Tons of peanut butter being dumped into New Mexico landfill

| Saturday, March 29, 2014, 12:01 a.m.

Nearly a million jars of peanut butter are being dumped in a New Mexico landfill to expedite the sale of a bankrupt peanut-processing plant that was at the heart of a 2012 salmonella outbreak and nationwide recall.

Bankruptcy trustee Clarke Coll said he had no other choice once Costco Wholesale refused to take shipment of the Sunland Inc. product and declined requests to let it be donated to food banks, repackaged or sold to brokers who provide food to institutions such as prisons.

“We considered all options,” Coll said. “They didn't agree.”

Costco officials did not return telephone calls seeking comment.

Court filings indicate the product was made with $2.8 million worth of Valencia peanuts owned by Costco and had been sitting in the warehouse since the company shut down and filed for bankruptcy last fall.

After extensive testing, Costco agreed to a court order authorizing the trustee to sell it the peanut butter. But after getting eight loads, Costco rejected it as “not merchantable” because of leaky peanut oil.

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