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In this episode of American Greed, CEO
Stuart Parnell starts with peanuts and
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makes millions by cutting corners and
exploiting workers.
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It doesn't run like a plantation.
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Parnell's peanut butter goes to stores,
schools, hospitals, and U .S. troops.
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But his factories are criminally dirty.
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We were trying to seal up holes in the
wall to keep mice from coming in.
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We found evidence of roaches, rats,
mice, beetles.
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The filth breeds one of the biggest food
poisoning outbreaks in U .S. history.
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Parnell knows the risk.
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But raking in $30 million a year, he
instructs workers to just ship it. I'm
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looking at him after seeing those emails
thinking, that's the devil right there.
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That's the epitome of greed.
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These pictures should be in the
dictionary next to the word greed.
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Due to their willful and knowing
actions, they killed nine people.
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This could end up being one of the
largest food recalls in U .S. history.
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Recall comes after federal officials
confirmed salmonella contamination at a
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Georgia facility.
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And now the recall is being expanded to
include every item made from peanut
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products at that plant in the past two
years.
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Peanut butter.
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It's a multi -billion dollar a year
industry and one of the most popular
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on store shelves.
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But in January 2009, it's deadly.
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Peanut products are laced with the
salmonella bacteria.
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It's sickening.
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and even killing people from coast to
coast.
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There's a race against time to trace the
source and stop what's turning into a
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nationwide panic.
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Food and Drug Administration is advising
Americans not to eat any products made
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with peanut butter or peanut paste until
further notice. And that includes
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cookies and cakes, ice cream, as well as
other foods containing peanut butter
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made at this Georgia plant.
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Food safety watchdog attorney Bill
Marler knows what this kind of
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looks like.
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I've been involved in every major and
many minor foodborne illness outbreaks
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that have occurred in the United States
in the last 20 -plus years.
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They're all tragic, but they all
appropriately freak people out.
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By February 2009, Congress is demanding
answers from this man.
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Stuart Parnell, President and CEO of
Peanut Corporation of America.
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One of the things I'm going to do today
is ask Mr. Parnell from Peanut
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Corporation of America if he'd like to
open this and sample some of the
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that he didn't think were a problem in
sending out for the rest of us to eat.
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Stuart Parnell has apparently lost his
appetite.
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He declines the offer to taste the
products.
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And with good reason.
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Evidence is mounting that this was no
accident.
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For two years, the operators of the
Georgia plant at the center of the
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investigation may have knowingly sold
contaminated products.
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Stuart Parnell's peanut empire is about
to come crashing down.
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But it was never supposed to end this
way.
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In the rolling hills of central
Virginia, peanuts are a major cash crop.
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It's here that Hugh Parnell, Stewart's
father, stakes his claim with the tiny
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company Parnell's Peanuts.
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In 1977, Hugh overhauls a roasting
facility in Gorman, Texas, and
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rechristens his namesake company as
Peanut Corporation of America.
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By 1994, revenues soar to more than $20
million.
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Hugh cashes out and retires.
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But peanuts are a family tradition.
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So in 2000, Stuart Parnell buys PCA.
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Food safety advocate and ethics
professor Darren Detweiler says Stuart's
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ambitions are bigger than his father's.
When Stuart Parnell took over the Peanut
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Corporation of America, he radically
expanded the company, both in terms of
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and the amount of profit that it was
making.
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PCA expands to another plant in Blakely,
Georgia, and at its height, Stuart
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Parnell triples revenue in just three
years.
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He's on the move.
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His brother Michael becomes PCA's number
one peanut broker.
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His brother was now a buyer of product
for him, and it wasn't just peanuts.
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Peanut powder or peanut dust that was
being used in a lot of different
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And that's great business for him
because now he's able to use this
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version of the product.
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From ice cream to energy bars to frozen
Thai dinners to dog food,
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PCA lands new clients throughout the
food supply chain.
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But PCA is also hiding dirty little
secrets.
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Shoddy sanitation, low -grade peanuts.
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and the corporate culture built upon
intimidation, low wages, and
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of workers.
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In Texas, the management was run by a
handful of white guys, with
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all the workers being Mexican
-Americans.
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And in Georgia, it was run by a handful
of white guys, and all the workers were
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African -American.
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It was like, you know, a plantation.
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It was run like a plantation.
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And just like those bad old days, the
work is profitable for the man on top.
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Parnell snaps up another company in
Plainview, Texas, and a roasting and
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blanching company in Virginia, close to
his custom -built home on a five -acre
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estate in Lynchburg.
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Parnell runs his growing PCA dynasty
from a converted garage behind the
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The Parnell brothers especially were
making a pretty good living.
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Brokering and selling this product
around the United States.
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PCA processes around 2 % of America's
peanuts.
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Yet they supply product to more than 200
companies, including giants like
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Kellogg's and General Mills.
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PCA had a pretty broad business.
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It had a nice little corner of the
market.
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That 2 % was, you know, pretty valuable.
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Schools, nursing homes, FEMA relief
kits.
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Even America's troops overseas rely on
PCA.
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Their products primarily went into then
other products, whether peanut butter
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cookies or crackers. And they were these
big tins of peanut butter that
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primarily went to hospitals and opal
combs. I think that tells you a lot
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sort of how integrated our food system
is that you don't really even know who's
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making your stuff.
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So who's making sure the food is safe?
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Federal food safety agencies are
mandated to monitor and inspect
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But with limited resources, these
agencies depend on private companies to
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their own operations.
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Perhaps surprisingly, given the scandal
that will later emerge, Stuart Parnell
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sits on the government's peanut standard
board.
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The fox is guarding the hen house.
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And the hen house is a filthy mess.
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To maximize profits and to minimize
expenses, this peanut dust
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and powder would sit there in the open,
uncovered.
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And during that time, there was rat
infestation. They found holes in the
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and water would gather and bird
droppings would get into the water. They
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seep into this product.
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And sometimes he literally had
employees.
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sweep off some of the rat poop. This was
just business as usual, the idea of put
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it out there.
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Fortunately for the consumer, most major
food conglomerations, like Parnell's
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biggest clients, want to make sure their
providers are meeting safety standards.
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They require independent laboratory
testing.
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So PCA hires several labs, including
Charles Dybels, to test its peanut
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samples. Food manufacturers want to make
food.
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They don't necessarily want to do all of
that in -house. It has to do with core
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competencies. Their core competencies
are not to run laps. That's what we do.
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Accurate testing takes anywhere from 28
hours to five days.
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Dymo looks for several pathogens,
including the Salmonella bacterium,
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cause vomiting, diarrhea, dehydration,
and in some cases, death.
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At each stage of the process, you're
whittling that down to your target. And
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then you finally get your target
organism by what we call a confirmation
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It's the last step in the process where
we can say, yay or nay. This is
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salmonella or this is not salmonella.
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And if the results come back positive?
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One positive takes precedence over
however many negatives you may have
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that lot. You don't release it into
commerce.
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Not only that, though, if the product
itself is contaminated, all the
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that that product touched is now
contaminated.
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When American Greed returns, PCA test
results are coming back positive for
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salmonella. But that's an easy fix.
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Stu Parnell had his quality assurance
manager literally take documents and use
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liquid paper to cover up the date and
put a new date on it to satisfy food
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companies that wanted to buy that
product.
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By the mid -2000s, Stuart Parnell is
making big money in peanuts.
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But Parnell is also turning a blind eye
to glaring sanitation problems at his
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factories. And he runs roughshod over
food safety standards.
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Some of the lots that they were shipping
out didn't even get tested. It was
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economic to him, and he didn't care
about the consumer.
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Parnell ships products out the door
before getting test results at least six
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times between 2004 and 2006.
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Even more troubling, some of the tests
that are being performed come back
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positive for Salmonella.
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And Salmonella is bad for business.
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Stewart's brother is getting all these
deals put together and they need to feed
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the system.
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And, you know, they're getting contracts
with Kellogg. They're getting contracts
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with a variety of other middlemen.
They're saying, give me, give me, give
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give me, give me the peanut butter. Give
me the peanut chips.
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And they couldn't keep up with the
orders because they kept getting
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salmonella tests.
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If he pulls the product, Parnell risks
plunging into a financial abyss of debt.
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So he plays a dangerous game of Russian
roulette.
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Here's how it works.
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In any given vat of peanuts, salmonella
may exist only in isolated pockets.
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Parnell exploits this fact.
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They came up with this very intricate
scheme where they would take more
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tests on a lot than they would normally
do it, and then they would send it out
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to multiple different labs.
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And some of the labs would come back
negative.
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Some of them would come back positive.
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A positive result would force any
ethical owner to dump the entire lot in
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local landfill.
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What they would do is they would get rid
of those test results and only use the
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certificate analysis that said negative.
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This cherry -picking of data works for a
while.
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But then Parnell and his quality
assurance team abandon any pretense of
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science.
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They simply rewrite the bad test
results.
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Eventually, they just started forging
the certificate of analysis to say they
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were all negative.
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And you wonder what the hell they were
thinking about. They don't bother
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customers that test results come back
positive for salmonella.
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And when customers like Bloomfield
Bakers learn from their own lab tests
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the PCA peanuts they're using are
tainted, Well, Stewart's just as shocked
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they are.
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So when somebody was saying, hey, it
tested positive, it was like, oh, why
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that do that?
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On October 5, 2006, Stewart writes to
Bloomfield Baker's director of
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I am dumbfounded.
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In over 26 years of business, he says
he's not found any instances, even
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of a salmonella problem.
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Year after year, emails revealed the
real Stuart Parnell.
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He complains that lab tests are breaking
me. When employees ask for critical
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test equipment, Stuart says, only if we
will not get screwed.
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This is costing us huge dollars.
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Lie about the sales if it saves us
money.
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The lies ensure a cushy existence.
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He has a horse country estate.
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And the avid outdoorsman hits the waves
in his powerboat.
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00:14:24,640 --> 00:14:26,120
Or heads skyward.
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00:14:26,440 --> 00:14:31,260
Parnell is a licensed pilot and owns a
two -seater Mooney M20.
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He enjoys weekends at Oakwood Country
Club.
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And an odd touch of luxury in his
otherwise dank Texas plant, a custom
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tub to soothe away any frayed nerves.
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Life is good for PCA's man in the big
chair.
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Revenues are almost $30 million.
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But one place the money isn't going is
factories.
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The man owns an airplane, so obviously
he wasn't starving to that.
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We wouldn't put any money into this
company, and we're always complaining
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money. PCA hires Kenneth Kendrick in
July 2006 as an assistant plant manager
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Plainview, Texas.
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With a background in lab testing for the
meat industry, he should be an instant
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asset. But it seemed like I'd stepped
back in time 50 years.
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Something was always being welded and
patched back together, and you could
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tell by looking at it, it was over
-equipment.
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Their idea of a lab and quality control
on that was making sure the peanuts were
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the right color.
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It's even worse than he thinks.
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Stuart Parnell hasn't registered his
Plainview plant with the Food and Drug
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Administration.
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The agency has no idea it even exists.
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Kendrick's new job is off the grid.
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He's working at a ghost factory.
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Where were these problems? How were they
being hidden?
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00:15:59,981 --> 00:16:02,849
Well, it's hard to find those problems
if you don't even know that the facility
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exists.
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00:16:04,199 --> 00:16:06,240
ironically, in Plainview, Texas.
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Within weeks of taking the job, Kendrick
is appalled by what he finds.
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00:16:11,980 --> 00:16:16,480
We were trying to fill up holes in the
wall to keep mice from coming in.
230
00:16:16,880 --> 00:16:21,199
I expected there would be, like, this
routine lab testing and these things in
231
00:16:21,200 --> 00:16:26,220
place that, you know, were just
standard, and they just simply weren't
232
00:16:26,860 --> 00:16:30,220
The safety of the food was never a
concern.
233
00:16:31,470 --> 00:16:35,869
I got alarmed at the amount of positive
they were getting. We actually got on
234
00:16:35,870 --> 00:16:39,349
the phone with the quality manager at
the time and said, hey, I'm available.
235
00:16:39,350 --> 00:16:42,110
If you need help, you know, I'm
available.
236
00:16:42,410 --> 00:16:47,309
And his answer was basically, I actually
like the positive because then maybe we
237
00:16:47,310 --> 00:16:48,990
can force the owner to take action.
238
00:16:49,350 --> 00:16:53,830
And I remember leaving that phone call
thinking, God, this company is cheap.
239
00:16:55,180 --> 00:16:59,979
One of my favorite quotes from Parnell's
email is, we have a lady in Texas who's
240
00:16:59,980 --> 00:17:04,919
good with the whiteout. So apparently
other people were just taking the next
241
00:17:04,920 --> 00:17:11,879
closest sample somebody had done and
using that lab report and sending
242
00:17:11,880 --> 00:17:13,339
it with the peanuts.
243
00:17:14,200 --> 00:17:19,479
And when Kendrick offers to actually fix
the problems rather than just cover
244
00:17:19,480 --> 00:17:22,500
them up, this is the response he gets
from Parnell.
245
00:17:22,501 --> 00:17:26,409
So I called him and said, hey, I used to
work in a lab. I hear that you have
246
00:17:26,410 --> 00:17:28,880
this problem. He goes, I have Hartford
insurance.
247
00:17:28,910 --> 00:17:31,980
Don't worry about it. I need to get back
to work on other things.
248
00:17:32,890 --> 00:17:36,490
In November 2006, Kendrick quits.
249
00:17:37,150 --> 00:17:40,940
I'd been there four months. I thought
something bad was going to happen here.
250
00:17:40,990 --> 00:17:45,769
You know, I knew something was going to
go bad at some point, and I just didn't
251
00:17:45,770 --> 00:17:46,820
want to be part of it.
252
00:17:47,350 --> 00:17:48,830
When American Greed returns.
253
00:17:49,790 --> 00:17:54,330
Stuart Parnell's greed and corner
-cutting take a human toll.
254
00:17:54,670 --> 00:17:57,200
Cancer couldn't claim her, but peanut
butter did.
255
00:18:10,450 --> 00:18:16,050
Peanut Corporation of America is
knowingly shipping salmonella -laced
256
00:18:16,370 --> 00:18:17,970
and they have been for years.
257
00:18:19,050 --> 00:18:24,749
CEO Stuart Parnell's emails spelled out
his callous disregard for other people's
258
00:18:24,750 --> 00:18:27,570
health. He writes, no test results?
259
00:18:28,070 --> 00:18:29,330
Just ship it.
260
00:18:29,530 --> 00:18:31,650
I'll hold my breath again.
261
00:18:31,970 --> 00:18:33,050
Turn them loose.
262
00:18:33,510 --> 00:18:40,269
They were operating outside industry
norms, and they willfully released
263
00:18:40,270 --> 00:18:41,249
that was contaminated.
264
00:18:41,250 --> 00:18:43,550
And they did it again and again and
again.
265
00:18:43,930 --> 00:18:49,319
Former employee Kenneth Kendrick,
disturbed by what he's seen, goes into
266
00:18:49,320 --> 00:18:53,819
whistleblower mode and sends anonymous
emails to health departments and food
267
00:18:53,820 --> 00:18:56,680
companies warning them about PCA.
268
00:18:57,300 --> 00:19:00,740
Unfortunately, his cries fall on deaf
ears.
269
00:19:01,900 --> 00:19:07,079
I had sent anonymous emails to the Texas
Department of Health. Now, they denied
270
00:19:07,080 --> 00:19:10,720
getting any from a Mr. Kendrick. Well, I
didn't send them under Mr.
271
00:19:10,920 --> 00:19:14,280
Kendrick. I couldn't get the attention
of anyone.
272
00:19:14,700 --> 00:19:17,230
That's, you know, your average Joe off
the street.
273
00:19:18,250 --> 00:19:22,230
I never wanted to go in the press. I'm
not good at this. I don't like this.
274
00:19:22,530 --> 00:19:23,870
There was no regulation.
275
00:19:24,130 --> 00:19:25,180
No one cared.
276
00:19:25,870 --> 00:19:31,709
Despite his frustration, or maybe
because of it, Kendrick has an uneasy
277
00:19:31,710 --> 00:19:33,030
about PCA.
278
00:19:33,550 --> 00:19:37,550
I somehow had a feeling. I was like, I'm
going to hear about this again someday.
279
00:19:38,330 --> 00:19:40,990
Someday arrives in September 2008.
280
00:19:42,000 --> 00:19:47,380
In mild cases, salmonella poisoning
causes painful abdominal cramps, fever,
281
00:19:47,580 --> 00:19:49,240
vomiting, and diarrhea.
282
00:19:49,760 --> 00:19:56,719
But if it enters the bloodstream,
salmonella can be deadly, especially for
283
00:19:56,720 --> 00:19:58,100
very young and old.
284
00:19:58,800 --> 00:20:04,019
The strain that we isolated from PCA was
salmonella typhimurium. This is an
285
00:20:04,020 --> 00:20:05,220
organism that will kill.
286
00:20:06,020 --> 00:20:09,100
The people that it has the most...
287
00:20:09,520 --> 00:20:14,500
adverse effects on are what we call
immunocompromised, the elderly, infants,
288
00:20:14,720 --> 00:20:16,340
small children, pregnant women.
289
00:20:16,600 --> 00:20:21,220
By November 2008, those symptoms are
popping up in clusters.
290
00:20:22,060 --> 00:20:28,300
At first, it's three states, then 12,
14, 28,
291
00:20:28,640 --> 00:20:29,690
46.
292
00:20:30,980 --> 00:20:37,440
U .S. Senator Amy Klobuchar serves
Minnesota, a state affected by the
293
00:20:37,960 --> 00:20:42,279
The CDC and the FDA, everyone works
together on these kinds of things, and
294
00:20:42,280 --> 00:20:45,799
sometimes the state health departments
discover something first, and it's
295
00:20:45,800 --> 00:20:50,939
telling them. Half the people who fell
sick fell sick before there was even any
296
00:20:50,940 --> 00:20:53,160
kind of consumer awareness or notice.
297
00:20:54,320 --> 00:21:00,559
That December in Perham, Minnesota, Jeff
Allmer's mother Shirley is a living
298
00:21:00,560 --> 00:21:06,000
miracle. In two years' time, she's
beaten lung cancer, then brain cancer.
299
00:21:06,560 --> 00:21:11,439
But she's still weak, and minor
dehydration lands her in a rehab center
300
00:21:11,440 --> 00:21:12,490
regain strength.
301
00:21:13,380 --> 00:21:16,680
Doctors say not to worry, she'll be home
by Christmas.
302
00:21:17,200 --> 00:21:22,259
She seemed to be having a better
appetite and eating, and, you know, she
303
00:21:22,260 --> 00:21:25,800
particularly liked chicken and peanut
butter toast.
304
00:21:27,280 --> 00:21:29,510
It was a good thing that she ate those
things.
305
00:21:29,640 --> 00:21:34,459
But on December 21st, instead of
planning a cancer -free Christmas with
306
00:21:34,460 --> 00:21:37,900
mom, Shirley's children get shocking
news.
307
00:21:39,040 --> 00:21:44,539
The doctors recommended that all the
family get up to the hospital to see her
308
00:21:44,540 --> 00:21:46,950
because they didn't expect her to last
that day.
309
00:21:47,620 --> 00:21:50,360
Shirley Allmer dies late that evening.
310
00:21:50,780 --> 00:21:56,119
Doctors think pneumonia is the culprit,
but the medical examiner has a different
311
00:21:56,120 --> 00:21:57,170
conclusion.
312
00:21:57,740 --> 00:22:01,860
It came out in her autopsy.
313
00:22:02,510 --> 00:22:05,090
or the death certificate that she had
sepsis.
314
00:22:05,870 --> 00:22:08,390
And sepsis is blood poisoning,
basically.
315
00:22:09,430 --> 00:22:10,910
And we thought that was odd.
316
00:22:11,350 --> 00:22:14,590
Weeks later, Jeff happens upon something
else.
317
00:22:14,910 --> 00:22:21,029
I was reading an Associated Press report
that casually mentioned a 72 -year -old
318
00:22:21,030 --> 00:22:23,969
northern Minnesota woman died from
salmonella poisoning.
319
00:22:23,970 --> 00:22:25,330
My mom's 72.
320
00:22:25,970 --> 00:22:29,250
She's up in northern Minnesota, and she
had blood poisoning.
321
00:22:29,740 --> 00:22:33,880
A call to the Minnesota Health
Department leaves Jeff's family stunned.
322
00:22:33,881 --> 00:22:37,239
They said, I'm sorry you have to hear it
this way, but that's your mother
323
00:22:37,240 --> 00:22:38,320
they're reporting on.
324
00:22:38,880 --> 00:22:41,410
Cancer couldn't claim her, but peanut
butter did.
325
00:22:43,680 --> 00:22:50,239
In Portland, Oregon, on January 3, 2009,
three -year -old Jacob Hurley's parents
326
00:22:50,240 --> 00:22:51,860
think he might have the flu.
327
00:22:52,360 --> 00:22:56,160
He's listless, throwing up, feverish,
and miserable.
328
00:22:57,550 --> 00:23:02,569
When one of your children is sick,
you're scared for them, and you feel a
329
00:23:02,570 --> 00:23:03,620
bit helpless.
330
00:23:04,070 --> 00:23:06,650
There's blood in his diarrhea.
331
00:23:07,190 --> 00:23:12,809
So we go to the pediatrician, but the
whole time, all it is is just treat it
332
00:23:12,810 --> 00:23:18,409
like the flu. If there's anything that
he likes and can keep down, go ahead and
333
00:23:18,410 --> 00:23:23,669
feed it to him. In Jacob's case, that
ultimate comfort food isn't ice cream or
334
00:23:23,670 --> 00:23:26,330
popsicles. It's peanut butter crackers.
335
00:23:27,080 --> 00:23:33,499
Then we get a phone call from the
doctor's office saying that he tested
336
00:23:33,500 --> 00:23:35,020
for salmonella poisoning.
337
00:23:35,280 --> 00:23:40,959
So the doctor just said, keep doing what
you're doing, and you can feed him
338
00:23:40,960 --> 00:23:42,240
whatever he likes.
339
00:23:42,241 --> 00:23:46,859
Jacob's parents have no reason to think
the crackers are poisoning their little
340
00:23:46,860 --> 00:23:49,360
boy, so he continues to eat them.
341
00:23:49,600 --> 00:23:53,400
He was sick for a full week, pushing 10
days.
342
00:23:53,680 --> 00:23:55,850
The doctor didn't know what the source
was.
343
00:23:56,460 --> 00:23:58,020
Nobody knew what the source was.
344
00:23:58,100 --> 00:24:03,179
In January 2009, local health
authorities and the Centers for Disease
345
00:24:03,180 --> 00:24:09,020
used DNA testing to positively identify
the culprit, PCA peanuts.
346
00:24:09,400 --> 00:24:16,259
The fact that the DNA was so unique and
100
347
00:24:16,260 --> 00:24:22,979
% match between the peanut butter
cracker sample, unadulterated, that we
348
00:24:22,980 --> 00:24:24,030
from our house.
349
00:24:24,560 --> 00:24:29,000
had an exact match to the DNA salmonella
in Jake's stool.
350
00:24:29,540 --> 00:24:33,120
For the federal government, that was the
smoking gun.
351
00:24:34,060 --> 00:24:40,239
After two weeks, Jacob Hurley fully
recovers. But the experience forever
352
00:24:40,240 --> 00:24:41,700
his parents' perspective.
353
00:24:42,240 --> 00:24:45,960
You start to get an inkling that this is
just the tip of the iceberg.
354
00:24:46,260 --> 00:24:51,380
And then you realize that, how lucky we
were.
355
00:24:52,840 --> 00:24:57,320
PCA peanuts will claim the lives of nine
victims in five states.
356
00:24:58,860 --> 00:25:04,639
For U .S. Senators Amy Klobuchar and Al
Franken of Minnesota, the outbreak hits
357
00:25:04,640 --> 00:25:06,520
especially close to home.
358
00:25:07,580 --> 00:25:12,119
Three of the nine people that died
because of the contaminated peanut
359
00:25:12,120 --> 00:25:17,979
were in my state. In the case of Shirley
Allmer, the grandma, 72 -year -old
360
00:25:17,980 --> 00:25:22,120
grandma who died, she was surviving
cancer and had no warning.
361
00:25:22,440 --> 00:25:29,299
We just didn't have in place the
mechanisms for tracing back to where
362
00:25:29,300 --> 00:25:30,360
this came from.
363
00:25:30,640 --> 00:25:36,939
That's what was so tragic about Jeff's
mom, which is that she had some peanut
364
00:25:36,940 --> 00:25:39,800
butter from a jar that had been on the
shelves for months.
365
00:25:41,540 --> 00:25:43,200
When American Greed returns,
366
00:25:44,340 --> 00:25:48,919
Stuart Parnell comes face to face with
his victims and the congressional
367
00:25:48,920 --> 00:25:53,109
firestorm. So the food poisoning of
people, is that just the cost of doing
368
00:25:53,110 --> 00:25:54,490
business for your company?
369
00:26:06,370 --> 00:26:12,589
By the time the CDC identifies Peanut
Corporation of America as the source of
370
00:26:12,590 --> 00:26:17,609
the salmonella outbreak, its products
have already been distributed, sold, and
371
00:26:17,610 --> 00:26:19,010
sometimes eaten.
372
00:26:19,610 --> 00:26:22,050
Everything is on such a lag, such a
delay.
373
00:26:22,850 --> 00:26:25,860
So you just never knew where it was
going to end at that point.
374
00:26:27,250 --> 00:26:31,589
Retailers scramble to pull anything with
possible PCA products off their
375
00:26:31,590 --> 00:26:32,640
shelves.
376
00:26:32,830 --> 00:26:38,589
And with the modern food supply chain so
interconnected, the list grows longer
377
00:26:38,590 --> 00:26:39,640
every day.
378
00:26:40,170 --> 00:26:45,670
When you start seeing the news reports
of things that you never even thought
379
00:26:45,710 --> 00:26:48,720
like dog food that had peanut butter in
them, this affected.
380
00:26:49,130 --> 00:26:54,370
Everybody. One -time PCA employee
Kenneth Kendrick watches in horror.
381
00:26:54,630 --> 00:26:59,510
So far, officials don't even know about
PCA's Plainview facility.
382
00:27:00,250 --> 00:27:04,209
Texas is still operating full tilt, and
there was even a shelter in Virginia
383
00:27:04,210 --> 00:27:05,590
still operating full tilt.
384
00:27:05,830 --> 00:27:12,829
I'm sending emails, getting generic
responses, and I'm starting to get kind
385
00:27:12,830 --> 00:27:16,629
of very frustrated at this point. Hey,
is nobody still looking at Texas? What
386
00:27:16,630 --> 00:27:17,680
going on here?
387
00:27:18,580 --> 00:27:21,260
Kendrick finally gets the attention of
the FDA.
388
00:27:21,720 --> 00:27:26,520
He knows all the dirty little secrets
and draws maps for the investigators.
389
00:27:27,220 --> 00:27:31,100
I need you to take ten steps. Take a
left, open this door, and go upstairs.
390
00:27:31,101 --> 00:27:34,219
If you go upstairs, you're going to see
a false ceiling. You're going to find
391
00:27:34,220 --> 00:27:34,999
dead rats.
392
00:27:35,000 --> 00:27:40,579
Civil attorney Ron Simon tours the
Georgia plant and shares his findings
393
00:27:40,580 --> 00:27:45,280
reporters. We found evidence of roaches,
rats, mice.
394
00:27:46,000 --> 00:27:49,840
Beetle, we even found in one instance,
broken wire in the peanut paste.
395
00:27:50,120 --> 00:27:54,060
Meanwhile, during a 2009 interview with
the Virginia TV station,
396
00:27:54,800 --> 00:28:01,379
Stuart Parnell's sister, Beth Falwell,
insists that PCA plants are just fine
397
00:28:01,380 --> 00:28:05,640
and says Parnell's critics simply don't
have a head for business.
398
00:28:06,260 --> 00:28:10,599
They're throwing slanders at him.
They're saying he's done these things.
399
00:28:10,600 --> 00:28:15,060
people would stop and think, why would
we have some filthy building?
400
00:28:15,800 --> 00:28:16,940
doing work for Kellogg.
401
00:28:16,941 --> 00:28:22,859
People that have never been in business
don't know. They know nothing about what
402
00:28:22,860 --> 00:28:24,120
it takes to run a business.
403
00:28:25,280 --> 00:28:30,220
Stuart Parnell is about to have the
worst month of his life so far.
404
00:28:31,640 --> 00:28:37,939
On Monday, February 9, 2009, the FBI
raids PCA's Lynchburg, Virginia
405
00:28:37,940 --> 00:28:41,440
headquarters, located in Stuart
Parnell's garage.
406
00:28:42,540 --> 00:28:45,120
They also raid the Blakely, Georgia
plant.
407
00:28:46,000 --> 00:28:52,419
Two days later, Parnell and PCA take the
blame at a congressional hearing on the
408
00:28:52,420 --> 00:28:58,120
outbreak. Lives were lost and people
were sickened because they took a
409
00:28:58,200 --> 00:29:01,600
and I believe knowingly, shipping
product that was contaminated.
410
00:29:02,380 --> 00:29:06,320
The hearing reveals bombshell after
bombshell.
411
00:29:07,420 --> 00:29:09,760
Parnell's emails are damning.
412
00:29:11,600 --> 00:29:17,859
And I'm looking at him, having after
seeing those emails, thinking, that's
413
00:29:17,860 --> 00:29:18,910
devil right there.
414
00:29:19,100 --> 00:29:20,640
That's the epitome of greed.
415
00:29:21,780 --> 00:29:24,910
His picture should be in the dictionary
next to the word greed.
416
00:29:25,980 --> 00:29:27,920
Peter Hurley testifies.
417
00:29:28,540 --> 00:29:32,320
People have died due to PCA's willful
negligence.
418
00:29:32,520 --> 00:29:37,139
And while he doesn't speak, just seeing
the face of three -year -old survivor
419
00:29:37,140 --> 00:29:38,190
Jacob Hurley.
420
00:29:38,650 --> 00:29:41,010
drives home what's really at stake.
421
00:29:42,130 --> 00:29:47,349
Oregon House Representative Greg Walden
knows all about Jacob, and he's
422
00:29:47,350 --> 00:29:52,869
outraged. One of the things I'm going to
do today is ask Mr. Parnell from Peanut
423
00:29:52,870 --> 00:29:57,089
Corporation of America if he'd like to
open this and sample some of the
424
00:29:57,090 --> 00:30:00,760
that he didn't think were a problem in
sending out for the rest of us to eat.
425
00:30:01,150 --> 00:30:04,130
Parnell pleads the fifth five times.
426
00:30:05,330 --> 00:30:08,929
Mr. Chairman and members of the
committee, on the advice of my counsel,
427
00:30:08,930 --> 00:30:14,829
respectfully decline to answer your
question based on the protection
428
00:30:14,830 --> 00:30:16,729
under the United States Constitution.
429
00:30:16,730 --> 00:30:20,209
He was going to hide behind the Fifth
Amendment, which he had a constitutional
430
00:30:20,210 --> 00:30:22,230
right to do, and I knew that.
431
00:30:22,430 --> 00:30:27,589
But to me, it was the question of the
moment. It was, you didn't seem to think
432
00:30:27,590 --> 00:30:32,810
it was a problem to cut it loose because
you were worried about your money.
433
00:30:33,290 --> 00:30:36,290
and let people see how it plays in the
marketplace.
434
00:30:36,730 --> 00:30:40,449
And it didn't play well. It killed, it
sickened, it robbed people of their
435
00:30:40,450 --> 00:30:43,040
futures and their family members, and it
was wrong.
436
00:30:43,090 --> 00:30:48,470
Four days after the public excoriation,
on February 13, 2009,
437
00:30:49,010 --> 00:30:51,450
PCA files for bankruptcy.
438
00:30:52,490 --> 00:30:59,349
They were obviously facing these illness
claims, but also all the recall cost
439
00:30:59,350 --> 00:31:02,090
claims. PCA didn't have recall
insurance.
440
00:31:03,240 --> 00:31:04,440
There was nothing there.
441
00:31:04,500 --> 00:31:05,550
So they just went.
442
00:31:05,740 --> 00:31:08,580
The recall hits food suppliers hard.
443
00:31:08,800 --> 00:31:12,680
An estimated $200 million in short -term
losses.
444
00:31:13,320 --> 00:31:15,640
The human toll hits harder.
445
00:31:16,340 --> 00:31:21,159
There's not a day that goes by that I
don't think about my mom and I don't
446
00:31:21,160 --> 00:31:22,420
about the circumstances.
447
00:31:22,460 --> 00:31:25,220
My mom died and she shouldn't have died.
448
00:31:26,280 --> 00:31:27,720
Could have been prevented.
449
00:31:28,380 --> 00:31:31,720
By April 2009, the outbreak is over.
450
00:31:32,350 --> 00:31:39,129
While the CDC's official toll lists 714
people in 46 states sickened,
451
00:31:39,130 --> 00:31:43,850
they estimate dozens more victims for
every one illness reported.
452
00:31:44,430 --> 00:31:48,030
But the true toll could be as high as 20
,000.
453
00:31:48,430 --> 00:31:50,110
At least nine are dead.
454
00:31:51,150 --> 00:31:54,170
I couldn't sleep at night knowing I let
more people die.
455
00:31:54,770 --> 00:31:59,569
And I sometimes still cry at night for
the nine who did, that I wasn't able to
456
00:31:59,570 --> 00:32:01,250
stop that back when I worked there.
457
00:32:01,720 --> 00:32:06,000
and replay in my head a million
different ways.
458
00:32:06,960 --> 00:32:09,080
Who else could I have tried to contact?
459
00:32:09,760 --> 00:32:16,079
Darren Detweiler knows what that loss
feels like. In 1993, his 16 -month -old
460
00:32:16,080 --> 00:32:21,799
son Riley was the last to die from an E.
coli outbreak that started with Jack in
461
00:32:21,800 --> 00:32:22,960
the Box hamburgers.
462
00:32:23,200 --> 00:32:27,479
There were no state or federal charges
brought against Jack in the Box at the
463
00:32:27,480 --> 00:32:30,180
time, but they admitted that they broke
the law.
464
00:32:30,680 --> 00:32:37,019
And you've got to really start to
wonder, what is the prosecutorial
465
00:32:37,020 --> 00:32:42,379
when it comes to the food industry? How
can Stuart Parnell, who technically was
466
00:32:42,380 --> 00:32:48,559
responsible for more deaths than Charles
Manson, not be held responsible, not be
467
00:32:48,560 --> 00:32:51,720
tried in a federal court and not serve
jail time?
468
00:32:53,660 --> 00:32:58,400
Next, will CEO Stuart Parnell get a
legal slap on the wrist?
469
00:32:59,040 --> 00:33:02,140
or serve real time for his poisoned
peanuts.
470
00:33:10,080 --> 00:33:15,380
PCA's salmonella -tainted products cause
the largest food recall in U .S.
471
00:33:15,400 --> 00:33:16,450
history.
472
00:33:16,600 --> 00:33:19,420
There's a breathtaking financial
fallout.
473
00:33:20,720 --> 00:33:24,440
The loss estimates grow to a whopping $1
billion.
474
00:33:26,990 --> 00:33:32,889
In the aftermath, PCA CEO Stuart Parnell
is at the center of a firestorm of
475
00:33:32,890 --> 00:33:33,940
civil cases.
476
00:33:34,230 --> 00:33:38,070
But he isn't facing criminal charges
yet.
477
00:33:39,190 --> 00:33:43,170
In 2009, they announced there was a
criminal investigation.
478
00:33:43,430 --> 00:33:48,310
And for years, literally, that's all we
knew.
479
00:33:49,030 --> 00:33:53,070
Minnesota Senator Al Franken champions
food safety reform.
480
00:33:53,710 --> 00:33:57,330
and advocates for PCA victims like Jeff
Ulmer.
481
00:33:57,530 --> 00:33:59,510
These guys knew what was going on.
482
00:34:00,090 --> 00:34:06,770
Due to their willful and knowing
actions, they killed nine people.
483
00:34:07,290 --> 00:34:14,289
Jeff deserves a lot of credit for not
letting go. He was crucial to
484
00:34:14,290 --> 00:34:17,090
the case in working with the
prosecutors.
485
00:34:19,020 --> 00:34:23,300
Former U .S. Attorney Michael Moore must
maintain a balancing act.
486
00:34:24,179 --> 00:34:27,520
On one hand, this case is about the
victims.
487
00:34:28,820 --> 00:34:30,920
You had folks who lost parents.
488
00:34:31,199 --> 00:34:34,540
You had people who lost family members
they loved.
489
00:34:34,800 --> 00:34:39,039
You had folks who had children that were
sickened because of the outbreak that
490
00:34:39,040 --> 00:34:40,800
we thought about on a daily basis.
491
00:34:41,639 --> 00:34:46,560
On the other hand, the prosecution
requires cold, hard facts.
492
00:34:48,040 --> 00:34:52,339
The judge is not going to let you talk
about your mother suffering and dying
493
00:34:52,340 --> 00:34:56,939
because of tainted peanut product in a
case that deals with whether or not
494
00:34:56,940 --> 00:34:59,340
somebody committed fraud by mail or
wire.
495
00:35:00,560 --> 00:35:04,640
Meanwhile, the PCA outbreak goads
Congress into action.
496
00:35:06,200 --> 00:35:12,979
On January 4, 2011, President Barack
Obama signs the Food Safety
497
00:35:12,980 --> 00:35:14,580
Act into law.
498
00:35:15,340 --> 00:35:21,239
It's predicated on best practices that
can be scientifically proven and that we
499
00:35:21,240 --> 00:35:24,639
step up the inspections and have better
flow and transparency and more
500
00:35:24,640 --> 00:35:28,679
information available to the inspectors
because all of those things played a
501
00:35:28,680 --> 00:35:30,740
role in what went wrong with PCA.
502
00:35:30,960 --> 00:35:35,400
It's the most sweeping set of food
reforms in seven decades.
503
00:35:37,310 --> 00:35:40,740
You've gotten a lot bigger since the
last time I saw you. How you been?
504
00:35:40,850 --> 00:35:45,110
Good. Good to see you. You hungry? I'm
still happy.
505
00:35:49,170 --> 00:35:55,709
Congressman Greg Walden keeps PCA's
crime -taped peanut products in his
506
00:35:55,710 --> 00:35:56,850
as a reminder.
507
00:35:57,590 --> 00:36:01,349
You know, you think about somebody
willing to take that risk. One people's
508
00:36:01,350 --> 00:36:02,709
are literally on the ballot.
509
00:36:02,710 --> 00:36:06,350
It's truly a thick mind that's doing it.
It's our job.
510
00:36:06,840 --> 00:36:10,320
is to be that voice for people who feel
they have no voice.
511
00:36:10,540 --> 00:36:14,640
This was clearly a bipartisan piece of
work that we did, and we need to.
512
00:36:15,180 --> 00:36:21,319
When American Greed returns, changing
the law is a good start, but Parnell's
513
00:36:21,320 --> 00:36:25,560
victims want to make sure he sees the
inside of a jail cell.
514
00:36:26,160 --> 00:36:33,099
This was a message, a clear message,
that you can't just pay a fine and
515
00:36:33,100 --> 00:36:34,150
walk away.
516
00:36:46,000 --> 00:36:51,599
Four years after the PCA Salmonella
outbreak, Prosecutor Michael Moore and
517
00:36:51,600 --> 00:36:55,700
team meticulously combed through three
million pieces of evidence.
518
00:36:56,340 --> 00:37:00,280
These cases are complex. They take a lot
of time. They take a lot of resources.
519
00:37:00,281 --> 00:37:04,039
At the same time, the cases are such a
magnitude that you want to make sure
520
00:37:04,040 --> 00:37:05,599
it gets the attention it deserves.
521
00:37:05,600 --> 00:37:09,380
Moore must tie it all back to one big
theme.
522
00:37:10,220 --> 00:37:11,660
People have lost their lives.
523
00:37:11,661 --> 00:37:15,619
And, you know, children have suffered a
great deal through illness. And it just
524
00:37:15,620 --> 00:37:19,699
reminds you that the case is not just
about Mr. Parnell, but this case is
525
00:37:19,700 --> 00:37:20,750
people.
526
00:37:20,960 --> 00:37:27,679
In February 2013, a grand jury issues a
76 -count indictment against
527
00:37:27,680 --> 00:37:32,160
Stuart Parnell, Michael Parnell, and
three of their plant managers.
528
00:37:33,660 --> 00:37:36,320
The charges don't include murder.
529
00:37:37,560 --> 00:37:40,150
People understand lying, cheating, and
stealing.
530
00:37:40,151 --> 00:37:42,459
And that's what this case ultimately was
about.
531
00:37:42,460 --> 00:37:45,539
And we knew we could get justice for the
victims in the same way, even though we
532
00:37:45,540 --> 00:37:52,079
were calling the case a wire fraud and
mail fraud case, conspiracy case, as
533
00:37:52,080 --> 00:37:55,899
opposed to moving forward on some type
of manslaughter. But there's just no
534
00:37:55,900 --> 00:37:58,100
reason to put family members through
that.
535
00:37:58,440 --> 00:38:03,279
Darren Detweiler writes academic
articles about the case and lands an
536
00:38:03,280 --> 00:38:04,600
with Stuart Parnell.
537
00:38:05,190 --> 00:38:10,009
And he literally ends the conversation
with, you know, we should get together
538
00:38:10,010 --> 00:38:14,190
and maybe have a burger and a beer or
something after this all blows over.
539
00:38:14,990 --> 00:38:17,110
But it's not going to blow over.
540
00:38:18,130 --> 00:38:24,449
In the summer of 2014, Parnell's
attorneys claim he had no idea what his
541
00:38:24,450 --> 00:38:30,509
employees were up to and that attention
deficit disorder causes him to make
542
00:38:30,510 --> 00:38:31,560
terrible decisions.
543
00:38:32,710 --> 00:38:34,880
The emails told a totally different
story.
544
00:38:35,080 --> 00:38:36,900
He knew exactly what was going on.
545
00:38:37,140 --> 00:38:40,720
And what happened in that plant was
happening at his control and his
546
00:38:40,980 --> 00:38:46,760
On September 19, 2014, the verdict comes
down for Stuart Parnell.
547
00:38:47,440 --> 00:38:52,420
Guilty on 71 counts of conspiracy,
fraud, and misbranded food.
548
00:38:53,140 --> 00:38:58,319
Jeff Allmer, the Hurleys, and other
victims are all back in Albany, Georgia
549
00:38:58,320 --> 00:38:59,940
the sentencing a year later.
550
00:39:00,700 --> 00:39:03,260
I sat there in the courtroom that
morning.
551
00:39:04,880 --> 00:39:09,399
Not knowing what the outcome was going
to be. Is it going to be a slap on the
552
00:39:09,400 --> 00:39:10,439
hand three months?
553
00:39:10,440 --> 00:39:12,000
Is it going to be life in prison?
554
00:39:12,980 --> 00:39:16,700
One by one, PCA victims share impact
statements.
555
00:39:17,160 --> 00:39:20,260
As they leave the stand, they walk past
Stewart's family.
556
00:39:20,980 --> 00:39:26,119
And according to Detweiler, they face an
appalling parting shot from a Parnell
557
00:39:26,120 --> 00:39:27,170
family member.
558
00:39:27,660 --> 00:39:30,680
You could not miss it. She was flipping
them the bird.
559
00:39:31,160 --> 00:39:32,700
And the federal marshal...
560
00:39:33,150 --> 00:39:37,629
basically takes a few steps over,
reaches over, and grabs this woman and
561
00:39:37,630 --> 00:39:41,329
basically pulls her from her seat and
hauls her out towards the back of the
562
00:39:41,330 --> 00:39:46,230
courtroom. And it was Beth Falwell, the
sister of Stuart Parnell.
563
00:39:48,350 --> 00:39:51,550
Parnell's underlings cooperate without
the drama.
564
00:39:52,290 --> 00:39:57,110
Three former plant managers plead guilty
to obstruction of justice and fraud.
565
00:39:57,430 --> 00:40:01,570
They are sentenced to three, five, and
six years in prison.
566
00:40:02,410 --> 00:40:05,430
Michael Parnell is sentenced to 20
years.
567
00:40:06,190 --> 00:40:10,729
Stuart Parnell doesn't realize he's
about to make history as a defendant in
568
00:40:10,730 --> 00:40:11,870
food poisoning case.
569
00:40:12,590 --> 00:40:16,010
His sentence, 28 years.
570
00:40:17,810 --> 00:40:19,710
This was a landmark case.
571
00:40:19,970 --> 00:40:24,809
You know, you go from three months as
the maximum potential jail time to 28
572
00:40:24,810 --> 00:40:29,669
years. When those numbers were read out
by the judge that evening, there was a
573
00:40:29,670 --> 00:40:30,720
gasp.
574
00:40:31,540 --> 00:40:36,739
Stuart Parnell could spend the rest of
his life behind bars, but he's still
575
00:40:36,740 --> 00:40:37,790
alive.
576
00:40:38,920 --> 00:40:42,180
The sentence can't bring Jeff Ormer's
mother back.
577
00:40:42,640 --> 00:40:48,459
I heard an ad on the radio for Mother's
Day, and it came to my mind that I
578
00:40:48,460 --> 00:40:54,259
should send a Mother's Day card, and I'm
going to send it to the person that put
579
00:40:54,260 --> 00:40:55,310
her in the ground.
580
00:40:55,560 --> 00:40:57,440
And I simply wrote in there,
581
00:40:57,441 --> 00:41:01,609
I didn't know where to send it this year
since my mother's no longer alive, so
582
00:41:01,610 --> 00:41:05,040
I'm sending it to you, the person
responsible for where she is today.
583
00:41:05,170 --> 00:41:06,310
And then I signed it.
584
00:41:07,710 --> 00:41:08,890
I know what you did.
585
00:41:09,130 --> 00:41:10,310
You know what you did.
586
00:41:10,750 --> 00:41:12,270
I'm not walking away from this.
587
00:41:12,690 --> 00:41:18,289
While Parnell appeals his case,
advocates say the Food Safety
588
00:41:18,290 --> 00:41:23,190
requires more funding to give it the
teeth legislators intended.
589
00:41:23,890 --> 00:41:24,940
Red tape.
590
00:41:25,330 --> 00:41:26,410
Mindless regulation.
591
00:41:27,640 --> 00:41:29,960
Hurting our economy, killing jobs.
592
00:41:30,880 --> 00:41:37,419
Well, yeah, there's another side to
that. And the other side of that is that
593
00:41:37,420 --> 00:41:43,619
it prevents stuff from happening that
actually hurts our economy, that
594
00:41:43,620 --> 00:41:44,670
hurts the lives.
595
00:41:45,180 --> 00:41:46,740
We didn't lose Jake.
596
00:41:47,760 --> 00:41:54,400
And that made me realize how lucky we
are and how I can...
597
00:41:55,600 --> 00:41:57,020
Talk to members of Congress.
598
00:41:58,900 --> 00:42:01,760
I'm happy. I'm healthy. I have a happy
and healthy son.
599
00:42:02,520 --> 00:42:07,539
From the person that's in prison and the
president in the White House, everybody
600
00:42:07,540 --> 00:42:14,379
eats. Every food producer should at
least do their part of what they know to
601
00:42:14,380 --> 00:42:21,339
right, to give us good, safe food. And
Stuart Parnell didn't do any
602
00:42:21,340 --> 00:42:23,330
of that. I love you, buddy. I love you,
too.
603
00:42:24,140 --> 00:42:28,479
Next. When money is no object, the limit
of the credit card was the only thing
604
00:42:28,480 --> 00:42:30,780
that stopped them. The object was to get
more.
605
00:42:31,200 --> 00:42:34,960
It was just boom, boom, boom, boom,
boom. Five rounds from the last 45.
606
00:42:35,260 --> 00:42:36,310
Enter the dark side.
607
00:42:36,360 --> 00:42:38,600
American Greed next on CNBC.
608
00:42:38,650 --> 00:42:43,200
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