Kudler Law

Kudler Fine Foods boasts a produce department containing “over 350 fresh fruits, vegetables, herbs and spices” (University of Phoenix, 2008). This also includes a diverse variety of apples, Asian produce and herbs, and an emphasis on healthy living by providing both organic and non-organic lines of produce. An arrangement with local growers offering 100% organic produce was reached and the line is now offered and marketed in all three Kudler Foods retail stores and changes are pending because of the decision to carry the product. “The USDA’s National Organic Program regulates the standards for any farm, wild crop harvesting, or handling operation that wants to sell an agricultural product as organically produced” (USDA, 2008).

Four primary topics need to be addressed and lists of questions which will require an answer or further investigation are given for each topic.

As a result of the decisions use local growers of organic produce and start a catering service, Kudler Foods has decided to shut down some departments (e.g., deli, confectionary, on-site prepared meals) for 3 months for refurbishing. This will result in some employees not being needed. What obligations does Kudler Foods have to its employees? Can Kudler Foods legally shut down these departments? Questions Kudler Foods should ask and consider.

• How many employees stand to lose their jobs during this 3 month refurbishing?

• How many employees can we transfer to other locations during the 3 month project?

• If we transfer the employees, will they want to stay there rather than come back to their home location?

• If employees choose unemployment as an option, will they come back to the store or will Kudler Foods have to spend money on recruiting new employees?

• How much money will Kudler Foods stand to lose during the 3 month project?

• Is there a chance that Kudler Foods might lose some regular customers to other stores during the time they are closed? If some customers only come to Kudler Foods for their excellent meat selection and the deli is closed for 3 months, will those guests return once the deli is open again?

• Could the refurbishing cause an overall loss in profit even after the project is done?

• Is there a potential for lawsuits from employees because of layoffs?

• Should Kudler Foods provide on-site training or potential short term job opportunities?

• Should Kudler Foods make contracts with current employees guaranteeing their job security once the refurbishing is over? What if the employees go to other companies during the remodel? Should Kudler Foods have employees sign confidentiality agreements?

The local organic produce growers want contracts with Kudler Foods so they can have some certainty regarding where their produce is sold. Should Kudler Foods enter into contracts with these growers? Questions Kudler Foods should ask and consider:

• What financial benefits exist for Kudler Foods if it chooses to contract with local organic growers? How will these financial benefits be redistributed into the company in a way that advances profitability?

• Will Kudler Foods customers benefit directly from contracts with local organic growers? If so, will this benefit be in the form of savings, quality, convenience, or all a combination of all?

• Assuming local growers’ prices are slightly higher than those of the grower(s) from which Kudler Foods is currently ordering; do the benefits covered by answering questions 1 and 2 outweigh that difference?

• If Kudler Foods chooses to enter into contracts with local growers, what legal restrictions will it face against buying from other companies in the case of an emergency (such as if the contracted growers are unable to fill an order.)

• If contracts are established, what legal binds will exist for the growers to ensure produce availability and quality? How will Kudler Foods be compensated if the growers break this aspect of the contract in any way?

• Is it feasible for the contracts to include provisions to ensure that Kudler Foods is legally able to end the agreement should the growers not provide the agreed upon good service or product? If so, what should these provisions be? If not, will the benefits of contracting outweigh the risks involved in being tied to a particular grower for the length of the contract?

• What might growers expect from Kudler Foods in addition to the payment aspect of the contract? Will certain size orders or specific frequency of ordering be required? Would it be possible for Kudler Foods to adhere to these types of requirements?

• How might the customers of Kudler Foods respond to finding out about the fact that it contracts with local growers? Would it be viewed positively or negatively? How might Kudler Foods affect this view through marketing?

• Would entering into contracts with local growers reduce Kudler Foods liability in cases of food poisoning or otherwise tainted food if part of the contract includes the requirement that the grower guarantee food safety? How would this differ from the amount of liability Kudler Foods now has without contracts?

• Do any other local grocers contract with local growers for their produce? If so, how have these grocers benefitted from those contracts, if at all? Also, how will Kudler Foods differentiate itself from competitors if it chooses to contract with some of the same local growers? Or should it avoid contracting with these particular growers to ensure differentiation altogether.

Organic produce does not have preservatives. What product liability implications does this have for Kudler Foods? What regulatory implications does this have for Kudler Foods? Questions Kudler Foods should ask and consider:

• What are the legal implications if a product is labeled organic by the grower but it is actually not organic?

• What is Kudler Food’s responsibility to their customers to ensure the produce provided by the grower is what is says?

• Kudler Foods is assuming the grower has met the federal regulations to be a certified grower of organic produce. What is the level of due diligence required by Kudler Foods to guarantee the product is