Independent lab tests indicate Teavana teas contain pesticides, says Glaucus
Glaucus Research sent thirteen of Teavana's (TEA) most popular teas to an accredited lab in Germany for testing. The results indicate Teavana's teas contain pesticides in the amounts that exceed U.S. and EU regulatory limits. Glaucus believes Starbucks (SBUX) is buying a "massive liability" in Teavana given the Federal Trade Act and state consumer protection laws prohibit deceptive marketing and notes Teavana markets its teas as either "Organic" or "European Organic." The firm believes Starbucks has been deceived by Teavana's statements and will eventually walk away from the transaction. Glaucus rates Teavana a Strong Sell.