Costco sues Trump administration for tariff refunds
Popular wholesale retailer Costco has sued the Trump administration over tariffs. They are seeking a refund of the customs duties they paid.
Dissatisfied customers have filed a class action lawsuit accusing wholesale retailer Costco of falsely advertising that its rotisserie chicken products were “preservative-free.”
The complaint, obtained by USA TODAY, was filed in the U.S. District Court for the Southern District of California on January 22 and alleges that Costco’s Kirkland Signature seasoned rotisserie chicken contains two preservatives: sodium phosphate and carrageenan.
The proposed plaintiffs allege that Costco “systematically defrauded customers of tens of millions (if not hundreds of millions) of dollars by falsely advertising Kirkland Signature Seasoned Rotisserie Chicken as ‘preservative-free.'”
The lawsuit, filed by two California women, accuses Costco of violating multiple consumer protection laws, including in California and Washington, where the wholesale retailer is headquartered.
Costco announced in a statement to USA TODAY on January 28 that it had removed the sign.
“To ensure consistency between the labeling of our rotisserie chickens and what we see in our warehouse and online displays, we have removed references to preservatives from our labels and online displays,” the company said in a statement. “We use carrageenan and sodium phosphate to support moisture retention, texture and product consistency during cooking. Both ingredients are approved by food safety authorities.”
Here’s what we know about the lawsuit.
Why is Costco being sued?
As evidence, the complaint includes a photo of an in-store advertisement for Costco’s Kirkland Signature Seasoned Rotisserie Chicken, which says the $4.99 food product does not contain preservatives, artificial flavors or colors, MSG, or gluten.
But the complaint alleges that chicken meat contains sodium phosphate, a preservative that controls pH, reduces fat oxidation, and effectively slows microbial growth and spoilage. The proposed class also accused Costco of containing carrageenan in its rotisserie chicken. Carrageenan is a preservative commonly used to thicken foods, but has no nutritional value, according to WebMD.
The complaint’s alleged false advertising stems from the fact that “no preservatives” signs are prominently displayed in Costco stores and on the company’s website, as well as the fact that two types of preservatives are listed in small, “discreet” letters on the back of the package.
In addition to accusing Costco of violating the False Advertising and Consumer Protection Act, the complaint says the retailer violated the Unfair Competition Act by engaging in “unfair business practices and practices that deceive Plaintiffs and members of the California subclass into purchasing rotisserie chicken or paying a premium in return by advertising ‘preservative-free’ products.”
What do you want the proposed class to do?
If certified by the court, the class would include everyone in the United States who purchased Costco’s rotisserie chicken, according to the complaint. Lawyers for the proposed class are also asking the court to approve a subclass consisting of customers who purchased chicken in California.
In addition to class certification and subclass recognition of California customers, the plaintiffs also seek unspecified monetary damages.
Despite the lawsuit filed by two California women, both said they plan to buy Costco’s rotisserie chicken again, with one warning that “Costco products cannot rely on preservative-related claims unless they are accurate and consistent with the product’s ingredients.”
This story has been updated with new information.
Saleen Martin is a reporter for USA TODAY’s NOW team. She is from Norfolk, Virginia (757). Email sdmartin@usatoday.com.
