The Cost of $4.99 Roast Chickens: Costco Sued for Animal Abuse

It was a rare milestone for a retail company, but a sign of the value roast chickens have for Costco’s business. The company has sold them at $4.99 for more than a decade, less than most competitors, and uses them as loss leaders to lure customers into stores. Costco (COST) sold 106 million cooked poultry last year.

But Costco is now facing a lawsuit from two shareholders claiming the company and its top executives violated animal welfare laws and, in doing so, breached their fiduciary duties. The lawsuit calls into question Costco’s efforts to keep its key item cheap.

“Costco neglects and unlawfully abandons its chickens,” alleges the lawsuit, filed this month in Seattle. Company executives, the lawsuit states, “caused, [are] aware and consciously unaware of the clear signs of Costco’s continued mistreatment of chickens. »

Costco did not immediately respond to request for comment on the lawsuit.

As part of the operation, Costco recruited area farmers to raise broiler chickens to deliver to the Nebraska processing plant.

But the lawsuit alleges that Costco intentionally raises these broilers that are too big to stand on their own in factory farms and that “disabled birds are slowly dying of starvation, injury and disease.”

This follows allegations from another animal rights group about Costco’s treatment of its chickens.

In 2021, Mercy for Animals filmed undercover scenes of injured chickens in a crowded factory on one of the farms. The video led to a story by a prominent New York Times opinion writer titled “The Ugly Secrets Behind Costco Chicken.”
In response to the article, Costco defended its treatment of animals and said it adheres to standards developed by the National Chicken Council, a trade association.

But Costco’s practices could harm demand for rotisserie chickens, the lawsuit alleges, and damage its company’s reputation.

“As more and more consumers learn of the mistreatment of Costco chickens, the benefits gained from using rotisserie chickens at a loss to drive customer traffic and purchases…will disappear or drastically diminish because preferences consumers not to buy illegally or unethically produced products will outweigh the lure of ‘cheap’ chicken.”

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