A New York state court has reportedly refused to grant the National Restaurant Association’s request for a preliminary injunction to stall the enforcement of New York City’s new requirement that chain restaurants label menu items containing 2,300 mg of salt or more, which is set to take effect March 1, 2016. Nat’l Restaurant Assoc. v. New York City Dept. of Health, No. 654024/2015 (N.Y. Super. Ct., New York Cty., order entered February 24, 2016). During the hearing, the court reportedly distinguished the rule from a ban on the ingredient, noting, “It’s not a ban. It’s information. It’s a warning.” Under the rule, chain restaurants must display a logo of a triangle with the image of a salt shaker next to applicable menu items or risk a $200 fine for each infraction. See Bloomberg, February 24, 2016. Issue 595
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Viacom International Inc. has filed a lawsuit against IJR Capital Investments alleging that a restaurant owned by the company infringes on Viacom’s intellectual property in the “SpongeBob SquarePants” franchise. Viacom Int’l Inc. v. IJR Capital Invs., No. 16-0257 (S.D. Tex., Houston Div., filed January 29, 2016). As the complaint explains, “The ‘Krusty Krab’ is owned by Eugene H. Krabs, a prominent and recurring character in the SpongeBob universe. SpongeBob SquarePants works at the ‘Krusty Krab’ as a fry cook, but he also performs a myriad of other duties, and once stated that his official title is ‘Vice Assistant General Manager in charge of certain things.’” IJR operates The Krusty Krab in Texas and has filed for trademark registration. Viacom argues that IJR is “attempting to trade off of the goodwill and reputation of the ‘SpongeBob SquarePants’ media franchise’ and that consumers are likely to be confused by IJR’s use of “Krusty…
A Shanghai court has reportedly fined three Chinese technology companies for their part in spreading rumors that KFC fare is produced with “mutant chickens” with eight legs and six wings. KFC filed a lawsuit in June 2015 seeking damages for economic losses and damage to its reputation. The court reportedly ordered the companies to make an official apology and pay a total of $91,191 (600,000 yuan) to KFC. Additional details about the lawsuit appear in Issue 567 of this Update. See Reuters, February 2, 2016. Issue 593
The Centers for Disease Control and Prevention has declared that two E. coli outbreaks linked to Chipotle Mexican Grill Inc. “appear to be over,” but the agency has not identified a food source for the outbreaks. “The epidemiologic evidence collected during this investigation suggested that a common meal item or ingredient served at Chipotle Mexican Grill restaurants was a likely source of both outbreaks,” the agency said. “When a restaurant serves foods with several ingredients that are mixed or cooked together and then used in multiple menu items, it can be more difficult for epidemiologic studies to identity [sic] the specific ingredient that is contaminated.” Meanwhile, Chipotle faces a joint investigation by the U.S. Food and Drug Administration and U.S. Department of Justice into a 2015 norovirus outbreak in one of its California restaurants. The company has reportedly been served an additional subpoena requiring it to produce documents on company-wide…
Chipotle Mexican Grill has reportedly been served with a grand jury subpoena as part of a U.S. Attorney’s Office and Food and Drug Administration criminal investigation into a California norovirus outbreak in August 2015 that sickened more than 200 people. The company’s fare was also linked to a norovirus outbreak in Massachusetts in December 2015. Chipotle’s food safety practices face additional scrutiny over an ongoing E. coli outbreak that has resulted in the closure of 43 Chipotle locations in Washington and Oregon and reports of related illnesses in several other states. See The New York Times, January 6, 2016. In a January 6 Form 8-K filing with the U.S. Securities and Exchange Commission, Chipotle reported a 14.6 percent drop in fourth quarter 2015 sales and non-recurring expenses related to its foodborne illness incidents of $14 to $16 million. Meanwhile, Pomerantz LLP announced on January 8 that it has filed a…
A law took effect in France on January 1, 2016, that requires restaurants to provide take-away boxes to diners who request them. The law reportedly targets the country’s rising food waste problem, but may have little impact—one government-commissioned report concluded that “the obstacle is mostly cultural” because “the majority of diners don’t dare to ask for the leftovers of their meal, while the restaurateurs see it as a ‘degradation’ of their dishes.” The French do not have a term for a take-away box; many reportedly call it “le doggy bag,” but a hotel and restaurant industry union is attempting to replace the term with “le gourmet bag.” See France 24, January 4, 2016. Issue 589
The National Restaurant Association (NRA) has petitioned a New York state court for a declaratory judgment stating that a New York City regulation requiring restaurants to post warnings on menu items high in sodium is arbitrary and capricious as applied. Nat’l Restaurant Assoc. v. New York City Dep’t of Health & Mental Hygiene, No. 654024/2015 (N.Y. Sup. Ct., filed December 3, 2015). The complaint compares the regulation to the city’s 2012 attempt to prohibit sales of soft drinks in cups larger than 16 ounces, alleging that the New York City Board of Health is merely “looking to grab headlines as the purveyor of ‘first in the nation’ health initiatives, notwithstanding that, in truth, its sodium regulation is illogical, unlawful, and more likely to mislead consumers about sodium health than help them.” NRA argues that the regulation, which took effect December 1, 2015, is “riddled with arbitrary exclusions and exemptions that…
New York City has appealed a trial court decision overturning a determination that expanded polystyrene foam (EPS) cannot be recycled, which had resulted in a municipal ban on the material. In re Restaurant Action Alliance, NYC, No. 100734 (N.Y. App. Ct., filed October 26, 2015). The appeal argues that the commissioner of the Department of Sanitation of New York conducted an extensive review over six months before reaching the determination that EPS could not feasibly be recycled and, thus, should be banned from commercial use within the city. “City Council prudently left determination of predictive questions about the future feasibility and sustainability of recycling foam waste to the judgement of the Commissioner,” the appeal argues. “[The trial court] was wrong to second guess the Commissioner’s determination based primarily on a short-term recycling plan proposed by the world’s largest foam manufacturer.” Additional information about the lower court’s ruling appears in Issue…
Subway has reached a settlement agreement in a case alleging its "footlong" sandwiches were not 12 inches in length. In re Subway Footlong Sandwich Mktg. & Sales Practices Litig., MDL No. 2439 (E.D. Wis., settlement agreement filed September 29, 2015). Under the agreement, Subway will require its franchisees to "use a tool for measuring bread in each Subway® restaurant to help ensure that the bread sold to customers is either 6 or 12 inches long" and will check for compliance during its monthly franchise inspections, with an increase in penalties for failure to measure up. If the court approves the agreement, Subway will pay each class representative $1,000 and the class counsel's attorney fees of $525,000, but no monetary awards will be distributed to class members. Additional information about the lawsuit appears in Issues 468 and 487 of this Update. Issue 582
The U.S. Department of Labor and New York Attorney General Eric Schneiderman have announced that four Papa John’s Pizza franchisees have agreed to pay $469,355 for labor violations. Back wages and damages will be distributed to 250 affected workers, to whom the franchisees failed to pay minimum and overtime wages and failed to provide one week’s worth of adequate uniforms. “Once again, we’ve found Papa John’s franchises in New York that are ripping off their workers and violating critical state and federal laws,” Schneiderman said. “Fast food chains across the state should be on notice: we will not stop until your workers are treated with respect and paid lawful wages. Once again, I call on Papa John’s and other fast food companies to step up and stop the widespread lawlessness plaguing your businesses and harming the workers who make and deliver your food.” See New York State Office of the…
