INSURER BATTLES EXPECTED IN PA. SALMONELLA CASE

August 7, 2006

The Pennsylvania-based convenience store chain Sheetz Inc. has settled all but a few customer lawsuits spawned by salmonella-tainted tomatoes sold at its stores two years ago.

But complicated legal battles involving Sheetz, insurance companies and food suppliers must now settle this question: Who pays the multimillion dollar tab?

“We stepped up to the plate and took care of our customers. Now we have to take care of the harm that’s been done to us,” said Michael Cortez, general counsel for Altoona-based Sheetz.

So far, most of the money paid to Sheetz customers has come from U.S. Fire Insurance Co. The company insured Coronet Foods Inc., of Wheeling, W. Va., which sold the tomatoes to Sheetz.

What remains to be seen is whether U.S. Fire will be reimbursed by Coronet’s suppliers and their insurance companies.

Sheetz officials and Coronet’s former owner are also seeking damages for the harm done to the businesses, said Sheetz’s San Diego-based attorney, Fred Gordon.

“I have uncovered zero evidence to suggest that Sheetz did anything wrong other than being a conduit for tainted tomatoes,” Gordon said.