A federal court has dismissed with prejudice a data-breach suit filed by a group of credit unions against Noodles & Co., holding that the restaurant had no independent duty of care to the unions distinct from its contractual agreements with MasterCard and Visa. SELCO Cmty. Credit Union v. Noodles & Co., No. 16-2247 (D. Colo., order entered July 21, 2017). The plaintiffs, four credit unions whose cardholders’ information was compromised by the data breach, sued for negligence, negligence per se and declaratory relief, claiming they lost revenue due to decrease in card usage after the breach was publicized and incurred costs related to canceling and reissuing cards, responding to cardholder inquiries and monitoring accounts. The court held that economic loss rules in both Colorado and the unions’ home states barred recovery in tort for purely financial losses caused by negligence. Further, the court found, no independent duty exceptions to those…
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Two consumers have filed lawsuits alleging they contracted norovirus after eating at one of Chipotle Mexican Grill’s locations. Hogan v. Chipotle Mexican Grill, No. 109599 (Va. Cir. Ct., Loudoun Cty., filed July 26, 2017); Moore v. Chipotle Mexican Grill, No. 109660 (Va. Cir. Ct., Loudoun Cty., filed July 26, 2017). Both complaints allege negligence and breach of implied warranties, and each plaintiff seeks $74,000 in damages and attorney’s fees. The Loudoun County Health Department has identified more than 135 people who became ill after eating at Chipotle’s Sterling, Virginia, restaurant between July 13-16, 2017, and confirmed that two people tested positive for the same strain of norovirus. On July 19, federal prosecutors served Chipotle with a new subpoena seeking details about the outbreak. In 2015, the U.S. Attorney’s Office for the Central District of California began a criminal investigation into a series of norovirus, E. coli and Salmonella outbreaks traced…
A KFC Corp. franchisee that sells halal chicken has filed a lawsuit against the company, alleging the franchise agreements did not disclose a purported company policy preventing franchisees from making religious claims about their food. Lokhandwala v. KFC Corp., No. 17-5394 (N.D. Ill., filed July 24, 2017). The plaintiff, who owns and operates eight franchises, began advertising and selling halal chicken in 2003, and KFC allegedly assisted with locating approved poultry suppliers and distributors of halal-certified chicken. In 2016, the plaintiff asserts, the company informed him that it had a policy dating back to 2009 prohibiting religious claims about KFC products, “citing a risk of lawsuits and consumer confusion.” The plaintiff alleges the policy was not disclosed in any of his franchise agreements, violating the Illinois Franchise Disclosure Act; he further alleges that his “customer base and business revenue is heavily dependent on the sale of Halal chicken to the Muslim community”…
A California consumer has filed a putative class action against Dunkin’ Brands Group alleging that Dunkin' Donuts deceived customers into believing its blueberry and maple products contained “real” blueberries and maple syrup or sugar instead of artificial flavorings. Babaian v. Dunkin’ Brands Grp., No. 17-4890 (C.D. Cal., filed July 3, 2017). The plaintiff contends that the chain’s use of the terms “blueberry” and “maple” in doughnut names represent to consumers that the products contain “real ingredients” and that Dunkin’ has a duty to disclose the use of artificial flavorings. Further, the plaintiff asserts that whether the doughnuts actually contain “real ingredients” is material to a “reasonable” consumer’s purchase decision because of the antioxidant properties and health benefits of both blueberries and maple syrup. Claiming breach of warranties, breach of contract, fraud, intentional and negligent misrepresentation, quasi-contract and violations of California consumer-protection laws, the plaintiff seeks class certification, damages, restitution and…
A New York plaintiff has filed a proposed class action against Dunkin’ Brands alleging the chain’s "Angus Steak" breakfast sandwiches contain beef patties rather than Angus steak. Chen v. Dunkin’ Brands, No. 17-3808 (E.D.N.Y., filed June 25, 2017). The complaint alleges that the restaurant’s “Angus Steak and Egg Sandwich” and “Angus Steak and Egg Snack N’ Go Wrap” do not contain “steak” but instead a beef patty of “minced meat which contains ‘fillers and binders.’” Claiming violations of state consumer-protection laws and the Magnuson-Moss Warranty Act, unjust enrichment, breach of warranties and negligent misrepresentation, the plaintiff seeks class certification, disgorgement, damages and attorney’s fees. Issue 640
A consumer has filed a putative class action alleging Chipotle Mexican Grill, Inc. failed to take measures to prevent an April 2017 data breach in which hackers used malware to steal customer data from the magnetic stripes on payment cards. Baker v. Chipotle Mexican Grill, Inc., No. 17-1134 (C.D. Cal., filed June 9, 2017). The complaint alleges that Chipotle failed to take “adequate and reasonable measures” to protect its data systems, which reportedly contain personally identifiable information in addition to payment card data. The plaintiff seeks class certification, equitable relief, damages and attorney’s fees. Issue 638
The Center for Science in the Public Interest (CSPI) and National Consumers League have filed a lawsuit alleging the U.S. Food and Drug Administration’s (FDA’s) decision to delay implementation of rules requiring chain restaurants and food sellers to display nutritional information violated the Administrative Procedure Act. Ctr. for Sci. in the Pub. Interest v. Price, No. 17-1085 (D.D.C., filed June 7, 2017). The plaintiffs allege that the agency “repeatedly delayed” the compliance date for the nutritional labeling rules, which were originally scheduled to take effect in December 2015. One day before the revised enforcement date in May 2017, FDA announced that compliance would be delayed until May 2018. The plaintiffs request that the court vacate the delay. Additional details on the delay announcement appear in Issue 633 of this Update. “The Trump administration’s delay of menu labeling ill serves consumers, who need and want better information about their food choices,” CSPI Director of Nutrition Policy Margo G. Wootan said in a June…
A federal court has given preliminary approval to a class action settlement in which Cracker Barrel restaurants will develop a disability-access compliance policy for parking facilities at its locations. Heinzl v. Cracker Barrel Old Country Store, No. 14-1455 (W.D. Pa., order entered May 15, 2017). The settlement agreement requires Cracker Barrel to develop a survey form to assess whether the parking facilities at all of its locations comply with the 2010 Americans with Disabilities Act Standards For Accessible Design. The company will then assess and ensure that parking at the 107 locations identified by the plaintiff are brought into compliance. The agreement also includes annual reporting and monitoring provisions. The court will accept objections to the settlement from members of the class until July 13, 2017, and hold a fairness hearing in August. Issue 635
Five Guys has moved to dismiss an Americans with Disabilities Act (ADA) complaint from a blind plaintiff allegedly unable to use the burger chain’s website, arguing that the plaintiff cannot prove she was denied access to a “place of public accommodation” because the statute is limited to physical facilities. Marett v. Five Guys Enters, No. 17-0788 (S.D.N.Y., memorandum filed May 15, 2017). The plaintiff points to a federal circuit split on the issue and has asked a New York federal court to follow the Second Circuit, which has held that the ADA guarantees “more than mere physical access” and that the “website is a service of the physical location.” The plaintiff claims that Five Guys’ website, which allows online ordering in addition to general restaurant and menu information, is inaccessible to blind patrons despite the existence of “readily available technological solutions.” Issue 635
New York City is reportedly considering a bill that would require curbside recycling of expanded polystyrene foam (EPS) containers. The city’s Sanitation Department is currently under a court mandate to develop a plan to collect and clean EPS containers. New York City previously attempted to ban EPS containers in 2013, but a court invalidated the prohibition after a challenge by several food companies, supermarkets and foodservice businesses. Additional details on the decision and the city’s appeal appear in Issues 579 and 583 of this Update. See Huffington Post, May 4, 2017; New York Post, May 7, 2017. Issue 634
