9. Does failing to comply with industry standards at the time of
the contamination constitute a breach of duty?
ampur Crisis aeview and objectives idents of some West oast states and out C d into western Canada. Wh eventual Was part of their business model without the r juice was fresh from the en the b to juice made by the California, the acteria was by othe pasteurization process that was used juice walla Juice n fact, Odwalla was one of the pioneers of a wider Company in walla market analysts were shocked in disbelief had prided itself on g a soc y movement in the United States favoring more organic food consumption. Odwalla’s founders held the belief that cess of heating the juice to a cerain temperature for purposes of ki ng any ba that had developed during cteria growing, picking, the company that about producing healthiest juice on the market events that followed the outbreak he taste of the or processing-affecte Odw juice and was unnecessary. Instead, provid e an eria. a used an acid-based rinsing process to kill bac Producing fresh organic fruit juice as a central component of its busi model, Odwalla developed adample of how vastly diff erent areas of the law act corporate strategy during a corporate crisis d how business ethics principles help drive the a loyal following of consumers who desired the fresh decision-making process. Th e objective of this case est juice possible, and its sales grew exponentially. By tudy is to attempt to understand legal and ethica the mid-1990s, Odwalla was selling nearly $90 millio worth of juice per year implications using a comprehensive and practica approach. In analyzing this case, students hone skills SOIL TO SOUL in constructing a business strategy for handling a cr Odwalla’s founders were at the forefront of the corpo- by spotting the multifaceted legal and ethica rate social responsibility movement that can be traced challenges of the crisis, (2) recognizing the strengths to the mid-1980s. Indeed, as one of the founders was weaknesses in Odwalla’s responses, and (3) fond of saying, they embraced a “Zen-like philosophy ng legal insight and ethical decision-making mod in all of their dealings, and community was an impor tant factor in the equation. The company employed a craft a response soil to soul metaphor to describe its commitment to ew Legal Concepts using fresh organic fruit (soil) to nurture the “body whole (soul) of its consumers. Odwalla’s reputa Prior to reading the case, briefly review the follow tion as a socially responsible, growth-oriented com ing legal concepts that were covered previously in pany flourished as it received awards from Business this textbook, food and drug safety (p. 612), prod Ethics magazine in 1995 for Outstanding Corporate y negligence (p. 272), criminal p s84) and business Think of Environmentalism and from Inc. magazine in 1996 as Employer of the Year. ese areas of the law as you read the case study CRISIS ON THE COAST acts and questions In early October 1996, an outbreak of E. col struck several West Coast states, including California and Washington, and reached into western Canada as well oDwALLA JUICE coMPANY’s ORIGINS Walla Juice Company was started in 1986 by a is a potentially deadly bacterium that develop E. coli p of friends living together in San Francisco Bay area Starting with hand juicer shorthand for ally grown fruit, the owners produced fresh case study, E. coli is of bacteria back shed of one of the founders’ homes and purposes of this the name of a strain animals For which is and Juice by delivering it daily to area restaurants o15 H7 tracts of humans or dairy hat lives in the digestive meat, raw milk not E. coli has been found in uncooked that have be found products, and raw fruits and vegetables or proc for this case study may b2e. been properly 741 s textbook’s website at www.m odwalla Juice Company Crisis CAPSTONE STUDY 2 The CASE
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