Before I explore the latest controversy to have come out of Tuesday’s highly public raid of the Hartmann Farm delivery, I should report that the Hartmann Farm, half a dozen of its customers, and the Foundation for Consumer Free Choice have filed suit in state court against the state to seek return of confiscated product and an end to “harassing and malicious prosecution.” They charge the Minnesota Department of Agriculture with having “intentionally introduced this chaos in hopes of creating conflicting decisions, increasing Respondents costs to defend himself, and to advance multiple theories of liability. Serial prosecutions for the same alleged offenses, are an abuse of process, and can have no legitimate purpose…”
The matter of “harassing and malicious prosecution” can be summed up in a small but very controversial matter that has come up since the seizure of Hartmann milk on Tuesday.
Most people who have viewed the video from the Tuesday raid on the milk being delivered by the Hartmann Farm to buyers in suburban Minneapolis have noticed near the end the handicapped parking placard hanging from the front-seat mirror in the Jeep Cherokee used to haul some of the milk away. They have also noticed that the two MDA investigators who took the milk from the Hartmann truck and loaded it into the station wagon did not appear to be handicapped—or at least not handicapped enough that they had trouble walking briskly carrying several big coolers loaded down with milk.
I made a disparaging remark in my original post about the placard being “a nice touch,” based on my initial assumption that the placard was part of a disguise allowing the MDA agent to operate plain-clothes-like and gain easy access to businesses that might be under his jurisdiction. But since the video came out, there’s been a fair amount of discussion on listserves, with most comments I’ve seen believing the placard belonged to the agent. That certainly seems to make more sense, but then the question that comes up is this: was the agent driving his personal vehicle, with the handicapped placard belonging to himself or a family member, or was he driving a state vehicle and using the placard for himself?
A few of the listserve comments from Minnesota raw milk drinkers have been surprisingly conciliatory, expressing understanding for the agent that he or his family might need a handicapped placard. “People with handicaps don’t always ‘look’ the part. …Condemning him in a public way still does not help the cause. Do we want our children – those who witnessed slanderous comments from adults – to judge whether a person’s handicap/sticker is valid?”
I decided to inquire with the MDA, and a spokesperson refused to provide any information about why the investigator was carrying out a police action (serving a search warrant accompanied by local police) in a car with a prominently displayed handicapped parking placard. “I’m not at liberty to explain details of an ongoing investigation,” he said.
Well, I for one am not sympathetic either to the investigator or to the MDA’s refusal to comment. I’m sorry if he or a family member is handicapped, but driving to a police action with a handicapped placard is inappropriate and, perhaps more important, he and the MDA need to be called on it. For one thing, it’s deceptive. Are the targets of the investigation supposed to assume the guy confiscating their property is handicapped and they should be extra considerate of him? Or, if the targets were serious criminals, are they to assume they can easily resist his confiscation of their property because he’s handicapped?
Showing up at a police raid with a handicapped placard could also suggest the guy is flouting the law. If you’ve ever used a handicapped placard (and I have, in driving my mother around during the last couple years of her life, when she could barely walk), you know the protocol is that you only use the placard if you absolutely have to—if there isn’t any regular parking nearby, and you can’t walk a long distance. Otherwise, you leave the one or two handicapped spaces for those most seriously handicapped. And a family member who doesn’t need the placard never uses it when the handicapped person isn’t in the car.
Since this investigator didn’t need a handicapped parking spot for his raid, I can only assume he had been using the placard at other places, or else uses it all the time, whether he needs to or not.
Why am I harping on this? Because the MDA is looking for every technicality and bringing every weapon at its disposal to destroy Michael Hartmann, and destroy his customers’ food. The MDA is also accusing Hartmann of being sloppy. The agency has used questionable legal tactics in prohibiting Hartmann from delivering milk, and has gone search-warrant-shopping to harass his dairy—the citizens suing MDA say the state has purposely gone to four different judges for its four search warrants in connection with the case, in hopes that each new judge can be easily convinced to issue a warrant by virtue of knowing little about the case.
And the state has obviously stooped to penetrating the Hartmann buying group with an informer or undercover agent who is relaying information to the authorities. How else would they have been alerted about the delivery on Tuesday?
The MDA’s targets, in my judgment, are entitled to be just as tough. The time for being nice is over. Indeed, the nicer Minnesotans are to these bullies, the more they’ll take it for weakness, and do more bullying. I don’t care how you slice it, an enforcement agent showing up at a raid in a car with a handicapped placard dangling from the mirror is slopping, inappropriate, and dangerous. Indeed, what about showing up in a private vehicle to begin with? Is he doing that so he gets a mileage allowance? Combat pay? Or just being lazy?
As more than one person has said here, this is war, and in warfare, you must respond with every weapon at your disposal. We have rules in our police and legal system, and I guarantee you they don’t include showing up at a raid with a handicapped parking placard, any more than they allow unnecessary search warrants. The MDA should, as part of its “investigation,” be investigating why one of its officers was misusing a handicapped parking placard in an enforcement action. And Hartmann customers should be insisting on answers to their questions, demanding professionalism and an end to official theft of people’s food.
An excerpt from the MN Driver & Vehicle Services website – Disability Parking information pages (http://www.dps.state.mn.us/dvs/Disability/disability%20frame.htm):
The certificate is issued to you, not the vehicle. Display it when parking any vehicle you drive or ride in.
The certificate is only to be displayed on the rearview mirror when parked. Driving while the certificate hangs from the mirror is a dangerous misdemeanor offense (for obstructed view). Source: Minnesota Statutes 169.71.
Although I am proud to see champions of the cause turning on the video cameras this just a baby step to being a warrior
Being a warrior means strategic organization and utilization of all available advantage and application of those assets in the most calculated way. Deception,ambush, etc….
This is serious and if you want raw in Minnesota you will need to meet in small groups and plan smartly. Beret boy is easy bait.
Mark
Alvin Schlangen
Freeport MN
That is a sign of real weakness when used by an inspector. For the common American, I respect the special needs of a person that is not able to ambulate or move about freely. But when it comes to a person that is posing as a disabled person but seizing our raw milk….I give No Quarter. The Beret Boy has choosen to join a battle and that means he is a represenative of an enemy. He is not the enemy ( as a person )….but he is allied and taking a check from the corrupt powers that control and direct his actions. He can choose to quit and not do what he does. He can be forced to search his soul.
To use a "disability" sign is just poor form. It is down right sloppy and shows what rookies these clowns actually are.
A well thought out Guerrilla Raw Milk Liberation Strategy could kick Beret Boy's butt quickly and effectively.
The legal venue is respectable and remarkable. That is just one venue….and very worthwhile…the court of public oppinion is what I am talking about winning.
The good raw milk consumers of Minnesota need to set up a reverse sting and bait Beret Boy or his allies into a media disaster. Cameras rolling…..
Mark
You have the bait and if they do not take it…you win.
If they take your bait and you set your tap correctly you win.
Win Win….you set the place and time of your media, super mom ambush.
Secrecy calm and strategic smarts!!
You are in control….not Beret Boy.
Mark
I work hard to protect my source.
When I serve milk at a meal I tell everyone that it is raw milk, people can choose to partake or not. If they plan to visit me for a few days and do not want raw milk they are free to bring their own.
We had a new fellow, a relative that started working for us. He became very sick and went to the hospital. Their first question was about consuming raw milk. Thankfully he not only did not drink it, he did not even handle the container. If he had it would have been a nightmare for my producers. The final analysis was that he was not used to working with cattle and probably did not wash his hands well. But who knows? Actually he used to truck cattle and worked with them. His baby contacted MRSA from a day care child,(not the 'dangerous' kind, they said), no uproar. Perhaps it was an offshoot of that. But if he had handled the milk, there would have been an ugly mess even though no one else was ill.
Although a number of people around here who help their neighbors who have cafos have been ill, there are no announcements, no police, no USduh. No investigation to see if their regular workiers have been ill.
Has anyone checked on illnesses of the migrant workers who work in cafos?
MN has had a terrible dairy cafo situation in Thief River falls area that went on for years, neighbors were evacuated quite a few times becuase of hydrogen sulfide. How come the authorities can not stop such a place as that for years, an even allow the sale of their milk?
It is the Health Departments that sleep with the FDA policies that are robbing you blind. The FDA and PMO regulate raw milk. The USDA is specifically not incharge of raw milk at all.
So make sure that you yell at the FDA, Monsanto, Deans Foods, the NCIMS and the CAFO PMO crowd….that is where the challenges come from.
Mark
"OATH KEEPERS: ORDERS WE WILL NOT OBEY"
"9. We will NOT obey any orders to confiscate the property of the American people, including food and other essential supplies."
"The privilege against self-incrimination is neither accorded to the passive resistant, nor to the person who is ignorant of his rights, nor to one indifferent thereto. It is a FIGHTING clause. It's benefits can be retained only by sustained COMBAT. It cannot be claimed by attorney or solicitor. It is valid only when insisted upon by a BELLIGERENT claimant in person." McAlister vs. Henkel, 201 U.S. 90, 26 S.Ct. 385, 50 L. Ed. 671; Commonwealth vs. Shaw, 4 Cush. 594, 50 Am.Dec. 813; Orum vs. State, 38 Ohio App. 171, 175 N.E. 876. The one who is persuaded by honeyed words or moral suasion to testify or produce documents rather than make a last ditch stand, simply loses the protection. . . . He must refuse to answer or produce, and test the matter in contempt proceedings, or by habeas corpus." [Emphasis added.]
I've NOT heard this from the news here. Why isn't the media reporting this? This is important, if the contamination is at one cafo, it's most likely at all or most. Can't make all that poop just go away. Contaminate the land, water and air….
Look at what they did with those contaminated eggs…sold them to processors and they went into animal foods, processed phoods… now they are selling them again to sheeple.
The cafo's are poison on so many levels yet the govt allows the continuance and there does not appear to be any changing of the way they do business at the cafos or the processing plants.
Yesterday there was a story about GM oranges to come from china. Soon there will be little choice in what foods we consume.
Essentially,we have a system where wealthy farmers feed the poor crap and poor farmers feed the wealthy high-quality food.
http://www.newsweek.com/2010/11/22/what-food-says-about-class-in-america.print.html
Nice article about how food in America has become a dividing point.
I say lack of food access is sheer lazziness and ignorance. We take EBT cards at the OPDC farmers market and have never ever failed to find a way to provide good food to people who want it. I agree that food deserts are a reality and that the poor are disadvantaged because of habitual media brainwashing and mental pickling from the garbage provided to them at the local 7-11 store. This is true…but it can be overcome!!
Anyone that is consciuos can find good food. It just takes "consciousness and desire", a couple of things that are missing in America…. at all levels of income.
Mark
Mark
One thing I would add to the discussion is the fact that when the officer from Mn was asked a question he said that this action did not concern the questioner.
If I have my facts right as a member of the co/op the person asking the question was involved in the action as a member off that co/op.
The biggest problem of late that WIDATCP did very well last year and seems that MDA is now doing, is marginalizing the partner consumer and ignoring the rights of those consumer partners.
This trend cannot continue of the State not recogizing the informed consumer partners rights in a contract of free and informed consent and association.
It was good to see 30 to 40 people show up as they did, however as this gets more intense all consumer partners must show up and demand thier part in the responsibility of the contract relationship so the powers that be know that the former consumer now partner understands that this is thier product not just the producers.
Short of that and we have protected consumers by the nanny State and all actions are for your own good.
Tim Wightman
In my opinion, we need more people like Will Allen of Growing Power in Milwaukee, helping to provide broader access to good food. I believe it is in Kansas City where there is a program to help African immigrant (Ethiopian? I can't remember for sure.) plant and tend community gardens, using their knowledge and giving them a sense of purpose. Yes, it can be overcome. Mark, you talk so much of "teach, teach, teach" and how important that is. I don't find it inspiring to use the words "lazy" and "ignorant".
Lykke,
Why would anyone want to pay the regulators who aren't fair..they allow big ag to poison people without shutting down or tossing in jail. There is no trust there. What about those poor souls who where hospitalized and/or died from the eggs, meats, pasteurized milk, etc? Haven't heard you squeal about that. You sure you wish to mention responsibility-self policing in the same paragraph as regulators? LMAO
For the record, I think the regulators should be spending their time on mass distributed food where they can have the most impact vs. wasting time on small producers. The self-policing (aka, exemption) model for small farms has merit, but is pointless if you ignore and excuse bad practices on your small farms.
I was a part of a failed farmers market that tried to start in a poor part of Fresno. The residents simply would not come and shop for raw foods. We found that the best approach was gardens at schools.
I have found it nearly impossible to unpickle a pickled brain. Talk about trying to teach the unteachable!!! I know I have tried this and it is virtually impossible
You can lead a horse to water but…….
Reality says whole foods are eaten by conscious people. Consciousness is not a caste system. Consciousness means you connect the dots between being a slave and being truly free.
Transportation was not the issue. It was desire. We had the farmers market in their neighborhood.
If the poor want to rise up they will need to get up.
Mark
I too have seen the terrible poverty and irony in some of our most rich agricultural areas where the very people working in the fields are devoid of good nutrition (worse, they are exposed to pesticides, especially their children).
All that said, how can you make excuses for Hartmann dairy's bad practices, let alone making them into some kind of small farmer hero? It flies in the face of the RAMP concept and providing safe, regulated raw milk for consumers. I doubt they are what USDA's Know Your Farmer had in mind when they created the program.
You make an excellent point.
The Hartmans safety and sanitation issues are exactly why standards and good policies must be developed and embraced by all that produce raw milk in America, regardless of FDA state level head-in-the-sand anti-raw milk policies. A farmer that produces raw milk must be absolutely committed to safety and use it as a proud bragging point for his brand.
Blackmarket raw milk is not a predictable or reliable thing. Fully transparent, tested, inspected raw milk is quite another story. I have said this time and time again…..
"There are Two Raw Milks in America". One for people and one for the pasteurizer.
If you try and take the one for pasteurization and sell some on the side….it is still intended for the filth excusing pasteurizer. If the Hartmans have an issue with standards, sanitation or their over all conditions, this is an issue that I am not familiar with ( all I know is the rumors ). I know that many consumers love and trust them.
Each farmer that asks the trust of his consumer to buy and consume raw milk must embrace food safety as if his life and their lives depends on it….because it does.
It is my hope that early next year, that Tim at FTCLDF will have a draft of national standards for raw milk production ready for producers and consumers to review. When they are finalized, I want to be the first to sign-up and work hard to embrace the standards and try our best to mentor others to follow this lead. I would hope that the Hartmans would be in line to follow as well. If our movement is ever going to gain respect….we must be far better than the CAFO PMO and leave those short sighted greedy depraived technologies in the filthy swill sewer swamp of history.
Mark
Answer me this…..
How can you be so in love with the FDA and its policies when they approved Gardisil to be given to young women and even young boys with tragic results including at least 73 deaths and at least 18,700 severely sickened children that are suffering what appears to be life long debilitating injury.
The FDA is a lethally criminal organization. It should be dismantled immediately and all of them summarily criminally indicted and jailed under RICO.
Lykke…what do you think and feel about this tragic FDA result??
Lykke….how many deaths has raw milk caused in the last 37 years…..
The answer…ZERO!! ( CDC official data ).
Your bias is truly embarrassing.
Mark
You say "This discussion is pathetic. Did you forget this farmer put a child in the hospital and produced raw milk under filthy conditions? How about doing some self-policing to save the tax payers from having to pay regulators to clean-up the mess. Free choice devoid of responsibility is irresponsible. "
What evidence is there that truly shows this farmer is practicing under filthy conditions? We all know that Ag depts and the FDA LIES! Was a child really "put in the hospital"?
I have been reading that several people have gotten their milk from this farmer for a while.
It's the people who self police the farmer! I go to my farmers to see their farm and see what they do. I don't see a need for any government agency to do this.
If you educate the consumer, and allow for increased personal relationships between farmers and their customers.. the need for 'regulators' AND 'regulations' decreases.
Yes there might be 'incidences'…and some people might get sick…but this is what is going on now with many other foods, even with the regulations that are in place.
Small local producers limit the extent of a possible outbreak…large commercial producers encourage large widespread outbreaks…when there is a problem.
The FDA, as does Lykke, have it ass backwards…although you got to admire her passion and spunk…it's just misdirected.
The marketplace is always consumer controlled…and when government, via regulation, tries to effect that market, it makes it more difficult for the natural consumer driven forces to govern.
That someone gets sick is terrible…but the notion that any food supply can be perfect is not a reality…unless of course, everything that is consumed is sterilized.
It's called COGNITIVE DISSONANCE.
I suspect that Lykke feels impotent about affecting the larger issues at FDA (ie, more deaths), so she's made raw milk her cause even though there are NO raw milk deaths.
How else to explain Lykke's irrational postings… unless she's Marler's employee and not FDA's.
The Girls Scouts absolutely loved their OPDC Raw Milk Badge earning and farm learning experience.
We now have at least 25 more raw milk drinkers and thinkers. Raw Milk and Girls Scouts Cookies is launched and doing great!!!
http://www.facebook.com/home.php?#!/photo.php?fbid=10150105093471181&set=a.434060491180.227149.171911861180
Eat your heart out!!!
Mark
The Girls Scouts absolutely loved their OPDC Raw Milk Badge earning and farm learning experience.
We now have at least 25 more raw milk drinkers and thinkers. Raw Milk and Girls Scouts Cookies is launched and doing great!!!
http://www.facebook.com/home.php?#!/photo.php?fbid=10150105093471181&set=a.434060491180.227149.171911861180
Eat your heart out!!!
Mark
Am I missing something? Hartmann was in violation of the law. Farm sales are legal, but retail sales are no in Minnesota. M.S.A. 32.393. These folks were not buying the milk on the farm were they? The folks that became ill from Hartmann's dairy this year were getting their milk at similar drop spots. Right, raw milk outbreaks do not happen, they are a conspiracy. Give me a break.
http://www.marlerblog.com/legal-cases/the-raw-truth-about-milk-and-cheese-in-2010/
I may not agree with Mark on some things, but I admire that he has taken the lesson of 2006 to heart. OP has been doing a great job at leading a safe raw milk charge. Hartmann, et al can learn from that. Denying reality does not make you right.
Yes you are missing a few things. The MN Constitution states that any person may sell or PEDDLE the products of the farm or garden occupied and cultivated by him without obtaining a license. I dare you to check the definition of peddle. But, if you want to insist on the MN statue you listed- read the part that states "SECURED or purchased for personal use by any consumer at the place or farm where the milk is produced". Isn't the milk secured by the customers when they phone or email their order DIRECTLY from the farm? If I call a theater box office and reserve tickets in my name, haven't I secured these tickets?
And aren't we supposed to be finding ways to "go green"? How is it good for our environment for 200 vehicles from nearly the same location to all be driving out to the same location when there is the option of just ONE vehicle traveling to their location?
And for the handicapped sticker. These stickers are meant to be used when a disabled person needs to park in a disability parking space. It can not be used to park in no parking space and you can not drive with this sticker hanging from the mirror. So why was this guy using it to park in front of a driveway and truck? That would be a no parking spot! Why do we "raw milk drinkers" focus on this detail? Maybe because the DOA has decided to focus on things that are petty and have no real relevance to this case? Maybe because had the tables been turned and it was just a "normal" person trying to use the sticker in this way, they would have been charged with a misdemeanor? I bet you wouldn't hesitate to use this info against someone you were prosecuting!
LOL! Good one!
You can't win with this group…we the people are too smart. Way to go Katie.
Why don't you concentrate on the people getting sick from pasteurized milk and from food that comes from CAFOs and CFOs and other large factory farms REALLY practicing dirty! The large egg producers with dead chickens caged with live chickens and eggs passing by dead chickens.
Oh yea and why not go after the humans maimed or killed by toxic vaccines and big pharma drugs?
The title of the day long presentation was using the social networks to utilize the "Get to Know Your Farmer and Your Food" message.
I was fascinated by who showed up. There were crop duster operators, chemical salesmen, farmers and the like. The moderator and key presenter was all about how to make Monsanto look better and how to sell GMO to the wider markets and consumers. No where was there any dialogue about selling to or connecting to real consumers. You know…the ones that are demanding and want it their way so the food does not make them sick!!!
Much of the morning lecture was centered on how to spin GMO's and how to use other names instead of GMO…like "bioengineering". They were trying their best to put " family farm lip stick" on the CAFO GMO, Cloned, Antibiotic fed pig.
I bit my tongue and waited and waited….and then it all just came out.
I made the point that when a farmer truly listens and connects to a consuming consumer….his life, his practices and the types of products he produces will change. There was dead calm in the packed room when I said this. I also said to expect a minefield of serious questions for the farmer that sprays, uses GMO's, Clones, Pasteurizes and otherwise does things against nature and real consumers. The value added smart connected consumer is wanting the opposite. The days lessons were supposed to be focused on how to use the social media networks to improve the image of the farmer in commodity agriculture.
What a serious error.
Those poor farmers are about to be Pimped by FOOD INC Ag business and not get one dollar more for their commodity crops. What is the use of the social blogs and media if you do not engage in a true conversation with real consumers??
They missed (or perhaps intentionally abused ) the point entirely.
The idea behind the USDA "Get to Know Your Farmer and Get to Know Your Food Initiative" is to encourage local purchase of foods that reflect the needs of the consumer….it is about direct relationships because the farmer has listened and responded to his consumers needs.
Now Monsanto and FOOD Inc agribusiness are trying to use the farmers to help defend, explain and protect their tragic toxic consumer isolating commodity products and processes.
The farmer gets nothing from this effort….all he gets is a another kick in the teeth. He is being asked to march ( unprepared ) forward into the minefield of truth with a bunch of Monsanto lies using his families stories as the FOOD Inc protector.
The entire message was about a continued disconnection under the title of "social reconnection".
OPDC and other organic consumer connected farmers are directly connected to our consumers and constantly use that honest feedback to redesign our message and products in the mirror image of what the consumers want and need.
I left early to go get some work done and to connect to more consumers.
I really feel for the farmer that is alienated and commoditized. Sadly, the industry rope being thrown to them is actually a noose.
On a positive note….perhaps the attempts to reconnect with awaken some of the brighter farmers and change will occur despite this communication debacle and abuse of FaceBook.
http://www.knowacaliforniafarmer.com/
This is not the USDA program but rather an attempt by a consortium of industry to use the message of the USDA with out the serious integrity of its message of "honest connection".
Mark
You had an opportunity to explain what the evidence behind your accusations against Hartmanns was,back when the "slam dunk" accusations were originally made.You were silent when we discussed the fact that the PFGE DNA evidence was invalid.Now you are making those same unfounded accusations again.Why don't you explain to us why you have so much confidence in those tests?Both you and Lykke keep making these accusations that raw milk is making people sick.Why won't you discuss the evidence that is being used to support these accusations?People other than microbiologists and genetics scientists are understanding that DNA evidence is NOT evidence that can be used to find a "match".The Minnesota Dept of Health's use of the word "match" in their tests is intentional deception,in other words"FRAUD".Yes ,I am saying that they are conspiring with the CDC and the FDA.They all have endorsed the goal of Healthy People 2020 to make raw milk illegal.
Way to go for speaking up! Praying that you got through to someone…one of the puppets or sheeple.
nancy j using (my other alias)
Or the recent egg outbreak. How did they figure out where the contaminated eggs came from if DNA fingerprinting is nonsense?
cp
Finding a "match" is easy.The point is that PFGE can only legitimately be used to distinguish strains.They may be indistinguishable but that is not the same as "matching".The more PFGE analysis done that turn up indistinguishable the more likely that the bacteria are closely related.That doesn't mean anything without any other evidence.It is not unusual to find a "match" when you are only comparing a few characteristics.
If similar strains of bacteria are found in different places,does that mean that there was movement from one place to another or does that mean that the environmental factors are similar in both places?Exposure to antibacterials is common in food.This results in selecting for certain strains of bacteria that are resistant to those antibacterials.It is more likely that closely related strains of bacteria are an indication that the environmental factors involved are similar.Antibacterials themselves are a well known cause of illness.For example: Roundup(a common herbicide used on corn and soy and other crops) is a common contaminant in food,it will select for certain strains of bacteria.Just because two people have similar strains of bacteria in their stool sample and similar symptoms of illness may only mean that they have both consumed Roundup.We can't tell what the contaminated food was without more evidence.No one is looking for residues of Roundup in food,so they will never figure out what really caused the illnesses.Two people could both be made ill by Roundup residues without consuming the same foods.I have read that Guiness Beer has Roundup residues,so would corn chips made from Roundup Ready corn or any food made from Roundup Ready soy.Or how about bacon from a pig fed on Roundup Ready corn and soy,or a chicken raised on the same feed.Do animals concentrate these residues after consuming these herbicides daily over several months?
from: http://www.bloomberg.com/news/2010-12-09/dean-foods-chief-engels-loses-59-as-s-p-s-worst-after-milk-takeovers-sour.html
Dean Foods Co. Chief Executive Officer Gregg L. Engles built the nations largest dairy processor. Now he may have to start dismantling his creation.
Deans stock is off 53 percent this year, making it the worst performer in the Standard & Poors 500 Index. The Dallas- based companys earnings are getting squeezed by big-box stores and supermarket chains looking for price concessions. At the same time, Dean is having to contend with big jumps in prices of commodities such as raw milk, butterfat, soybeans and sugar, Bloomberg Businessweek reports in its Dec. 13 edition.
Combined, these trends are crimping the companys cash flow and may make it difficult for Dean, which is carrying about $4 billion in debt, to stick to the terms of its loan agreements, says Vicki Bryan, an analyst with Gimme Credit LLC in New York. Deans ratio of long-term debt to equity stands at 260 percent, the highest of any food or beverage company in the S&P 500.
I expect them to opportunistically divest assets, Bryan says. Its going to be tough under market conditions to get an optimal price.
Dean spokeswoman Liliana Esposito declined to comment.
Deans net income has declined year-on-year for the last four quarters straight. Earnings have come in short of analysts estimates twice in 2010. And the company has said that conditions wont improve in the first half of 2011.
Credit Facility
Dean rose 94 cents, or 13 percent, to $8.39 at 4:15 p.m. in New York Stock Exchange composite trading. The shares gained the most since Nov. 24, 2008, after Dean said in a filing it plans to offer as much as $400 million of notes to repay existing debt and it amended the companys credit facility to give greater flexibility under its debt covenants, said Eric Serotta, an analyst at Wells Fargo Securities in New York.
A graduate of Yale Law School, Engles, 53, is described on Deans website as the primary architect of the consolidation of the U.S. dairy industry. It all started with a dairy in San Juan, Puerto Rico, which Engles and a group of investors purchased in 1993 and took public three years later.
In 2001, Engles acquired Dean, a company in Franklin Park, Illinois, with roots in the evaporated-milk business. More recent purchases include White Wave, a maker of Silk soymilk, in 2002; organic milk maker Horizon Organic in 2004; and, in 2009, Alpro, which produces soy-based products in Europe.
Deans annual sales have soared, climbing from $150 million in 1994 to $11 billion last year, according to a Securities and Exchange Commission filing.
Pressure From Retailers
Credit Suisse Group AG analyst Robert Moskow says Deans strategy of driving down costs to undercut smaller, less efficient milk processors and force them to scale back capacity hasnt yielded results. At the same time, Dean is facing pressure from retailers who are discounting milk to attract penny-pinching consumers while demanding price breaks from suppliers. Also, more shoppers are buying cheaper private label milk products instead of Deans brands.
Our industry is going through a wrenching ordeal, Engles said in a conference call on Nov. 9, after the company reported a 51 percent drop in third-quarter net income.
To cut costs, Engles has closed five plants since 2009. Still, Michael Benoit, an analyst at Chicagos Talon Asset Management, says Dean is in a downward spiral and may not be able to trim expenses fast enough to counter a steep rise in commodity prices.
We are passing on Dean because we think its structurally impaired, Benoit says.
Asset Sales
Engles has begun selling off some of the pieces of his empire. Dean booked a $6.4 million after-tax gain from the sale of Rachels Dairy, an organic yogurt maker based in the U.K., to Frances Groupe Lactalis in August. Last month, General Mills Inc. agreed to buy Deans Mountain High yogurt business for an undisclosed price.
One business that would likely draw bids is WhiteWave- Alpro. Earnings at the unit, which produces soy-based drinks, continue to rise. In a Nov. 10 report, analysts at Sanford C. Bernstein led by Alexia Howard in New York noted that a sale of WhiteWave-Alpro could cut Deans debt nearly in half.
In the November call with analysts, Engles said that the unit is managed quite separately and would therefore be easy to hive off.
Some of Deans shareholders might be relieved to see a buyer step forward amid concerns that the companys fortunes may not turn around. The stock surged more than 8 percent on Aug. 31 after the website Briefing.com reported chatter about a bid from Frances Groupe Danone. Danone CEO Franck Riboud has since told the press hes not interested in getting into the milk business.
Until some European player or other conglomerate swoops in, the fundamental picture remains bleak, says Alan Thompson, a derivatives trader in Greenwich, Connecticut, for the Timber Hill LLC division of Interactive Brokers Group Inc., which owns Dean shares.
To contact the reporters on this story: Shruti Date Singh in Chicago at ssingh28@bloomberg.net; Matthew Boyle in New York at Mboyle20@bloomberg.net.
To contact the editors responsible for this story: Simon Casey at scasey4@bloomberg.net; Robin Ajello at rajello@bloomberg.net.
cp
You are correct in a number of areas. MDH should not have used the word match to describe patterns. Indistinguishable is the correct term. Match is the common term but it is not the most accurate.
You state that bacteria that have the same PFGE pattern does not prove that they come from a common origin. True, you need to have other evidence, namely epidemiological evidence. However, you go way too far claiming that PFGE is invalid. PFGE, like all bacterial subtyping tests, need to be viewed with caution and with a thorough understanding of bacteria and bacterial genetics. Also, it is imperative to have epidemiological information.
Lastly, your theory that environmental factors are the reason for strains with the same PFGE patterns during an outbreak is unlikely explanation in most outbreaks and does not appear to be to be the case in this Hartmann outbreak. Unfortunately, it is not something that is ever possible to completely refute, you could always say that there is some unknown environmental cause for an outbreak even though all evidence points to a much more tangible cause.
OLD POST
Since there has been some questions about the Hartmann Dairy outbreak, I thought I could help understand the situation better. I have been to several days of testimony, have followed the case on media, and have been informed of the goings on at the hearing when I was not there (second hand information is always a little dangerous but media seem to correspond with information I heard. Keep in mind that this case took about 10 days of hearings so I can't go into excrutiating detail but hopefully this will be enough info for people to get a flavor of the hearing. I welcome others that were at the hearing to provide more info or clarification in case I did not get some of the details correct. Below is a summary of the outbreak:
1. The Minnesota Department of Health (MDH) gets all isolates of E. coli 0157 (EC) from humans sent to their lab for PFGE with 2 enzymes (clinical labs send the isolates to MDH). In this instance, the MDH lab identified 2 isolates that had indistinguishable PFGE patterns. These patterns had never been seen before in MN. The info about the PFGE matches were sent to the epidemiologists for follow-up. The lab has very little info about these people so there is no way to identify that this could be a raw milk outbreak.
2. The MDH epidemiologists routinely interview all cases of EC with an extensive questionaire. These interviesws take 30-60 minutes and they attempt to identify all food that the case had consumed for 5 days before illness. Questions about previously identified risk factors are also asked such as swimming is fresh water, visiting a farm, and raw milk consumption.
3. When there are a cluster of cases, the interviews are compared to see if there are similarities between the exposures (consumed common food, ate at the same restaurant, etc). In this case, it was noted that the first several cases in this cluster all consumed raw milk from Hartmann Dairy. I believe that 8 of 9 cases that had this PFGE type consumed raw milk from Hartmann's. This is very strong epi evidence. As an aside, MDH is extremely good at at identifying outbreaks. They are one of the best health depts in the country (google team diarrheae, which is their nickname, for more information).
4. Based on this evidence, the Minnesota Dept of Agriculture inspected the dairy and took samples. The inspector noted a lot of concerns about the cleanliness of the dairy-I am not a farmer so I don't know whether these are valid concerns. Some of the concerns seemed picky and some seemed legitimate. Some of the concerns were dead animals in the barns (owls, a calf, and chickens-note only the owl is mentioned in the link below).
http://minnesota.publicradio.org/display/web/2010/08/19/raw-milk-sales/
5. Environmental samples from the farm tested positive for E. coli 0157 and had the same PFGE as the EC that sickened the humans (I believe it was 28 of 80 specimens had EC 0157 with the same PFGE type). It is not surprising that EC would be found in the environment (which contains cow poop), but the fact that humans had the same 2 enzyme pattern provides reasonable explanation why humans would have become ill (contamination of the milk).
6. Testing at MDH of the raw product from the farm yielded no EC 0157 but some cheese did contain some non-0157 shiga toxin producing EC (called STEC). Non-0157 STEC are also considered a pathogen. The MDH laboratorian testified that it is extremely hard to detect EC 0157 from milk. Plate counts were very high on some of the milk (I was not there that day so I am relying on second hand and media accounts)
http://minnesota.publicradio.org/display/web/2010/08/26/raw-milk-hearing/
7. Tim Wigtman testified on behalf of the defendant. He inspected the facility and said that quality milk could be made their, but he also had concerns. By some of the qualities he uses to evaluate the quality of the dairy, this farm failed. I think it was clear he felt this was an optimal operation.
http://minnesota.publicradio.org/display/web/2010/08/20/milk-hearing/
Other links of interest:
http://minnesota.publicradio.org/display/web/2010/09/07/hartmann-raw-milk-case/
http://www.startribune.com/business/102498279.html?elr=KArksUUUoDEy3LGDiO7aiU
http://www.startribune.com/local/102399924.html?elr=KArksUUUoDEy3LGDiO7aiU
I hope this helps understand this hearing better. I tried to stick to the facts as much as I could.
September 19, 2010 | Interested
"The FDA, as does Lykke, have it ass backwards…although you got to admire her passion and spunk…it's just misdirected."
Nice. I think we're ready to go on our first date 🙂
Mark and others,
Regarding work on illnesses caused by pharmaceuticals (side effects, reactions, etc.) – that's great. Someone absolutely should be doing that. But, I don't follow the logic that someone else shouldn't be working on preventing foodborne illnesses. How is preventing a child from being harmed by a drug more valuable than preventing a child from being harmed by a foodborne pathogen? There is no logic in suggesting that one is more important than the other.
Interested,
Great points. Thanks for re-posting your earlier comment that I missed while off the blog. Agree with all of it (miguel, consider my answer to your question about PFGE "ditto.").
Merry Christmas !!! Soy to the world ( whole foods newest saying ) finally gets it's fair pay back!!!
Raw milk brings true Joy to the world.
Mark
Actually the PFGE patterns can match.What is deceptive is that a match in PFGE patterns is extrapolated to claiming that "matching" strains of bacteria have been found.Matching PFGE patterns does not mean that the two isolates of bacteria match,they are correctly referred to as indistinguishable.
We agree that even if we could be sure that two isolates from different places were identical that does not mean that they share a common origin.
What I am wondering is what is the epidemiological evidence that connects the illnesses to the milk.I haven't seen anything besides PFGE given as evidence and we do seem to agree that this is not enough to make the connection.
Mark,
As Dean Foods implodes what will happen to all of the dairy farmers that have contracts with Dean Food's farmers co-op known as DFA(dairy farmers of America)?It is my understanding that these farmers are under contract to share in the losses as well as the profits of the co-op.
…not just any old raw milk! We must remember that!
See points 2 and 3. There are routinely extensive interviews of all cases of foodborne illness (at least with the major pathogens such as Salmonella, E. coli 0157 and Shigella). 8 of 9 reported they had consumed raw dairy product from the same dairy. That is very strong evidence. If you assume that approximately 3% of the population consumes raw milk product (I have seen estimates between 2-5 %), having 8/9 people with EC 0157 with the same PFGE type and that consumed raw product from the same facility due to chance is neglible. Keep in mind, that the questionaires are not focused at raw milk, that is one of many questions on the questionaire.
MDH has used this methodology to solve many outbreaks in the past including a huge peanut butter outbreak, an outbreak from peppers that other groups mistakenly identified as from tomatoes, and they had a major role in the S. enteritidis egg outbreak.