Huy Fong Foods Inc., the company that manufactures those ubiquitous green-capped bottles of Sriracha, sued the company that provides their chili peppers earlier this week. According to NBC, Huy Fong Foods accused Underwood Ranches of breach of production agreement, breach of contract, and civil theft. Underwood Ranches has provided Huy Fong Foods with its chili peppers for the past 30 years.
The suit says that from 2008 to 2016 the Sriracha makers paid over $190 million and made pre-payments to Underwood Ranches. Until 2016, the chili pepper providers always returned any overpayments to Huy Fong. However, that year, Huy Fong says Underwood Ranches withheld $1.4 million. They have also held onto $7 million worth of equipment, provided to them by Huy Fong. "Underwood is holding Huy Fong's equipment hostage, severely impacting Huy Fong's ability to complete the 2017 harvest and greatly increasing the expense associated with the harvest," the suit says. Underwood has also refused previous requests to return the $1.4 million overpayment.
Apparently, the companies had worked together according to verbal agreements as well as written contracts, making this an even more complicated situation, especially if it goes to court.
Earlier this summer, Huy Fong announced they would be launching Sriracha Seasoning Stix, which are solid sticks of the sauce that can act as a sort of infused marinade for meat of all kinds.
In 2013, it was reported that Huy Fong sold 20 million bottles of Sriracha and brought in $60 million per year for the unadvertised hot sauce. (Presumably, that number has only sky rocketed since.)
So far, Huy Fong's suit against Underwood Ranches hasn't yet impacted the price or availability of Sriracha.