A government-supervised group representing the egg industry overstepped its authority by waging a two-year "crisis" campaign to halt the growth of a San Francisco vegan mayonnaise startup, joking about putting "a hit" on its CEO and deleting emails in an apparent attempt to cover its tracks, a federal investigation has found.

The investigation, sparked by documents obtained through the Freedom of Information Act by an Massachusetts Institute of Technology researcher and his Washington attorney, reveals how the American Egg Board and the $7-billion egg industry perceived Just Mayo, an egg-less mayonnaise, to be a threat — and the measures it took to try to crush its manufacturer, now called Hampton Creek. 

The American Egg Board, an industry-funded promotion group overseen by the U.S. Department of Agriculture's marketing branch, spent at least $59,500 to counter the product's publicity advances, including hiring a top-tier Chicago public relations firm to plant "USDA approved" pro-egg messaging with bloggers the firm considered "influential," according to investigation documents.

Other board efforts included pop-up ads promoting eggs — usually the board's "Incredible Edible Egg" logo — that would outrank other content when Internet users searched such terms as "Beyond Eggs," the initial name for Hampton Creek, or its founder, Josh Tetrick, according to the internal investigation by the Agriculture Department.

Investigators found no evidence to support allegations by Tetrick that the board intervened in a lawsuit by food giant Unilever that unsuccessfully challenged Hampton Creek's use of the word "mayo" to describe its egg-free product. 

A separate action by the Food and Drug Administration, which monitors claims and labeling of food products, caused Hampton Creek to make several alterations of its label, including defining what it meant by the word "just." 

The investigation found no evidence to support Tetrick's allegation that the board tried to influence that inquiry, although emails show that an official with the marketing service suggested forwarding the board's concerns about labeling to the FDA. Ivy replied, "Okay. Let's do it," but expressed unspecified "concerns" that needed further discussion.

Ivy also suggested to a United Egg Producers member that the agency already knew of complaints about labeling but that "maybe it needs to be pushed."

Investigators said that the board's spending to fund research to compare the environmental footprint of egg substitutes with those of eggs was justified, but that specifying one company and product in its internal budgeting documents, which were not properly submitted for USDA review, violated federal guidelines.

"The review indicated certain activities appear to not have been approved" by the USDA's Agricultural Marketing Service, and that some budget amendments were not even submitted to the service for approval. The board "acted inappropriately by failing to obtain AMS approval for specific budget allocations and the related project activities," the investigation found.

Penalties for the behavior were mostly confined to additional training in ethics and procedures. No criminal charges were made.

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