Hot Sauce Company Sues Manufacturer Over Exploding Bottles

A product liability dispute is bubbling between a popular salsa and hot sauces company and its manufacturer.

Iowa-based Lola’s Fine Sauces alleges in a lawsuit that it lost several hundred thousand dollars after customers complained that Lola’s bottled products bubbled, exploded and fermented after purchase. Lola’s alleges manufacturer EcoIdeas promised it would take remedial actions, such as filing an insurance claim, but is now claiming it has no insurance coverage.

Lola’s filed a lawsuit in December in Iowa district court, and the case has since been transferred to the U.S. District Court of Southern Iowa.

Lola’s products are sold nationwide at major retailers such as Target and Walmart.

According to Lola’s, the company entered into an agreement with Canadian-based EcoIdeas to manufacture mini bottles of Lola’s hot sauces to distribute to retailers. As part of the agreement, EcoIdeas would indemnify and hold Lola’s harmless against all damages, losses, costs and expenses arising out of defects.

In 2024, Walmart removed defective Lola’s products from its shelves over improperly packaged and labeled bottles, causing Lola’s to pay a billback of nearly $155,000, the lawsuit alleges.

Then in 2025, Lola’s began receiving calls and messages from customers that its bottles were bubbling, exploding and fermenting, with sauce in several bottles also being discolored, the company says.

Lola’s alleges the out-of-pocket harm to be approximately $525,000.

Lola’s says it sent EcoIdeas a written notice regarding the issues, and EcoIdeas acknowledged its breach of contract. After originally being told that the manufacturer would assume responsibility, Lola’s has since been given the cold shoulder, the company says.

“EcoIdeas is now claiming it has no insurance coverage, and it still has not provided information to Lola’s about the issues to allow Lola’s to pursue any type of insurance claim,” the lawsuit claims.

In a counterclaim, EcoIdeas denied it is liable to Lola’s for any incurred damages. The manufacturer said that any attempt by Lola’s to inject the issue of whether insurance coverage does or does not exist into the case is irrelevant and inadmissible.

EcoIdeas is seeking a jury trial.

The case is Lola’s Fine Sauces Inc. v. EcoIdeas Innovation Inc., S.D. Iowa, 4:26-cv-00021, 1/9/26.