American food supplier OSI Group LLC is disputing a Chinese court's ruling that its local subsidiary had sold expired chicken and beef to fast food chain in China including McDonald's and KFC. OSI Group claimed that it had been the subject of a smear campaign.
Shanghai Jiading People's Court said in a statement on Monday that it fined two of OSI's units in China 2.4 million yuan ($365,000) and sentenced 10 OSI's employees to prison, according to The Wall Street Journal.
The sentenced employees including a general manager at OSI in China, Yang Liqun, who was sentenced to three years in prison and a 100,000 yuan fine, ABC News reports. Yang, an Australian citizen, was also ordered to be deported after the prison sentence.
In 2014, China accused employees of Illinois based OSI Group subsidiary, Shanghai Husi Food Co., of mixing expired meat with fresh product, Taipei Times reports. The authorities shut down the food processing factory after the accusation.
The controversy was sparked by an investigation report by a Shanghai television, Dragon TV, that showed the factory workers scooping meat off the floor and putting it back into processing machinery.
After Dragon TV's report aired, OSI's business in China collapsed. Following the report, Chinese authorities arrested six employees of the company's Shanghai unit and launched an investigation.
OSI Group said China court's verdict is inconsistent with the facts and evidence that were presented in the court proceedings.The food firm added that it is "forced to consider an appeal through all legal channels".
The food company said that Chinese authorities unjustly held OSI employees for 17 months and barred OSI's senior leaders and reporters from attending the trial.
It said that after an actual investigation was completed, all authorities involved have recognized that the case has never been about food safety.
OSI Groups also said it planned to take legal action against Dragon TV over the 2014 report. The company said in a statement that the TV station "made false and incomplete accusations that ignored facts and Chinese law".
Internal OSI documents suggest that a review the company conducted after the scandal found that the report by Dragon TV was staged by its former employee and two journalists.
Chinese authorities haven't released findings of their investigation over OSI's practices. They destroyed batches of the meat that had been recalled in the incident. China court statement said OSI has violated China's food safety law by selling substandard food.
