Costco took meat supervisor’s ‘secret invention’ but never paid him for it, GA suit says
A Costco employee in Georgia said he got got nothing in return after he gave the big-box retailer a “secret invention” that helped save hundreds of thousands of dollars.
Now he’s suing.
Company officers at Costco Wholesale Corp. went back on their word to provide Ronald McLeod with money and other benefits if the invention — an automated meat ordering system — proved successful, according to a lawsuit moved to federal court this week.
The invention reportedly reversed significant inventory losses for Costco, McLeod’s lawyer said, and the company subsequently implemented it at other stores.
“Defendant Costco continues to use and benefit from plaintiff’s original and unique ideas, secrets, inventions, strategies, and formulas associated with the use and implementation of plaintiff’s system within its operations, with great success,” the lawsuit states.
McLeod first sued in the Superior Court of Coweta County on Dec. 15, court documents show. But Costco had the litigation moved to the Northern District of Georgia on Feb. 14, saying the dispute belongs in federal court because the Washington-based corporation is in another jurisdiction.
A lawyer representing McLeod and counsel for Costco did not immediately respond to McClatchy News’ request for comment on Feb. 18.
According to the complaint, McLeod was hired as a meat supervisor at a Costco store in Sharpsburg, Georgia, about 75 miles northwest of Macon, in March 2018.
Years earlier, in 2002, McLeod’s lawyer said he “developed a secret and confidential system designed to increase inventory accuracy, increase profits, and manage budgetary expenses associated with the commercial sale of meat and meat-related products.”
He reportedly introduced that system to Costco’s CEO and several managers at the beginning of October 2019 — more than a year after he started working there. According to the lawsuit, Costco agreed to try it and promised McLeod payment and other rewards if the invention performed well.
McLeod subsequently gave the company “certain novel secrets, inventions, strategies and formulas” related to the development of the system, his lawyer said. He then reportedly spent considerable time implementing it, often without pay or on his days off.
The system was officially implemented at his store in November 2019, according to the lawsuit.
McLeod’s lawyer said it was met with great success and reversed $230,000 in inventory losses, prompting Costco to implement it at another store in Alpharetta.
Despite the accomplishment, McLeod was not met with any rewards — financial or otherwise, his attorney said.
The lawsuit makes claims for fraudulent and negligent misrepresentation related to Costco’s broken promises as well as breach of contract and misappropriation of McLeod’s ideas. Costco has not yet responded to the complaint, court filings show.
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