Industry News | December 20, 2017 | By Peggy Carouthers | QSR Exclusive Brief

Another Chipotle is Under Investigation for Foodborne Illness

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The Pico Boulevard Chipotle Mexican Grill in Los Angeles is being investigated by the Los Angeles Health Department’s Acute Communicable Disease Control unit after customers have complained of foodborne illness symptoms.

Chipotle has acknowledged the reports of illness but said no customers had contacted the company about the incidents. "We take any report of illness very seriously," Chris Arnold, a spokesperson from Chipotle, told Business Insider. "We are aware of three reports [two of which appear to be the same] on a user generated reporting site, but there is no clinical validation associated with those reports, and we have not been contacted by customers directly to substantiate these claims. As a precautionary measure, we have implemented heightened sanitization measures at this restaurant, which we do as a matter of policy if ever we receive reports of illness [even if they are not substantiated]."

Customers reported their illness on a website that allows them to comment anonymously called iwaspoisoned.com. This is the same site that was used to report illness earlier this year at the Sterling, Virginia, Chipotle store that was temporarily closed due to health concerns. More than 130 customers had complained of foodborne illness symptoms and norovirus, a highly contagious stomach virus, was found to be the cause.

Since reports of this latest food safety scare and investigation, stocks fell almost 7.9 percent by noon. They dropped close to 5 percent to $298.67 at close but climbed a touch over 1 percent in after-hours trading. This scare is just the most recent in a year plagued with bad news for the brand. Though the year started on a promising note with a 28.1 percent year-over-year revenue increase and same-store sales growth of 17.8 percent that showed recovery from the 2015 E.coli outbreaks that hit 14 states, the Virginia norovirus scare, and other brand news from the year dampened consumer trust in the brand.

The brand also faced backlash from customers when video was released of rodents falling from the ceiling of a store in Dallas. The store was closed and sanitized before reopening. A data breach also plagued the brand earlier this year, as it reported that “most” of the chain’s 2,250 stores were impacted. Malware accessed card information from those used at POS terminals between March 24 and April 18 this year.

Despite attempts to regain consumer trust by launching queso in September—a product that had been long-requested by fans—the efforts fell short with consumers disappointed in the dip. Chipotle’s third-quarter earnings missed expectations, and shares fell after the earnings report. The brand hit its lowest value since March 2013.

Additionally, actor Jeremy Jordan of Supergirl claimed he had been so sick after eating at Chipotle that he was hospitalized and “almost died.” The chain denied that its food caused the illness, but stocks again fell before rebounding.

Since then, Chipotle’s founder and CEO Steve Ells stepped down to an executive chairman role focused on innovation while the troubled brand searches for new leadership. Chipotle relaunched the queso this month with a new recipe that it hopes will better satisfy consumers.