No Rocky Road for This Ice Cream Product Recall

No Rocky Road For This Ice Cream Product Recall Law360, New York (May 18, 2015, few weeks, it brought in a team of experts, who 1:20 PM ET) -- A recent recall by an worked with the U.S. Food and Drug Administration artisan ice cream company serves to investigate the cause of contamination. as a case study in how to conduct a On May 5, Jeni’s announced it believed it had recall that, while costly in the short identified the source of the contamination: the spout term, may result in even greater cost and risk of a production machine used to fill pints. The avoidance in the long term. machine was not used to fill buckets from which it Jeni’s Splendid Ice Creams is an Ohio-based scooped ice cream in its retail shops, but the company started in 2002. Known for its unique company continued with its plan to dispose of both flavors, such as Brambleberry Crisp and Garance buckets and pints. Jeni’s reports it is investing more Vert Clair, and locally sourced, organic ingredients, than $200,000 in improvements to its kitchen, Jeni’s now has 21 retail stores in six states and processes and testing protocols to address the distributes to more than 1,700 grocery stores, problem and prevent its recurrence. After previously restaurants and boutiques nationwide. vowing it will not resume production until it can “ensure it is 100 percent safe,” Jeni’s announced on The recall stems from random testing the Nebraska May 11 it planned to resume production by the end Department of Agriculture performed on a pint of ice of the week. cream at a Whole Foods Market Inc. store in Lincoln, Nebraska, on April 2. The testing, completed on April Jeni’s may have learned from the recent recall 21, indicated the presence of listeria, which is known experience of Blue Bell Creameries, another ice to cause relatively minor illness in most healthy cream company grappling with a listeria outbreak. individuals, but can cause severe illness in the After several patients at a Kansas hospital young, elderly and those with compromised immune developed listeriosis in January, Blue Bell started systems, as well as miscarriages and stillbirths in issuing limited recalls in mid-March, and ultimately pregnant women. issued an expanded recall in mid-April. At least three deaths have been linked to the outbreak, and Blue Although no injuries had been reported, given the Bell recently has come under fire for knowing of difficulty of determining the source of the listeria problems since 2013. contamination, Jeni’s issued a voluntary recall of all of its ice cream and other frozen products and Jeni’s has received nearly universal praise for its closed all of its retail stores within 48 hours after the handling of the issue. Crisis communications testing was completed. Over the course of the next advisers Hennes Paynter Communications — which ATLANTA CINCINNATI CLEVELAND COLUMBUS DAYTON NEW YORK WASHINGTON, D.C. ATTORNEY ADVERTISING No Rocky Road For This Ice Cream Product Recall reports it is not advising Jeni’s — wrote a recent It remains to be seen whether any litigation related to article arguing Jeni’s “appeared to be writing a the Jeni’s recall will be filed, and facts regarding how textbook example of how to respond the right way the listeria contamination initially developed, when catastrophe strikes your company.” Comments including whether Jeni’s knew or had reason to know on social media reports about the recall have been of it, are not known. However, the company’s actions overwhelmingly positive and customers have been during the recall have undermined a number of the covering retail store fronts with notes of support, arguments plaintiffs' counsel often make in recall- vowing to resume their patronage after the recall. spawned litigation, including that the defendant was slow to recall (at the cost of consumer safety), failed Key to Jeni’s crisis management has been its to include all potentially affected products, and failed communication strategy. It changed the home page to properly remedy the problem once discovered. for its website to content exclusively devoted to the recall, with a personal message from the company’s Jeni's timely and forthright communications strategy founder, Jeni Britton Bauer, set up a round-the-clock has been particularly effective in avoiding the communications center for fielding calls, and has perception that it is engaged in a cover-up — a issued regular press releases and social media typical plaintiff’s theme in litigation against corporate posts sharing updates about the recall and defendants. Jeni’s also has received praise for investigation. providing partial pay and maintaining health benefits for workers who otherwise would not have received Plaintiffs' counsel often look for recalls to find their paychecks during the shutdown. The company’s next piece of litigation to pursue. Not only do approach has led to a strong consensus that it has individual personal injury claims often follow recalls, acted as a “responsible corporate citizen,” which not class actions on behalf of all consumers who only will serve it well should it be in the position of purchased the product have become increasingly defending against claims of negligence or punitive popular after a recall shines a spotlight on a potential damages, but may even enhance its brand product problem. Such lawsuits typically claim either reputation and value in the long run. that the consumers would not have purchased the product had they known of the alleged risk the Jeni’s estimates the recall will cost more than $2.5 product posed or that the product was not worth the million; it has not disclosed whether insurance will price paid due to the problem that led to the recall. cover any of the costs. Ultimately, though, it may be Relatedly, the discovery of product problems and a smart investment to avoid the potentially greater ensuing recalls can lead to investor claims that costs of litigation stemming from the problem. product problems were not timely disclosed to Companies at risk for product recalls, especially investors, resulting in artificially inflated stock prices. consumer product companies, may want to take note 2 No Rocky Road For This Ice Cream Product Recall of Jeni’s quick decision-making, criticism-proof recall scope, and well-timed and sincere communications as both good public relations and litigation risk management strategies. —By Jennifer M. Mountcastle, Thompson Hine LLP Jennifer Mountcastle is a partner in Thompson Hine’s Columbus office. The opinions expressed are those of the author(s) and do not necessarily reflect the views of the firm, its clients, or Portfolio Media Inc., or any of its or their respective affiliates. This article is for general information purposes and is not intended to be and should not be taken as legal advice. 3.

Load more