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Lloyd v. Frontera Produce, Ltd.

United States District Court, D. Maryland, Northern Division

September 24, 2014

DONNA KAY WELLS LLOYD, Plaintiff,
v.
FRONTERA PRODUCE, LTD., et al., Defendant.

MEMORANDUM OPINION

WILLIAM D. QUARLES, Jr., District Judge.

Donna Kay Wells Lloyd, personal representative for the Estate of Clarence D. Wells, sued Frontera Produce, Ltd. ("Frontera") and Primus Group, Inc. ("Primus") in a product liability suit arising from a 2011 Listeria outbreak. ECF No. 38-1.[1] Frontera asserted third-party claims against Pepper Equipment Corp. ("Pepper Equipment"), Jensen Farms, and Bio Food Safety, Inc. ("Bio Food Safety").[2] ECF No. 14-1. Pending are Primus's motion to dismiss for failure to state a claim, ECF No. 19, Pepper Equipment's motion to dismiss for lack of personal jurisdiction, ECF No. 35, and Lloyd's motions to supplement her response to Primus's motion to dismiss, ECF No. 37, and to file an amended complaint, ECF No. 38. No hearing is necessary. Local Rule 105.6 (D. Md. 2014). For the following reasons, the motion for leave to amend will be granted, the motion to supplement will be denied, [3] the motion to dismiss for failure to state a claim will be denied as moot, and the motion to dismiss for lack of personal jurisdiction will be granted.

I. Background[4]

A. Facts[5]

This case arises from a 2011 nationwide Listeria outbreak allegedly linked to contaminated cantaloupe grown, distributed, and sold by Jensen Farms and Frontera. According to the CDC, [6] 147 persons in 28 states were infected with one of five outbreak-associated strains of Listeria monocytogenes. ECF No. 38-1 ¶¶ 3.1-3.2. Of those, 33 deaths and one miscarriage were reported. Id. ¶ 3.4. In Maryland, one of the affected consumers was Mr. Wells. Id. ¶ 3.67. On or about August 23, 2011, Mr. Wells began having symptoms of Listeriosis[7] after consuming Listeria -contaminated cantaloupe sold by Frontera. Id. ¶¶ 3.67-3.68. One week later - on August 31, 2011 - Mr. Wells died. Id. ¶ 3.72. Blood tests confirmed that Mr. Wells had been infected with one of the Listeria monocytogenes strains associated with the Jensen Farms outbreak. Id. ¶ 3.73.

1. Jensen Farms, Frontera, and Primus

Jensen Farms, a Colorado Partnership, grew, processed, and packaged agricultural products, including cantaloupe. ECF No. 14-1 ¶ 2. Frontera distributed and sold cantaloupe in Maryland. ECF No. 38-1 ¶ 1.2. In 2011, Frontera distributed almost all of Jensen Farms's cantaloupe crop. Id. ¶ 3.9. Before distribution, Frontera required Jensen Farms to pass a third-party food safety audit. Id. Primus provides audits for agricultural businesses that manufacture and sell food products. Id. ¶ 1.3.[8] Primus retained the services of a subcontractor, Bio Food Safety, to audit Jensen Farms's ranchlands and packing facility. Id. ¶¶ 1.3, 3.36.[9]

2. Pepper Equipment[10]

Pepper Equipment sold Jensen Farms the machinery Jensen Farms used to process cantaloupe. ECF No. 14-1 ¶ 4. Incorporated in Colorado, Pepper Equipment has its principal place of business in Monte Vista, Colorado. ECF No. 35-2 ¶ 2. Pepper Equipment manufactures and sells agricultural equipment in Colorado. Id. ¶ 3. It maintains a passive website, www.pepperequipmentco.com. ECF Nos. 35-1 at 4, 35-3.[11] Customers can view equipment, read about the company, and find contact information. See Pepper Equipment Corp., http://www.pepperequipmentco.com (accessed Sept. 16, 2014); ECF No. 35-3. The website states that Pepper Equipment "serve[s] the produce industry throughout the U.S." ECF No. 35-3 at 3.

According to Pepper Equipment's affidavits, all business transactions between Jensen Farms and Pepper Equipment were in Colorado, including Jensen Farms's purchase of cantaloupe processing equipment. ECF No. 35-2 ¶ 4. Pepper Equipment has not sold any of its agricultural equipment to purchasers in Maryland or through distributors in Maryland. ECF No. 39-1 ¶¶ 6-7. Pepper Equipment has never directed advertising to, or advertised in, Maryland. Id. ¶ 8. Pepper Equipment has no knowledge of the geographic distribution of its customers' products, including Jensen Farms. Id. ¶¶ 9-10.

3. Jensen Farms Audit

Before the Listeria outbreak discussed below, [12] in 2011 Jensen Farms or Frontera, or both, contracted with Primus to audit Jensen Farms. Id. ¶ 3.7.[13] The contracting parties intended that Primus's audit (1) would "ensure that the facilities, premises, and procedures used by Jensen Farms in the production of cantaloupe met or exceeded the applicable standards of care related to the production of cantaloupe";[14] (2) would ensure that the food products Jensen Farms produced and Frontera distributed would be high quality, fit for human consumption, and not contaminated by lethal pathogens, such as Listeria; and (3) would determine whether the conditions under which Jensen Farms produced its cantaloupes met the standards of care necessary to be "Primus Certified." Id. ¶ 3.17. Frontera required Jensen Farms cantaloupe to be Primus Certified before it sold or distributed the cantaloupe, a requirement of which Primus was aware. Id. ¶¶ 3.18, 3.26.[15]

In the contract, Primus agreed, pursuant to its audit guidelines:

- [T]o assess and determine if Jensen Farms's packinghouse facilities, premises, and food safety procedures met or exceeded the applicable good agricultural and manufacturing practices, industry standards, and relevant FDA industry guidance standards of care;
- [T]hat its auditors should interpret its audit guidelines with food safety and risk minimization being the key concerns;
- [T]hat its auditors should consider that where laws, commodity specific guidelines, and/or best practices recommendations existed and were derived from a reputable source, those practices and parameters should be followed; [and]
- [T]hat the Jensen Farms... auditor [would] utilize four separate conformance categories, with related relative scoring levels and points: full conformance; minor deficiency; major deficiency; and non-conformance.

Id. ¶¶ 3.27-3.30.

Primus's audit guidelines included a "Good Manufacturing Practices (The Facility Tour)" section that assessed "general food safety, operational practices, equipment, equipment cleaning, and general cleaning practices and procedures." Id. ¶ 3.31. The guidelines also included a "Food Safety File" section that assessed "general food safety file requirements, self-inspection records, maintenance and sanitation records, and microbial testing records." Id. ¶ 3.32. Both sections were to be assigned a conformance category. Id. ¶¶ 3.31-3.32.[16]

On July 25, 2011, Bio Food Safety auditor James DiIorio[17] audited Jensen Farms's ranchlands and packing facility (the "2011 audit"). Id. ¶ 3.36. Although Primus's guidelines required Jensen Farms to be engaged in normal functions during the audit, or the audit would be terminated, Jensen Farms was not operational when DiIorio conducted his audit. Id. ¶¶ 3.35-3.36. DiIorio gave Jensen Farms a "superior" rating, and a score of 96%. Id.

During the 2011 audit, Eric Jensen explained to DiIorio the refurbished washing system that had replaced a hydrocooler previously used to wash cantaloupe, including the discontinuation of the use of chlorinated water. Id. ¶ 3.37.[18] DiIorio saw the washing system and noted the change in his report. Id. He did not question the removal of the hydrocooler or the suitability of the replacement washing system; he did not advise Jensen Farms that the replacement system was deficient, below industry standards and practice, or that it created a contamination risk. Id.

DiIorio failed to consider "multiple conditions or practices, " including the use of inappropriate equipment, the lack of antimicrobial solution in the cantaloupe wash water, the absence of hot water for hand-washing, the failure to precool cantaloupe, and poor facility design that enabled pooled water to create a harborage site for bacteria. Id. ¶¶ 3.46-3.46.7. Had DiIorio terminated the audit or considered deficient facility conditions and practices, Jensen Farms would not have passed the 2011 audit. Id. ¶¶ 3.52-3.53. DiIorio "erroneously misrepresented to Jensen Farms" that it "met or exceeded" applicable standards of care, thereby preventing Jensen Farms from taking corrective action. Id. ¶¶ 3.58, 3.62.

4. Listeria Outbreak

On September 2, 2011, the Colorado Department of Public Health and the Environment ("CDPHE") announced that it was investigating an outbreak of Listeriosis. Id. ¶ 3.1. On September 9, 2011, CDPHE announced that the likely source of the Listeria outbreak was cantaloupe. Id. On September 12, 2011, CDPHE announced that the Listeria was linked to Rocky Ford brand cantaloupe from Colorado; it later determined that the contaminated cantaloupes were grown by Jensen Farms and distributed by Frontera. Id.

On September 14, 2011, Jensen Farms recalled its Rocky Ford brand cantaloupe. Id. ¶ 3.6. On or about September 19, 2011, the Food and Drug Administration ("FDA") announced that it found Listeria monocytogenes on samples of Jensen Farms cantaloupe taken from a Denver-area store and on samples taken from equipment and cantaloupe at the Jensen Farms packing facility. Id. ¶ 3.5.

5. FDA and CDPHE Inspection of Jensen Farms

On September 10, 2011, FDA and CDPHE officials conducted an inspection at Jensen Farms. Id. ¶ 3.38. Of 39 samples collected from the facility, 13 tested positive for Listeria monocytogenes indistinguishable from three out of five outbreak strains. Id. ¶ 3.39.[19] Testing showed that 17 out of 18 Jensen Farms cantaloupe removed from store shelves were positive for one or more of the five outbreak strains. Id. The higher rate of positive samples taken from store shelves indicated that the conditions under which the cantaloupes were distributed allowed Listeria monocytogenes to thrive. Id.

From September 22-23, 2011, the FDA conducted an environmental assessment at Jensen Farms. Id. ¶¶ 3.41-3.42. The FDA reported its findings in an October 19, 2011 report ("FDA Report").

On facility design, the FDA Report stated that certain features of the packing facility allowed water to pool on the packing facility floor. Id. ¶ 3.42(a). Wet environments are potential reservoirs for Listeria monocytogenes, and the pooling of water near packing equipment may have spread the pathogen to food contact surfaces. Id. Samples collected from areas where water had pooled tested positive for outbreak strains. Id. Thus, facility design "may have contributed to the introduction, growth, or spread of Listeria monocytogenes." Id. [20]

On equipment design, the FDA Report stated that the equipment used to wash and dry the cantaloupe was not easily cleaned or sanitized. Id. ¶ 3.42(b). Dirt and product buildup was visible on the equipment, even after it had been disassembled, cleaned, and sanitized. Id. The FDA Report stated that, because the equipment was not easily cleaned and had previously been used to process other raw produce "with different washing and drying requirements, Listeria monocytogenes could have been introduced" from the equipment's prior use. Id. Thus, equipment design "likely contributed to the introduction, growth, or spread of Listeria monocytogenes" found on the cantaloupe. Id.

On postharvest practices, the FDA Report stated that "[w]arm fruit with field heat potentially created conditions" allowing "the formation of condensation, " which was ideal for Listeria monocytogenes growth. Id. Samples collected from cold storage tested positive for two outbreak strains. Id. The FDA Report concluded that the absence of precooling before the cantaloupes entered cold storage "may have provided ideal conditions for Listeria monocytogenes" to develop. Id.

In October and December 2011, FDA officials participated in briefings pursuant to a congressional investigation into the causes of the Listeria, outbreak. Id. ¶ 3.43. FDA officials cited failures at Jensen Farms that "reflected a general lack of awareness of food safety principles, " including condensation on the packing facility floor; poor drainage resulting in water pooling; "inappropriate food processing equipment"; the lack of antimicrobial solution, such as chlorine, in the cantaloupe ...


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