Prosecutors still investigating 2010 salmonella outbreak tied to Iowa farms

Decosters could still be implicated by former egg plant manager

Three years after a nationwide salmonella outbreak caused by contaminated eggs from Iowa, federal prosecutors are still seeking criminal charges.

Attorneys in Iowa’s Northern District are waiting to sentence a former manager of an Iowa egg company involved in the 2010 outbreak that sickened about 2,000 people, possibly to see what testimony he provides to a grand jury that continues to investigate the case.

Tony Wasmund, 62, of Willmar, Minn., pleaded guilty in September to conspiring to bribe a federal egg inspector at Wright County Egg, one of the Iowa egg farms operated by Austin “Jack” DeCoster and Peter DeCoster, a father and son from Clarion.

Wasmund’s sentencing is scheduled for Aug. 16, nearly a year after he took a plea deal from the U.S. Attorney’s Office.

The delay feeds speculation that prosecutors are using Wasmund’s testimony to a Cedar Rapids grand jury to implicate others in the DeCoster egg operations. Wasmund’s attorney, Richard Kerger, of Toledo, Ohio, said he could not comment on the substance of the investigation or the target.

“It’s an ongoing criminal investigation, and the arrangement we have with the government precludes me from commenting one way or the other,” Kerger told The Gazette.

Brandon Garrett, a University of Virginia law school professor who specializes in criminal prosecution and created a library of federal plea agreements, said prosecutors often build corporate cases from the bottom up, using lower-level plea deals to get information about executives.

“The prosecutors might very well be evaluating what assistance the former manager can provide,” Garrett said of the Wasmund plea. “If the company itself is not yet fully cooperating, or if prosecutors want to be sure they are hearing the full story, then prosecutors may turn to former employees to learn what really happened.”

U.S. Assistant Attorney Peter Deegan said he could not comment on the timing of Wasmund’s sentencing or anything else in the case.

More than 1,900 people across the country became ill in 2010 from Salmonella Enteritidis linked to tainted eggs supplied by Quality Egg, doing business as Wright County Egg, and Hillandale Farms, an Alden operation also managed by the DeCosters. The companies recalled 550 million eggs nationwide.

Iowa is the top egg-producing state in the nation.

The DeCosters apologized for the outbreak when they testified Sept. 22, 2010, before an oversight and investigations subcommittee of the U.S. House Committee on Energy and Commerce.

“Over the years, we have grown to be pretty big in producing eggs,” Jack DeCoster said. “Unfortunately, we got big quite a bit before we stopped acting like we were small. What I mean by that is we were big before we started adopting sophisticated procedures to be sure we met all of the government requirements.”

A congressional investigation found salmonella samples from the DeCosters’ egg farms more than 400 times between 2008 and 2010, the Associated Press reported. Inspectors also found dead chickens, insects, rodents, large piles of manure and filthy conditions at the farms.

Peter DeCoster, who was chief operating officer for Wright County Egg, testified in 2010 the firm had five egg-producing farms at that time in Iowa with 5.8 million egg-laying hens producing about 1.4 billion eggs each year.

“We are terribly sorry that our eggs may have made people sick,” Peter DeCoster told Congress. “As a father, as a food producer, and as the leader of Wright County Egg, only wholesome, safe eggs are acceptable.”

In addition to health and safety violations, Jack DeCoster was labeled a “habitual offender” of Iowa’s environmental laws in 2000.

Wasmund pleaded guilty to authorizing another employee to use $300 in petty cash to bribe an inspector from the United States Department of Agriculture (USDA) to release for sale eggs that had failed to meet federal standards, court records state.

The plea deal came as part of a grand jury investigation based in Sioux City, one of two courthouses in Iowa’s Northern District.

A grand jury, which normally consists of 16 to 23 people, listens to evidence presented by a federal prosecutor to determine if there is probable cause to believe a person has committed a crime and should be put on trial. If the grand jury decides there is enough evidence, the group will issue an indictment.

Grand jury hearings are private since they can end without indictment.

Kerger said he couldn’t comment on the criminal probe, but said Wasmund is no longer a target.

“I could theorize they are looking into the salmonella thing, but I don’t know that,” Kerger said. “I would assume that the people leading the company would be the targets.”

Wasmund told The Gazette he could not say whether he had testified before the grand jury and referred further questions to Kerger, who said his client had nothing to gain by talking about the case.

“The judges, prosecutors all read newspapers,” he said. “If he said something infelicitous, shall we say, it could affect his sentence.”

Among witnesses called to testify before the grand jury in Cedar Rapids was Jerry Crawford, a Des Moines attorney who represented Jack DeCoster in the mid-2000s.

“I was called to authenticate a sales brochure,” said Crawford, who was not representing the DeCosters at the time of the 2010 outbreak.

Two Washington, D.C, attorneys were at the federal courthouse in Cedar Rapids May 22 talking with Des Moines-based DeCoster attorney, Jan Kramer.

Thomas Green, senior counsel for Sidley Austin, was named D.C.’s White Collar Lawyer of the Year in 2011 by Best Lawyers, a peer-review website. He’s known for successfully defending food giant Tyson in immigration and environmental cases. Frank Volpe, another white collar criminal defense expert for Sidley Austin, was also at the courthouse May 22.

Volpe told the Gazette he could not comment on why he was in Cedar Rapids.

“There may be a day we can talk about this,” Volpe said. But “it’s an ongoing grand jury investigation.”

Jack DeCoster and his wife live in Maine, but maintain a house in Clarion, a Wright County town of 2,800. Peter DeCoster and his family also live in Clarion. Messages left in person at their houses were not returned.

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