Kerry Inc. pleads guilty to producing cereal in unsanitary conditions, agrees to pay $19,228,000

Food manufacturer Kerry Inc. pleaded guilty Friday to a misdemeanor charge of distributing adulterated cereal made in unsanitary conditions, in this case, Kellogg’s Honey Smacks. 

The cereal made at the company’s defunct Gridley, Illinois facility was linked to a 2018 salmonella outbreak.

If the court accepts the guilty plea, Kerry will also pay a $19,228,000 criminal fine, the largest criminal penalty ever levied in a U.S. food safety case.

“Food manufacturers have a critical responsibility to produce and sell food that is safe for American consumers to eat. We will continue to pursue and bring to justice those who put the public health at risk by allowing contaminated foods to enter the U.S. marketplace,” said Food and Drug Administration Office of Criminal Investigations Assistant Commissioner Justin Green in a Justice Department announcement.

From June 2016 to June 2018, routine tests detected the presence of salmonella 81 times, with at least one sample testing positive for salmonella each month. The plea agreement confirms that employees at the facility failed to take corrective actions.

Part of this failure came from the top. Ravi Chermala, director of quality assurance at Kerry until September 2018, pleaded guilty in October 2022 to three misdemeanor counts of distributing adulterated cereal. He is due for sentencing on Feb. 16.

In his guilty plea, Chermala admitted that he directed subordinates at the Gridley facility not to relay certain pieces of information to Kellogg’s. Chermala also confessed that he had those subordinates alter the plant’s pathogen monitoring program, impeding their collective ability to detect and report unsanitary conditions.

In June 2018, the FDA and Centers for Disease Control and Prevention announced that an outbreak of salmonella beginning in March 2018 was traceable to the Gridley facility. Kellogg’s proceeded to recall all Honey Smacks manufactured there from 2017 onward. 

Ultimately, the salmonella outbreak caused 130 cases of infection, with no fatalities.

“Kerry regrets the unacceptable practices and failures that occurred at Gridley. Arising from the issues, conduct and practices that occurred there, the company made the decision to permanently close the plant,” Kerry said in a statement, noting that the issues were specific to the Gridley plant.