Hobbit Business Review

Starbucks Hit With ‘Ethical’ Lawsuit Alleging Abuse, Bad Practices on Farms

Starbucks was hit with a lawsuit this week after a consumer group accused the chain of misleading claims that it’s “committed to 100% ethical coffee sourcing.”

The National Consumers League claimed that the coffee giant’s farms perpetuated abuse, citing a case from 2022 when local authorities found that 17 employees on a coffee farm in Brazil were not provided protective equipment.

“We take allegations like these extremely seriously and are actively engaged with farms to ensure they adhere to our standards,” Starbucks said in a statement, noting that the company planned to “aggressively defend against the asserted claims.”

The lawsuit alleged that Starbucks farms “have committed documented, severe human rights and labor abuses, including the use of child labor and forced labor as well as rampant and egregious sexual harassment and assault,” also citing a report from BBC in 2023 that claims sexual harassment and “gender-based violence” were occurring at a Starbucks tea supplier in Kenya. Starbucks immediately suspended sourcing from the farm upon the report.

Starbucks’s website claims that its coffee is 99% ethically sourced.

“Starbucks coffee is verified 99% ethically sourced. We are working with other industry leaders to make coffee the first sustainable agricultural product,” the company says. “We plan to invest in training and financing for coffee farmers and provide 100 million coffee trees by 2025.”

The coffee chain had a strong year, reporting a 39% increase in net earnings for Q4 of fiscal 2024 as compared to the year prior, with operating income jumping over 42% in the same period.

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