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Pundit’s Mailbag —
What Are The Feds Up To

Joel Schulz of Russet Potato Exchange in Wisconsin, the heart of the current spinach/E. coli outbreak, asked a question:

If everyone in Salinas is cooperating so well, why is the FBI on the scene this morning?

Fair enough and, to you and me, it may seem like the FBI ordering everyone out of facilities so they can take what they need smacks of a problem. But, as in the old song, “it ain’t necessarily so.”

We discussed the subject somewhat right here. The basic question is why might the FBI execute these warrants instead of the prosecutor asking for what he would like to see? Three reasons:

  1. Ambitious prosecutors and others in government want to make a name for themselves, get on the evening news, run for attorney general, etc.
  2. Government officials may feel it desirable for the public to perceive that no stone is being left unturned in this investigation. They needed to take action of a type that would be dramatic and make the news programs.
  3. The kind of evidence the government wants may signal a new area of investigation or is the kind of evidence that could be easily destroyed. And the government didn’t want to take chances that anything could be tampered with or destroyed.

It appears that the Feds are looking to see if they can build a case under the 1938 Federal Food, Drug and Cosmetics Act, because that Act makes it a crime to sell or distribute “adulterated” products.

It is a funky law because, although it is a criminal statute, it does not require the government to prove any intent. It is sort of a criminal law counterpart to the strict liability concept in civil actions which we discussed here. The simple selling of adulterated product is a crime.

However, typically violations are just misdemeanors, not felonies. You really need evidence that people knowingly did something wrong to get a felony conviction.

So far, we know of nothing like that in this case.

The law was used against Odwalla in 1996 and Sara Lee in 2001. Because it involves criminal acts, which are typically not paid for by insurance, the mere threat of a charge can give the government a powerful tool to get a settlement.

This case has been so high-profile the Feds may not consider walking away saying they couldn’t find anything an acceptable answer.

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