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Subway 'Footlong' settlement gets appeals court grilling

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Reuters reports on CEI's Center for Class Action Fariness's hearing in their objection to the Subway "footlong" settlement. 

A federal appeals court on Thursday cast doubt on the legitimacy of a settlement resolving claims that Subway tricked customers by selling "Footlong" subs that were less than a foot long.

A three-judge panel of the 7th U.S. Circuit Court of Appeals in Chicago heard arguments on a challenge by prominent class-action critic Ted Frank, who said the settlement gave too much money to lawyers and no relief to customers who felt shorted.

Lawyers for the plaintiffs were awarded $520,000, and $5,000 of "incentive awards" were awarded to 10 plaintiffs.

But Frank said the accord merely codified practices that Subway, operated by Doctor's Associates Inc, adopted in January 2013.

He said the settlement's "principal effect" was to "force the defendant to give money to lawyers, with nothing going to the class at all."

The plaintiffs' lawyers accused Frank of arguing that they should not be paid simply because there was no monetary relief.

Circuit Judge Diane Sykes, however, questioned the settlement itself, saying "very few" sandwiches fell short of 12 inches, customers could always ask for more food, and customers who already ate "short" sandwiches would get no benefit.

"There is just no argument for a consumer fraud action here," she said. "Any claim that the shape of the bread is material would be rejected as a matter of law as frivolous."

Read the full article at Reuters