The unpasteurized milk swiftly caught on as part of the growing natural food movement. But the Food and Drug Administration considers McAfee a snake oil salesman and recently launched an investigation into whether his dairy illegally shipped raw milk across state lines. The agency even tried to recruit one of his employees to secretly record conversations with him.
The case against McAfee is part of a crackdown on raw milk by government health officials who are concerned about the spread of food-borne illnesses. Lawmakers and law enforcement agencies are stepping up efforts to keep unpasteurized milk out of reach, even as demand for the niche product grows.
McAfee, who was among the first in California to sell raw milk on a large scale, brushed off the investigation.
Twenty-two U.S. states prohibit sales of raw milk for human consumption, and the rest allow it within their borders. The FDA bans cross-border sales.
In Pennsylvania, local officials recently busted two dairies unlawfully selling milk straight from the cow.
And in Maryland, health officials issued an emergency ban late last year on "cow-sharing" agreements, claiming they were aimed at skirting a ban on raw milk sales.
"Raw milk should not be consumed by anyone for any reason," said John Sheehan, head of the FDA's dairy office. "It is an inherently dangerous product."
But shutting down sales is tricky because the federal government has largely let states regulate the raw milk industry. The result is a hodgepodge of laws that confuse consumers, dairy farmers and regulators alike.
McAfee said he expects the FDA's criminal probe to be dropped without charges in a deal that will require him to guarantee his interstate shipments are for use only as pet food. The FDA declined to comment.
Raw milk proponents insist they are under siege by state and federal regulators intent on snuffing out the industry.
The popularity of raw milk is fueled by consumers' concerns about the chemicals and hormones used in traditional dairy farming, and a growing interest in unprocessed, organic foods.
Devotees of raw milk ascribe to it almost mythical healing powers. They feed it to babies, believing it strengthens the immune system and staves off digestive troubles. The heat used in pasteurization, they say, kills healthy natural proteins and enzymes.
"It's a magic food," said Sally Fallon, president of the Weston A. Price Foundation, a nonprofit that advocates consumption of natural foods.
The FDA insists pasteurization destroys harmful bacteria without significantly changing milk's nutritional value. The process also extends its shelf life.
Nevertheless, some consumers have formed cooperatives to support dairy farmers who offer raw milk. They also join "cow-sharing" programs in which farmers take care of cows that are "leased" by consumers.
Food safety officials say raw milk has sickened hundreds of people with salmonella, E. coli and other bacteria. According to the Centers for Disease Control and Prevention, 1,000 people fell ill from raw milk between 1998 and 2005. Two died.
The FDA ban on cross-border sales of raw milk led to its criminal investigation of Organic Pastures, a Fresno dairy owned by McAfee that is California's largest raw milk supplier.
The agency ordered two of McAfee's employees to testify before a grand jury and offered to pay one of them to surreptitiously record her conversations with McAfee, according to the worker.
"The main issue was selling our products outside the state of California," said dairy worker Amanda Hall, who refused to wear the wire. The two workers' grand jury appearances were canceled last month.
Even if McAfee avoids criminal charges, he still faces lawsuits filed by the families of five children who claim his raw milk made them seriously ill.
He denies the allegations and said testing at his dairy did not detect the strain of E. coli that sickened some of the children.
McAfee also is challenging a new California law requiring lower bacteria levels in raw milk. He fears the change will put him out of business. A judge in San Benito County last month ruled for the state, but McAfee appealed the decision on Thursday. Also, a state senator plans to introduce a bill to repeal the law.
Whole Foods Co. lobbied for a law that ensures raw milk dairies can stay in business.
"It is a growing piece of our business," said Walter Robb, the company's co-president. "We want to protect consumer choice."
He and other raw milk proponents argue that the FDA should spend its time working on other agricultural practices that jeopardize food safety, such as the way large farms confine animals.
But parents like Melissa Herzog strongly disagree.
Herzog, whose 10-year-old daughter spent two months in the hospital after her kidneys failed because of E. coli poisoning, is one of the families suing Organic Pastures over the 2006 outbreak that health officials determined was probably caused by raw milk from the dairy.
"I don't have anything good to say about raw milk," she said. "It was a horrible experience."