There has been a major court ruling in the 2015 listeria outbreak involving Blue Bell Ice Cream.
A federal appeals court is backing a federal judge who ruled that two insurance companies do not have to pay the damages against the Blue Bell board of directors. The reason is due to the listeria outbreak that killed three people and infected ten others was not an accident.
The courts have ruled there is ample evidence that Blue Bell's management and board of directors knew there were traces of listeria that had begun to seep into the food-line months before the outbreak was reported. Yet the production continued.
The federal judge ruled that is not something the insurance companies should have to be held accountable for.
Shareholders filed suit against the company and the board after the company lost millions of dollars during the outbreak which caused the company to close for several months.
In 2020 a Texas grand jury charged the former president Paul Kruse of Blue Bell Creameries L.P. with wire fraud and conspiracy in connection with an alleged scheme to cover up the company’s sales of Listeria-tainted ice cream in 2015.
Blue Bell pleaded guilty to two counts of distributing adulterated food products in violation of the Federal Food, Drug, and Cosmetic Act. On Sept. 17, 2020, the court sentenced the company to pay criminal penalties totaling $17.25 million. Blue Bell also agreed to pay an additional $2.1 million to resolve civil False Claims Act allegations regarding ice cream products manufactured under insanitary conditions and sold to federal facilities, including the military. The total $19.35 million in fine, forfeiture, and civil settlement payments constitutes the second largest-ever amount paid in resolution of a food safety matter.
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