USDA launches probe into American Egg Board’s emails over Just Mayo maker Hampton Creek
An USDA spokesperson told FoodNavigator-USA: “USDA’s Agricultural Marketing Service (AMS) is conducting a thorough administrative review of issues involving the American Egg Board. This involves a substantial amount of material, and while AMS expects to complete the review in an expeditious manner, a complete review will take some time.”
Asked about the earlier-than-expected retirement of AEB CEO Joanne Ivy - who stepped down on Sept 30 shortly after hundreds of embarrassing emails over Hampton Creek were made public, rather than as expected, on December 31 - he said: “AMS will not comment on personnel matters involving the Board.”
Asked about USDA’s responsibility when it came to the AEB's conduct, he said: “While AMS approves a wealth of board materials and communications, AMS does not pre-approve the content of every email of a board member or board staff member, nor are these individuals USDA employees.”
He added: “USDA strongly supports agriculture, including promotion of products within the scope of pertinent rules and regulations, and is committed to establishing a level playing field that protects and promotes all appropriate agricultural endeavors. AMS does not condone any efforts to limit competing products in commerce.”
Sen Mike Lee calls on USDA to find out if AEB board members abused their positions
His comments came shortly after Senator Mike Lee (R-Utah) sent a letter to agriculture secretary Tom Vilsack (dated October 20) calling for an investigation amid reports that the AEB engaged in “a strategic, multifaceted campaign to use the power and resources of the federal government to undermine the economic prospects of Hampton Creek, based on their fear that the food start-up’s product, Just Mayo, represented a ‘crisis’ and a ‘major threat’ to the egg industry”.
(For a detailed report on the emails and the AEB’s response, click HERE.)
However, the investigation was launched well ahead of the receipt of Senator Lee’s letter, said the USDA spokesman: “The administrative review began September 3, 2015.”
Among other things, Sen Lee wants USDA to determine whether AEB board members and alternates abused their position; who was involved in an alleged conspiracy to pressure Whole Foods into de-listing Just Mayo; and whether Roger Glasshoff, the National Supervisor for Shell Eggs at AMS, acted within the scope of his duties and the USDA’s ethical standards when he advised the AEB to contact the FDA with respect to its complaints about Just Mayo?
He added: “If these Great Depression era institutions [such as the AEB] have outlived their purpose, and if evidence suggests they behave like state-sponsored cartels that intimidate and handicap their competition, should Congress continue to authorize them?”
The AEB is not commenting on the USDA announcement, but has vigorously denied allegations that it “engaged in numerous illegal activities” by allocating resources that should have been devoted to promoting eggs on covert attempts to thwart the progress of Hampton Creek.
Speaking to FoodNavigator-USA Friday, Hampton Creek CEO Josh Tetrick welcomed the news, adding: "For me this is not about selling more Just Mayo, but about whether the AEB is behaving in a way that aligns with USDA's stated values. We started this company because we believed that food that is better for the environment should be more accessible to more people. The checkoff programs run by the USDA should also be about making better food accessible to more people, and so we think it's a phenomenal thing that Secretary Vilsack is looking into this and wants positive reform to ensure that this is the case."
What is all the fuss about?
A stream of emails unearthed via freedom of information act (FOIA) requests made by The Guardian recently suggested that the American Egg Board - which receives funding from a national legislative checkoff on all egg production from companies with 75,000+ hens in the continental United States - overstepped its mandate.
Among other things, the emails suggested the AEB paid someone to call Whole Foods to attempt to block the distribution of Just Mayo and pushed the FDA to looking into Hampton Creek's labels in the wake of a Unilever lawsuit alleging it violated federal food labeling rules.
However, AEB Director of Marketing Communications Serena Schaffner told us that "No one at AEB or anyone acting on its behalf ever contacted the FDA about Hampton Creek." And while Unilever "did reach out to AEB regarding its lawsuit against Hampton Creek", she said, it was told that "AEB could not be a party to its lawsuit or provide assistance related thereto.”
Regarding the allegation about Whole Foods, she said: "Anthony Zolezzi, a food industry consultant, believed Just Mayo’s packaging was misleading and on this basis, offered to alert his contacts at Whole Foods to that fact. Mr. Zolezzi has never received compensation from AEB. Whole Foods continues to sell the products in their stores."
Finally, emails referring to threats to Josh Tetrick (‘You want me to contact some of my old buddies in Brooklyn and to pay Mr Tetrick a visit?’) were clearly made "in jest" although the AEB admits they were in "poor taste", she added.
As for bloggers paid to push egg products in forums where Hampton Creek products were being discussed, she said, they "disseminated positive messages about eggs", and "did not disparage Hampton Creek in any way".
Hampton Creek: We’re confident of finding common ground with the FDA
Asked whether he had had any further conversations with the FDA about a recent warning letter (click HERE) advising him that Hampton Creek's flagship product Just Mayo did not comply with federal standards of identify for the labeling of mayonnaise, Josh Tetrick told FoodNavigator-USA: “We haven't sat down with them yet but I’m confident we can find common ground.”
*For a detailed account of the FOIA requests, read this report by Michele Simon in EatDrinkPolitics.
