Wholesalers, retailers and distributors of aquatic products have filed a lawsuit against Costco Wholesales and its subsidiaries over a lack of transparency about the contents of its inventory, according to the company’s attorney, Robert B. Kallstrom.
In the lawsuit, filed in the United States District Court for the Southern District of New York on Monday, the plaintiffs allege that Costco’s failure to disclose the content of its aquatic products constitutes a violation of the False Claims Act, a federal law that prohibits unfair and deceptive business practices.
The suit was filed on behalf of several consumers, who allege that the products are inferior to those of competitor companies, such as Costco Whipsales, which makes its own brand of fresh water bottles, and is the largest supplier of bottled water in the U.S.
The plaintiffs claim that they received product samples of the products but did not realize that they were being contaminated with pathogens, which is prohibited by the False Claim Act.
The suit claims that the companies have failed to make the necessary disclosures regarding the nature of the contamination.
According to the complaint, Costco does not make any public statements about the nature or extent of the pathogens, nor does it make any assurances regarding the quality or safety of the product.
“Consumers should not rely on Costco Wholsale to ensure that their purchased products meet the quality standards of its competitors,” said Kallstrons attorney, Brian W. Schulze.
“Consumers are entitled to expect a higher standard of quality and safety from a retailer that supplies them with their goods.
In fact, Costco should be required to provide consumers with a detailed, complete, and accurate inventory and packaging description, along with information regarding the products’ ingredients and health effects.
Costco should not be able to evade its obligations to consumers by claiming that its inventory and labeling is ‘perfect.'”
The suit also alleges that Costco violated the False Statement Policy in violation of Title 5, United States Code, which prohibits a retailer from “deliberately misleading, misrepresenting, or deceiving consumers about the products it sells, the products contained in its store inventory, or its product descriptions, packaging, or packaging characteristics, or any other information related to the products, including the quality of the goods, the health effects of the ingredients in the products and the quality and availability of the materials in the store.”
In addition to the suit, the defendants also face a class action suit in New York State, alleging that the company has committed fraud and other fraudulent acts in relation to the sale of its own products and services.
In addition to that lawsuit, the New York Attorney General’s Office has also filed a civil complaint against the defendants in New Jersey and Virginia.