Costco sued over its $4.99 rotisserie chicken. Here’s why.

Disgruntled customers have filed a proposed class action lawsuit accusing wholesale retailer Costco of falsely advertising that its rotisserie chicken contains “no preservatives”.

Filed on Jan. 22 in the U.S. District Court for the Southern District of California, the complaint, obtained by USA TODAY, alleges Costco’s Kirkland Signature Seasoned Rotisserie Chicken contains two preservatives, sodium phosphate and carrageenan.

The proposed class alleges Costco “has systemically cheated customers out of tens–if not hundreds–of millions of dollars by falsely advertising its Kirkland Signature Seasoned Rotisserie Chicken as containing ‘no preservatives.’”

The lawsuit, brought on by two women in California, accuses Costco of violating multiple consumer protection laws, including in California and Washington state, where the wholesale retailer is headquartered.

Costco said in a statement to USA TODAY on Jan. 28 that the company has removed the signage.

“To maintain consistency among the labeling on our rotisserie chickens and the signs in our warehouses/on-line presentations, we have removed statements concerning preservatives from the signs and on-line presentations,” the company said. “We use carrageenan and sodium phosphate to support moisture retention, texture, and product consistency during cooking. Both ingredients are approved by food safety authorities.”

Here’s what we know about the lawsuit.

Why is Costco being sued?

As proof, the complaint includes a photo of an in-store advertisement for Costco’s Kirkland Signature Seasoned Rotisserie Chicken, which says the $4.99 food product contains no preservatives, no artificial flavors or colors, no MSG and no gluten.

However, the complaint alleges the chicken contains sodium phosphate, a preservative that controls pH and reduces fat oxidation, effectively slowing microbial growth and spoilage. The proposed class also accused Costco’s rotisserie chicken of containing carrageenan, which, according to WebMD, is a commonly used preservative that thickens foods, yet has no nutritional value.

The complaint’s false advertising allegations stem from the “no preservatives” sign prominently displayed in Costco stores and on the company’s website, and from the fact that the two preservatives are listed on the back of the packaging in smaller and “less prominent” print.

In addition to accusing Costco of violating false advertising and consumer protection laws, the complaint says the retailer broke unfair competition laws by engaging in “unfair business acts and practices by tricking Plaintiffs and members of the California Subclass into purchasing or alternatively paying a premium for its rotisserie chicken by advertising the product with ‘no preservatives.’”

If certified by the court, the class would include anyone in the U.S. who purchased Costco’s rotisserie chicken, according to the complaint. The proposed class’ attorneys are also asking the court to approve a subclass consisting of customers who bought the chicken in California.

In addition to class certification and the approval of a subclass of California customers, the plaintiffs are also requesting unspecified monetary damages.

Despite the two California women initiating the lawsuit, both said they plan to purchase Costco’s rotisserie chicken again, with one giving the caveat that she “cannot rely on Costco’s preservative-related representations for the product unless those representations are accurate and consistent with the product’s ingredients.”