E.Coli Outbreak and Subsequent Closure of Chipotle Restaurants

E.Coli Outbreak and Subsequent Closure of Chipotle Restaurants

Background

An E.Coli outbreak in 2015 led to several hospitalizations across US States with Washington and Oregon the most affected areas. Most of the people affected had eaten from a Chipotle restaurant in the run-up period to the diagnosis (Grill, 2016). Therefore, the infection was attached to the restaurant chain and was under investigation by health authorities and the Food and Drug Administration (FDA) unit. In reaction to the developments, the restaurant chain closed down 43 of its branches in Washington and Oregon voluntarily, citing abundant caution. At the time, only six of their restaurants had been directly linked to the outbreak. In total, there were 19 cases of illness out of which eight had been hospitalized (Centers for Disease Control and Prevention, 2016). The investigation sought to establish the exact source of infection and took food samples from the restaurants to the FDA. Though it was apparent that the source was a food product, the particular item was unknown and the exact restaurant it stemmed from could also not be traced. This would help health officials understand the patterns of infection and cross contamination and thereby prepare a suitable response. It was apparent that the case was not the first of its kind and would lead to fiscal losses.

Chipotle & Food Safety

Chipotle is one of the leading restaurant chains in the US with regional and global establishments. They specialize in tacos and Mission-like burritos which has made them a name amongst the middle class who prefer fast foods in their daily hustles (Parrish, 2007). The establishment has been operating since the early 1990s growing into one of the best performers rivaling the likes of McDonalds. By 2015, Chipotle was reported to have over 2,000 locations in the US and beyond, served by around 45,000 staff worldwide (Bacon, 2011). The chain has been ranked as the best Mexican fast food joint on multiple locations and appears among the top ten in overall rankings. 

The restaurant has however not been without controversy. There have particularly been multiple issues to do with food safety prior to the E.Coli outbreak. Back in 2008, the organization was widely criticized for misleading customers into believing that their food was made of organic products or locally sourced materials which they equated to “healthy.” More importantly, they had been involved in several disease outbreaks that raised issues of food safety. In March 2008, it was reported that 22 people had contracted hepatitis A from a Chipotle restaurant in La Mesa, California (Fedenia & Hirschey, 2015). In the same year, there was a Norovirus outbreak in Ohio where at least 400 people became sick after eating in a Chipotle restaurant. This was a high profile case that almost matched the impending E.Coli outbreak with respect to the restaurant. Only a year later, a Campylobacter jejuni outbreak was reported with the restaurant accused of not cooking chicken as required causing the infections. Lettuce had been cross contaminated in the process leading to a large scale effect on the consumer pool. Before and even after the current case of STEC O26 E.Coli strain, there were several other cases reported involving E.Coli, Norovirus and Salmonella outbreaks (Grill, 2016). As it emerges, the restaurant had an extensive history of safety issues.

Analysis of Issues

The outbreak in question was that of the Shiga toxin producing STEC O26 strain of E.Coli. Most E.Coli strains occur naturally in the human intestines and are harmless. The harmful strains like the one in this case were often ingested through feces, either directly or through food materials (Stevens & Lunsford, 2014). In essence, many people contract E.Coli infections after making contact with animals like cows. For example, there was a case of 25 infections in Washington after a group of individuals visited a dairy fair.  However, it was clear that the harmful strain in question had been contracted through food materials from Chipotle.

Though Chipotle closed down 43 of their restaurants voluntarily citing abundance of caution, the move was tied to their history on food safety. The restaurant was guilty of causing various outbreaks of E.Coli and Norovirus in the past leading to quite a number of hospitalizations (Hu, Parsa & Self, 2010). It was therefore justified for them to close down their restaurants rather than wait for aggravation in acknowledgement of their own recklessness. The move was not laudable as there was a possibility that failure to close more restaurants would have endangered more lives and opened them up to further scrutiny.

In the end, the outbreak was going to prove financially costly. Customers spent money in seeking medical care after eating in Chipotle restaurants and would repay them by keeping off their food joints (Ragas & Roberts, 2009). There was indeed lots of negative publicity to contend with in the situation. The company’s share price immediately dropped in the stock exchange while a lawsuit was file seeking damages in the region of $75000 (Liebelson & Sep, 2013). These events in combination spell financial losses for the company.

Conclusion

Chipotle’s E.Coli outbreak case was unfortunately not the first of its kind. The company had been indicted in various cases of the same outbreak, Norovirus and other infections in the past. Issues emerging include that not all E.Coli strains were harmful but in this case the Shiga-toxin producing STEC O26 strain was the causative agent. Elsewhere, the move to close down several of their establishments was not laudable as it was tied to their history of recklessness while financial losses seemed inevitable. 

References

Bacon, D. (2011). Undocumented immigrants stand up to Chipotle. Race, Poverty, and the Environment, 18(1), 13-14.

Centers for Disease Control and Prevention. (2016). Multistate outbreaks of Shiga toxin-producing Escherichia coli O26 infections linked to Chipotle Mexican Grill restaurants (final update). CDC Online.

Fedenia, M., & Hirschey, M. (2015). The Chipotle Paradox. Journal of Applied Finance, Vol. 19, No. 1 & 2.

Grill, C. M. (2016). New Chipotle Food Safety Procedures Largely in Place; Company Will Share Learnings from 2015 Outbreaks at All-Team Meeting. Press release, January, 19.

Hu, H. H., Parsa, H. G., & Self, J. (2010). The dynamics of green restaurant patronage. Cornell Hospitality Quarterly, 51(3), 344-362.

Liebelson, D., & Sep, W. (2013). Behind the Burrito: 5 Things Chipotle’s Ads Don’t Tell You. Mother Jones, 34 (5), 11-17

Parrish, M. (2007). Fresh and fast Chipotle Mexican Grill chain sets an example by buying meat and produce from family farms. Pittsburgh Post-Gazette, E1.

Ragas, M. W., & Roberts, M. S. (2009). Communicating corporate social responsibility and brand sincerity: A case study of Chipotle Mexican Grill’s ‘Food with Integrity’program. International Journal of Strategic Communication, 3(4), 264-280.Stevens, N. L., & Lunsford, R. (2014). Beyond the burrito: Chipotle Mexican Grill’s brand extension. Journal of Business Cases and Applications, 12, 1.