National Consumers League Sues Starbucks, Alleging Deceiving Customers with Claims of “100% ethical” Coffee

CoffeeNetwork (New York) - The National Consumers League (NCL), America’s pioneering consumer advocacy organization, on Wednesday, January 10, 2024, filed a lawsuit alleging that Starbucks is falsely and deceptively claiming “100% ethical” coffee and tea sourcing, detailing widespread evidence the company relies on farms and cooperatives that commit egregious labor and human rights violations.

The lawsuit, filed in the Superior Court of the District of Columbia, notes that Starbucks has responded to its consumers’ demand for responsible corporate practices by launching a yearslong campaign to brand itself as a leader in ethical coffee and tea sourcing, including by developing its own set of “Coffee and Farmer Equity (C.A.F.E.) Practices” verification standards. In one promotional video featured during the 2023 holiday season, a Starbucks spokesperson says that when he drinks Starbucks coffee, “I know it was ethically sourced.”

In reality, the lawsuit alleges, the company’s marketing misleads consumers and fails to convey the rampant sourcing from coffee and tea farms and cooperatives with a documented history of child labor, forced labor, sexual harassment and assault and other human rights abuses.

“On every bag of coffee and box of K-cups sitting on grocery store shelves, Starbucks is telling consumers a lie,” said Sally Greenberg, chief executive officer of the National Consumers League. “The facts are clear: there are significant human rights and labor abuses across Starbucks’ supply chain, and consumers have a right to know exactly what they’re paying for. NCL is committed to exposing and reining in these deceptive practices and holding Starbucks accountable for living up to its claims.”

In 2022, for instance, the Brazilian labor prosecutor issued a complaint against Starbucks’ largest Brazilian supplier, citing working conditions analogous to slavery, including illegally trafficking more than 30 migrant workers. At the Cooxupé collective, which accounts for 40 percent of Starbucks’ Brazilian coffee supply and has received the “C.A.F.E. Practices” certification, investigators found that workers put in excessive hours and carry coffee sacks weighing over 100 pounds on their backs.

“Starbucks’ failure to adopt meaningful reforms to its coffee and tea sourcing practices in the face of these critiques and documented labor abuses on its source farms is wholly inconsistent with a reasonable consumer’s understanding of what it means to be ‘committed to 100% ethical’ sourcing,” the complaint reads. “Similarly, Starbucks’ failure to disclose to consumers the unreliability of these certification programs and their limitations as a guarantee of ethical sourcing are misleading omissions material to the decision-making of a reasonable consumer.”

To protect consumers who may unknowingly be buying unethically sourced coffee or tea — and paying a premium for those products — National Consumers League seeks an order enjoining Starbucks from further engaging in deceptive advertising and requiring the company to run a corrective advertising campaign. Making good on its representations to consumers would require Starbucks to significantly reform its sourcing and monitoring practices to ensure that workers on the farms and cooperatives that supply its coffee and tea products are treated fairly and in accordance with the law.

Over the last decade, a broad range of investigations by government agencies and journalists has uncovered a clear pattern of labor and human rights abuses at Starbucks’ preferred farms and cooperatives — even those that have received the company’s own “C.A.F.E. Practices” certification.

At the James Finlay plantation in Kenya, a Starbucks tea source, undercover reporters with the BBC exposed rampant sexual abuse, including supervisors forcing women into having sex in exchange for work. Thousands of Finlay workers have also filed a class action lawsuit alleging grueling working conditions that wore down their bodies and detailing Finlay’s practice of firing chronically injured workers instead of providing them with healthcare. Finlay workers are reportedly paid the equivalent of $30 per week.

At the Starbucks-certified Mesas Farm in Brazil, law enforcement officers in 2022 rescued 17 workers, including a 15-, 16- and 17-year old, from slavery-like conditions, which included outdoor work, unprotected from the elements, that required workers to lift coffee sacks weighing over 130 pounds. The Mesas Farm has also failed to provide the workers with the personal protective equipment that is required by Brazilian law.

At three different Starbucks certified farms in Guatemala, Channel 4 found children under 13 years old working 40 or 50 hours per week.

Although Starbucks has repeatedly been made aware of the rampant abuses at its supplier and “C.A.F.E. Practices” certified farms and cooperatives, the company has failed to respond with meaningful action.

“Starbucks misleadingly fails to disclose facts material to consumer purchasing decisions, including that many of its supposedly ethical suppliers have in fact relied on forced and/or child labor, i.e. that C.A.F.E. Practices certification does not guarantee the absence of forced and child labor,” the complaint reads.

In response, Starbucks EVP of global coffee, social impact & sustainability, Michelle Burns, issued a statement in defense of the company’s program, calling it “best-in-class.”

“Transparency is essential to fulfilling our mission, upholding our promises, and living our values. In that spirit, here are the facts about Coffee and Farmer Equity (C.A.F.E.) Practices, which was one of the industry’s first set of ethical sourcing standards when it launched in 2004 and remains the cornerstone of our holistic work to ensure the long-term supply of high-quality coffee,” she said.

She further explained that C.A.F.E. Practices is a verification program, not a one-time certification system, and that each supply chain is required to undergo reverification regularly with frequency dictated by their performance in the program and the size of the farm.

“Starbucks relies on SCS Global Services (SCS) to ensure the quality and integrity of the third-party auditing for C.A.F.E. Practices. Evaluation criteria are open-sourced and publicly available, consisting of more than 200 indicators across four criteria areas: economic transparency, social responsibility, environmental leadership and quality,” the statement said. “In instances where Starbucks is notified of alleged violations, we take immediate action.”

Alexis Rubinstein