Professionalism/Huy Fong Foods, Sriracha, and the City of Irwindale

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Introduction[edit]

In 2013 the city of Irwindale filed a lawsuit against Huy Fong foods after resident living near the plant complained of the painful odor emanating from the factory during the production.

David Tran[edit]

David Tran, the founder and CEO of Huy Fong foods, was born in Vietnam in 1945, which according to the Chinese zodiac is the year of the rooster, hence the rooster on the company logo. In 1975 Tran made his first sauce, the Pepper Sa-te, which he packed in a recycled glass baby food jars and delivered it on a bicycle.[1]

Following the Vietnam war, David Tran, who was a major in the South Vietnam's army escaped communist Vietnam and immigrated to the United Sates on a ship named heuy fong, which later became the name of his company. When he arrived in the United States in 1979, he had no job or money, so he started making hot sauce and driving around in his van to sell it to Asian restaurants and markets in LA.

Huy Fong Foods[edit]

In 1980 David Tran founded Huy Fong foods in Chinatown, LA. Huy Fong foods makes three types of chili sauces, the chili garlic sauce, the sambal oelek sauce and the most famous of them all, the sriracha sauce.

Sriracha sauce is made of chili peppers, sugar, garlic, distilled vinegar, and salt. [1]

The word sriracha comes from the name of the city of Si Racha,Thailand, which some[2] say is the birth place of the sriracha sauce. Even though David Tran didn’t invent the sriracha sauce he added his own twist to it, making it hotter and thicker and by the response of the public, they approve. In 2007 Huy Fong foods oversold Sriracha with 3 month left in that year and in 2012 it sold $60 million worth of sauce and the company’s revenue has been increasing by 20% each year[3] but what’s remarkable is Huy Fong foods does not advertise at all. And by the looks of it they don’t needed to. There are several Facebook pages [4] [5] and YouTube videos[6][7] dedicated to sriracha sauce.

By 2011, Huy Fong foods had outgrown its previous factories and moved to its new $40 million 655,000-square-foot factory in Irwindale, California, which tripled its production. [pic of the new plant]. A year after the factory moved to Irwindale they were making about 70,000 bottles a day.[8] This caused people living near the plant to complain about the chili fumes coming out of the factory, which lead Irwindale city to file a lawsuit against Huy Fong foods in the Los Angeles county superior court.

The Lawsuit[edit]

In late 2012, residents of Irwindale, California started to notice a chili odor that was being released from the Huy Fong foods Sriracha factory nearby. Residents complained that the smell was causing eye irritation, burning skin, and coughing. After fewer than 30 residents, including a city councilman’s son, filed complaints with the city regarding the odor, Huy Fong foods installed filters in hopes that the complaints would subside. [9] The following year, the City of Irwindale was still receiving complaints. In response, Huy Fong foods installs additional filters and files a request for a third-party air quality consultant to inspect the plant. The following month, the City of Irwindale formally sues Huy Fong foods, citing the odor as a “public nuisance”. [10]

Air Quality Inspection[edit]

It was not until February 2014 that the South Coast Air Quality Management District completed their inspection of both the plant and the local areas that provided the complaints. AQMD found that out of the 61 total complaints against Huy Fong foods, 41 complaints came from only 4 different addresses. After inspection of the factory, AQMD did not issue a notice of violation due to adequate air quality standards. [11] Following the statements of AQMD as well as a judge declaring a “lack of credible evidence” of factory-related health problems, the City of Irwindale dismisses the lawsuit in May 2014.

Second Lawsuit[edit]

For two years, the plant did not receive any formal complaint and believed the debacle had ended. However, in May 2016, Irwindale filed a second lawsuit against Huy Fong foods, stating they were behind on paying over $400,000 in fees. When Huy Fong foods signed a disposition and development agreement with the city, instead of paying taxes, the company agreed to pay the city $250,000 each year for 10 years. The lawsuit stated that Huy Fong had been late in paying these fees for the past two years. When asked about the unpaid fees, David Tran, the owner of Huy Fong foods, stated that he stopped paying the fees because he felt is company had been treated unfairly over the past few years. [12] Several months after the second lawsuit had been filed, Huy Fong Foods launched a countersuit against the City of Irwindale for harassment. The countersuit states that the city incorrectly sued Huy Fong Foods instead of Huy Fong Irwindale LLC, a separate company involved with city contracts. [13]

The most current news regarding the ongoing lawsuit suggests that both parties may settle out of court.

Professionality[edit]

The complex interplay of professional ethics informing decision making at Huy Fong foods is as murky as their sauce. The company has brought hundreds of jobs and hundreds of thousands of dollars in tourism to the city of Irwindale since its move, and shutdown of the factory could greatly harm the town’s source of income. [14][15] However, neighbors report moving birthday parties indoors and keeping children from playing outside, indicating a decreased quality of life for some. [16] Changing of the recipe to decrease the odorous peppers would dishonor the tradition and integrity of the product according to Tran [17]. These competing aspects of professionalism create a “pick two” triangle:

A large "Pick two" Triangle

Determining which corners of the triangle represent the highest of professional ideals is up for interpretation.

Similar Scenarios[edit]

While there are many hot sauces in production in the United States, none have received the complaints of harmful fumes as Sriracha. Tabasco, a hot sauce made in Louisiana, has a similar chili and initial chili processing to the chilies used in Sriracha. Chilies are chopped finely and combined with salt and vinegar, potentially releasing similar odors as the Sriracha. However, the location of Tabasco on Avery Island, a remote estate dedicated to the sauce, prohibits neighbors from inhaling the spicy fumes. [18] Those who wish to tour the ‘blending’ facility are instructed to “see the vats where our pepper mash becomes TABASCO® Sauce! Push a button to smell the intense pepper aromas.” Patrons are not directly exposed to the air from processing unless they actively seek it, suggesting the company is aware of the potential discomfort from the odor. [19] The production of livestock causes unpleasant odors. Hog farmers in North Carolina face frequent lawsuits for the odors of feces and urine associated with their farms [20]. Bills have been introduced in North Carolina state assemblies to cap odor related lawsuits against hog farmers, however these have since been vetoed, indicating a lack of legal precedent for odor related suits [21]. Right to farm laws generally protect farmers from nuisance suits, however, odor may have the potential to cause bodily harm and is thus not considered nuisance, rather an environmental concern [22].

Until legal precedence is set, it is likely that odor related suits will continue to be settled outside of court to protect the interests of farmers and manufacturers nationwide. The professional ethic of maintaining a productive and successful business with product integrity while balancing concerns of the communities supporting the business begs an impossible balance for some.

Future Studies[edit]

Huy Fong foods vs. The City of Irwindale will continue to unfold behind closed doors in the coming months. As the case progresses, monitoring court proceedings and public settlements will inform the professionality of Huy Fong foods.


References[edit]

  1. https://communitytable.parade.com/222621/smccook/what-is-sriracha-and-what-is-a-good-brand-substitute/
  2. http://tinyletter.com/whoinvented/letters/who-invented-sriracha
  3. http://articles.latimes.com/2013/apr/12/business/la-fi-himi-tran-20130414
  4. https://www.facebook.com/TheSrirachaCookbook/
  5. https://www.facebook.com/SrirachaNinja/?hc_ref=SEARCH&fref=nf
  6. https://www.youtube.com/watch?v=sn5ePIhpDGs
  7. https://www.youtube.com/watch?v=GIQ8mN-1V3I
  8. http://prosydelacruz.com/provencal/david-tran-enterpreneurial-genius-sriracha-rooster-hot-sauce/
  9. http://articles.latimes.com/2013/oct/31/local/la-me-ln-sriracha-complains-councilman-son-20131031
  10. http://www.latimes.com/local/lanow/la-me-ln-irwindale-sues-sriracha-20131028-story.html#axzz2j1T5nJF5
  11. http://www.reuters.com/article/us-usa-sriracha-california-idUSBREA3927220140410
  12. http://www.dailynews.com/general-news/20160527/why-sriracha-is-facing-another-lawsuit-and-a-hefty-bill-from-the-city-of-irwindale
  13. http://www.sgvtribune.com/general-news/20160715/sriracha-maker-huy-fong-foods-countersues-irwindale-wants-750000-back
  14. http://www.seattletimes.com/nation-world/ruling-on-hot-sauce-factory-raises-job-worries/
  15. https://www.brookings.edu/blog/up-front/2017/02/07/a-spicy-red-sauce-and-how-immigrants-generate-jobs-and-growth-in-the-us/
  16. http://articles.latimes.com/2013/oct/28/local/la-me-ln-irwindale-sues-sriracha-20131028
  17. http://articles.latimes.com/2013/apr/12/business/la-fi-himi-tran-20130414
  18. http://www.tabasco.com/avery-island/visitor-information/
  19. http://www.tabasco.com/avery-island/visitor-information/
  20. http://nola14.nytimes-institute.com/2014/05/30/tabasco-sauce-holds-its-own/
  21. http://www.newsobserver.com/opinion/editorials/article148833834.html
  22. https://www.lawyersandsettlements.com/lawsuit/pig-hog-chicken-poultry-farm-nuisance.html