Costco Replies to Customer Complaints About Selling Baby Seal Oil Capsules - and Sea Shepherd's Rebuttal

A customer of Costco shared with us the form letter (below) received in response to an inquiry as to why they are selling seal oil capsules which are a product of the annual Canadian seal "hunt." Following, Sea Shepherd responds (in bold text) to each point.

Costco Wholesale & Omega 3 Seal Oil Capsule sales in St-John's Newfoundland and Labrador

Seattle, WA

April 7, 2006

Dear Costco Customer,

From time to time over the past few years, Costco has carried an over the counter product in its pharmacy in the St. John's, Newfoundland and Labrador, Canada, location that is a byproduct of oil derived from Canadian seals. It is a product that is requested by members in that one location.

Costco has been urged over the years to discontinue the product by various parties, notably by the Sea Shepherd Conservation Society, who are opposed to the seal hunt in Canada.

Costco has never taken a position on the controversy between various parties and the Canadian and Newfoundland and Labrador governments regarding the seal hunt. We have consistently made it clear to all parties that we do not take political positions, and our actions should not be misconstrued as such.

Sea Shepherd: Indeed, Costco has taken a position on the seal hunt. The position is that they support the slaughter of baby seals because they are marketing a product obtained from this cruel and massive annual massacre of seals. To say they do not support the seal hunt as they sell products from the seal hunt is akin to a slave owner saying they did not condone slavery.

On March 1, recognizing that the sale of the seal oil capsule product was limited to a single location in Newfoundland and Labrador, Canada, and in light of the very small dollar value of the sales in a single location, Costco made a business decision to discontinue the item. The item has not been carried in any of Costco's 346 locations in the United States.

Sea Shepherd: In fact, Costco made the decision in response to numerous Sea Shepherd requests to remove the product. In 2004, they removed the product and informed Sea Shepherd that they had done so. They then quietly restocked the product. When Sea Shepherd found out that they had done so, Costco again agreed to remove the product and stated in writing that they would do so and that they would not restock the product again. A week later, they again reneged on this promise.

While there were conversations with the Sea Shepherd Conservation Society, the decision to discontinue the product had nothing to do with the Sea Shepherd Conservation Society. Our decision to place or pull a product from our shelves is never based on politics.  Each item must stand on its own commercial merits.

Sea Shepherd: Two years of correspondence is evidence that Costco did make the decision after negotiations with Sea Shepherd. This statement is simply not true.

In its March 30 press release, the Sea Shepherd Conservation Society falsely stated that Costco had removed the product from its shelves across Canada (it had been carried in only the St-John's location) and that this action was intended by Costco as a statement of its opposition to the seal hunt (Sea Shepherd knew that we were intending no such statement).

Sea Shepherd: Sea Shepherd had, in fact, informed Costco in advance that this news would be shared publicly and Costco did not object.

As a direct result of the Sea Shepard Conservation Society's actions, Costco has been made an unwilling participant of the media blitz surrounding the Canadian seal hunt, and has faced a firestorm of protest from its members in Newfoundland and Labrador, as well as from the government of Newfoundland and Labrador, protesting the removal of the product.

Sea Shepherd: Costco is not an unwilling participant in the media blitz surrounding the Canadian slaughter of seals. Costco willingly decided to support the seal slaughter by marketing baby seal oil in their Newfoundland outlet. Costco is now intending to sell this obscene product in other Canadian stores. They cannot sell this product in U.S. stores because the sale of seal oil is illegal in the United States.

As a result of member demand in the only Costco location where Omega 3 seal oil capsules were sold, we informed the appropriate governments and our members of our intent to restore the product to that single location. We recognize that some outside of Newfoundland and Labrador may wrongly construe this as a political statement; however, our decision to restock the product in St. John's is consistent with our company policy of being guided solely by the commercial merit of an item.

Sea Shepherd: The decision to restock was a political statement of support for the sealing industry. If Costco is guided by the demands of their customers, they will remove this product from their Canadian stores in response to membership protests.

If you would like to let Costco know how you feel about the fact that they sell a product derived from dead baby seals:

CEO of Costco:

Jim Sinegal
Chief Executive Officer

Karen Paulsell
Administrative Assistant to Jim Sinegal
Direct phone: 425-313-8565
Fax: 425-313-8103

Shareholders - Two contacts best used by anyone who holds shares in Costco or who is thinking about purchasing shares:

Sharon Rugh
Executive Assistant to Richard Galanti
Direct phone: 425-313-8256
Fax: 425-313-6593

Richard Galanti
Chief Financial Officer
Direct phone: as of yet unknown

Canadian Senior Executives - Costco's top decision-makers in Canada (the ones who ultimately pushed to restock the shelves with seal oil caps):

Louise Wendling
Senior Vice President of Costco Canada
Direct phone: 613-221-2000 ext. 2020
Fax: 613-221-2001

Pierre Riel
Senior VP and General Manager for Eastern Canada
Direct phone: 613-221-2000 ext. 2003
Fax: 613-221-2001

Pharmaceuticals - Two individuals in Canada in charge of Costco's pharmaceutical division which handles the seal oil product:

Reza Farmand
Director of Pharmacy
Direct phone: 613-221-2313
Fax: 613-221-2001

Mitch Johnston
Buyer - Canadian Pharmacies
Direct phone: 613-221-2385