Chinese Court Fines OSI Group Over 2014 Meat Scandal
February 01 2016 - 5:21AM
Dow Jones News
By Laurie Burkitt
SHANGHAI--A Shanghai court fined two units of U.S.-based food
processor OSI Group LLC 2.4 million yuan ($365,000) and sentenced
10 people to prison for "producing and selling inferior products"
in a case that has rippled through the food industry in China.
The Shanghai Jiading People's Court said in a statement on its
microblog that it fined the Shanghai and Hebei units of OSI and
that it sentenced Australian Yang Liqun, a general manager at OSI
in China, to three years in prison, followed by deportation, and
fined him 100,000 yuan. The other nine defendants, including one
OSI operations director, face sentences from 19 months to 32
months, the statement said.
The court's statement said that from March 2013 to July 2014,
OSI's Hebei and Shanghai units produced substandard food for
fast-food chains, including Yum! Brands Inc. and McDonald's Corp.
The company violated food-safety laws regarding recalled food, the
statement said.
A spokeswoman for OSI said the company had no immediate comment
on the fine or sentences. Mr. Yang couldn't be reached for comment.
Yum Brands and McDonald's both cut ties with OSI in China in July
2014.
Chinese authorities began investigating the company in 2014,
after a Chinese TV report purported to show workers at OSI's
Shanghai unit, Shanghai Husi Food Co., changing production dates on
meat to extend its sale period. The report alleged the meat was
going to fast-food chains. Chinese authorities arrested six
Shanghai Husi employees that have been held since August 2014.
Sheldon Lavin, OSI's CEO, apologized at the time for "completely
unacceptable" missteps at the company.
In January 2015, when Shanghai food-safety watchdogs announced
plans to destroy all meat recalled in the incident, OSI questioned
the measure, which it said was done without any testing of the
relevant products.
The moves by authorities against OSI paralyzed its business in
China, where it had been one of the biggest food suppliers by
volume.
Lilian Lin contributed to this article.
(END) Dow Jones Newswires
February 01, 2016 05:06 ET (10:06 GMT)
Copyright (c) 2016 Dow Jones & Company, Inc.
McDonalds (NYSE:MCD)
Historical Stock Chart
From Aug 2024 to Sep 2024
McDonalds (NYSE:MCD)
Historical Stock Chart
From Sep 2023 to Sep 2024