Costco gets into serious trouble over its $4.99 rotisserie chicken

Costco might be one of the biggest grocery chains in the country, but poor quality standards have caught up to the retail giant. The company is facing a lawsuit that claims its popular rotisserie chicken has salmonella contamination. The lawsuit comes after a study that was done last year, which claimed that the retailer’s chicken processing plant in Nebraska constantly fails safety standards set by the US government. Such a claim is damning to the retailer.

The lawsuit claims that the Nebraska plant fails U.S. Department of Agriculture safety standards, with more than 9.8% of whole chickens and 15.4% of chicken parts testing positive for salmonella contamination, as per a report in Reuters. The same was mentioned in the study done last year by Farm Forward. The study also claims that despite failing safety standards, Costco sends potentially salmonella-infected products to stores nationwide.

“Costco’s Lincoln Premium Poultry (LPP) plant in Fremont, Nebraska, slaughters over 100 million chickens annually for two of Costco’s most popular products—rotisserie chicken and raw chicken breasts sold under the Kirkland Signature brand. But the plant consistently fails USDA salmonella safety standards year after year, sending contaminated chicken to Costco stores nationwide,” it read. Neither Costco nor its Nebraska processing plant has replied to the complaint yet.

The rotisserie chicken, sold for $4.99, is one of the most popular products the store has ever had. Its price has remained the same for years despite inflation, making it a loss leader. Costco believes that incurring this kind of loss is worth it, as they make most of their revenue from membership fees. However, just because a product is a loss leader, it does not mean that a retailer could knowingly sell a product that may pose a serious health risk.

"Costco’s failure to control salmonella in its chicken supply is not a harmless technicality—it poses a real danger to consumers and violates their trust," the complaint said. The plaintiff, Lisa Taylor, of Affton, Missouri, said that she used to regularly buy the rotisserie chicken from the retailer’s warehouses in and around St. Louis. However, at the time, she was not aware of the Salmonella risk and believes that she had overpaid as a result.

Taylor claimed that she was seeking compensatory and triple damages for shoppers who bought Kirkland Signature rotisserie chicken and raw chicken parts since January 1, 2019, as Costco violated Washington consumer protection laws. It will not be good news for the retailer if this lawsuit goes wrong.

More on Market Realist

There's some bad news for customers who buy gift cards from Costco

Costco finally solves a major issue affecting many US retailers — including Walmart and Target

Costco shoppers reveal the item that makes memberships worth it — it's not what you'd think