Food & Food Equipment News

Labor Commissioner's Office Cites Chula Vista Restaurant for Wage Theft

The Labor Commissioner's Office cited a Chula Vista restaurant more than $274,000 in back wages and penalties for multiple wage theft and labor law violations.

Dorantes Inc., doing business as La Querencia, is ordered to pay $164,688 to six workers who worked an average of nine hours per day, five days a week without breaks, and were paid on average less than $6 per hour.

La Querencia was also fined $110,150 in civil penalties, workers' compensation penalties and wage statement penalties.

The Labor Commissioner's Office launched a complaint-based investigation at the Mexican restaurant in January and found that the owner was under-reporting the number of workers employed there. The owner claimed only five employees, but investigators found 14 workers employed. Investigators in February cited La Querencia $21,000 for failing to carry adequate workers' compensation insurance coverage.

An audit of the restaurant revealed that La Querencia management denied six workers meal or rest breaks, and paid them a straight rate of $50 per day regardless of hours worked, for a period spanning June 2014 through February 2017.

The Labor Commissioner's Office last month cited La Querencia $72,290 for minimum wage violations and penalties, $83,131 for liquidated damages, $1,735 for unpaid overtime wages, $3,077 for meal period violations, $3,234 for rest period violations, and $1,221 for waiting time penalties, all payable to the six affected workers. Additionally, the Labor Commissioner's Office fined La Querencia $54,500 for wage statement violations and $34,650 in civil penalties for minimum and overtime wage violations.

When workers are paid less than minimum wage, they are entitled to liquidated damages that equal the amount of underpaid wages plus interest. Waiting time penalties are imposed when the employer fails to provide workers their final paycheck after separation. This penalty is calculated by taking the employee's daily rate of pay and multiplying it by the number of days the employee was not paid, up to a maximum of 30 days. The civil penalties collected will be transferred to the state's general fund as required by law.

The Labor Commissioner's Office, officially known as the Division of Labor Standards Enforcement, is a division of the Department of Industrial Relations (DIR). Among its wide-ranging enforcement responsibilities, the Labor Commissioner's Office inspects workplaces for wage and hour violations, adjudicates wage claims, investigates retaliation complaints and educates the public on labor laws.

Former Taco Bell Manager Sues for Wrongful Termination After Blowing Whistle on Food Safety Violations

William Bisek has sued his former employer, Border Foods, Inc. – one of the largest Taco Bell franchisees in the United States – for retaliation under the Minnesota Whistleblower Act. Bisek alleges that he was wrongfully terminated for reporting serious food safety violations at Taco Bell's Columbia Heights, Minnesota, location to Border Foods' management. The Columbia Heights Taco Bell is one of more than 60 Taco Bell locations owned and operated by Border Foods.

Bisek's Complaint – filed in Hennepin County on May 31, 2017 – describes how he was terminated the day after he escalated reports to Border Foods' regional managers regarding food safety practices that violated the Minnesota Food Code and other laws protecting consumers. These food safety violations included extensive and clearly visible mold growing in the water supply tank and on the spouts for the beverage machines, and serving expired meats, tortillas, and taco shells to customers when the expiration dates marked on the storage containers had been fraudulently changed by employees. Bisek's complaint also involved improper sanitation: for example, the water temperature at the washing sinks was at least 40 degrees F below minimum requirements and a toilet brush and plunger that were often wet were kept at the front counter where money was exchanged.

"The food safety violations at issue here are shocking and appalling," said Bisek's attorney, Lawrence. P. Schaefer of Schaefer Halleen. "The law protects employees so they can be confident that if they put their neck out in an attempt to stop their employer from putting public safety at risk, they will not suffer retaliation. We intend to demonstrate for the court that Border Foods terminated Mr. Bisek because he blew the whistle and to prevent him from continuing to do so. We believe the company's conduct here goes to the heart of why we have whistleblower laws."

"Perhaps naively, I honestly thought Border Foods would appreciate me flagging these food safety problems for them. Because the violations were so obvious and the implications for Taco Bell customers so clear, I thought the company would quickly address them, and I might even be looked at in a positive light for helping them come into compliance," Bisek said. "I could not have been more wrong and it unfortunately cost me a great career opportunity."

Soupman Chief Financial Officer, Robert Bertrand Suspended After Being Indicted On Tax Charges

Soupman, Inc.'s Chief Financial Officer and President, Bob Bertrand, has been suspended after being indicted on federal tax fraud charges for alleged misconduct for the period 2010-2014.

"The company is deeply shocked and saddened by these events. The company will be immediately launching an internal investigation to determine whether its public filings need to be amended for the period in question or any subsequent period based upon the allegations," said Jamieson Karson, CEO. "Moreover, we expect that this news will not make it easier for us to raise the capital we need to remain in business."

Bertrand was charged in federal court in Brooklyn, New York, with 20 counts of failure to pay Medicare, Social Security and federal income taxes for the period between 2010 and 2014. As alleged in the indictment, from 2010 through 2014, Soupman's total approximate unreported cash and stock compensation was $2,850,967.59, and the total approximate tax loss to the United States was allegedly $593,971.52. Current CEO, Jamieson Karson joined the company in August, 2015.

HEINEKEN Acquires Remaining Stake in Lagunitas Brewing Company

Heineken N.V. has acquired all the remaining shares in Lagunitas Brewing Company. To maintain the Lagunitas culture and free spirit, the company will continue to operate as an independent entity within HEINEKEN and will report within the HEINEKEN Americas Region.

Tony Magee, the Founder of Lagunitas, will remain active as Executive Chairman of the company and will be supported by his current management team. In addition, Magee will take a leading advisory role to HEINEKEN and its executive team on the global and local craft strategy.

HEINEKEN has enjoyed a successful partnership with Lagunitas since 2015, when it acquired a 50 percent stake in the company. Since then Lagunitas has continued to outperform the U.S. beer market, where craft beer now represents about 11 percent of total volume. Lagunitas is the market leader in the IPA segment, the fastest growing sub-segment within craft, and sold over 1 million hectolitres in 2016. HEINEKEN has helped to expand Lagunitas' international presence, including entry into new markets such as France, Mexico, Italy and Spain, and extended the brand's availability in markets including the UK, Canada, Netherlands, Sweden and Japan. Following this transaction HEINEKEN will accelerate the export of Lagunitas to many more markets around the world.

The impact of this acquisition, similar to the proposed acquisitions in Brazil and in the UK, is excluded from the 2017 FY margin guidance. In the current year the impact of acquiring Lagunitas is expected to be slightly margin dilutive.

Commenting on the transaction, Jean-François van Boxmeer, Chairman of the Executive Board & CEO of HEINEKEN said: "Our partnership with Lagunitas has been a great success and today's announcement marks the next stage of an exciting journey. We look forward to accelerating the roll-out of the Lagunitas brand to many more markets, and sharing Lagunitas craft beer with many more consumers around the world."

Tony Magee, founder and Executive Chairman of Lagunitas, added: "During the 19 months of our partnership we have come to trust and truly believe in each other. Through that we have found ourselves aligned on how to bring the vibe of U.S. craft-brewing to beer lovers everywhere. Only by fully committing to this relationship can we both respond to the historic opportunity that awaits us in all 24 time zones."

The transaction has been completed with immediate effect. Financial terms are not disclosed.

FDA Extends Menu Labeling Compliance Date to 2018

The U.S. Food and Drug Administration is extending the compliance date for menu labeling requirements from May 5, 2017 to May 7, 2018. This extension allows for further consideration of what opportunities there may be to reduce costs and enhance the flexibility of these requirements beyond those reflected in the interim final rule.

The FDA is inviting comments for 60 days on the implementation of the menu labeling requirements, such as approaches to reduce regulatory burden or increase flexibility related to (a) calorie disclosure signage for self-service foods, including buffets and grab-and-go foods; (b) methods for providing calorie disclosure information other than on the menu itself; and (c) criteria for distinguishing between menus and other information presented to the consumer.

The extension will be effective on May 4, 2017 when the Federal Register publishes the extension in advance of the May 5 compliance date. The 60-day comment period will begin on May 4, 2017.

Submit electronic comments to http://www.regulations.gov. Submit written comments to the Division of Dockets Management (HFA-305), Food and Drug Administration, 5630 Fishers Lane, rm. 1061, Rockville, MD 20852. All comments should be identified with Docket No. FDA-2011-F-0172 for “Food Labeling; Nutrition Labeling of Standard Menu Items in Restaurants and Similar Retail Food Establishments; Extension of Compliance Date and Request for Comments.”

Carlo's Bakery Brings First Location to Atlanta, Georgia

On Saturday, April 8, 2017, Carlo's Bakery, the subject of the hit TLC series "Cake Boss," will unveil the brand's first location in Atlanta, Georgia at the Perimeter Mall. In cooperation with GGP, celebrity chef and New York Times best-selling author, the Cake Boss Buddy Valastro, alongside his famous famiglia, will celebrate the grand opening of the 300 square foot mini-bakery with a ribbon cutting ceremony at 6:30 a.m. Immediately upon opening, local foodies and fans alike will instantly have access to the worldwide brand's signature and beloved desserts including cannoli, lobster tails, cupcakes, cookies, cakes, and more. The famed fares are prepared and baked fresh daily on premises.

"To finally have the opportunity to reach our fans that are based in the Atlanta-area is incredible to me," states Buddy Valastro. "Mia famiglia and I meet people all the time and we always get asked to open here or there, in this country, in that city, and we really wish we could just go ahead and open the doors to a Carlo's Bakery but a lot goes into it. We take our time, we find the right locations, we make sure we can share our treats exactly as you would get them in Hoboken before we even think to open. I'm thrilled to finally share the result of all that effort with the people of Atlanta. They're going to love it!"

Panera Bread and JAB Announce Definitive Merger Agreement

Panera Bread Company and JAB today announced that the companies have entered into a definitive merger agreement under which JAB will acquire Panera for $315 per share in cash, in a transaction valued at approximately $7.5 billion, including the assumption of approximately $340 million of net debt. The agreement, which has been unanimously approved by Panera's Board of Directors, represents a premium of approximately 30 percent to the 30-day volume-weighted average stock price as of March 31, 2017, the last trading day prior to news reports speculating about a potential transaction, and a premium of approximately 20 percent to Panera's all-time high closing stock price as of that same date.

Comment by Panera Founder, Chairman and CEO
Ron Shaich, Founder, Chairman and CEO of Panera, commented, "By any measure, Panera has been one of the most successful restaurant companies in history. What started as one 400 square foot cookie store in Boston has grown to a system with over 2,000 units, approximately $5 billion in sales, and over 100,000 associates. In more than 25 years as a publicly traded company, Panera has created significant shareholder value. Indeed, Panera has been the best performing restaurant stock of the past 20 years – up over 8,000 percent. Today's transaction is a direct reflection of those efforts, and delivers substantial additional value for our shareholders."

Shaich continued, "Over the last five years, we have developed and executed a powerful strategic plan to be a better competitive alternative with emerging runways for growth. The themes we have bet on - digital, wellness, loyalty, omni-channel, new formats for growth - are shaping the restaurant industry today. Indeed, the power of the plan is evident in our business results. Today, we are pre-releasing Q1 2017 company-owned bakery-cafe comps of 5.3 percent, which is 690 bps better than the Black Box all-industry composite."

Shaich concluded, "Our success for shareholders is the byproduct of our commitment to long-term decision making and operating in the interest of all stakeholders, including guests, associates, and franchisees. We believe this transaction with JAB offers the best way to continue to operate with this approach. We are pleased to join with JAB, a private investor with an equally long-term perspective, as well as a deep commitment to our strategic plan."

Farmer-Owned Co-op Land O'Lakes, Inc. Acquires Vermont Creamery

Vermont Creamery Co-Founders Bob Reese and Allison Hooper and Land O'Lakes, Inc. President and CEO Chris Policinski announced today that their businesses have joined forces. Vermont Creamery will become an independently operated subsidiary of Minnesota-based Land O'Lakes. It will continue to produce its award-winning fresh and aged goat cheeses, cultured butter and fresh dairy at the creamery in Websterville, Vermont.

"We have always taken seriously our commitment to our farmers, employees and Vermont's working landscape—these values are at the core of our decision to sell the business," said co-Founder Allison Hooper. "As we experience unprecedented growth, we need a partner who can bring the resources and expertise necessary to help us realize our vision and the potential of our business."

"We purchased Vermont Creamery and welcome them to the Land O'Lakes family because we love their brand and would like to help bring it to even more people," said Chris Policinski, Land O'Lakes President and CEO. "We share a value-added, branded approach to marketing our products, a meaningful respect for our customers and deeply rooted rural values."

Hooper and Reese, who founded the business in 1984, say Land O'Lakes is the ideal new owner. A farmer-owned food and agricultural cooperative, Land O'Lakes has been in operation for more than 95 years. Widely known for its iconic butter brand, it is a diverse business that also includes Purina Animal Nutrition and WinField United. At its core, Land O'Lakes is driven by agricultural products that return value to farmers and fulfill its purpose of feeding human progress.

"Vermont Creamery's heritage mirrors our own here at Land O'Lakes—a company founded by people who care about bringing the highest quality products from farm to fork," said Beth Ford, Land O'Lakes group Executive Vice President and COO. "We are excited about the culture of product innovation they have built in addition to the category itself and the opportunities for even more expansion."

"After years of thoughtful planning and a rigorous selection process, we are confident that we have found the best steward of our business, values and people in Land O'Lakes. We are both respected dairy brands with deep connections to farmers and an unyielding commitment to quality and innovation. We look forward to this opportunity to tell our story more broadly and increase access to our high-quality dairy products," co-Founder Bob Reese added.

Reese and Hooper will serve as trusted advisors and brand ambassadors for the business. President Adeline Druart and the leadership team will remain in place as will all employees of the business. Ayers Brook Goat Dairy is not included in the transaction. The Hooper family will retain ownership of the farm, which will continue to serve as a key supplier to the creamery and catalyst for the growth of the goat dairy industry in Vermont. The terms of the acquisition will not be disclosed.

Adeline Druart, President of Vermont Creamery remarked, "Bob and Allison have been such incredible entrepreneurs building Vermont Creamery's success and mentoring the team on their vision and values for the business. Partnering with Land O'Lakes adds the next key ingredients for our growth: additional resources and dairy expertise. This transaction positions Vermont Creamery for continued success in the future."

Founded at a time when Americans rarely ate goat cheese, Vermont Creamery has grown over nearly 35 years to be a premiere producer of fresh and aged goat cheese, crème fraîche and cultured butter. With hundreds of awards and burgeoning national distribution, Vermont Creamery is respected as a pioneer of the artisan cheesemaking movement in America. In 2014, Vermont Creamery was the second cheesemaker in the world to earn B Corp certification and will maintain this certification and commitment to tits community, employees and environment under new ownership.

The Hershey Company Announces New Executive Team

The Hershey Company has announced the new executive leadership team that incoming President and CEO Michele Buck has chosen to lead the organization. The new team balances continuity in key positions through exceptional leaders from within the company and world-class talent from outside of Hershey. 

“Hershey is an innovative snacking leader with its number one market share in U.S. confection and increasing breadth across U.S. snacking,” said Buck. “I’m extremely confident in the individuals who will lead our organization as we delight our customers and consumers with innovation and news in the marketplace and strive to deliver leading sales growth and margins across the food industry. This is a great team, with a range of experiences, expertise and backgrounds to accelerate our innovation, execute with excellence, instill a commercial mindset in all we do, and inspire our remarkable employees to achieve our goals.” 

The following eight leaders will comprise Hershey’s new executive leadership team, effective March 1, unless otherwise noted: 

Todd Tillemans, President, U.S. – Tillemans will join Hershey on April 3 to lead the company's flagship U.S. business including core confection, its expanding portfolio across snacking, and its sales and go-to-market teams. Tillemans joins the company from Unilever, where he worked for more than 23 years. He has held multiple leadership positions, including leading Unilever’s skin care business in Europe and Russia, its personal care business in the United States, and most recently serving as President, Customer Development U.S. 

Steven Schiller, President, International – Schiller, currently President, China & Asia is named President, International.  He will continue to oversee the China and Asia markets and will assume responsibility for the Americas region, India and Europe, Middle-East, and Africa. 

Terry O’Day, Senior Vice President, Chief Product Supply and Technology Officer – O’Day, currently Chief Supply Chain Officer, will continue to oversee the company's supply chain organization and will assume responsibility for Hershey’s productivity, information technology and enterprise connectivity initiatives. 

In connection with these announcements, Chief Knowledge and Technology Officer Waheed Zaman will retire from the company effective March 31. 

The Hershey Company has undertaken a search for a Chief Growth Officer who will lead Hershey’s insights and analytics, strategy, marketing excellence functions, innovation, research and development, mergers and acquisitions and The Hershey Experience. The company has identified an external candidate who is expected to join the team this spring.  

Continuing in their roles are: 

• Senior Vice President and Chief Financial Officer Patricia Little  
• Senior Vice President, General Counsel and Secretary Leslie Turner 
• Senior Vice President and Chief Human Resources Officer Kevin Walling 
• Senior Vice President and Chief Administrative Officer Mike Wege 

“These appointments reaffirm our commitment to creating opportunities for remarkable people to grow within the company and to attracting world-class talent from outside of Hershey. On behalf of the board of directors and management, I would like to thank Waheed Zaman for his work over the past four years to advance our technology, data and analytics capabilities,” Buck said.

Starbucks Pledges to Hire 10,000 Refugees

Starbucks CEO Harold Schultz has assured his company's stakeholders that the company will respond to President Trump's executive orders banning refugees and others from seven predominantly Muslim countries from entering the United States by hiring refugees 10,000 refugees over the next five years in the various countries around the world in which the company does business.