the chain gang

Chipotle Shareholders Are Now Suing the Company

A rough week gets just a little rougher.

It’s been a hard week for ol’ Chipotle: On Tuesday, a franchise in Virginia closed briefly after multiple customers fell violently ill with what turned out to be norovirus, a throwback to the Great Chipotle Poisonings of 2015. But there’s more, because while burrito fans were getting sick in Virginia (and documenting their experiences in great detail), customers at a Dallas location complained that mice were falling from the ceiling, on account of what a Chipotle spokesperson said was a “small structural gap in the building.” (It has since been repaired.)

And now, FOX31 reports, shareholders have filed a class-action lawsuit against the chain, claiming Chipotle “deceived them with misleading information that the company had fixed its problems with food safety and now stocks are sinking.”

Though both incidents are likely one-offs — norovirus, unlike E. coli, is unlikely to have come from the food-supply chain, and the spokesperson promised the falling mice were “an extremely isolated incident” — the chain’s stocks were down more than 5 percent on Thursday, and Chipotle’s share price has dropped more than 10 percent over the last five trading days.

In the suit, shareholders argue that Chipotle had led “customers and the investing public” to believe the issues with food safety that plagued the chain in 2015 had been fixed, and that they’d continued to buy and sell Chipotle stocks based on those assurances. But, stockholders claim, the events of this week show that those assurances were false, food-safety issues aren’t resolved, and the company “hid that information from the public to keep stock prices high.” If they’d known the truth, they say, they never would have invested in Chipotle, and now that stock prices are falling like mice, they’re suing for their losses.

A Chipotle spokesperson told FOX31 that the company would not discuss details of the suit as a matter of policy, though he did add that “a lawsuit is simply allegation and is proof of nothing.”

Chipotle Shareholders Are Now Suing the Company