In the wake of several disease outbreaks, the popular Mexican restaurant chain has now been served a federal subpoena and is under criminal investigation.
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The investigation is being made by the U.S. Attorney’s Office for the central district of California, in conjunction with the Food and Drug Administration’s Office of Criminal Investigations, according to a regulatory filing Chipotle made with the Securities and Exchange Commission. But its spokesperson Chris Arnold has confirmed they will be cooperating fully with the investigation. It requires the company to produce a broad range of documents related to the August norovirus incident at its restaurant in Simi Valley, California, which sickened more than 200 people, including 18 workers. “It is not possible at this time to determine whether we will incur, or to reasonably estimate the amount of, any fines, penalties or further liabilities in connection with the investigation pursuant to which the subpoena was issued”, Chipotle said in the filing.
“And in August, a salmonella outbreak in Minnesota sickened 64 people who had eaten at Chipotle”.
As of the moment, it is still hard to accurately assess how the joint criminal probe will impact the company’s future prospects.
Sales fell 14.6 percent in the fourth quarter, marking the first decline for the Denver company since it went public in 2006.
A series of food scares in recent months increasingly puts the food giant under the scrutinizing watch of both federal and state-based regulators. Norovirus, a common and easily transmitted germ, causes diarrhea, cramps, and vomiting. “For the full month of December, comparable restaurant sales were minus 30 percent”. The company spokesman’s only comment clarified that the subpoena was for the Simi Valley case.
“That was a first for us”, Beach said in a phone interview.
Representatives for the U.S. Attorney’s office and the FDA declined to comment. “The investigation has not identified what specific food is linked to illness”.
“Following this announcement and related national media attention, our comparable restaurant sales trended down to minus 37 percent”, the company said. The norovirus outbreak also affected the company’s shares, which are dwindling continuously, and its sales.
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While the state retail food code doesn’t specify a time by which a restaurant must notify health officials, “normally, we are informed much earlier than that”, Beach said. The company says it will further sanitize its operations, hire food safety consultants and subject the testing of its ingredients to more serious scrutiny.
