Peanut Corp. also had 1990 recall

The Lynchburg-based peanut company at the heart of a nationwide salmonella outbreak was forced to recall its peanut butter once before -- in 1990. But it has operated mostly out of the public spotlight in its three decades in business, according to public documents.

The Peanut Corp. of America was incorporated in Texas in 1977 and has headquarters in a small office behind its president's home in Lynchburg.

The company processes tens of millions of pounds of peanuts annually but has largely been unknown to those outside the food industry. Only amid trying circumstances, as in the 1990 recall that generated a lawsuit, and in a current recall that has affected hundreds of products nationwide, does the company find itself the object of scrutiny and public interest.

The company has hired Washington public relations official George Clarke, whose statements on behalf of the company have been posted on its Web site, peanutcorp.com.

The company's last statement, dated Jan. 31, expressed sympathy for those sickened by salmonella but said little else, asserting that "to engage in any discussion of the facts at this point is premature."

The Food and Drug Administration says at least 529 people have become sick from peanut products traced to the company's Blakely, Ga., plant. As many as eight deaths may be linked to the salmonella outbreak.

More than 430 products, including cookies, snacks, candy and dog biscuits, have been recalled. The outbreak has reached 43 states.

The family of a 72-year-old Minnesota woman has filed suit against Peanut Corp., the Justice Department has opened a criminal investigation and Congress plans to hold hearings on the recall.

Yesterday, meanwhile, The Associated Press reported that the company's Plainview, Texas, plant had operated for four years without being properly inspected by health officials. And the Center for Science in the Public Interest is urging national supermarket chains to use their discount-card programs, which track shopping habits, to alert customers who have bought recalled foods. Costco already does so, the AP reported.

Through it all, members of the Parnell family, which founded and runs the company, have mostly stayed mum.

The company has pulled information from its Web site, but President Stewart Parnell, the founder's son, posted a statement last week in which he said the company has "been devastated by this."

The Peanut Corp. employs about 90 workers at three plants: one in Suffolk; one in Plainview; and one in Blakely.

The company acquired the Suffolk plant from the Tidewater Blanching Corp. in 2001. At the time of the sale, Stewart Parnell told The Virginian-Pilot newspaper that his company had annual revenue of about $5 million.

The company opened a peanut-processing plant in Plainview in 2005 after the city of Plainview, Hale County and the Plainview/Hale County Industrial Foundation offered $400,000 in incentives.

The company said it would hire 40 workers initially and expand to 85, but foundation Executive Director David Evans said Monday that employment at the plant remains at 30. Still, he said, the plant has been an outstanding corporate citizen.

"One of the best," Evans said. "We're proud to have them here. And I'm proud to stand behind them during this [recall]."

The heart of the operation, however, is the company's Georgia plant, which industry insiders said processes 35 million pounds of raw peanuts per year, or 1.6 percent of all peanuts processed in the United States annually.

The FDA has asserted that Peanut Corp. knowingly released products from the plant that potentially were contaminated with salmonella.

The recall appears to be the company's biggest ordeal since 1990, when an FDA inspector found unacceptable levels of aflatoxin, a toxic mold, in the company's peanut butter, according to documents filed in Bedford County Circuit Court. The company subsequently recalled the product, which prompted the American Candy Co. of Delaware to file suit against Peanut Corp.

According to the suit, filed in 1992, American Candy bought hundreds of 50-pound cases of peanut butter to make peanut butter kisses, but was unable to sell the product because of the recall. American Candy and Peanut Corp. reached a settlement in 1993 in which an insurance company paid American Candy $90,000.

Contact Rex Bowman at (540) 344-3612 or .

Times-Dispatch librarian researcher Kathy Albers contributed to this report.