Feds Charge Trio with Selling Bogus Orange Juice
Jul. 26, 1989
CHICAGO (AP) _ A company sold millions of cases of orange juice as 100 percent pure but had substituted beet sugar, waste water and other products in violation of federal law, the goverment said in an indictment.
The government said those substitutes accounted for 15 percent to 40 percent of the orange juice concentrate sold by the now defunct Bodine's Inc. of Chicago from 1978 to 1985.
The federal indictment announced Tuesday charges two former owners and a top executive of the orange juice company with conspiracy.
The indictment cites 18 instances in which beet sugar, corn sugar, monosodium glutamate, grapefruit solids and other substitutes were used in the orange juice concentrate in violation of the federal Food, Drug and Cosmetic Act, said U.S. Attorney Anton Valukas.
The company increased its annual sales from $5 million to $100 million over the same period, the indictment said. About the same time, concentrated orange juice solid cost $1.29 per pound, compared with 29 cents a pound for beet sugar.
The Food and Drug Administration began its probe of the company in the early 1980s, after a customer suffered a negative reaction to the sugar content in a can of juice, Valukas said.
Between 1983 and 1985, about 7 million cases of products were produced for sale nationwide to more than 150 supermarket chains and wholesalers under 50 different labels. Among the best know labels were Scot Brand, Heritage House and Red Owl.
''There are no allegations that consumers were at risk as a result of the substitutions ... even though they used, at times, the waste water stream from a distillation system,'' said Assistant U.S. Attorney Pierre Talbert. ''Obviously, though, they were able to undersell their competition.''
Named in the indictment were Bodine's former owners, Edward Boden Sr. and Edward Boden Jr., both of Chicago; and Roger Walsh Jr., formerly vice president of finance and now a Texas resident. If convicted, all three face a maximum of 57 years in prison and $4.75 million in fines.
Roger Walsh Sr., a former chief executive officer of Bodine's who held a 20 percent share of the company, also was named as an unindicted co-conspirator.
The manufacturing operation, located on the city's West Side, was sold in 1985 to McCain OJ Inc. Talbert said McCain was not connected to the scheme alleged in the indictment.