A company that misled consumers into thinking its eggs originated in California settled a lawsuit by donating $50,000 worth of its product to a pair of San Diego food banks, the San Diego City Attorney's Office announced Wednesday.
Luberski Inc., which operates under the brand name Hidden Villa Ranch, will also pay $53,517 in penalties and investigative costs to resolve the allegations of mislabeling statements on its egg packages.
Under the settlement, 201,240 of the company's eggs are being distributed to needy families and food programs via Feeding America San Diego and the Jacobs & Cushman San Diego Food Bank.
An investigation by the San Diego City Attorney's Office found that Hidden Villa Ranch eggs, which were purchased locally at Costco stores, had been labeled "California Ranch Fresh" and "A Product of Hidden Villa Ranch, Fullerton, Ca.," even though they were purchased at out-of-state egg plants.
In the time since the lawsuit against Luberski was filed, eggs have been recalled from out-of-state farms due to salmonella poisoning. Consumers who mistakenly believed their eggs were from California would not be concerned upon learning of a recall of Iowa eggs, for example, and so might not seek out information that would protect their families from illness.
Officials also said the source of eggs is important to many California consumers following passage of the Standards for Confining Farm Animals initiative, which was approved by state voters in November 2008 and took effect as the Prevention of Farm Animal Cruelty Act. It sets forth requirements for California egg producers and out-of-state egg plants that sell within California. Hidden Villa Ranch has since revised its packaging.
The San Diego City Attorney's Office does not traditionally accept settlements in forms other than U.S. currency, but City Attorney Jan Goldsmith said his office looks for opportunities where defendants in consumer protection lawsuits can give back to the community.
"This was a creative resolution, and a win-win for San Diego," Goldsmith said. "Our food banks get $50,000 in eggs to help the needy. Our office enforces the law, and Hidden Villa Ranch is held accountable."
