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After a $300 bribe, thousands fell sick, 550 million eggs recalled

Quality Egg LLC is expected to plead guilty Tuesday and pay a $6.8 million fine for selling old and damaged eggs with false labeling that caused a nationwide salmonella outbreak in 2010.

In a plea agreement filed Monday, Iowa-based Quality Egg admitted bribing a U.S. Department of Agriculture inspector to approve sales of poor quality and misbranded eggs.

Company owner Austin “Jack” DeCoster and his son Peter DeCoster are expected to plead guilty to a misdemeanor of introducing adulterated food into interstate commerce.

The DeCosters face up to a year in jail, according to plea agreements filed Monday by federal prosecutors.

Jack DeCoster, 79, of Turner, Maine, and his son Peter, 50, of Clarion, Iowa, have agreed to pay $100,000 fines each, the AP reported.

The plea deal still needs final approval from U.S. District Judge Mark Bennett.

The government said tainted eggs caused the 2010 salmonella outbreak that made thousands sick across the United States.

It led to the recall of 550 million eggs.

Quality Egg has stopped doing business.

Prosecutors said a company manager, Tony Wasmund, 63, and another employee bribed a USDA inspector at least twice to approve pallets of eggs that didn’t meet minimum quality standards, the AP said.

“The inspector, who has since died of natural causes, accepted a cash bribe of $300 in April 2010 and at least one more of an unspecified amount for releasing those eggs without reprocessing,” according to the plea agreement.

Wasmund cooperated with prosecutors. 

He pleaded guilty in 2012 to one count of conspiracy to bribe a public official, sell restricted eggs with intent to defraud, and introduce misbranded food into interstate commerce with intent to defraud and mislead.  

He’s scheduled to be sentenced on federal court in Iowa on September 12.

The investigation didn’t find evidence the DeCosters knew that Quality Egg deliberately mislabeled eggs from 2006 to 2010.

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Richard L. Cassin is the publisher and editor of the FCPA Blog. He can be contacted here.

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1 Comment

  1. If, "The investigation didn't find evidence the DeCosters knew that Quality Egg deliberately mislabeled eggs from 2006 to 2010," then I have several questions: Did they know the manager bribed the official and when did they find out, after the 1st or 2nd offense. If it was after the 2nd offense and they put a stop to it so there was never a 3rd–is that what happened? Where can we learn more details on this case?


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