A federal investigation against the American Egg Board is underway after the government-supervised group waged a two-year, $59,500 campaign to halt the growth of the $7 billion San Francisco vegan mayonnaise startup called Hampton Creek that developed the eggless Just Mayo product.
The American Egg Board hired a top-tier Chicago public relations firm to run the campaign, which included planting pro-egg messaging with influential bloggers and releasing pop-up ads promoting eggs that would outrank other content, including “Beyond Eggs,” Hampton Creek's original name. Investigators found that this “was not an appropriate activity” under USDA guidelines, reports the Los Angeles Times.
The group even joked in an e-mail exchange about putting “a hit” on its CEO, the investigation found.
The investigator concluded that these efforts to undermine Hampton Creek exceeded the 1976 bylaws governing the American Egg Board.
The investigation was sparked by documents obtained through a Freedom of Information Act request on the part of an MIT researcher.
The activities carried out by the Egg Board appear to have pushed Egg Board CEO Joanne Ivy into early retirement last year. Ivy allegedly approved of an offer from consultant Anthony Zoletti to convince Whole Foods Market to pull the product from its shelves across the country in 2013--although Whole Foods told investigators that no such attempt was made, and Just Mayo is still available at the chain's 435 stores.
“The sworn statements obtained during the [Agricultural Marketing Service] Review indicate that the inappropriate discussions did not result in any actual conduct detrimental to 'Just Mayo' being marketed by Whole Foods,” the investigation concluded.
Investigators also found no evidence that the board intervened in a lawsuit that unsuccessfully challenged Hampton Creek’s use of the word “mayo” on the packaging of its egg-free product, as Hampton Creek CEO Joshua Tetrick alleged.
The American Egg Board is an 18-member board appointed by the Secretary of Agriculture. It collects $20 million in annual fees from large-scale producers to support egg research and promote the egg industry.
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Image care of Hampton Creek