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Chipotle Is Being Sued by Its Shareholders — Again

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The latest lawsuit follows two high-profile incidents involving norovirus and rats

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Photo by Andrew Renneisen/Getty Images

Chipotle’s making headlines this week for all the wrong reasons: Following a confirmed norovirus outbreak that sickened customers at a restaurant in Virginia and news that rats were allegedly falling from the ceiling at a Dallas location went viral, its stock price has been on a downslide. Now, the burrito chain is being sued by a group of shareholders, KDVR reports.

The lawsuit, filed in the U.S. District Court of Colorado, argues that Denver-based Chipotle deceived both investors and customers into believing that the chain had fixed its food safety issues, and in doing so kept its stock price artificially high; now, they’re losing money thanks to the falling stock.

“As a result of Defendants' wrongful acts and omissions, and the precipitous decline in the market value of the Company's securities, Plaintiff and other Class members have suffered significant losses and damages,” the suit claims. The company’s stock price has fallen by more than 10 percent this week.

The plaintiffs are seeking damages and legal fees. The suit also names founder and CEO Steve Ells, former co-CEO Marty Moran, and chief financial officer John Hartung as defendants.

This isn’t the first time Chipotle has been sued by investors: A similar suit filed in the wake of the E. coli and norovirus disasters of 2015 claimed the chain misled investors about its food safety practices, and another lawsuit alleged shady stock deals and mismanagement by Chipotle executives in the wake of its food safety debacle.

While it was originally reported that 13 customers had fallen ill after eating at a Chipotle store in Sterling, Virginia, the Wall Street Journal reports that figure has continued to rise, with more than 100 people now claiming to have gotten sick after dining there.

Chipotle does not comment on pending litigation. Check out the lawsuit in its entirety, below:

Shareholders Sue Chipotle, Claiming the Company Deceived Them [FOX 31]
Chipotle Reopens Store After 13 Customers Get Sick [E]
Diners Say Rats Fell From the Ceiling at a Dallas Chipotle [Eater Dallas]

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