Liability in The Food Processing Industry.

With our food resources becoming more global, food contamination has become a growing concern. Over the last five years, food contamination has become a media favorite with headlines such as: "E-Coil Cases See 400% Increase", "Deadly Hot Dogs and Ham", and "Health Concerns Mounting Over Bacteria in Chicken". The negative publicity can ruin a company. If you survive the public outcry, then come the "lawyers" and the liability issue.

Liability in our Civil Justice System can be measured in two ways. "Actual Damages" and "Punitive Damages".

Actual damages are usually quantitatively defined as the cost of the action and injury caused to the plaintiff as a direct result or the negligent actions of the defendant.

Punitive damages, on the other hand, are usually granted as punishment to the defendant for his negligence and are usually many times more than the actual damages. Punitive damages are based on the two factors. The first is negligence; the second is ability to pay. Risk Managers consider liability risk as three factors: damages, punitive damages and ability to pay.

In order to mitigate your liability, there is usually only one area you can limit your exposure. Damages are based on actual injury to the plaintiff, be it personal, such as hospital and doctor bills or loss of income, loss to real property, and cost of the action. There isn't much you can do here. Ability to pay is based on the company's balance sheet. Again, not much you can do here. However, punitive damages can be mitigated by taking an aggressive, proactive stand against the possible cause of action. In other words, by utilizing the best available/affordable technology (BAT) coupled with best management practices, judge and/or jury will take under consideration that you took the extra steps to avoid this accident. However, accidents do happen by factors out of our control.

Case in point: Technology exists to identify lightening strikes within five (5) miles of a golf course (more people are struck by lightening on a golf course than anywhere else in the world). A sales person makes a sales call to a Golf Course and explains this new technology to the course manager. When the manager hears the price, he says: "No way, that is too much money. It is not in our budget!" A few weeks later lightening strikes and kills a golfer. A plaintiff's lawyer picks up the case and sues the golf course. The damages were bad, but the punitive damages were astronomical due to the fact that the golf course could have prevented the man's death had they purchased the lightening warning system. The jury was further biased by the fact that the course management was aware of the technology, but declined the purchase to save money. The jury viewed this as a big, wealthy golf course that was too cheap to buy the lightening system that would have saved this man's life!

Second case in point: A mother is bathing her two children in a bathtub. She uses an extension cord to plug a hair dryer into a hallway outlet. The bathroom outlet, which had a GFI, was utilized by other appliances. The hallway outlet did not have a GFI. The children accidentally knocked the dryer into the tub water and were electrocuted. The hair dryer company was sued by the mother and ordered to pay heavy punitive damages because GFI technology was available to install directly on the hair dryer, but to save money, the appliance company chose not use it on the hair dryer.

With food contamination stories a major event on the nightly news and more plaintiff's attorneys become astute to contamination as big pay-out cases, food processors must take a lesson from the medical community who have now learned from our legal system to practice defensive medicine. Food processors must learn to practice defensive processing.

Food contamination is going to happen just like airline and space program tragedies. People are human and make mistakes. Thinking it can't happen is like playing ostrich and hiding your head in the sand. However, you can limit your exposure by taking a proactive, aggressive approach to food sanitation by upgrading your process with the latest technology and employing Best Management Practices (BMP) with Best Available/Affordable Technologies (BAT).

Affordable technology now exists which can reduce airborne bacteria, mold and fungi in the 90% range. Also, food wash systems can use aggressive advanced oxidation ultrapure-water, again capable of reducing microbial counts in the 90% range. Food surfaces can be treated with affordable and approved oxidizing ionizing radiation that will reduce surface microbial counts in the high 90% range. The ionizing radiation system is not considered penetrating radiation, and as such carries none of the negatives associated with radiation.

Utilizing the Best Available/Affordable Technology and taking an aggressive pro-active approach to food sanitation, a company will be in a position for mitigated punitive damages should an accident happen.

In addition to the liability issue, you will benefit from:

* A Positive Image. By utilizing a positive public relations campaign, you can develop free publicity. A media event announcing your new program will enhance your image with your clients as well as your employees and the general public. With the right publicity, stock value could be enhanced.

* Reduced Product Liability Insurance Rates. With a state-of-the-art high tech food safety program, insurance companies will recognize the value of reduced liability and will be more receptive to negotiate rates.

* A Safer Product. With a three-part program attacking air, water and food surfaces, bacteria levels will drastically drop, and you will be producing a safer product.

An ounce of prevention could be worth millions in punitive damages and insurance rates.