A Minnesota state judge has ruled that Wal-Mart (NYSE: WMT) violated state laws involving rest breaks and wage-related issues two million times and could face $2 billion in damages. The judge is threatening to impose a fine of $1,000 for each offense. He also ruled that the company pay current and former employees $6.5 million in compensation for contractual violations.

The second phase of the trial will begin on October 20 when a jury will decide on damages. Wal-Mart says it disagrees with portions of the decision and may appeal.

Judge Robert R. King Jr. said that Wal-Mart's audits revealed that the company was aware of the problems but "put its head in the sand" and chose to do nothing. This is just the latest chapter in Wal-Mart's one step forward, two steps back effort to change its public image.

Regardless of where you stand on Wal-Mart (I am ambivalent), this decision is good news. It shows that the legal system is working and will hold the company responsible when it breaks the law. Two billion dollars in damages is a lot of of money, even for Wal-Mart, and it may inspire the company to be more vigilant in making sure that its labor practices comply with the law.

This post is part of our Big Company, Small Town series, featuring large companies and the small towns in which they are headquartered.

Ah, Spam. Doesn't the word make your mouth water? Or maybe not. Either way, Spam must be given its due. It is the most famous of the mystery meats, those exciting concoctions of the meat-packing industry. It has been sold by the billions of cans since its invention in 1937. It helped feed the Allies and win World War Two. It is central to a Monty Python skit about Vikings in a greasy spoon, and now a Broadway musical. It provides a name for unwanted e-mail. It theoretically lasts forever. And it is a product of the Hormel Foods Corporation (NYSE: HRL).

Spam is made in several places, but its ancestral home and main production facility is in Austin, Minnesota, sometimes called Spam Town. Austin is the small town south of Minneapolis that is home to Hormel, proud maker of all things Spam. (I should note that Hormel would prefer that we write "SPAM luncheon meat" but I don't think we'll take that suggestion too seriously.)

Hormel has long dominated the town of Austin, and not just because the Spam Museum is located there. It is by far the largest employer in town and the majority of workers in Austin work for Hormel, producing many of the company's meaty foods. Hormel's roots in the town go deep. Drawn by the town's good rail and river access, George A. Hormel opened a meat packing business there in 1891, and his small company eventually grew into the billion-dollar colossus that today owns a dizzying array of food brands, from Chi-Chi's and Valley Fresh to Dinty Moore and, of course, Spam. (Does it seem fair that one company gets to own both Dinty Moore and Spam?)

An Associated Press news release stated that Malt-O-Meal has voluntarily recalled several breakfast cereals in connection with 23 cases of salmonella poisoning in 14 states. The press release indicates that the recall, issued April 5, 2008 is aimed at bags of cereal which were produced in the last 12 months at Malt-O-Meal's Northfield Minnesota facility.

The company is privately held.

The press release states: "(The cereals) were distributed nationally under the Malt-O-Meal brand name, as well as private labels including Acme, America's Choice, Food Club, Giant, Hannaford, Jewel, Laura Lynn, Pathmark, Shaw's, ShopRite, Tops and Weis Quality. The cereal bags have "best if used by" dates from April 8, 2008 (coded as APR0808), through March 18, 2009 (coded as MAR1809).

The company urges consumers to discard any unused cereal bearing the effected dates. Retailers have been notified to remove affected product from their shelves. For complete details on this recall, you may review the company's own public notice of recall on the Malt-O-Meal website.

Malt-O-Meal President and CEO Chris Neugent states in the company press release: "Malt-O-Meal has a strong food safety record and we are constantly looking for ways to improve our products and procedures to exceed industry standards. We have a strong food safety program in place throughout our operations, including our warehouse, processing facility and distribution system."


Gary Sattler is a freelance blogger and the Malt-O-Meal, Cinnamon Toasters cereal he ate this morning was quite delicious.

In the cutthroat world of wireless telephone service competition, low down and dirty tricks sometimes become the norm in the fight for every single customer. Unfortunately, the terms of service can lock customers into a bad marriage of sorts based on what many consumers find to be misleading language and contract legal-ese. And now, some wireless companies seem to be turning on their own customers. AT&T, Inc. (NYSE: T) recently claimed the right to cut off customers that criticize it publicly. Nice. Telecom censorship is exactly the kind of public image AT&T needs, eh?

Well, Sprint Nextel Corp. (NYSE: S) has been sued by the state of Minnesota for apparently extending consumers' contracts without their knowledge or permission. Are telecom companies so afraid of customer empowerment that they need to either lock customers down to contracts without their consent or boot them from services for posting a critical blog entry? In Sprint's case, a customer making a small change in a wireless calling plan automatically triggered a new two-year contract, which -- of course -- was not communicated to the customer when the new contract when into effect.

In AT&T's case, the company apparently does not want anything critical said about it (and all subsidiaries of BellSouth, to be exact) or the 'offending' customer can be cut off from AT&T's various services. Is this what the telecom industry has come to? The 'non-serving' of customers? Every company is going to make mistakes, but the speed and accuracy at which they correct them speaks volumes to the world. In some cases, however, the sneakiness factor related to pulling wool over consumers' eyes appears to be more important.