Illinois Judge Allows Restaurant Rent Relief Due To “Act Of God”
Restaurateurs facing months of back rent may have caught a break. A bankruptcy court in Illinois ruled that the force majeure or “Act of God” clause in a restaurant lease can excuse the tenant’s responsibility to pay the entire rent amount during forced business closures due to the coronavirus. Giglio’s State Street Tavern, an Italian restaurant in Chicago, filed for bankruptcy protection in February and was unable to pay rent from February through June. The landlord, Kass Management Services Inc., told the restaurant owner, Bobby Hitz, to either pay the rent from March through June or leave the premises, according to Illinois court documents.
The judge, Donald R. Cassling, ruled that the restaurant must pay the full rent due for the month of March. However, for the remaining months, the judge ruled that Illinois Governor J.B. Pritzke’s executive order to suspend on-premise consumption was evidence of force majeure. According to judge Cassling, since the restaurant still offered takeout, curbside pickup and delivery during those months, the business is only required to pay rent “in proportion to its reduced ability to generate revenue due to the executive order.” The restaurant estimated that 75% of its locations were unusable due to the executive order, so the judge ruled that the tenant should pay 25% of the rent from April through June with monthly rents likely increasing as coronavirus restrictions are eased. The ruling sets a precedent for other restaurateurs in similar legal battles with landlords.
Former Bumble Bee CEO Imprisoned For Tuna Price Fixing
Christopher Lischewski has been ordered to serve 40 months in prison for price fixing in the canned tuna market. The former president and chief executive of Bumble Bee Foods was the leader of the scheme, which included three other executives. According to prosecutors, the scheme was in effect from November 2010 to December 2013 and affected over $600 million worth of canned tuna sales. In 2017, Bumble Bee pleaded guilty to its role and was sentenced to pay a $25 million fine. In September, StarKist, the other canned-tuna company involved in the conspiracy, was sentenced to pay a $100 million fine. “Executives who cheat American consumers out of the benefits of competition will be brought to justice,” said Makan Delrahim, assistant attorney general in charge of the Justice Department’s antitrust division, “particularly when their antitrust crimes affect the most basic necessity, food.”
Authorities Crack Down On €2.5 Billion Black Market for European Eels
Critically endangered European eels, Anguilla anguilla, are bred in the Atlantic Ocean near Spain and Portugal then released into the expansive Sargasso Sea to reproduce. However, approximately 25% of the eel population is intercepted by eel traffickers for the black market, which nets up to €2.5 billion worth of eels each year. From 2015 to 2017, one smuggler alone carried 6.5 tons of baby (glass) eels into the UK for sale. Traffickers masked as tourists often pack water-filled bags of eels in suitcases on flights to Hong Kong, a trafficking hub with an estimated 900 aquaculture farms that shepherd the eels to dinner tables throughout Southeast Asia.
In the mid-twentieth century, as wetlands were drained, hydroelectric plants were built, and pollution increased, the European eel population plummeted. Eels were soon declared endangered, and in 2010 the sale of eels outside Europe was banned. But wildlife trafficking has become increasingly widespread, forcing authorities such as Europol to use more sophisticated surveillance methods. The huge market for illicit eels not only threatens the endangered eel population, it has also become a revenue stream for terrorist groups, according to Paul Stanfield, Interpol’s director of organized and emerging crime. .
Atlantic Conservation Area Now Open To Commercial Fishing
A 5,000 square mile conservation area in the Atlantic Ocean has been opened up to commercial fishing after being closed in 2016. The area was initially closed to protect endangered species, and some environmental groups warn that commercial fishing in the area will hasten their demise. “These are fragile and vulnerable resources, and I am concerned for their future health,” said Rip Cunningham, former chair of the New England Fishery Management Council. As commercial fisheries struggle during the coronavirus crisis, the move throws them a lifeline, allowing fishing to resume in the Northeast Canyons and Seamounts Marine National Monument. “We’re cutting regulations from highways and roadways to fish,” said President Trump.
Bipartisan Agriculture Bill Addresses Farmers And Climate Change
On Thursday, U.S. senators presented a bipartisan bill that would direct the Agriculture Department to encourage farmers, ranchers and landowners to use carbon dioxide-absorbing practices to generate carbon credits. The proposed Growing Climate Solutions Act directs the USDA to create a program to help the agriculture sector gain access to revenue from greenhouse gas offset credit markets. In 2018, the average price of such credits was $3 per tonne, but demand for credits is expected to grow when airlines purchase offsets to comply with the industry’s Carbon Offset Reduction Scheme (CORSIA), which will begin in 2021.
The bill puts new USDA-certified protocols in place for farmers, ranchers and forest owners seeking to develop projects that generate offset credits under existing programs. The bill also offers a new revenue stream for farmers, ranchers and land owners suffering from economic impacts of the coronavirus and global trade tensions.
Chicken Industry Executives Indicted For Price Fixing
On Wednesday, a CEO and three other industry executives were indicted for colluding to fix prices in the wholesale chicken market. The indictment alleges current and former senior executives at Pilgrim’s Pride Corporation and Claxton Poultry Farms illegally inflated prices from 2012 to 2017. Jayson Penn, Chief Executive and Roger Austin, former vice president of Pilgrim’s Pride were both charged. The president of Claxton, Mikell Fries, and vice president Scott Brady, were also indicted. Since 2016, leaders of the $65 billion U.S. chicken industry have been suspected of conspiring to fix prices, as poultry buyers sued producers.
According to Watt Global Media, the five largest companies control 61% of U.S. chicken production, with Tyson Foods Inc. accounting for 21% of that. The indictment includes Tyson Foods Inc., Pilgrim’s Pride, Claxton Poultry Farms, Sanderson Farms Inc. and Perdue Farms Inc. All five companies have denied the allegations. Producers claim that poultry prices increased over the years due to supply and demand factors such as rising domestic consumption and exports. In 2012, the U.S. Department of Agriculture began examining national wholesale prices for whole chickens, finding that they had risen 11% by the end of 2018. Prices decreased about 27% from the start of 2019 through the end of February 2020. The latest price reductions came as chicken companies expanded production to prepare for larger exports due the finalizing of new trade deals.
Justice Department Investigates Soaring Beef Prices
Grocery-store shoppers paid 26 cents more per pound for fresh beef in April than they paid in March, according to the Bureau of Labor Statistics. But ranchers were paid an average of less than $100 per 100 pound for their steers, well below the five-year average of $135 per hundred pounds, according to the USDA. This combination of high consumer price and low payouts to ranchers has the Department of Justice suspicious. In April, Republican senator Chuck Grassley of Iowa along with 19 other senators and 11 states attorneys general, called for an investigation into the price fluctuations. “Something’s not right in the industry,” Grassley said.
This situation is not without precedent. One hundred years ago, the five biggest meat packers controlled 82% of the beef market. The Justice Department intervened, and by 1980 the top four meat packers controlled 36% of the market. But a wave of mergers kneecapped the increased market competition, and by 1988, four companies again controlled 70% of the fresh beef market.
While the dynamics of the fresh beef market precede the pandemic, slaughterhouse closures and increased illness among workers have magnified questions about recent price increases (as of May 15, there were 14,271 reported COVID-19 illnesses among meatpacking employees). According to Kansas State University agricultural economist Ted Schroeder, higher consumer prices are merely a result of supply and demand. Plants are running at about 50% capacity, says Schroeder, and the “bottleneck” of steers ready for slaughter but unable to be processed due to the limited workforce has decreased supply, increased demand, and lead to higher prices.
Nonetheless, ranchers filed an antitrust suit in Minneapolis federal court last year, alleging that the four biggest meatpackers (Tyson, JBS, Cargill, and National Beef) are colluding to set prices. Bill Bullard, CEO of the Ranchers-Cattlemen Action Legal Fund, which represents ranchers now being paid less for their steers, claims the four companies acted “with intent to reduce prices across the board.” The Justice Department is investigating whether the companies communicated to coordinate prices or if they were simply responding independently to each other’s actions in the marketplace.
Japanese Whisky Faces Scrutiny In Absence of Regulations
One of Japan’s leading whisky experts, Mamoru Tsuchiya, says a large amount of Japanese whisky is not actually made in Japan. It’s a disconcerting revelation, considering that Japanese whisky is in high demand around the world with rare whiskies such as Yamazaki 18 Year Old commanding prices upwards of $500 a bottle. Surprisingly, Japan has few rules to define “Japanese whisky.” Japanese companies may purchase spirits in bulk from abroad, label it “Japanese whisky,” then ship it abroad again. Companies may also export aged shochu distilled from various grains to sell in America as whisky. Some “distilleries” even import whisky in bulk then bottle it under various labels.
Since the early 2000s, Japanese whisky has had an increasingly good reputation as brands like Hibiki and Yamazaki have received widespread praise. To meet demand, many distilleries were in need of additional fully aged product and began buying product in bulk abroad, leaving whisky connoisseurs scratching their heads. In response, some distilleries have begun using the term “world blend” to indicate that what’s in the bottle includes a mix of imported and domestic products. To clarify terms, Mr. Tsuchiya’s Japan Whisky Research Centre has proposed a set of rules defining “Japanese whisky.” Under the rules, distilleries using the term would be required to use only grain in their mash, ferment it with yeast, distill it in Japan, then let it age in a wood cask for at least two years.
FDA Rolls Back Ingredient Labeling Requirements During Pandemic
On May 22nd, the Food and Drug Administration announced it would allow food manufacturers to make “minor” substitutions and omissions in food and beverage product labels. This practice would, under normal circumstances, be considered adulteration. However, as the coronavirus crisis has caused “unforeseen shortages or supply chain disruptions”, the FDA does not intend to object to slightly inaccurate food labels.
Substituted ingredients may not include common allergens such as eggs, milk, nuts, buckwheat, and sesame. Nonetheless, consumers and allergy awareness advocates are concerned about potential allergens being included in food and beverage products but not listed on the label. “FDA’s guidance casts doubt on whether those with food allergies can safely and confidently purchase food if labels will not provide necessary information regarding ingredients,” the non-profit Food Allergy Research & Education (FARE) group wrote in a statement. Get the full story here at The Counter, or here at Miami Herald.
Face Masks Now A Fixture In Restaurant Hospitality
When it comes to American dining, from fast food to fine dining, the face mask has become a standard part of the uniform. As federal, state, and local restrictions start to relax, dining rooms across the country are planning ways to maintain hospitality, and the mask has proven to be necessary to do so. Burger King executives are even reviewing mask designs to incorporate into the standard employee uniform.
The Inn at Little Washington, a Virginia restaurant with three Michelin stars, has ordered custom made masks in anticipation of a reopening. “People need to get out, obviously, and they don’t want to walk into an atmosphere that increases their anxiety,” said Patrick O’Connell, chef and proprietor of the restaurant.
