Former Head of Beech-Nut Admits Guilt in Phony Apple Juice Scam
NEW YORK (AP) _ The former president of the Beech-Nut Nutrition Corp. admitted he cheated millions of consumers by selling them sugar water labeled as pure apple juice for babies.
Niels L. Hoyvald, 56, pleaded guilty Monday to 10 felony counts of violating the federal Food, Drug and Cosmetic Act. The plea forestalled a third trial for Hoyvald.
″I did not intend to defraud, but I do plead guilty with intent to mislead the public,″ Hoyvald said. ″I did it knowingly.″
″We’re glad this defendant has finally admitted his involvement,″ said the prosecutor, Assistant U.S. Attorney Thomas H. Roche.
Beech-Nut and its corporate parent spent as much as $10 million in legal fees during the case, said federal Judge Thomas C. Platt.
Platt fined Hoyvald $100,000 and sentenced him to five years probation and six consecutive months of full-time community service. The agreement concludes a complex and costly prosecution that began three years ago.
Hoyvald was convicted in February 1988 on about 350 counts of willfully violating the food and drug act, but a federal appeals panel overturned the conviction on a technicality. A second trial in September ended with a mistrial.
Hoyvald, who has since been fired by Beech-Nut, was president of the company during part of the period that the baby-food giant produced and distributed as pure apple juice for babies what was actually water flavored with beet sugar or other sweeteners and containing little, if any, apple.
″This case has probably cost Nestle, the corporate parent of Beech-Nut, in fines and legal fees, many times the few millions they saved in passing off this bogus apple juice to the public,″ said Andrew J. Maloney, U.S. attorney for the Eastern District of New York.
In November 1987, Beech-Nut pleaded guilty to 215 felony counts and paid a $2 million fine, plus investigation costs.
Another defendant, John F. Lavery, a Beech-Nut vice president during the years the company willfully cheated millions of its customers, was also convicted in the scheme.
The U.S. Supreme Court last month ended Lavery’s right to appeal and obligated him to serve a year-and-a-day jail sentence.