Wal-Mart, sued over listeria, prompts retailers' concern

In late August, Charles Palmer ate cantaloupe bought at a Wal-Mart store in Colorado. Two weeks later, he began feeling sick, then became unresponsive and was rushed to a hospital where doctors diagnosed a listeria infection.

Now the 71-year-old retired Marine isn't just suing Granada, Colo.-based Jensen Farms, which grew the tainted cantaloupe that he says sickened him. He's also suing Wal-Mart for selling the fruit.

Fallout from the outbreak that has killed 29 Americans is broadening to other major retailers that sold the tainted produce and is spurring a national debate on the role groceries and stores should play in making the food-supply chain safe.

"Retailers are going to be left holding the bag," said Bill Marler, a Seattle-based lawyer who has filed at least eight lawsuits targeting the Colorado farm, its distributor, and Wal-Mart. "The grocery stores and retailers who sold the product - from big-box stores to roadside stands - are going to have to step in and fill the gap."

Victims of the listeria outbreak may file claims seeking more than $100 million, Marler said in a telephone interview. A U.S. House committee is investigating the outbreak and may hold hearings.

Craig Wilson, head of food safety at Costco Wholesale Corp., said producers should get ahead of the issue by expanding their internal food-safety checks to fight contamination. Industry analyst Jim Prevor said such tests by grocers or producers would be expensive and ineffective. Either way, retailers can expect the pressure on them to grow, Marler said.

Overall, food-based illness costs the United States $152 billion a year in health care and workplace and other economic losses.

Litigation that also includes growers and distributors - along with new scrutiny by U.S. regulators and Congress - is prompting calls for improved testing by the industry. Listeria is a bacterial infection that can cause fever, intense headache, nausea, and vomiting and can be fatal in some populations.

Retailers and grocery chains aren't usually targeted when food sickens customers, Marler said. In this outbreak, however, they will face litigation because the victims' claims will add up to more than Jensen Farms, the grower of the cantaloupes, and its distributor carry in insurance, he said.