WFM Whole Foods Market, Inc.

By Jesse Newman and Heather Haddon 

Federal regulators issued a warning letter to executives at Whole Foods Market Inc. over "serious violations" discovered by the agency during a February inspection of a Massachusetts plant.

The U.S. Food and Drug Administration said, in a letter last Wednesday, that Whole Foods had failed to manufacture, package and store food under conditions required to reduce the potential for microorganism growth and contamination.

Violations included condensate dripping onto surfaces where food was being prepared and failure to maintain equipment in proper conditions.

In a March letter, Whole Foods had said it was taking the "observations seriously" and was committed to correcting the problems, according to the FDA. But federal regulators found the grocer's response inadequate, writing that Whole Foods failed to mention steps it would take to supervise food processing operations and compliance going forward.

"We do not consider your response acceptable because you failed to provide documentation for our review," the FDA wrote, also citing a lack of backup documentation in Whole Foods' response.

The Austin-based grocer didn't immediately respond to requests for comment Tuesday.

Whole Foods has been hit with several months of difficult financial results, with its same-store sales slumping in one of the worst declines since the recession.

The grocer also paid a fine of $500,000 following an investigation last year by the New York Department of Consumer Affairs for overcharging for a sweeping array of prepackaged foods in New York City. Company executives said there was no intentional misconduct.

Whole Foods' stock slid after the FDA report surfaced Tuesday, closing down 2.9% at $32.52. The slump was one of the biggest one-day percentage drops for the company this year.

Regulators gave Whole Foods until the end of the month to take action to remedy the FDA's complaints.

Write to Jesse Newman at jesse.newman@wsj.com and Heather Haddon at heather.haddon@wsj.com

(END) Dow Jones Newswires

June 14, 2016 16:47 ET (20:47 GMT)

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