New Food Scare At Chipotle Causes Stock Drop

Chipotle Mexican Grill Inc. (NYSE:CMG) has suffered another suspected illness outbreak at one of its restaurants. A “small number” of illnesses were reported at a location in Sterling, Virginia, outside Washington, D.C.

It was not clear how many people became sick or whether they were customers or employees. Reports indicate that at least 13 people fell sick after eating there on Friday or Saturday. That location has since been closed.

Jim Marsden, Chipotle’s executive director of food safety, says that the company is working with health authorities to determine the cause of the outbreak. Chipotle hired Marsden to oversee its food-safety efforts in 2016. Marsden said, “In accordance with our established protocols, our team is working to ensure the safety of our customers and employees, including voluntarily closing the restaurant yesterday to conduct a complete sanitation.”

Those that became ill reported symptoms such as vomiting, diarrhea, severe stomach pain, dehydration, and nausea. Marsden said in an emailed statement, “The reported symptoms are consistent with norovirus.”

Norovirus cases aren’t rare. It’s the most common cause of foodborne illnesses in the U.S. Roughly 20 million Americans are sickened each year by the illness. The norovirus virus is typically spread from one person to another, but can also be transmitted by consuming contaminated food or water. It can spread quickly in closed places like daycare centers, nursing homes, schools, and cruise ships.

After the release of the information, the company saw its worst stock decline in seven months. The stock fell as much as 7.6 percent, marking the biggest intraday drop since December. It had been up 3.9 percent this year through Monday’s close.

Chipotle’s past problems have put health incidents at the chain under intense scrutiny. The company suffered a series of foodborne-illness outbreaks at the chain in 2015 that sickened hundreds of customers across about a dozen states. The outbreaks sent Chipotle’s sales and stock price plunging.

Since then, the burrito chain has returned to profitability and its same-store sales have begun moving in a positive direction. However, its recent successes have been overshadowed by a data breach, overtime pay lawsuits, and drug charges being brought against a senior manager.

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