Meatpacker in Cow-Abuse Scandal May Shut as Congress Turns Up Heat

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Meatpacker in Cow-Abuse Scandal May Shut as Congress Turns Up Heat By DAVID KESMODEL and JANE ZHANGFebruary 25, 2008; Page A1 http://online.wsj.com/article/SB120378150987388423.html CHINO, Calif. -- Last year, a man carrying a hidden video camera took a $12-an-hour job at a little-known beef slaughterhouse here. Now the meatpacker is about to collapse, and has become a flashpoint in a national debate over meat safety and the quality of food Americans serve their schoolchildren. Hallmark/Westland Meat Packing Co., one of the biggest suppliers of beef to the national school-lunch program before videos showing animal cruelty at the plant helped trigger the biggest meat recall in U.S. history, probably will shut down permanently, according to the company's general manager, Anthony

Magidow. The company's president and owner, Steve Mendell, hasn't responded to requests for comment, and its controller, Juan Acevedo, referred an interview request to Mr. Magidow. "I don't see any way we can reopen," Mr. Magidow said in a telephone interview. The closely held company, which had about $100 million a year in sales, is starting to run low on cash, he said. Hallmark/Westland struggled for years, but it began turning a profit consistently after being approved by the U.S. Department of Agriculture to begin supplying beef for the federal school-lunch program in 2003, Mr. Magidow said. Within two years, it was supplying about 25 million pounds of beef a year to the program through competitive bidding. Only 23 of the about 900 boneless beef suppliers in the U.S. are approved to supply such USDA commodity-purchase programs, said Les Johnson, a

consultant and former director of the food-distribution division of USDA's Food and Nutrition Service. To qualify, each facility must have its financial statements reviewed, be federally inspected, receive visits from USDA officials to examine plant processes and equipment and submit a technical explanation about how the plant does everything from controlling germs to testing the fat content of its products. For the 2004-05 school year, the government named Hallmark/Westland the school lunch program's Supplier of the Year. But the company began to unravel in late January, when a video made by an investigator from the Humane Society of the U.S. came to light. The video showed workers at the plant trying to make sick or injured cattle stand up with electrical-shock devices, forklifts and high-pressure water hoses. Cattle that can't walk or stand on their own are generally banned from

the nation's food supply. Such "downer" cows can be sources of mad-cow disease, which can cause a rare but fatal brain disorder in humans. The video "just astounded us," Mr. Magidow said Friday. "Our jaws dropped....We thought this place was sparkling perfect." The company closed voluntarily, fired two workers and began taking steps to be reauthorized to resume operations. But Mr. Magidow said additional Humane Society video provided to the USDA apparently gave the agency ammunition to issue a recall of 143 million pounds of beef produced by the plant, dating back as far as February 2006. (Watch that video.) Citing the continuing investigation, a USDA spokeswoman declined to say what evidence spurred the agency to act. Debate in Congress The scandal has triggered a heated debate in Congress and elsewhere over the safety

of the U.S. meat supply, as well as criticism of both the company and the USDA, which had inspectors stationed at the plant. Lawmakers in Washington and Sacramento have scheduled hearings starting this week to explore how the problem occurred despite the presence of federal inspectors, whether the USDA is doing its job, and whether the meat supplied to the school-lunch program is safe. On Thursday, Sen. Herb Kohl, a Wisconsin Democrat who heads an agriculture appropriations subcommittee, plans to hold a hearing to address, among other things, "serious questions on risks posed to children by the recalled beef," his office said. Secretary of Agriculture Ed Schafer and James Hodges, president of the American Meat Institute Foundation, an industry trade group, are expected to attend. Hallmark/Westland, meanwhile, has been deluged with hundreds of emails by consumers furious about the video, says Mr. Magidow. He says

the recall is too extreme in scope, and that the company is being unfairly maligned, because there is no evidence that any of the recalled meat was contaminated. The USDA says no one has gotten sick from the meat and that there is very little risk of harm from consuming it. The company fired the two workers shown in the video that the Humane Society released in January. Daniel Ugarte Navarro, a 49-year-old former cattle-pen manager at the plant, faces the possibility of more than five years in prison on felony and misdemeanor charges of animal cruelty, said Deborah Ploghaus, deputy district attorney in San Bernardino County. Luis Sanchez, 32, who worked for Mr. Navarro, faces three misdemeanor charges. Efforts by The Wall Street Journal to reach the two men were unsuccessful. The daily Press-Enterprise in Riverside, Calif., quoted a woman who identified herself as Mr. Sanchez's

wife denying that her husband had done anything illegal. The paper also spoke with Mr. Navarro's wife, but she declined to comment. Mr. Navarro was a supervisor with some 30 years of experience, Mr. Magidow said. He said Mr. Navarro dealt directly with USDA inspectors conducting audits, as well as private companies that bought meat from the plant and conducted their own audits. Suspended Operations After the video was released, the USDA launched an investigation into the plant's practices, and the company voluntarily suspended operations. The plant began trying to address its problems so it could resume production, Mr. Magidow said. Among other steps, it hired Arrowsight, a Mount Kisco, N.Y., monitoring company, to help it step up surveillance. The company installed about 15 video cameras throughout the slaughterhouse to help monitor activities. Arrowsight couldn't be reached for comment. Leading up to the weekend of the recall, Feb. 16-17, "We were starting to do all the things necessary" to be reauthorized, Mr. Magidow said. "We were doing everything we could to make sure we had the foremost facility." But that weekend, in a phone call to Hallmark/Westland's president, Mr. Mendell, at 1 a.m. West Coast time, the USDA informed the meatpacker that new evidence had emerged that suggested a significant violation of USDA safety rules and the need for a massive recall. It was the additional undercover video shot by the Humane Society, Mr. Magidow said. He said he hasn't seen the video, but said company officials have been told that it shows an animal that had fallen down before entering the "kill" or "knocking" box, where the animals are slaughtered. The animal is about "half in, half out" of the box, he said. Wayne

Pacelle, the Humane Society's president, confirmed that description of the video. The video apparently showed only one cow in such a situation, Mr. Magidow said. But the USDA interviewed an employee who worked on the slaughtering line who told them that, on rare occasions, the company went ahead and slaughtered an animal that had stumbled prior to slaughter after initially being cleared for slaughter by inspectors. The company is supposed to first contact a USDA inspector in such situations. The employee told USDA officials that he had followed instructions from Mr. Navarro that if an animal had slipped prior to reaching the kill box but was otherwise a normal, ambulatory animal, to go ahead with the slaughter, according to Mr. Magidow. The employee began working at the company in February 2006; that became the start date of the recall. "We are going by what we were told, we have not been allowed to see the video," Mr.

Magidow said. The USDA has said it received new evidence that led to the recall covering two years, but it has declined to disclose the details, because its investigation is pending. "We know that it was a very rare occurrence," USDA official Kenneth Petersen told reporters last week, "but obviously, given that we went back two years, we obviously have some reason to believe that it occurred with some frequency over the last two years." The initial video didn't provide specific evidence that downer cattle may have been slaughtered, though it shows animal cruelty. After being approved for slaughter, cattle must walk up a serpentine 90-foot chute, on an incline, before being killed, Mr. Magidow said. The chute meanders in part so that cattle won't suspect what is about to happen to them, he said. The incline helps ensure that only cattle able to walk and stand on their own can make

it to the slaughtering line. ------------------------ Cary Birdwell If we are what we eat, then I'm fast, cheap, and easy!

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