J.D Vance-Funded Startup Was Hit By Employee Disillusionment

There was a “shocking amount of turnover” at a JD Vance-funded startup that was supposed to help rural families, a lawsuit has claimed.

AppHarvest employees complained that they were so poorly trained that many of the vegetables and fruits they grew went to waste—but the damaged crops were allegedly hidden before visits by news media and investors.

The company filed for bankruptcy in 2023 with $341 million in debt.

Vance, an Ohio senator and Donald Trump’s vice presidential running mate, had hailed AppHarvest as a way to keep jobs in Appalachia, a major theme of his political career.

The company built a 2.8 million square foot greenhouse in Morehead, Kansas, to grow fruit and vegetables.

Vance invested $150,000 in the company and was named on the board of directors in March 2017, according to his Senate disclosures. He is not named in the lawsuit and there is no suggestion that he is personally to blame for the complaints.

AppHarvest was founded on January 19, 2018, and was a domestic producer of fruits and vegetables and, grew all of its crops indoors “utilizing Controlled Environment Agriculture,” according to the suit.

Newsweek sought email comment on Wednesday from Vance’s campaign and from AppHarvest’s attorney.

An investor lawsuit in New York federal court claimed that the company employees were so badly trained and overworked that much of the produce was very poor quality or a complete waste.

The company settled the claim for $4.85 million in March, 2024 and the settlement was approved by a federal judge.

The lawsuit used interviews with former employees to allege a culture of exhaustion and disillusionment.

“According to a confidential witness (“CW1″), a former Crop Care Specialist at the Morehead Facility who was employed from October 2020 through July 2021, AppHarvest workers damaged a ‘shocking amount’ of tomatoes in the Morehead Facility,” because of worker disillusionment and undertraining, the lawsuit states.

“CW1 stated that to mitigate lost productivity, AppHarvest increased the Company’s hourly requirements, which in turn caused massive worker dissatisfaction and a ‘shocking’ amount of turnover,” the lawsuit adds.

“CW1 observed that personnel ‘began jumping ship’ as soon as AppHarvest changed its hours policy and that, prior to the first harvest, at least one person a week from CW1’s team left the Company.”

“CW1 estimated that two to three employees left the Company every week throughout CW1’s tenure.”

The investors claimed they lost their investment when the company was forced to reveal its employee problems in SEC disclosures.

According to the lawsuit, one confidential witness, CW4, a former Group Lead of Crop Care Specialists who worked at AppHarvest from October 2020 to September 2021, took photos of the waste at the Morehead Facility in approximately May or June of 2021, “which the witness stated was representative of how the entire greenhouse looked through the duration of the harvesting season, except for when news media or investors visited and it was deemed necessary to ‘hide the waste.'”

AppHarvest investors claimed in their court filings that they were misled about worker training and the company’s tomato production standards.

“Another confidential witness (“CW2″), a former AppHarvest Quality Control Specialist at the Morehead Facility from January 2021 through March 2021, stated that the tomatoes that reached the packhouse from the greenhouse ‘constantly’ had holes, cuts, scars, spots, were leaking fluid or flesh, or had other imperfections,” the lawsuit states.

The lead plaintiff, investor Alan Narzissenfeld, lost his $391,000 investment in AppHarvest.

The plaintiffs claimed AppHarvest, which went public in January 2021, had failed to tell them about the huge staffing retention problem and the lack of adequate training.

The Morehead greenhouse was built over approximately sixty-three acres and was hailed by Vance as a way to keep jobs in rural America.