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Scotts Miracle-Gro Co. is suing a supplier to reclaim the Marysville company’s peanut-related recall costs.
Feb. 18,2009
The lawn-and-garden products maker filed the lawsuit against Mount Prospect, Ill.-based Cereal Byproducts Co., claiming breach of contract and negligent misrepresentation and alleging it gave Scotts false information about the origins of its products.

Scotts is seeking unspecified damages, but said it expects to incur expenses of more than $75,000 for the purchase of products, recall costs, lost profits and injury to goodwill.

Scotts (NYSE:SMG) filed the suit Tuesday in U.S. District Court in Columbus, the same day it issued a recall for five varieties of suet wild bird food over concerns they might contain peanut meal bought from Peanut Corp. of America’s plant in Blakely, Ga. The products of Peanut Corp., which has filed for bankruptcy, are at the epicenter of a federal probe into a salmonella outbreak that has involved scores of illnesses and several deaths, including two in Ohio.

Scotts alleges that Cereal Byproducts repeatedly told it the peanut by-products didn’t come from the Blakely facility, according to the lawsuit. It also alleged the company didn’t inform Scotts of a potential contamination until early this month, well after peanut butter recalls had begun and after Scotts produced the bird food and shipped it to retailers.

Cereal Byproducts executives were unavailable for comment Wednesday.

Bird food included in the recall involves about $500,000 in annual revenue, less than 1 percent of Scotts’ sales for its bird food business.

Peanut Corp. originally recalled peanut butter and peanut paste but later expanded the callback to include all peanut products made in Blakely since January 2007, Scotts said. The company said salmonella can affect animals and pose a risk to people who handle products tainted with it. No human illnesses from the bird food have been reported and products from the Blakely plant are no longer being used, Scotts said.

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