Daily Harvest Food Poisoning Lawsuit Must Proceed Through Arbitration Process, Court Rules

A women who filed a class action lawsuit against Daily Harvest over severe gastrointestinal injuries experienced after eating recalled French Lentil + Leek Crumbles, will be forced to move her claim through an arbitration, before she can proceed with any traditional personal injury lawsuit in court.

Breanne Peni filed a one of the first Daily Harvest lawsuits in the United Stated District Court Southern District of New York in late June, shortly after a massive recall was issued for nearly 30,000 French Lentil + Leek Crumbles products that had been linked to at least 470 reports of illnesses.

Peni claims that she developed devastating gastrointestinal pain and injuries after eating the contaminated crumbles, which ultimately led to the need for surgical removal of her gallbladder. The lawsuit, along with several others filed by customers who similar gastrointestinal and gallbladder injuries, claim Daily Harvest was negligent in failing to exercise reasonable care in preparing and monitoring the safety and sanitary conditions of its products.

The lawsuit alleged that Daily Harvest knew or should have known about reports of illnesses among consumers during the months leading up to the recall, yet continued to market it’s new line of Crumbles, placing customers at risk.

In response to the lawsuits, Daily Harvest has been attempting to enforce an abitration clause in their service agreement. Many consumers who purchase Daily Harvest products were not aware that they were forfeiting their right to pursue a lawsuit against the company when they agreed to Daily Harvest’s Terms of Service Agreement, which contained an arbitration clause which reads:

Forced arbitration, also known as pre-dispute arbitration clauses, are commonly found in credit card agreements, loan paperwork, mobile wireless contracts, nursing home entrance agreements and other circumstances where consumers are placed in a position where they have no alternative but to waive their right to go to court in order to obtain services.

Instead of being able to pursue a lawsuit in court, disputes are taken to a board of arbitrators, which many critics point out are usually stacked in the company’s favor, decreasing the likelihood of a fair ruling for individuals pursuing damages.

U.S. District Judge Denise L. Cote, of the U.S. District Court for the Southern District of New York, where Peni’s claim was filed, issued an opinion and order (PDF) on November 10, denying Peni’s challenges to the validity and enforceability of Daily Harvest’s arbitration clause. Peni argued several aspects of the clause, stating it only covers a subset of disputes and that portions of the terms are unreasonable.

Peni further argued that a contract requires a meeting of the minds and a manifestation of mutual assent with respect to all of its terms, which the ordinary customer would not have fully understood that they were forfeiting their right to pursuing damages in a traditional court.

As a result of the court ruling, Peni’s lawsuit has been ordered to proceed through the arbitration process, where the discovery process is much more limited, and resolutions are generally considered binding with very limited ability for challenging.