Peanut Company Files for Bankruptcy

Feb. 13, 2009— -- Capping an action-packed week in the investigation of a widespread salmonella outbreak, the peanut company at the heart of the examination has filed for bankruptcy.

Peanut Corp. of America's Friday bankruptcy filing came after the list of recalled peanut products grew even longer Thursday night, when the company announced it was recalling all products shipped from a second of its plants. Of three plants owned by the company, both its Blakely, Ga., and Plainview, Texas, facilities have found evidence of possible salmonella and unsanitary conditions.

The Plainview plant had a long list of customers that, at one point, did business with the facility, including big names, such as Abbott Laboratories, Frito-Lay, General Mills, Kellogg and Whole Foods. Some 1,900 products now grace the list of one of the largest food recalls in U.S. history.

"The news from Texas state health officials of conditions at PCA's Plainview plant is alarming," said Rep. Bart Stupak, D-Mich., in a statement Thursday night. "I am pleased Texas officials have taken immediate action to recall every product ever produced at the facility."

"More alarming is the concern that there could be hundreds or even thousands of food processing facilities operating in this country that have never been inspected by the FDA, just as this plant has been doing since March 2005," said Stupak, who serves as chairman of the panel that examined the issue Wednesday.

According to a survey released Friday, many Americans are confused about what products the peanut recall includes. A study released by the Harvard School of Public Health found that one in four Americans mistakenly thought big brand names of peanut butter were already included, though they are not. The study also found that one in three are not confident that the food service industry and government inspectors can keep food safe.

Brand name peanut butter is still said to be safe for consumption, whereas smaller peanut butter brands and a variety of other products containing peanuts, from crackers and candies to ice cream, have been recalled.

Shoppers can learn which products are still safe by examining the list of recalled products on the Food and Drug Administration's Web site.

The salmonella outbreak has resulted in 600 illnesses and an estimated nine deaths believed to be linked to bad peanuts.

This week, lawmakers and victims' families expressed their anger over the outbreak and questioned the ability of the the food industry and the government to keep products safe.

Truck drivers, too, have started to blow the whistle. First reported by ABC TV affiliate WHAS 11 in Louisville, Ky., the driver of a truck traveling from Texas to Georgia said that along the way, packages of peanut paste burst in the back of his rig. After shoveling the paste out and putting it in barrels, the shipment was rejected at one Georgia company, but the Peanut Corp. of America signed for it and accepted the delivery.