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Peanut Plain in Plainview Bankrupt

Posted By admin || 28-Aug-2009

Texas-based Plainview Peanut Co., LLC filed Chapter 7 bankruptcy in a Virginia court last month, just two months after its parent company Peanut Corporation of America filed bankruptcy in the same court.

Plainview Peanut Co. is the subsidiary chiefly responsible for the salmonella outbreak earlier this year.  The processing plant in Plainview, TX had been operational since 2005 but was neither licensed nor inspected until January 2009.

In February, the plant voluntarily ceased operations upon the discovery of salmonella in peanut meal and granulated peanuts in its inventory.  This outbreak was part of a company-wide contamination that led to more than 600 people becoming ill and 9 people dying.  The subsequent recall is one of the largest product recalls in US history.

Stephen Sudolf, DVM (Director of the FDA's Center for Food Safety and Applied Nutrition) said of the food manufacturing industry, "The food industry is responsible for assuring their products are safe. They are required to follow good manufacturing practices.  When something like this happens, it represents a failure of the industry -- or here, an individual in the industry -- not living up to what is expected from them from a legal and moral standpoint. And that is to make sure their products are not harmful to the public."

Proper roasting should kill salmonella.  However, Robert Tauxe, MD, MPH (Deputy Director of CDC's Division of Foodborne, Bacterial and Mycotic Diseases) warns that salmonella can survive in a relatively dry product, like peanut butter or peanut paste.  Tauxe states, "When salmonella is in something dry, it can survive much more heat than when it is in something wet. It is a curious phenomenon of the organism."

In April the Texas Department of State Health Services said the plant was fined a record $14.6 million for violations including unsanitary conditions, illnesses linked to peanuts from the plant, product contamination and operating without a food manufacturer's license for almost four years.

While the deaths from the outbreak were linked to a plant based in Georgia and in spite of the parent company's bankruptcy filing's, Doug McBride (Spokesman for the Texas Department of State Health Services) said, "We felt the assessment of the administrative fines needed to be done regardless of financial situations.  If there is a violation, the penalties need to be assessed, period."

Filing Chapter 7 will allow the company the opportunity to sell off any of its assets, like capital equipment, inventory and property, in order to settle its debts.

Categories: Chapter 7 Bankruptcy
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