Jack DeCoster, Wright County Egg and Regulatory Failure

Elsa Gonzalez could see the egg recall coming years before it happened.

She saw it amidst the filth in which she and her coworkers labored.

She saw it in the rats that roamed the plant.

She saw it when she was being groped by her supervisor and her complaint resulted in no action.

She could see it coming when Pete DeCoster, son of the owner, licked an egg shell that was dirty and said it was fine to sell.

She saw it when she and other workers would tell the supervisors the eggs had blood in them.

“Put them through,” they were told.

Gonzalez, who was then an undocumented worker from Guatemala, worked at the factory in Galt, Iowa years before the recall in August 2010 of a record 380 million eggs, followed  a week later by the recall of an additional 170 million by Hallandale Farms, a company in which Jack DeCoster, Pete’s father had a stake.   Wright County Egg and the Maine-based factories also owned by Jack DeCoster engaged in a systematic practice of hiring undocumented workers.

Gonzalez saw the implications for food safety, but federal regulators were unable to do the same.

Gonzalez’s experience and DeCoster’s business practices illustrate that, nearly 20 years after President Bill Clinton wrote that the American people did not have the regulatory system they deserve, remains a deeply flawed system in which agencies do not communicate with each other, in which criminal penalties are barely existent, and in which there can be an astonishing lack of commitment within agencies designed to protect workers.

“It’s a regulatory failure,” said Celeste Monforton, a lecturer at George Washington University School of Public Health's Department of Environmental and Occupational Health.   “If we had a robust regulatory system, someone would have heard from the workers years ago. If you’ve got one problem, whether it’s hiring illegals or sexual abuse, you’re probably going to have other problems.

“It takes million of eggs for the light bulb to go off,” she said.

The system and DeCoster’s history

FDA spokeswoman Pat El-Hinaway explained that the U.S. FDA is responsible for food safety.

But that responsibility does not extend beyond that area-at most, she said, there is some informal communication between the agency and the USDA, which grades eggs’ size, but does not evaluate their safety.

DeCoster had a full-time USDA inspector at its facilities for at least 16 months before the recall, according to records Hoy obtained from the Iowa Department of Inspections and Appeals.

But despite the inspector working in the same type of conditions as Gonzalez witness, FDA regulators never inspected either set of Iowa facilities, according to Andrew Zajac in an August 2010 article published shortly after the recall.

Neither USDA or FDA could be reached for comment about the lack of communication.

Even if FDA inspectors had been there and observed the working conditions described by Gonzalez and others, they likely would not have reported it to other agencies, according to El-Hinaway.

The same is true for other agencies charged with overseeing the conditions of workers.

By the time the Wright County Egg recall occurred, DeCoster had faced legal sanctions for hiring an undocumented workforce in Maine and Iowa for more than 20 years.
Ramiro Salgado was one of those employees.

He worked in DeCoster from 1988 to 2004 in Maine and Iowa, spending a year in jail for refusing to help immigration authorities.

Now the owner of a Mexican store and restaurant in Clarion, Iowa, a community where many DeCoster employees work, he said DeCoster specifically hired undocumented workers for their vulnerability and work ethic.

In 1989, the company faced charges and received a fine from the INS for these practices, according to non-profit group Mercy for Animals.

In 2000, the time when Gonzalez worked in the Galt factory, the Iowa Coalition Against Domestic Violence (ICADV) filed a complaint against DeCoster’s company alleging that there was extensive sexual harassment and rape of Mexican women.

The company eventually settled, but not before flouting an injunction and agreeing to pay  $1.3 million in damages to 11 workers, $100,000 to ICADV, and $125,000 to any additional victims who might be identified within a year of the settlement decree, according to Mercy for Animals.

The levying of fines through civil proceedings, but no jail time from a criminal vantage point, is a concern for Bill Marler, principal of Marler Clark and a food safety lawyer.

Wright County Egg and the various permutations of them over decades, had various sorts of sanctions, but they were ones they could absorb kind of easily, “ Marler said.  “The reality is that I’ve never really understood the disconnect in food production.  We’ll put somebody in jail for selling meth, but we won’t put people in jail for poisoning 700 people and killing nine of them.

“If you had, instead of fining him $1 million, you put him in a jail for three months, it would have a bigger impact on him than if it happened on a more regular basis,” Marler said.
Wright County Egg  paid a settlement of $1.25 million in 2003 for hiring and employing undocumented workers from 1997 to 2002.   Assistant U.S. Attorney Martin McLaughlin helped negotiate the agreement.

DeCoster was put on probation for five years. One condition of the probation was that DeCoster had to pay for unannounced raids.

At least four such raids took place between 2003 and 2008.  All revealed the company was still employing undocumented workers.  This included a raid in September 2007 in which children were among the 51 people arrested.

Yet in 2008 Assistant Deputy Chief U.S. Probation Officer Jay Y. Jackson signed a document saying that DeCoster had met the conditions to be released from the probation.
U.S. Attorney spokesman Pete Deegan said McLaughlin had no comment about the settlement and its conditions.

Jackson also declined to comment.

In 2010, the recall occurred after an outbreak of salmonella that sickened 1,900 people, according to federal officials.

Worker impact

But the health consequences extended to workers, too.

Comforton of George Washington cited studies that have shown that employees who work in physically hazardous environments in which they have no control over their activities experience deleterious health effects.

“When you think about those things behind the economics of the situation-the low wages, the fact that these are the only jobs available, the sexual harassment-those are all hazards that these workers face,” she said.  “All have documented adverse physical effects.”

Gonzalez said she felt these consequences, but so, too, did workers in positions in the company.

Homero Ramirez was one such employee.

During a tenure of nearly 22 years, he became DeCoster’s lieutenant and earned more than $120,000 per year, according to documents Hoy obtained.

Yet in a suit filed in August 2011, Ramirez alleged severe mental and physical trauma as a result of the abuse he suffered from DeCoster.

The complaint alleged that Ramirez “worked in an environment and culture that treats Mexican American workers as ‘stupid’ and virtual slaves whose only value is their willingness to perform dangerous or demeaning tasks for DeCoster.”

Ramirez was the subject of physical and verbal abuse, according to the complaint.

He was forced to clean and oil large machines during normal plant operations without shutting the machinery down, as required by safety regulations, in an effort to haze Ramirez, the complaint said.

The complaint alleged that this and other actions took place to demonstrate DeCoster’s ironclad authority over Ramirez and the other employees.

DeCoster also derogatory remarks about Ramirez’s ethnic background and limited ability to read English, the complaint said.  He also repeatedly poked Ramirez hard in the chest.

As a result of these and other actions, Ramirez suffered anxiety, post-traumatic stress and depression.  He had physical symptoms like nausea, diarrhea, cramping and the loss of bowel control, the complaint said.

In their response, DeCoster lawyers denied all of the allegations.

DeCoster’s legal fate remains uncertain.

In mid-March (2012), lawyers for Jack DeCoster asserted that he was the subject of an ongoing federal criminal investigation.  In mid-May the Associated Press quoted documents from lawyers for DeCoster, his son Peter and and Quality Egg Chief Financial Officer Patsy Larson to say a federal grand jury has been meeting in Iowa to determine whether fraud or other crimes were committed in the production and testing of eggs. [In September 2012, Tony Wasmund, a former manager at DeCoster's Iowa egg farms, pleaded guilty for his role in a conspiracy to bribe a federal inspector to allow the sale of unapproved eggs, according to the Huffington Post. Wasmund acknowledged he conspired with at least one other person to bribe a public official in order to sell restricted eggs and misbranded food,  federal prosecutors said.]

“The worker safety issue and food safety issue are inextricably linked,” Singley said.  “What needs to happen is that the federal government and multiple agencies need to come up with a plan to deal with the impact on worker safety of modernizing the poultry industry.”

Photo Credit: Jon Lowenstein / NOOR