Starbucks sued for allegedly using coffee from farms with rights abuses while touting its ‘ethical’ sourcing

In this article SBUX Follow your favorite stocks CREATE FREE ACCOUNT Daniel Acker | Bloomberg | Getty Images A consumer advocacy group is suing Starbucks, the world's largest coffee brand, for false advertising, alleging that it sources coffee and tea from farms with human rights and labor abuses, while touting its commitment to ethical sourcing.

The case, filed in a Washington, D.C., court on Wednesday on behalf of American consumers, alleges that the coffee giant is misleading the public by widely marketing its "100% ethical" sourcing commitment on its coffee and tea products, when it knowingly sources from suppliers with "documented, severe human rights and labor abuses." "On every bag of coffee and box of K cups that Starbucks sells, Starbucks is heralding its commitment to 100% ethical sourcing," said Sally Greenberg, CEO of the National Consumers League, the legal advocacy group bringing the case.

"But it's pretty clear that there are significant human rights and labor abuses across Starbucks' supply chain." The lawsuit cites reporting about human rights and labor abuses on specific coffee and tea farms in Guatemala , Kenya and Brazil , and alleges that Starbucks has continued to purchase from these suppliers in spite of the documented violations.

A spokesperson for Starbucks did not immediately respond to a request for comment on its sourcing relationships with the farms and companies mentioned in the lawsuit, but in an earlier statement to NBC News said, "We take allegations like these extremely seriously and are actively engaged with farms to ensure they adhere to our standards.

Each supply chain is required to undergo reverification regularly and we remain committed to working with our business partners to meet the expectations detailed in our Global Human Rights Statement ." More from NBC News Northeast hit by heavy rain, flood warnings and power outages NRA distances itself from longtime leader Wayne LaPierre in opening remarks at civil trial Hunter Biden makes surprise appearance at House committee hearing to hold him in contempt In Brazil, labor officials have cracked down on several reported Starbucks suppliers over abusive and unsafe labor practices in recent years, including garnishing the cost of harvesting equipment from farm workers wages, not providing clean drinking water, personal protective equipment and bathrooms, and employing underaged workers.

In 2022, 17 workers, including three minors, were rescued by Brazilian inspectors from "modern slavery," according to Reporter Brasil , at a coffee farm managed by a man whose coffee roaster company received Starbucks' seal of certification a month earlier. In response to the Reporter Brasil stories and reported labor abuses in Kenya and Guatemala cited in the lawsuit, Starbucks issued statements at the time that the company was "deeply concerned," and that it would "thoroughly investigate" claims of labor violations, "take immediate action" to suspend purchases or "ensure corrective action" occurred.

In a promotional video on its coffee academy website, a Starbucks coffee buyer says the company's ethical sourcing stamp "means that we are buying coffee, making sure that it's good for the planet and good for the people who produce it." Greenberg said the suit aims to prevent Starbucks from making claims like those — particularly its "Committed to 100% Ethical Coffee Sourcing" advertising — unless the company improves labor practices within its supply chain.

Starbucks, like many companies, uses third party certification programs to ensure the integrity of its supply chains for tea and cocoa. The company launched its own sourcing standards, called C.A.F.E. Practices, in 2004 to oversee its coffee sourcing in more than 30 countries. The verification program is administered by a company called SCS Global Services in collaboration with Conservation International.

The verification program holds Starbucks coffee suppliers to more than 200 environmental, labor and quality standards. Farms that fail to meet those can be barred from supplying the company until corrective action is confirmed. But there have long been issues with how effective such programs are, according to experts.

In 2021, Rainforest Alliance, the third party that certifies Starbucks' supply chains for tea and cocoa, was sued in D.C. court by another consumer advocacy group over "false and deceptive marketing" of Hershey's cocoa as "100 percent certified and sustainable." A judge ruled last year that the case could move forward only against Hershey, as the manufacturer of the products.

Rainforest Alliance did not immediately respond to a request for comment. "There is this huge pile of evidence that shows that the mechanisms that [certifiers are] relying on to address problems like forced labor, child labor, gender based violence, are extremely flawed and not working very well," said Genevieve LeBaron, director of the School of Public Policy at Canada's Simon Fraser University.

"We have incident after incident that's uncovered in these supply chains. And still, companies go around and make these kinds of claims that they have 100% sustainable or ethical sourcing" said LeBaron, whose research into cocoa and tea has shown that the prevalence and severity of labor violations on certified and uncertified farms was "basically identical." LeBaron, who has consulted for the United Nations on global supply chain ethics, said the issue is not unique to Starbucks, but ethical commitments from large purchasing players like Starbucks can have an outsize impact on the integrity of supply chains if they are backed up.

Starbucks has 10 "farmer support centers " in coffee producing regions around the globe, including Brazil and Guatemala, but does not release public lists of certified suppliers, making it difficult to track how often its suppliers are found to be engaging in labor abuses. "I think it is really hard to have an ethical supply chain.

And I would say, you know, a lot of the reason for that is that, especially in agriculture, there's a sort of status quo of sourcing goods way below the cost of actually producing them. And as long as you have that, you're gonna have problems," LeBaron said..