismissed on a technicality. Judge Pitman — who also presided over Kruse’s criminal case — agreed the court lacked subject matter jurisdiction over Kruse because prosecutors failed to obtain a federal grand jury indictment. A criminal information was filed instead because a grand jury was not seated during May due to the Covid-19 pandemic. Blue Bell’s customers and investors have filed separate lawsuits against the company in the wake of the outbreak. A Houston man sued after he allegedly developed a severe infection after eating Blue Bell ice cream, lost consciousness for six days and nearly died.

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