CHARLOTTE, NC (WBTV) - A lawsuit recently filed in Mecklenburg County accuses a food manufacturer with distribution across the country of failing to test its product for potentially harmful bacteria and falsifying documents to make federal regulators believe it had.
The lawsuit was filed against Orange Baker, Inc, Rheon Automatic Machinery Co. and two corporate executives, Takashi Numao and Yoshiaki Okazaki, by a current employee and former employee.
In the lawsuit, Chris Herr, who is still an employee of the company, and Lisa Soler, who has resigned her job as a food quality inspector, claim company officials retaliated against them for attempting to blow the whistle internally.
The lawsuit filed on behalf of Herr and Soler by the Strianese Law Firm in Charlotte claims the company's behavior amounts to the company playing "'Russian Roulette' with people's lives and health in order to save time and money by foregoing legally required safety testing."
Orange Bakery has four facilities, three in California and one in Huntersville, NC.
Falsifying food safety tests
The Food Safety Modernization Act, signed into law in 2011, requires food manufacturers test product for E. Coli and Listeria. Both bacteria can cause serious health problems up to and including death.
According to the lawsuit, Orange Bakery, Inc contracted with a food testing company called Silliker to test its products at one point to comply with federal law.
But the suit says the company stopped paying Silliker to test its food for potentially deadly bacteria prior to January 1, 2015. Instead, the lawsuit alleges, the company "obtained blank Silliker 'Certificate of Analysis' forms, and forged the forms to show 'negative' results for Listeria and other bacteria based on testing that was never done."
The complaint lays out specific correspondence from company executives directing employees to fill out blank certificates of analysis to show passing results.
The lawsuit says Herr and Soler raised concerns about the company's practices multiple times within the company but, ultimately, to no avail.
One company executive is quoted in the lawsuit as providing this response to an email voicing concerns:
"Hi, Chris. I just explained to Mr. Numao [Orange Bakery's President] how big faking the documents in the production department is and we need to fix the system asap."
But the lawsuit says no changes were made.
Instead, the lawsuit claims, company executives relied upon the falsified documents when regulators from the United States Food and Drug Administration visited the company's facilities to examine safety documents and records.
"Defendants fraudulently deceived the regulators and SQF by providing the regulators with forged and falsified documentation for safety testing that had never been done, including the forged Silliker 'Certificate of Analysis' documents," the lawsuit says.
Retaliation for speaking out
Instead of creating change, the lawsuit says the two employees' complaints drew the ire of senior company executives.
The complaint says Soler resigned her position as a quality assurance employee for the company after she was physically and verbally harassed for speaking out.
"Defendants' executives cursed Soler, screamed and yelled at her, and berated her for complaining about Defendants' unlawful conduct," the complaint says. "Defendants repeatedly threatened Soler's job for complaining, and told Soler that they would no longer hire White or African American employees because those employees complained too much, so they would only hire Asian or Mexican employees because they complained less."
Eventually, the lawsuit says, an executive physically assaulted Soler by throwing objects at her and kicking a trash can at her.
Similarly, the complaint alleges, company executives have retaliated against Herr, too. The lawsuit claims company executives had reduced Herr's compensation and are actively working to build a case to force him to resign or terminate his employment.
The lawsuit claims that the company's lapse in food safety poses a risk to the general public.
According to the lawsuit, Orange Bakery's product is sold as frozen dough to stores and other food establishments that sell ready-baked products, including grocery store bakeries.
Included in the stories and companies that sell Orange Bakery products listed in the complaint are Whole Foods, Sam's Club, US Foods Service and Sysco.
A spokeswoman for Whole Foods told On Your Side Investigates the company does not carry any Orange Bakery product nation-wide but that the retailer is working to determine whether specific regions sell the bakery's product. Stores in the southern region, including Charlotte, do not sell Orange Bakery products, the spokeswoman said.
A spokeswoman for Sam's Club said the store takes the allegations made in the lawsuit seriously and is working to determine if and/or where the company sells food made with Orange Bakery products.
Spokesmen for US Foods Service and Sysco did not return calls and emails seeking comment Wednesday afternoon.
Company responds in court
Attorneys for Orange Bakery also did not return an email from On Your Side Investigates seeking comment Wednesday afternoon. But lawyers have filed a legal response in court accusing Herr and Soler of improperly using confidential company information to file their lawsuit.
"Orange Bakery's supervisors and managers instruct employees of the company to safeguard Orange Bakery's confidential information and trade secrets, and to not disclose such confidential business information to parties outside of the company," the company's counter-claim says.
The company claims Herr has violated a confidentiality and non-disclosure agreement by disclosing proprietary information and threatening to share the company's customer information for the purpose of the lawsuit against Orange Bakery.
"Orange Bakery did not grant Herr permission to access or utilize the Confidential Customer Information for any purpose related to this litigation," attorneys for the company wrote in a counter-suit.
The company has also asked a federal judge to issue a restraining order and injunction against Herr and Soler that would prevent either of them to speaking publicly about the accusations or providing any documents to support their claims that food sold by Orange Bakery could pose a public health risk.