A lawsuit filed Thursday in Oregon claims that Costco whitewashes its products as ethically sourced when in reality the retail giant is able to offer “hundreds” of items at discount prices because they’re produced using child or forced labor.
That includes chocolate made from cocoa that was illegally farmed by children in west Africa: cashews harvested by underaged and forced laborers in Brazil, Vietnam and Guinea-Bissau; and shrimp processed by exploited workers in India, according to a 95-page lawsuit filed in U.S. District Court for Oregon in Portland.
The lawsuit seeks class-action status from a judge and cash payouts of $200 for each Costco member in Oregon. The suit says the number of Costco customers who could be eligible for an award is unknown but likely exceeds 1.1 million people.
The suit doesn’t seek damages for Costco members outside of Oregon. Brian de Haan, one of the Portland lawyers who filed the suit, says it’s the first of its kind in the nation that he knows of.
Representatives for Costco didn’t immediately respond to a request for comment Thursday morning.
The suit is being filed by a Southeast Portland woman, Leslie Brunker, and a Tigard man, Jeremy Parra. Both started paying the yearly membership fees in order to shop at Costco within the past year, according to the complaint.
“The economics are straightforward: Producers that use child and forced labor can reduce their costs,” states the lawsuit. “… Polling shows that Americans overwhelmingly prefer not to buy products they know are tainted by child labor and are willing to pay a premium for products they trust to be ethically sourced.”
The suit continues: “To capitalize on this demand, defendant Costco Wholesale Corporation (’Costco’) brands itself as a retailer of ‘ethically sourced’ and ‘sustainable’ products and makes broad, categorical promises to shoppers about its ability to prohibit child and forced labor in the supply chains behind the products it sells.”
Costco is the nation’s second-largest retailer by customer dollars spent.
The lawsuit also seeks punitive damages and asks a judge to stop Costco “from continuing the unlawful, deceptive, fraudulent and unfair business practices alleged herein.”
The suit is not just contending that some of Costco’s store-brand products, sold under the name Kirkland, are unethically sourced.
The complaint also alleges that national and international brands sold at Costco, as well as at grocery stores across the country, are suspect, too. But the lawsuit holds Costco to a higher standard, saying Costco tells its members that the company “controls every element” of the supply chain of its Kirkland-brand products and that its supply chain is fully traceable.
The lawsuit alleges that “Costco sells hundreds of products” on the U.S. Department of Labor’s list of goods produced by child or forced labor, which was last updated in September 2024. In many cases, the Labor Department says workers are vastly underpaid, work with dangerous tools or machinery, are exposed to harmful chemicals or are children who are working instead of attending school. Many of the workers, the department says, are working in violation of their countries’ own labor laws.
“Corporate grocery chains have no economic incentive to confront this moral tragedy unless consumers hold them accountable,” the suit states.
The suit was filed by the firm Larkins Vacura Kayser.
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