Paul Seelig, the owner of Great Specialty Products, has been sentenced to 9-11 years in prison for falsely representing to his customers that his bread was gluten free. According to testimony from one of his former employees, Mr. Seelig also told customers that his products were “homemade,” even though he apparently just repackaged baked goods he bought at various stores.
The takeaway message (other than the obvious: follow the law) is that customers rely on a company’s representations, so it is important for those representations to be correct, documented, and verifiable. Even if Seelig had truthfully represented that he tested his products weekly, he failed to produce any records confirming this at trial. “Get it in writing” is as true now as it ever was; do you think your customers expect (and pay for) any less?
Recently, Paul Seelig, the owner of Great Specialty Products, was arrested for allegedly representing that its bread was “gluten free,” even though it allegedly tested positive for gluten. (Seelig denied the allegations, and he is currently on trial in North Carolina.) According to his defense counsel, the company was misled by its suppliers.
The purpose of this post is not to discuss the substantive merits of this dispute or pick sides; defendants are innocent until proven guilty. I will, however, address some risk management issues for companies that are trying to do the right thing, such as identifying simple steps one can take to minimize the risk of litigation, and when necessary, be better prepared to defend itself in a court of law (and the court of public opinion).
What is Gluten?
Gluten is a type of protein found in some grains. When people with celiac disease eat gluten, they may experience gastric distress and other symptoms. (The FDA estimates that up to 1% of the population may have celiac disease.) Some research has shown that gluten consumption may also contribute to other health problems. Accordingly, many consumers are now seeking “gluten-free” products.
What does “Gluten Free” Mean?
At this time, there is no standard for this term in the U.S. However, the FDA has proposed setting a threshold of 20 ppm for a product to claim that it is “gluten free.” The FDA also publishes a list of questions and answers about its proposed gluten-free labeling rule. That site also identifies several foods that naturally contain no gluten.
How Can My Company Tell Consumers About its Gluten-Free Products?
Good communication is important in any relationship, personal or business. Talk to your customers about their needs and interests. Are foods with low gluten levels acceptable, or does their diet have stricter requirements?
If you are buying purportedly gluten-free products from your suppliers, how are they testing and documenting that? Who performs their testing? How long do they (and you) keep records?
Be realistic about what you can do for your customers. Above all, it goes without saying that one should not exaggerate a product’s gluten-free status or flat-out lie to customers, as at least one chef allegedly did.