Jason Bourne novelist tanks Chipotle stock with one tweet

Despite Chipotle Mexican Grill’s attempt to move on from a string of high-profile foodborne illness outbreaks, the company’s stock moves Thursday show how fragile its reputation is at the moment.

chipotle.tweets.jul.16The stock dipped as much as 3.4 percent in early morning trading following a tweet from Jason Bourne author Eric Van Lustbader that said his editor had been hospitalized after eating at a Chipotle in Manhattan.

We are aware of the post made on Twitter, however there have been no reports of illnesses at any of our New York restaurants,” Chris Arnold, a spokesman for Chipotle, told CNBC. “Moreover, we have excellent health department scores throughout the city, and we continue to have the highest standards of food safety in our restaurants.”

Chipotle seems to be suffering some Jason Bourne-like amnesia.

jason.bourneAfter Chipotle released the statement, shares began to reverse themselves and were recently trading down $7.88, or 1.9 percent, at $392.44.

“Every time that something like that comes out, yes, it will affect the stock because it potentially impacts … the recovery [in the] near term,” Nick Setyan, a Wedbush analyst, told CNBC. “There is such a lack of visibility right now that every little thing is going to change that variable.”

The illness Van Lustbader reported is unconfirmed at this time, however, other Twitter users have taken to the social media platform to share their experiences with New York Chipotle restaurants.

E. coli, Salmonella, Norovirus: Chipotle, you’re gonna love it

Karlene Lukovitz of MediaPost reports that after battling since last summer to recover from a series of food contamination incidents, Chipotle Mexican Grill has released a new long-form video that returns to its pre-crisis brand messaging about the superiority of its fresh, natural ingredients over typical chipotle.BSfast-food fare.

According to Chipotle, the new video, “A Love Story,” began to be developed 18 months ago, before the restaurant chain’s first two contamination incidents in August 2015. 

Those salmonella and norovirus incidents were followed in Fall 2015 by an E. coli outbreak, and then by separate norovirus incidents in December 2015 and March 2016.

The latest video’s story is about two children who set up competitive all-natural juice stands. As they grow up and establish real businesses, they resort to competing by offering increasingly processed fast food with artificial ingredients. Ultimately, they unite, fall in love, have a family and launch a food truck offering Chipotle-like items in synch with their original standards of natural ingredients and preparation.

With all the natural things like E. coli, Salmonella and Norovirus.

Doesn’t sound like the food safety and marketing hucksters are talking.

In recent months, Chipotle has tried to revive its traffic and sales with free-food offers. But its Q1 2016 same-store sales were down 30%, and it reported its first loss as a public company. Its stock price has dropped by 35% over the past 12 months. 

The new video ends by promoting its latest revival effort: a “summer rewards” program called Chiptopia.

Hipsters, you’re spending money at Chipotle to pay for an alleged cokehead’s habit

Stephanie Strom of the N.Y Times reports Chipotle Mexican Grill was dealt another blow on Thursday after the executive leading many of Chipotle’s efforts to recover from five food safety fuck-ups in six months was charged with drug possession and accused him of having a connection to a cocaine delivery service in New York.

johnny.deppThe company said it had placed Mark Crumpacker (right, not exactly as shown), its chief creative and development officer, on administrative leave. “We made this decision in order to remain focused on the operation of our business and to allow Mark to focus on these personal matters,” Chris Arnold, a Chipotle spokesman, said in an email.

He made $4.3 million last year.

Mr. Arnold said other executives had already been assigned to take on Mr. Crumpacker’s work during his absence.

The company’s same-store sales, or sales in stores open at least a year, have fallen dramatically after food safety crises involving contamination by E. coli and norovirus. More than 500 people became sick after eating at a Chipotle in the second half of last year.

cocaine.blow.meThe company has adopted a number of more stringent food safety protocols and spent millions of dollars on marketing to win back customers, efforts led by Mr. Crumpacker. Just this week the company announced Chiptopia, a new loyalty program that rewards frequent customers with free food. Buy four burritos, for instance, and get a fifth one free.

On Thursday, Mr. Crumpacker was named in an indictment from Manhattan prosecutors as one of 18 repeat buyers of cocaine from a business that delivered drugs to customers.

Mr. Crumpacker could not immediately be reached for comment.

The district attorney said the drug ring delivered more than $75,000 worth of cocaine over a year. Three men were charged with running the operation, which prosecutors said was based on the Lower East Side.

The indictment described meetings between the traffickers and buyers in Duane Reade drugstores, Chinese food restaurants and hotels.

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Weird because their old steak also sucked: No one likes Chipotle’s new steak

After all of their food safety issues, Chipotle had to change the way they make a lot of their menu items, including steak. Now, steak is cooked on low heat at an offsite facility, and when it gets to stores it’s marinated and grilled.

steak.maubbisson.jun.16Gross.

Chipotle spokesperson Chris Arnold told Business Insider, “If there is any difference, it’s that the steak may be more tender than it was before,” to which we say, LOL. There’s no way that’s true.

Lots of customers feel the same way. There’s a Reddit post dedicated to solving the mystery called, “What happened to the taste?” So far, there are 27 comments, but this one seems to sum it up: “The new steak sucks, plain and simple.”

Other Redditors agree. “It’s dry, overcooked, and therefore chewy. I actually just had ‘fresh’ steak last night (they had just pulled it off the grill and sliced it) and it was still dry and overcooked.”

“Used to be a three time a week regular, same with a bunch of friends,” said another. “Anyone who was a steak lover including my girlfriend has stopped going really.”

Others argued it was harder to cook tasty steak with the new method, especially when preparing steak until it reached the required temperature for food safety.

steak.therm.jun.16“To me, this new steak never has a chance to be medium rare,”writes one Chipotle employee. “It goes from cold to medium well in two minutes on the grill.”

“Customer reactions so far? Not good,” another Redditor claiming to be a Chipotle employee wrote in March. “Many are saying the steak isn’t rare enough and that is tastes different… poor quality. I use to have a lot of pride in my steak, now that pride has faded.”

Twitter users are also complaining.

Chipotle’s food safety nightmare just keeps getting worse. For now, maybe stick to sofritos. Or, just eat somewhere else.

Like at our guest house in Maubuisson, France, where I went into town the other day and got these two from the butcher – shown against Hubbell tiny hands that are much larger than Trump tiny hands, for comparative purposes – and prepared on charcoal until close to 140F and then sat for 10 minutes.

It was really f*ucking good.

Chipotle executives accused of dumping stocks before E. coli outbreak

Clint Rainey of Grub Street writes that in January 2016, during the throes of Chipotle outbreaks, angry shareholders slapped Chipotle with a lawsuit claiming executives had obscured the fact that quality protocols weren’t up to snuff. It argued that withholding that vital little nugget ensured that nobody could abandon the company before shares tumbled to their lowest levels in years.

chipotle.diarrheaThat suit’s still pending, and now a small group of shareholders have filed another lawsuit: Chipotle executives, it says, “abused their control of the Company, and dealt themselves excessive compensation worth hundreds of millions of dollars through a corrupt stock incentive plan.”

Co-CEOs Steve Ells and Montgomery Moran, CFO Jack Hartung, and other senior execs are all named in the suit:

The Company’s public statements were materially false and misleading at all

relevant times, and caused an artificial inflation of Chipotle’s stock price. During the period when the price of Chipotle stock was artificially inflated, a majority of the board of directors (and a supermajority of the Individual Defendants) engaged in lucrative insider sales, reaping millions of dollars in net proceeds.

Basically, this group of shareholders claim in the suit that executives, relying on insider knowledge about food-safety protocols, sold hundreds of thousands of shares in the first half of 2015, right before the food-poisoning scandal. Ells banked $78 million after selling 119,057 shares “while the stock price was artificially inflated and before the fraud was exposed.” Moran, meanwhile, cashed out to the tune of $107 million, and Hartung to about $28 million. The suit even names small-fry “member of the Audit Committee” John Charlesworth, who it claims made $1.5 million on stock sales during the period in question.

For its part, Chipotle isn’t admitting any wrongdoing, saying it intends to defend itself “vigorously.”

Got raw egg in those salad dressings? Panera’s head chef says go back to basics

Every time a rock and roll band I’ve previously liked but haven’t liked so much lately says, we’ve gone back to our roots, we’re back to basics with this new album, I know it will suck.

It’s like saying, trust me. If you have to say it, you you’re not trustworthy.

So when the head chef of Panera Bread Co. says they’ve started making their salad dressing in house because “we have a pantry of ingredients that are wholesome and clean,” I wonder, has this so-called chef ever heard of salmonella-in-pepper? Raw eggs? Is this another Chipotle waiting to happen?

Dan Kish, head chef and senior vice-president of food at St. Louis-based bakery-cafe company Panera, said it was a big deal when the 2,000-strong chain began serving salads with a green goddess dressing made in-house.

“Being a big company, you have someone else make your salad dressings for you because that’s what big companies do, and they do it really efficiently and the specs are right on, and, man, is it cheap. But two weeks ago, we started making our green goddess dressing in-house because I said, ‘If you can make a smoothie, you can make a dressing.’ It’s not as easy as it sounds, of course, but we have a pantry of ingredients that are wholesome and clean.”

Mr. Kish discussed Panera Bread’s disruptive strategies during a panel presentation at the National Restaurant Association Restaurant, Hotel-Motel Show, held May 21-24 in Chicago. About a year ago, the chain published its No No List of ingredients that will not be used to formulate its products, including colors, flavors, preservatives and sweeteners from artificial sources. The company committed to removing these ingredients from its menu items by the end of 2016.

Is Salmonella on your no-no list? How about E. coli? Norovirus?

“Our customers didn’t have a problem with our dressing,” he said. “They didn’t even have a problem with artificial preservatives, necessarily… but we think the future is in eating better, and if I had to hitch my wagon to anything, I would want to be making better food and not mediocre food. I would want to make it accessible because this notion of accessibility, affordability and convenience (in fast-food), none of that has changed.”

Though the decision to convert Panera’s entire menu to simple ingredients initially “dropped a lot of jaws inside the company,” he said, the initiative fit within the brand’s core values.

“We didn’t have to change who we are,” Mr. Kish said. “All we had to do was just think a little more deeply about what that means in today’s terms and for today’s customer and today’s economics, and the answer sort of popped up. So this notion of knowing who you are and staying true to that is really the key.”

Through the process, he added, Panera’s food safety standards have remained as stringent as ever. “Because, trust me, unsafe clean food can be a really bad thing for everyone.”

There’s that trust me thing.

Chipotle outbreak makes Boston College commencement address

Part of our approach on barfblog is to inject surprise and humor, or what some might call shock jockery, into food safety messages to compel folks to employ risk reduction practices.

Sometimes we get it right, sometimes we don’t. Linking a norovirus outbreak with a tragic terrorist event isn’t the best idea. According to Boston.com, United States Secretary of Energy Ernest J. Moniz made the Chipotle/Boston Marathon bombing connection during a Boston College commencement speech.Screen-Shot-2016-05-23-at-10.38.40-AM-850x478$large

United States Secretary of Energy Ernest J. Moniz is a native of Fall River, Mass., an alumnus of BC and a professor at MIT, which means he knows very well what it means to be a Bostonian.

But Boston College’s commencement speaker gave a special shout-out to the class of 2016 for being what he called “Boston College strong.”

“You were here for the terrible Boston Marathon terrorism events, the terrible snow storm, and, as I understand, the perils of fast food became also known to this class,” he said.

Those “perils” occurred in December during a norovirus outbreak at the Chipotle in Cleveland Circle. More than 140 Boston College students got sick after eating at the restaurant, including many members of the basketball team.

Throwing stones from Haaarvaaard: The cost of a sick customer

Harvard picked an easy target, offering its management insight to Chipotle, but I’ve yet to see a paper about how the venerable Haaarvaaard Faculty Club managed to sicken patrons not once, but twice with Norovirus in 2010.

simpsons.harvardAccording to PR from Haaarvaaard, Chipotle has seen its shares tumble and recently reported its first-ever quarterly loss after the incident, which began in October when more than 50 people in 11 states were sickened by an initial E. coli outbreak.

The chain restaurant, which uses the tagline “Food with Integrity,” has prided itself on avoiding artificial ingredients, opting instead to use a relatively short supply chain of local growers for many of its ingredients.

That strategy just might have been part of its problem, says John A. Quelch, the Charles Edward Wilson Professor of Business Administration at Harvard Business School and Professor in Health Policy and Management at the Harvard T.H. Chan School of Public Health.

Quelch, who teaches a course to Harvard business and public health students called Consumers, Corporations and Public Health, says food safety is more challenging than ever for three reasons:

  • the globalization of the food business;
  • global food safety standards are lacking; and,
  • food safety problems can be quite costly.

Thanks for the insight. Back to hockey.

And they still know shit about food safety: Shareholders accuse Chipotle board of being too white

Early coverage out of the Chipotle shareholders’ meeting today from Virginia Chamlee of Eater, who writes, in the wake of a food safety crisis that crippled the company, Chipotle shareholders have voted in favor of shaking up the company’s board, arguing it is devoid of racial or gender diversity. The concerns were voiced at a company shareholder meeting held in Denver Wednesday morning.

token.south.park“Our basic premise is that it’s difficult to conceive of a more significant risk failure than what we’ve seen at Chipotle,” said Michael Pryce-Jones, the director of corporate governance at CtW Investment Group, who attended Wednesday’s meeting. In a phone conversation with Eater, Pryce-Jones said the company has “done a lot at the operational level, but not on the governmental side” to deal with the fallout from a string of food safety failures at Chipotle restaurants around the country last year.

The current board (which contains nine members, all of whom are white) has “all the marks of an insular board,” Pryce-Jones said, adding that the risk of a lack of diversity is group-think. “A good indication of that is a lack of accountability around their own conduct during the food safety scandal.”

CtW and other activist shareholders have recently argued that Chipotle board members failed to draw any lessons from the food safety scandal, as evidenced by the fact that no directors left the board and no new ones were appointed. “We’ve seen a stock price decline close to that of BP, after the Deepwater Horizon incident, or VW after their emissions scandals,” Pryce-Jones said. “For them not to consider board changes, shows a complete lack of awareness.”

After the meeting, CtW released a statement saying the vote “demonstrated that a significant portion of the investor base had lost faith in the credibility and competency of these board members.”

The board heard from a worker at Taylor Farms, a Chipotle distributor, that Taylor Farms workers have recently held protests at a handful of Chipotle stores, hoping to shed light on alleged safety issues at a California plant that prepares produce for the fast-casual chain.

According to those present at the meeting, Chipotle co-chief executive officer Montgomery Moran “seemed genuinely shocked” when told about the safety issues, and said he would look into them further.

I knew about the Taylor issues. So did many others. That’s why the board gets the big bucks.

But will it make fewer people barf? Chipotle hires more food safety expertise

Reuters reports that David Acheson, a former official at the U.S. Food and Drug Administration and the U.S. Department of Agriculture, and David Theno, a food safety consultant and former Jack in the Box executive who is credited with fixing food safety at the fast-food chain following a deadly E. coli outbreak in the 1990s, have joined the payroll at Chipotle Mexican Grill.

chipotle.burrito.vomitThey join James Marsden, a former meat science professor at Kansas State University, and Mansour Samadpour, chief executive of IEH Laboratories & Consulting Group.

That’s a lot of egos in one sandbox.

Or as friend of the barfblog, Don Schaffner, a food science professor at Rutgers University, told Reuters,“If I had to put together a dream team to fix something, you could do a lot worse,” But, he added, “I’ve begun to wonder a little bit about too many cooks. Each of those guys is going to have a perspective on what to do to fix the problem.”

Spokesman Chris Arnold confirmed the consultants were retained last year but would not say when or detail their duties. He did say Marsden, as executive director of food safety, would have “primary responsibility for our food safety programs.”

Expanding its complement of food safety experts is part of Chipotle’s effort to rebound from a spate of disease outbreaks – including E. coli, salmonella and norovirus – last year that crushed sales, repulsed customers and slashed $6 billion off its market valuation.

“We have committed to establishing Chipotle as an industry leader in food safety, and we have assembled an extremely capable team to help us achieve that goal,” Arnold told Reuters.

chipotle_ad_2Chipotle declined to make members of the team available for interviews.

Michael Doyle, director of the Center for Food Safety at the University of Georgia, said he expected the group’s focus “would likely be more on food safety preventive controls and less on food testing.”

Chipotle’s initial response emphasized testing ingredients for pathogens with the goal of stopping any source of illness from getting into its restaurants.

Acheson criticized the Chipotle for relying too heavily on that one approach. “I’m not a believer that you can test your way to safety,” he told Reuters in early December.

At the time, he said the focus should be on improving food sourcing and handling practices, including how suppliers are approved, “how they are leveraged in terms of training, storing, handling, and preparing of food.”

Arnold said Chipotle continues to work with the IEH testing firm. Its more recent changes have focused on food preparation. For instance, Chipotle said on its latest earnings call that it had started blanching bell peppers in an effort to kill germs.

family.guy.diarrheaThe chain also has cut some small suppliers. Kenter Canyon Farms said it lost business providing oregano to Chipotle through a third-party distributor.

“When that whole scandal happened with the E. coli, when they revamped their food safety. They cut ties with a lot of growers,” said Mark Lopez, sales director for the farm.

Chipotle’s Arnold said the chain would continue to support smaller farms, and has committed to spending $10 million to help them meet its standards. But he said the company has noted that it may be difficult for “some of our smaller suppliers to meet our heightened food safety standards.”