Jalapeño farmer wins $23.3 million in heated dispute with Sriracha maker

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Jalapeño farmer wins $23.3 million in heated dispute with Sriracha maker
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Underwood Ranches was the sole grower of the chili peppers used in Sriracha until a bitter legal battle with Huy Fong Foods ended a nearly 30-year partnership

Craig Underwood of Underwood Ranches tosses jalapeño peppers into the air in a Ventura County field where they are grown.

“It certainly isn’t our nature to give up. We felt we had been wronged, so we were hoping we could right that through the court,” said Underwood, who manages the Camarillo farm. “When the verdict came down, there was a lot of celebrating. We celebrated at lunch. We celebrated at dinner. And then we celebrated the next day.”

Historically, Huy Fong would prepay Underwood Ranches for the estimated costs associated with growing and harvesting the chilies. The agreement was “partly oral, partly written and partly established by the parties’ practice,” court records show.The following month, Huy Fong Foods filed a lawsuit in Los Angeles County Superior Court, which later was moved to Ventura County, where Underwood’s business is located.

“When our relationship with Huy Fong fell apart, we didn’t know what we were going to do on the farm. But we’re pepper growers,” Underwood said. “So after a while, we just thought, ‘Why don’t we make our own line of sauces?’”

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