October 22, 2004
Blaming adverse publicity from a salmonella outbreak this past summer that sickened more than 400 people, Coronet Foods said it was ceasing operations today at its plant in Wheeling, W.Va., leaving 220 workers without jobs.
The plant, which supplied bagged salads, vegetables and fruits to customers in about 20 states in New England, the Midwest and the mid-Atlantic region, informed its workers at the close of business yesterday, said Ernie Pascua, the company's chief executive officer.
"There was a lot of hugging, a lot of tears," Pascua said last night.
In some cases, several generations of family members have worked for the company, he said.
Coronet distributed sliced Roma tomatoes used in sandwiches sold at Sheetz convenience stores. About 330 Pennsylvanians who ate the sandwiches got sick with salmonella, and the outbreak is believed to have sickened another 80 people in nearby states.
John Culler, a Coronet spokesman, said last night that an inspection by the U.S. Food and Drug Administration found no salmonella contamination at its Wheeling facility.
FDA officials could not be reached for comment last night.
"Coronet Foods has had long-term relations with its many customers and has had a tremendous work force over the years," the company said in a statement. "It is with a great deal of regret that we have ceased operations.
"Losses of sales as a result of the adverse publicity have made it impossible to continue operations."
Pascua said workers were aware the company has been struggling financially.
"The salmonella incident caused a dramatic reduction in our sales over the summer," he said, indicating that sales had dropped as much as 40 percent.
Coronet Foods, which has operated in Wheeling for nearly 40 years, was unable to find buyers or partners that would allow the business to continue, he said.
The company is continuing discussions with several prospective buyers, but no firm purchase offers have been made, he said.
Bill Marler, a lawyer representing 107 people affected by the salmonella outbreak, said the FDA had not cleared Coronet of responsibility in the case. Investigators only found that the plant was not contaminated.
Marler's Seattle-based firm has filed three lawsuits as a result of the outbreak, all targeting Coronet. He said the company's decision to go out of business would not affect the lawsuits.
"Coronet has enough insurance to resolve all the claims," he said. "We're hopeful we can eventually get through this, either by litigation or settlement."
After the outbreak, Coronet lost its business with Sheetz, responsible for about 8 percent of revenues, Pascua said. Sales from other sources also declined, he said.
The company said it would keep its human resources office open temporarily and work with local employment assistance services to help workers find jobs.
Coronet Foods is owned by Howard Long, who founded the company in 1965, Pascua said.
The company's Eastern operations have been based in Wheeling, and the company is in the process of selling its Western division, based in Salinas, Calif., and in Yuma, Ariz., he said.
(Joe Fahy can be reached at email@example.com or 412-263-1722. Jerome Sherman can be reached at firstname.lastname@example.org or 412-263-1183.)