Chipotle Hit With Lawsuit Over GMO-Free Menu Claims A California woman has accused the burrito chain of false advertising.

By Reuters

This story originally appeared on Reuters

Chipotle Mexican Grill Inc's new GMO-free menu claims have lured diners and boosted the burrito chain's stock price, but it has some consumers crying foul.

A California woman has accused the popular chain in a lawsuit of false advertising after it trumpeted on April 27 that it was the first national restaurant company to use only ingredients that are free of controversial genetically modified organisms, or GMOs.

In her lawsuit filed Friday in federal court in San Francisco, the plaintiff Colleen Gallagher also alleged that Chipotle violated the Federal Food, Drug and Cosmetic Act because its food labeling is false and misleading, and deceived diners into paying more for their food.

"As Chipotle told consumers it was 'G-M-Over it,' the opposite was true," the Piedmont, California resident said. "In fact, Chipotle's menu as never been at any time free of GMOs."

Chipotle spokesman Chris Arnold declined to discuss the allegations, but said "we do plan to contest this."

Many U.S. diners have in surveys expressed a willingness to pay a premium price for food they perceive to be less processed and more natural or organic, and retail data back that up.

Chipotle's website carries disclaimers about the GMO content in its food.

Those disclaimers say that "most animal feed in the U.S. is genetically modified, which means that the meat and dairy served at Chipotle are likely to come from animals given at least some GMO feed." They add that "many of the beverages sold in our restaurants contain genetically modified ingredients."

Gallagher contended that most Chipotle diners are unlikely to see these disclaimers, and will rely instead on the company's advertising.

Her lawsuit seeks class action status and unspecified damages.

A woman named Colleen Gallagher, represented by the same law firm, is also a plaintiff in a 2014 lawsuit in the same court alleging that Bayer AG's claims about the health benefits of its One A Day multivitamins misled consumers. On Aug. 18, U.S. District Judge William Orrick denied Bayer's motion to dismiss that lawsuit.

Lawyers for Gallagher did not immediately respond on Monday to calls and emails seeking comment.

The case is Gallagher v Chipotle Mexican Grill Inc, U.S. District Court, Northern District of California, No. 15-03952.

Want to be an Entrepreneur Leadership Network contributor? Apply now to join.

Business News

Citigroup Mistakenly Credited a Customer with $81 Trillion Instead of $280: 'Inputting Error'

An employee caught the mistake quickly, but the bank has recently made other errors that have drawn scrutiny and fines from regulators.

Side Hustle

I've Made Hundreds of Thousands of Dollars With a Fun Side Hustle — And You Might Have Seen Me Doing It on TV

Phil Schraeder, CEO at GumGum Advertising, turned a childhood passion into a lucrative side gig.

Leadership

Micromanagement Is Murder: So Stop Killing Your Employees

A new study shows that jobs that are both high-demanding and give employees less control are associated with a 15.4 percent increased chance of death.

Science & Technology

The "Lazy" Entrepreneur's Guide to AI: 5 Tools to Run Your Business on Autopilot

Want to run your business on autopilot and escape the 24/7 grind? AI is the "lazy" entrepreneur's secret weapon! In this video, discover five game-changing AI tools to automate work, save time and boost profits.

Money & Finance

4 Expenses You Can Avoid When You First Start Your Company

Cost optimization is key if you want your startup to go far.