Court filings from Foundation Food Group’s legal battle with the Occupational Safety and Health Administration shed light on some details of the sale to Gold Creek Foods.
Gold Creek Foods announced Oct. 18 that it had finalized an agreement to “acquire substantially all the assets of Foundation Food Group,” though the terms of the deal were not disclosed. Foundation Food Group was the site of a deadly liquid nitrogen leak that killed six people Jan. 28.
Prior to the sale, a worker filed a complaint of an ammonia leak on March 11. Foundation Food Group attempted to quash a warrant from OSHA regarding ammonia refrigeration and storage systems as well as other records.
OSHA already cited Foundation Food Group and three other companies in relation to the Jan. 28 nitrogen leak, totaling 59 alleged violations that could lead to close to $1 million in penalties.
Messer, the chemical company also facing wrongful death lawsuits in Gwinnett County, reached an informal settlement agreement in August, while Foundation Food Group contested its citations.
U.S. District Judge Richard W. Story denied Foundation Food Group’s motion for reconsideration in June over the OSHA ammonia issue, and the company filed objections to the court’s final report and recommendation.
The court requested “input from the parties as to the impact that the completion of Gold Creek’s purchase of FFG would have on this case.”
After hearing both sides, Judge Story ordered Oct. 18 that FFG’s motion to quash OSHA’s warrant be denied and directed the clerk of court to close the case.
Before the ruling, the federal government spoke with Foundation Food Group’s counsel regarding the sale, though the company “declined to give the government a copy of the draft purchase and sale agreement,” according to their court filing.
“Counsel stated that Gold Creek was purchasing FFG’s assets, but not its liabilities, and that after the sale FFG would not conduct further poultry processing in North Georgia,” according to the government’s filing.
The government wrote in its brief that if Foundation Food Group does not operate a poultry plant, then OSHA will not need to inspect the plant. The government claimed the case was moot and asked the court to dismiss it because of the sale to Gold Creek.
“Of course, OSHA may one day need to inspect the plant owned and operated by Gold Creek, but Gold Creek is not the same complaining party,” according to the government’s filing. “FFG does not represent Gold Creek’s interests and cannot litigate on Gold Creek’s behalf.”
In response, Foundation Food Group claimed that the government’s argument about Gold Creek not being the “same party” as Foundation Food Group was undermined for three reasons: that OSHA’s regulations focus on a physical location rather than an employer; that the warrant is targeting the specific Memorial Park Drive establishment; and that the OSHA citations are for Foundation Food Group “and its successors.”
“Although a new entity may be acquiring the establishment at issue in this dispute, FFG will continue as a business and as the entity contesting the current OSHA citations from four separate investigations, and the establishment will continue conducting business as it always has, albeit under different ownership,” according to Foundation Food Group’s filing. “Nevertheless, the establishment remains the same, and the successor can be held accountable by OSHA for any failure to correct violations cited against the predecessor.”
The court ruled there is no longer a “live controversy” to grant relief, but the judge said that the issue was not moot.
“Though the chicken processing plant at issue here will indeed soon be owned by Gold Creek Foods instead of FFG, OSHA’s regulations and warrants target the ‘worksite’ or ‘establishment’ itself, rather than the owner or operator of the worksite or establishment,” the judge wrote.
Representatives from Gold Creek Foods did not return multiple emails and phone calls to discuss the sale.