McDonald's legal cases
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McDonald's has been involved in a number of lawsuits and other legal cases the course of the fast food chain's 66-year history. Many of these have involved trademark issues, but McDonald's has also launched a significant number of defamation suits.
McDonald's has been criticised for its liberal use of the court system, which its opponents say has been used to silence criticism and stifle competition from other businesses [citation needed]. McDonald's contends it is merely protecting its corporate interests from undue attack [citation needed].
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[edit] Defamation disputes
[edit] Cases brought by McDonald's
[edit] McLibel (UK)
- Main article: McLibel
In 2002, McDonald's took environmental campaigners Helen Steel and Dave Morris to court after they distributed leaflets entitled What's wrong with McDonald's? on the streets of London. The high-profile trial, which came to be known as the McLibel Case, lasted two and a half years, the longest in English legal history.
Though a High Court judge eventually ruled in favour of McDonald's, it was something of a Pyrrhic victory. The extended legal battle was a PR disaster, with every aspect of the company's working practices being scrutinised and the media presenting the case as a David and Goliath battle. Additionally, the damages received were negligible compared to the company's estimated £10 million legal costs because the court ruled in favour of a number of the defendants' claims, including that McDonald's exploited children in its advertising, was anti-trade union and indirectly exploited and caused suffering to animals. McDonald's was awarded £60,000 damages, which was later reduced to £40,000 by the Court of Appeal. Steel and Morris announced they had no intention of ever paying, and the company later confirmed it would not be pursuing the money. Steel and Morris went on to challenge UK libel laws in the European Court of Human Rights, claiming that the lack of access to legal aid and the heavy burden of proof that lay with them, as the defendants to prove their claims under UK law was a breach of the right to a fair trial and freedom of expression. The court ruled in their favour and the UK Government was forced to introduce legislation to change defamation laws.
[edit] Trademark and copyright disputes
[edit] Cases brought by McDonald's
McDonald's has also been criticized for its approach to preserving its image and copyrights [citation needed]. It has threatened many foodservice businesses with legal action unless they drop the Mc or Mac from their trading name.
[edit] McCoffee (US)
In 1994, McDonald's successfully forced Elizabeth McCaughey of the San Francisco Bay Area to change the trading name of her coffee shop McCoffee, which had operated under that name for 17 years. "This is the moment I surrendered the little 'c' to corporate America," said Elizabeth McCaughey, who had named it as an adaptation of her surname [1].
[edit] McChina Wok Away (UK)
In 2001, McDonald's lost a nine-year legal action against Frank Yuen, owner of McChina Wok Away, a small chain of Chinese takeaway outlets in London. Justice David Neuberger ruled the McChina name would not cause any confusion among customers and that McDonald's had no right to the prefix Mc [2]. (McChina UK vs McDonald's USA)
[edit] McMunchies (UK)
In 1996, McDonald's forced Scottish sandwich shop owner Mary Blair of Fenny Stratford, Buckinghamshire to drop McMunchies as her trading name. Mrs. Blair did not sell burgers or chips. She said she chose the name because she liked the word munchies and wanted the cafe to have a Scottish feel. The cafe's sign reflected this, featuring a Scottish thistle and a St Andrew's flag. But in a statement to Mrs. Blair's solicitors, McDonald's said if someone used the Mc prefix, even unintentionally, they were using something that does not belong to them. [citation needed]
[edit] McAllan (Denmark)
In 1996, McDonald's lost a legal battle at the Danish Supreme Court to force Allan Pedersen, a mincemeat sandwich vendor, to drop his shop name McAllan [3]. Pedersen had previously visited Scotland on whisky-tasting tours. He named his business after his favourite brand of whisky, MacAllan's, after contacting the distillery to see if they would object. They did not, but McDonald's did. However, the court ruled customers could tell the difference between a one-man vendor and a multi-national chain and ordered McDonald's to pay 40,000 kroner ($6,900) in court costs. The verdict cannot be appealed.
[edit] McCurry (Malaysia)
In 2006, McDonald's won a five year legal battle in Malaysia against a small restaurant named "McCurry". The defendant claimed that McCurry stood for Malaysian Chicken Curry, but a High Court judge ruled that the prefix Mc and the use of colours distinctive of the McDonald's could confuse and deceive customers. [4]
[edit] South African patent law
Apartheid politics had prevented earlier expansion into South Africa, but as the apartheid regime came to an end in the early 1990s, McDonald's decided to expand there. The company had already recognized South Africa as a potentially significant market and had registered its name as a trademark there in 1968.
Under South African law, trademarks cease to be the property of a company if they are not used for a certain amount of time. McDonald's had renewed the 1968 registration several times, but missed a renewal deadline. The registration expired and McDonald’s discovered two fast food restaurants in South Africa were trading under the name MacDonalds. Worse, a businessman had applied to register the McDonald’s name.
Multiple lawsuits were filed. McDonald’s was stunned when the court ruled it had lost the rights to its world-famous name in South Africa. However, the company eventually won on appeal [5].
[edit] The real Ronald McDonald (US)
The company waged a 26-year legal action against a family restaurant in Illinois opened by a man named Ronald McDonald in 1956. [6]
[edit] Cases brought against McDonald's
[edit] McSleep (Quality Inns International)
In 1988 Quality Inns was planning to open a new chain of economy hotels under the name "McSleep." After McDonald's demanded that Quality Inns not use the name because it infringed, the hotel company filed a suit in federal court seeking a declaratory judgment that "McSleep" did not infringe. McDonald's counterclaimed, alleging trademark infringement and unfair competition. Ultimately, McDonald's prevailed. The court's opinion noted that the prefix "Mc" added to a generic word has acquired secondary meaning, so that in the eyes of the public it means McDonalds, and therefore the name "McSleep" would infringe on McDonald's trademarks. Quality Inns Int'l v. McDonald's Corp. 655 F.Supp. 198 (D.Md. 1988).PDF
[edit] Viz top tips (UK)
Charles Griffis was not the only black franchiser to sue McDonald's over its redlining, i.e., not allowing its black franchisers to buy outlets in white areas. The NAACP http://www.naacp.org filed an amicus brief in support of Griffis. The case was settled out of court.
Tens of thousands of lawsuits regarding food poisoning, incidents such as chicken heads in McNuggets are not a public record since McDonald's usually settles out of court and has the court records sealed. http://www.pcrm.org
In 1996, British adult comic Viz accused McDonald's of plagiarising the name and format of its longstanding Top Tips feature, in which readers offer sarcastic tips. McDonald's had created an advertising campaign of the same name, which showcased the Top Tips (and then suggested the money-saving alternative - going to McDonald's). Some of the similarities were almost word-for-word:
- "Save a fortune on laundry bills. Give your dirty shirts to Oxfam. They will wash and iron them, and then you can buy them back for 50p." – Viz Top Tip, published May 1989.
- "Save a fortune on laundry bills. Give your dirty shirts to a second-hand shop. They will wash and iron them, and then you can buy them back for 50p." – McDonalds advert, 1996
The case was settled out of court for an undisclosed sum, which was donated to the charity appeal Comic Relief. However, many Viz readers believed that the comic had given permission for their use, leading to Top Tips submissions such as: "Geordie magazine editors. Continue paying your mortgage and buying expensive train sets ... by simply licensing the Top Tips concept to a multinational burger corporation."
[edit] Worker rights and union disputes
[edit] Cases brought against McDonald's
[edit] Coalition of Immokalee workers (US)
In March 2006, the Coalition of Immokalee Workers, a group of South Florida farmworkers, began a campaign demanding better wages for the people who pick the tomatoes used by McDonald's and other fast food companies [citation needed]. McDonald's is the second target after the group succeeded against Taco Bell [citation needed]. McDonald's Corporation has claimed that their SAFE (Socially Accountable Farm Employer) program is equal to or superior to the historic agreement between the CIW and Taco Bell. SAFE was initially represented, in November 2005, by CBR Public Relations Firm. According to their website, CBR-PR has "in-depth" experience handling "activist response management." SAFE, unlike the Taco Bell agreement, does not include a wage increase, worker participation, worker support or basic buying transparency. The program is run by the Florida Fruit and Beverage Association and the Redlands Christian Migrant Association (a childcare provider with no experience in labor issues). As the Florida Fruit and Vegetable Association represents farmers who have an interest in reducing costs, often at the expense of farmworkers, this represents a conflict of interests. Under SAFE, farmworkers themselves continue to be excluded from monitoring the conditions under which they work. According to the Robert F. Kennedy Center for Human Rights, "By partnering with SAFE and embracing its weak expectations — which don't include even such fundamental labor standards such as the right to overtime pay and freedom of association — McDonald's is setting the bar even lower for its American agricultural producers than it does for its suppliers in communist China." Until victory is won, the CIW and the rest of the Alliance for Fair Food, including The Student/Farmworker Alliance, The Robert F. Kennedy Memorial Center for Human Rights, and The Presbyterian Church (USA) will continue to pressure McDonald's to support human rights.
[edit] Child exploitation (UK)
In July 2001, McDonald's was fined £12,400 by British magistrates for illegally employing and over-working child labor in one of its London restaurants [citation needed]. This is thought to be one of the largest fines imposed on a company for breaking laws relating to child working conditions.
[edit] Advertising standards disputes
[edit] Cases brought against McDonald's
[edit] Fries advertisement (UK)
In 2003, a ruling by the UK Advertising Standards Authority determined that the corporation had acted in breach of the codes of practice in describing how its French fries were prepared[7]. A McDonald's print ad stated that "after selecting certain potatoes" "we peel them, slice them, fry them and that's it." It showed a picture of a potato in a McDonald's fries box. In fact the product was sliced, pre-fried, sometimes had dextrose added, was then frozen, shipped, and re-fried and then had salt added.
[edit] Health and safety disputes
[edit] Cases brought against McDonald's
[edit] The McDonald's coffee case (US)
- Main article: Liebeck v. McDonald's Corp.
In 1992, McDonald's settled with Stella Liebeck, a 72-year-old woman from Albuquerque, New Mexico, who suffered third-degree burns from hot coffee that she ordered at one of the company's drive-thrus. [8]. The lawsuit, which became known as the "McDonald's coffee case", is a well-known product liability lawsuit in the United States that became a flashpoint in the debate in the US over tort reform.
Liebeck was in the passenger seat of her grandson's car when the accident happened. After receiving the order, her grandson pulled the car forward and stopped so she could add cream and sugar to her coffee. She placed the cup between her knees and attempted to remove the plastic lid from the cup. As she did, the entire contents spilled into her lap. The sweatpants she was wearing absorbed the coffee and held it next to her skin. Liebeck suffered third-degree burns over her inner thighs, perineum, buttocks, genitals and groin. She was hospitalised for eight days, during which time she underwent skin grafts and debridement treatments.
Libeck tried to settle the claim for $20,000 to cover her medical costs, but the company offered only US$800. During the case, the company produced documents showing more than 700 claims by people burned by its coffee between 1982 and 1992. Some had also sustained third-degree burns.
McDonalds served the coffee at a temperature of nearly 200°F, which can cause third degree burns in a matter of seconds. McDonalds maintained that coffee must be heated to this temperature to be brewed to taste best. A McDonalds' quality assurance manager testified in this case that the coffee, as served by McDonalds, was not fit for consumption because it would burn the mouth and throat.
The jury awarded Liebeck $200,000 in compensatory damages, which was later reduced to $160,000 because the jury found Liebeck 20% at fault. It also awarded Liebeck $2.7 million in punitive damages. The trial court subsequently reduced the punitive award to $480,000, even though the judge called McDonalds' conduct reckless, callous and willful.
The case has become symbolic of trivial lawsuits and a lack of consumer responsibility in popular culture and has spawned a commonly forwarded email, The Stella Awards, which consists of fabricated lawsuits that are claimed to be true.
[edit] See also
[edit] External links
- McDonald's official worldwide website
- McSpotlight, an 'Anti-McDonald's extravaganza', which includes extensive though not very well referenced coverage of legal cases from an anti-capitalist viewpoint.
- McDonald's in the news - an extensive list of links to news articles about McDonald's, including coverage of legal cases, from a website aimed at franchisees of the company.
- SupersizeMyPay.Com, a union campaign to organise McDonalds workers and drive up the price of a hamburger
[edit] References
- Big Mac Versus the Little People by Jim Carey, The Guardian, April 15, 1995, retrieved September 19, 2006. See also: http://www.mcspotlight.org/media/press/littlepeople.html
- Article about the McChina Wok Away case
- Commentary from the Legal Minds Community about McDonald's lawsuit against Allan Pedersen, who runs a sausage stand named McAllan's in Silkeborg, Denmark.
- McDonald's wins McCurry war in Malaysia, Reuters, September 8, 2006 See also: http://go.reuters.com/newsArticle.jhtml?type=oddlyEnoughNews&storyID=13430850&src=
- Article from the Sentient Times reviewing Naomi Klein's book No Logo, in which Klein cites the 'real Ronald McDonald' case (see discussion).
- Commentary on McDonald's and South African patent law, from South African law firm Gammage & Burnham
- The Advertising Standards Authority's ruling on McDonald's fries
- Fact Sheet: McDonald's Scalding Coffee Case, from the Association of Trial Lawyers of America
