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Core Allegations
What they did · 8 points
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01
Costco’s Nebraska poultry facility (Lincoln Premium Poultry) earned the USDA’s worst food safety rating, Category 3, in roughly 92% of reporting periods since opening in 2019, meaning the plant consistently exceeded the allowable Salmonella contamination threshold.
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02
From late 2023 through mid-2025, the plant failed every single monthly Salmonella test, a period of sustained and total regulatory noncompliance spanning nearly two years.
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03
Costco sold and marketed these chickens as “Kirkland Signature Quality,” bearing USDA “Grade A” inspection marks, without disclosing the persistent contamination data to any consumer.
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04
Consumer Reports named Costco’s Nebraska plant among the “most contaminated poultry plants” in the entire United States, based on five years of USDA data through July 2025.
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05
Costco sold 157.4 million rotisserie chickens in Fiscal Year 2025 alone, a massive volume of product flowing from a facility that had been failing food safety standards for years without consumer notification.
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06
Roughly 1 in every 10 whole chickens and 1 in every 6 raw chicken part packages from the plant are estimated to have carried Salmonella at levels that exceeded federal standards.
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07
Costco’s own prior product packaging carried an explicit “Kirkland Signature quality guarantee” in boldface type, directly promising consumers the product met or exceeded national brand standards while the company concealed contamination data.
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08
The USDA’s enforcement arm issued a Notice of Warning to the Lincoln Premium Poultry plant on April 22, 2025, while Costco simultaneously continued to sell the product without any disclosure to its tens of millions of members.
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💰
Profit Over People
Revenue prioritized over food safety · 6 points
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01
Costco deliberately uses its $4.99 rotisserie chicken as a loss leader, selling below cost or at a financial loss, to drive warehouse traffic and increase overall member spending, including annual membership fees that are Costco’s primary profit engine.
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02
To protect the $4.99 price point, Costco invested $450 million in a fully vertical poultry operation, gaining complete control over genetics, feed, housing, slaughter, and processing, then chose cost-cutting practices that directly created conditions for Salmonella to thrive.
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03
Costco reported approximately $90 billion in FY 2025 sales and ranked 12th on the Fortune 500, demonstrating it has the financial resources to address contamination issues and has chosen not to.
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04
Chickens bred for rapid growth under Costco’s production model develop compromised immune systems and collapse under their own weight, creating disease vectors that directly raise contamination risk while lowering production costs.
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05
By continuing to sell contaminated chickens without a recall or remediation program, Costco avoided the direct financial cost of addressing the safety failure while passing the risk of illness entirely onto consumers.
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06
As a food safety advocate stated in the record: “Costco has 100% control. They get to decide how the birds are raised, what genetics are used, how the birds are killed. And right now they’re choosing the worst option.”
high
☣️
Public Health and Safety
Contamination, pathogen risk, and household exposure · 6 points
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01
Salmonella is one of the leading causes of foodborne illness and death in the United States, and contaminated chicken is the number one source of Salmonella-related sickness nationally.
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02
Even properly cooked chicken from a highly contaminated source poses elevated household risk because Salmonella present on carcasses substantially increases the chance of cross-contamination on kitchen surfaces, utensils, and other foods during preparation.
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03
Costco’s rotisserie chickens are marketed as ready-to-eat products intended for immediate family consumption. If any Salmonella survived the cooking process, the contaminated product would reach consumers without any opportunity for remediation.
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04
Crowded, high-density flocks bred for rapid growth, combined with industrial-speed processing lines, created conditions where Salmonella present in even a portion of an incoming flock could contaminate a substantially larger volume of finished product.
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05
USDA inspection data shows that in recent years, thousands of Costco’s chickens died in transit, including 2,000 birds freezing to death in unheated trucks and 1,600 suffocating from overcrowding, reflecting transport conditions that increase stress, illness, and pathogen spread before the birds even reached slaughter.
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06
The USDA’s own allowable contamination threshold permits up to 9.8% of sampled whole chickens to test positive for Salmonella. Costco’s plant exceeded even that permissive standard in 92% of all reporting periods, indicating contamination levels well above what regulators consider the outer limit of acceptable.
high
🏛️
Regulatory Failures and Oversight Gaps
How enforcement broke down · 5 points
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01
Federal regulations do not currently hold poultry companies directly accountable for Salmonella in raw meat or for animal welfare conditions, creating a regulatory gap Costco exploited to continue operating a contaminated facility without mandatory shutdown.
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02
The USDA’s Food Safety and Inspection Service classified Costco’s plant as Category 3 (its worst rating) across 56 of 65 reporting periods for young chicken carcasses from March 2019 through May 2025, yet no mandatory corrective action resulted in meaningful change.
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03
The USDA Grade A marks prominently displayed on Costco’s ready-to-eat rotisserie chicken are legally inapplicable to cooked poultry products, meaning the labeling was misleading by design, communicating a food safety endorsement that USDA never actually granted.
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04
The USDA’s enforcement arm issued only a Notice of Warning to the Lincoln Premium Poultry plant in April 2025, a non-binding enforcement action, despite more than five years of documented and continuous failure.
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05
A shareholder lawsuit filed in 2021 accused Costco directors of breaching fiduciary duties by tolerating illegal animal cruelty in its poultry supply chain. Costco’s response was to continue operations without structural reform.
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⚖️
Corporate Accountability Failures
Inaction despite full knowledge · 6 points
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01
Costco’s senior management was fully aware that its flagship $4.99 rotisserie chicken was sourced from a plant repeatedly exceeding Salmonella performance thresholds, yet did not implement effective corrective measures or consumer disclosures at any point from 2020 through 2026.
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02
After Farm Forward published a detailed public report on Costco’s Salmonella rates in 2025 and Consumer Reports named the plant one of the worst in the country, Costco issued no consumer warning, no member notification, and no change to its sales practices.
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03
When a 2021 undercover investigation by Mercy For Animals documented “dim barns thick with ammonia, birds too large to stand, open sores, and animals unable to reach food or water,” Costco’s official response was to dismiss the footage as “normal and uneventful activity.”
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04
Approximately 7.2 million Costco chickens die before reaching slaughter each year, a mortality rate indicative of severe systemic health failures in the supply chain, yet Costco has treated this loss as an acceptable cost of its low-price production model.
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05
Costco has provided no refunds or compensation to any consumer who purchased chicken products from the contaminated supply chain, and has not implemented any enhanced testing or notification program despite years of documented failure.
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06
The class action complaint alleges Costco fraudulently concealed the contamination, tolling the statute of limitations, because the company had superior access to the contamination data and actively withheld it from the consumers who were the direct victims of those risks.
high
👷
Animal and Labor Conditions in the Supply Chain
Conditions that created and sustained the contamination · 5 points
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01
Chickens in Costco’s supply chain are bred for rapid growth and raised in large, high-density flocks, creating stress, disease susceptibility, and ideal pathogen-spreading conditions that directly drove the Salmonella contamination crisis.
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02
A 2021 Mercy For Animals undercover investigation at Costco’s contract farms documented birds too large to stand, open sores, ammonia-filled barns, and animals unable to reach food or water. These are the conditions under which Costco’s food supply was grown.
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03
USDA reports document mass die-offs during transport to Costco’s Nebraska plant, including 2,000 birds freezing to death in unheated trucks, 1,600 suffocating from overcrowding and lack of water, and 1,000 dying in a trailer fire while awaiting unloading.
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04
USDA analysis found that periods of elevated Salmonella results at the facility coincided directly with citations for humane-handling deficiencies, showing a causal link between the company’s treatment of animals and the contamination reaching consumers.
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05
Costco’s own vertical integration was promoted as a mechanism for superior quality control. Instead, it became a mechanism for institutionalizing these conditions at scale with no third-party supplier to check or remediate them.
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Timeline of Events
2019
Costco opens its $450 million Lincoln Premium Poultry complex in Fremont, Nebraska, completing a fully vertical poultry supply chain. The plant begins failing Salmonella safety tests almost immediately.
2020
Costco becomes aware that its new plant is struggling with Salmonella contamination based on internal data showing high positives. The company does not disclose this to consumers or halt distribution.
2021
Mercy For Animals releases undercover footage of deplorable conditions at Costco’s contract chicken farms. Costco dismisses the footage as “normal and uneventful activity.” A shareholder lawsuit is filed accusing Costco’s directors of breaching fiduciary duties over illegal animal cruelty in its supply chain.
Sept 2023
Costco’s Nebraska plant begins a period of 100% test failure. Every single monthly Salmonella test for the next two-plus years will come back Category 3, the worst possible rating.
Oct 2025
Consumer Reports publishes a report naming Costco’s Nebraska plant among the most contaminated poultry facilities in the United States, based on five years of USDA data.
Nov 2025
The Street publishes an undercover investigation revealing that Costco’s supplier chickens were kept in overcrowded, unsanitary conditions with many birds suffering injuries.
Dec 2025
Farm Forward publishes a detailed public report on Costco’s Salmonella rates, drawing national attention. Costco issues no consumer warning, no recall, and no change to its sales or marketing practices.
Jan 2026
Yahoo Finance reports on USDA’s findings, characterizing Costco’s chicken as a “serious problem.” Costco still does not notify its member base.
Feb 12, 2026
Class action complaint filed in the U.S. District Court for the Western District of Washington by plaintiff Lisa Taylor on behalf of all Americans who purchased Kirkland Signature rotisserie or raw chicken products from Costco since January 1, 2019.
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Direct Quotes from the Legal Record
QUOTE 1 Costco’s total control over its own contamination problem Profit Over People
“Costco has 100% control. They get to decide how the birds are raised . . . what genetics are used . . . how the birds are killed . . . And right now they’re choosing the worst option.”
💡 A food safety advocate quoted in the complaint makes clear that Costco’s contamination crisis is not an accident or an oversight failure. It is a choice the company makes daily, with full knowledge of the consequences.
QUOTE 2 Costco’s Nebraska plant in 92% failure rate Core Allegations
“Costco’s Nebraska poultry facility (Lincoln Premium Poultry) . . . has earned the USDA’s worst food safety rating, Category 3, in roughly 92% of reporting periods since 2019.”
💡 This is not a plant that occasionally struggles. It is a plant that has almost never passed. That chicken has been on Costco’s shelves for six years.
QUOTE 3 Two years of 100% failure Core Allegations
“From late 2023 through mid-2025, Costco’s plant failed every single monthly Salmonella test (Category 3 rating 100% of the time), reflecting chronic, uncontrolled and unresolved contamination levels.”
💡 Every single month for nearly two years. Not a bad quarter. Not a temporary lapse. Every month. While Costco sold over 157 million chickens per year, every one of them labeled “Grade A.”
QUOTE 4 Costco’s response to undercover footage of animal suffering Accountability Failures
“A 2021 undercover investigation conducted by Mercy For Animals documented conditions at contract farms that revealed ‘dim barns thick with ammonia, birds too large to stand, open sores, and animals unable to reach food or water.’ Costco’s response was telling: it dismissed the disturbing footage as ‘normal and uneventful activity.'”
💡 Costco did not deny the footage. It confirmed it. The company told the public that these are normal conditions in its chicken supply chain. That is the supply chain feeding millions of American families.
QUOTE 5 Conditions that breed contamination Public Health
“Salmonella contamination doesn’t emerge out of nowhere. The conditions under which animals are raised contribute directly to the virulent spread of the disease, including overcrowding, poor ventilation, unsanitary conditions, and the genetic uniformity of birds bred to grow so fast that they often collapse under their own weight and suffer compromised immune systems.”
💡 This is quoted directly from Farm Forward’s published report on Costco’s supply chain. These are the structural conditions Costco built, funded, and refused to change.
QUOTE 6 What the contamination rate means in the home kitchen Public Health
“Every trip to Costco’s meat department comes with an unacceptably high risk of picking up bacteria-laden poultry that could send the entire family to the hospital.”
💡 The complaint translates the regulatory data into plain language: this is not a technical violation. This is a risk that has been inside millions of American refrigerators and on millions of family dinner tables.
QUOTE 7 Costco chose the $4.99 price over safety Profit Over People
“Costco has prioritized keeping its chickens at $4.99 over ensuring those chickens are safe to eat, all while holding out its poultry to consumers as top-quality and wholesome, without any meaningful disclosures of the problems that plague its poultry production plant.”
💡 This is the core of the complaint in one sentence. Not a regulatory failure. Not bad luck. A deliberate choice to protect a price point at the expense of consumer safety.
QUOTE 8 The USDA Grade A label is inapplicable and misleading on rotisserie chicken Regulatory Failures
“Prepared poultry products themselves are not eligible for USDA Grade A designation, making the designation inapplicable, and thus highly deceptive when placed on Costco’s rotisserie chicken.”
💡 Costco was not just hiding contamination data. It was actively displaying a government-style safety mark that legally cannot apply to the product it was selling. Consumers had no reason to suspect anything was wrong.
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Commentary
❓ How serious is this class action lawsuit, and does it have merit? ▾
This case is built on federal government data, not speculation. USDA inspection records, published and publicly verifiable, show that Costco’s Nebraska plant failed safety standards in 92% of all reporting periods since 2019. Consumer Reports and Farm Forward independently corroborated this data. The core legal theory, that Costco sold a product it knew was contaminated while marketing it as safe and high quality, is a straightforward consumer protection and implied warranty claim. The evidence required to prove the company’s knowledge exists in its own internal records. That is not a frivolous case.
❓ Why didn’t the government shut down Costco’s plant if it was failing tests? ▾
This is one of the most damning aspects of this case. Under current federal law, the USDA does not have mandatory authority to shut down a poultry facility solely for elevated Salmonella rates. The Category 3 rating carries no automatic legal consequence. The agency issued only a Notice of Warning in April 2025, after more than five consecutive years of failure. This regulatory gap is not an accident. The poultry industry is one of the most politically powerful food lobbies in the United States, and it has spent decades shaping the rules that govern it. Costco knew exactly how much regulatory enforcement risk it was actually facing, and it bet correctly.
❓ Is the Salmonella in Costco’s chicken dangerous if I cook it properly? ▾
This is the answer Costco relies on to avoid accountability, but the science is more complicated. Proper cooking kills Salmonella on the meat itself. The danger extends to everything the contaminated raw chicken touches before it is cooked: cutting boards, knives, countertops, your hands, other foods. Cross-contamination during preparation is a major route of Salmonella exposure, and a product with persistently elevated contamination levels substantially increases that risk. The complaint also covers ready-to-eat rotisserie chicken, which is not cooked by the consumer at all. If contamination survived the industrial cooking process, consumers ate it directly.
❓ Why did Costco build its own poultry plant in the first place? ▾
To protect the $4.99 price. When Costco could not find a third-party supplier willing to produce chicken at a price point that allowed the company to sell it at or below cost, it spent $450 million to build its own supply chain. Vertical integration gave Costco complete control over every decision that affects food safety: the breed of bird, how it is raised, how dense the flocks are, how fast the processing line runs, and what sanitation protocols are followed. Costco made every single one of those choices. That total control is exactly why this lawsuit names Costco, and not some distant subcontractor, as the responsible party.
❓ How does this connect to broader patterns of corporate harm? ▾
The Costco chicken case follows a pattern that repeats across American corporate history: a company gains control over a supply chain, internalizes the cost savings, and externalizes the risk onto consumers, workers, and communities. The $4.99 price is the visible result of invisible harm. The harm is absorbed by the birds that die in transit, the workers processing contaminated carcasses at industrial speed, and the families who bring Salmonella-laden chicken home without knowing it. The price is only possible because those costs are hidden. That is not a market success story. It is a market failure that regulatory capture has allowed to continue for six years.
❓ Did Costco know about the contamination problem? ▾
Yes, unambiguously. USDA inspection results are published and updated regularly. Costco receives inspection reports directly from FSIS when its plant is in Category 3. Internal data showing high Salmonella positives was available to the company within the first year the plant opened. By 2021, the pattern was documented. By 2025, it was the subject of national media coverage in Consumer Reports, Farm Forward, The Street, and Yahoo Finance. Costco did not claim ignorance after any of these events. It simply continued selling the product.
❓ Who is most at risk from this contamination? ▾
Salmonella infection is dangerous for everyone, but it is most serious for young children, elderly adults, pregnant people, and anyone with a compromised immune system. These are exactly the populations that buy a $4.99 family dinner from Costco. The rotisserie chicken is marketed as a convenient, affordable meal for families. The people most vulnerable to severe Salmonella illness are also the people most likely to be served that chicken. Costco knew this and sold the product without a single warning.
❓ What can I do to prevent this from happening again? ▾
There are concrete actions available right now. First, if you purchased Kirkland Signature rotisserie or raw chicken from Costco at any point since January 2019, you may be a member of the class in this lawsuit. Monitor classaction.org and the case docket (Case 2:26-cv-00528, W.D. Washington) for notice of how to participate. Second, contact Costco directly through its member feedback channels and demand a full public accounting of contamination rates and corrective actions. Third, contact your congressional representatives to demand USDA reform that gives the agency mandatory enforcement authority over facilities that persistently fail Salmonella standards. Food safety should not require a class action lawsuit to enforce. The law should do that automatically, and right now it does not.