Chipotle Subpoenaed in Criminal Investigation Over Norovirus Outbreak
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A grand jury has subpoenaed Chipotle Mexican Grill in an investigation of a norovirus outbreak, and the chain warned investors Wednesday the fallout from increased media attention about foodborne illness has hammered its sales.
Comparable restaurant sales nosedived 14.6 percent during the fourth quarter, the chain said in a filing Wednesday. This metric dropped as much as 37 percent during the quarter.
During the period, Chipotle battled multiple foodborne illnesses, including a multistate E. coli outbreak and norovirus at a Boston location.
Following the filing, Chipotle's stock opened down 1.5 percent.
It also announced that a federal grand jury in California has subpoenaed the chain, requiring it to produce documents related to an August outbreak of norovirus in Simi Valley, California.
"It is not possible at this time to determine whether we will incur, or to reasonably estimate the amount of, any fines, penalties or further liabilities in connection with the investigation pursuant to which the subpoena was issued," the filing said.
"As a matter of policy, we don't comment on pending legal actions, but will offer our full cooperation," said Chipotle spokesman Chris Arnold.
Chipotle's board also authorized a $300 million stock repurchase, its second for that amount since in early December.