Confidential
Settlement – $8,515,000Judge
Court
Marin Superior
Attorneys
Plaintiff
Defendant
Facts
BanTransFats.com Inc. is a non-profit corporation that campaigns to have trans fatty acids (TFAs) eliminated from foods. Trans fatty acids are created by partial hydrogenation of oils and were alleged to cause an increase in dangerous LDL cholesterol and a reduction in beneficial HDL cholesterol, as well as other health problems. In 2002, McDonald's Corporation announced through a press release and a publicity campaign that it would be changing to a new cooking oil by March 2003. The new oil would result in a reduction of TFAs in McDonald's fried foods, including a 48 percent reduction in TFAs in French fries, and a 16 percent reduction in saturated fat. On Feb. 28, 2003, McDonald's issued a press release announcing an indefinite delay in changing the oil. BanTransFats.com sued McDonald's for injunctive relief under the California Business and Professions Code for false advertising. A separate class action suit was also brought by Katherine Fettke for alleged violations of consumer protection statutes in all 50 states and the District of Columbia, fraud, breach of contract, negligence and other causes of action.
Settlement Discussions
$7 million was donated by the defendant to the American Heart Association. $1.5 million was spent on publishing notices to the public regarding the TFA initiative. The plaintiffs were awarded $7,500.
Damages
BanTransFats.com requested that McDonald's be ordered to place notices in the media to ensure that its California customers were informed that the oil had not been changed. The plaintiffs in the nationwide class action requested damages to be distributed on a cy pres basis.
Result
McDonald's agreed to spend $1.5 million to publish media notices nationwide. It also agreed to donate $7 million to the American Heart Association for programs regarding TFAs. It also agreed to pay $7,500 to BanTransFats.com and $7,500 to representative plaintiff Katherine Fettke.
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