Costco has been involved in the breeding, raising, and slaughtering of chickens since 2019. It set up a company called Lincoln Premium Poultry in Fremont, Nebraska, in order to supply itself with cheap meat. Working through Lincoln Premium Poultry, Costco encouraged numerous people in Nebraska and Iowa to become chicken contract growers, despite those people lacking any prior experience farming chickens.

Costco breeds and slaughters approximately 100 million chickens per year.

The shareholders alleged that Costco—which has near-total control over the genetics, lives, and deaths of the birds it sends to these contract growers—had abdicated its legal obligation to protect its animals. Following the 2021 undercover investigation, conducted by Mercy for Animals, the Costco Rotisserie Chicken Facebook fan page owner even converted the page into a campaign against Costco’s mistreatment of chickens.

The defendant executives filed a motion to dismiss the Costco case. Our clients responded in opposition.

On March 24, 2023, the court held a hearing on the motion. Unfortunately, the court decided to grant the defendants’ motion to dismiss. In so doing, the judge explicitly left open one avenue for our shareholder clients to have their animal-neglect concerns addressed: sending a formal demand to Costco’s board.