Reuters discusses the Subway class-action settlement with Ted Frank.
A U.S. federal appeals court on Friday threw out a class-action settlement intended to resolve claims that the Subway sandwich chain deceived customers by selling “Footlong” subs that were less than a foot long.
The 7th U.S. Circuit Court of Appeals in Chicago called the settlement “utterly worthless,” even as it rewarded the customers’ lawyers for convincing Subway it was better to make the case go away than fight.
A settlement approved by a Wisconsin federal judge in February 2016 required Subway to adopt quality control measures, consistent with “the realities of baking bread,” to ensure that its six- and 12-inch sandwiches were that length.
But a prominent class-action critic, Ted Frank, said this merely codified practices Subway adopted soon after Corby’s photo went viral.
He said it made no sense to award $520,000 to the customers’ lawyers, plus $5,000 of “incentive” awards to 10 plaintiffs, for settling.
The 7th Circuit has jurisdiction in Illinois, Indiana and Wisconsin. Frank said he hoped courts elsewhere will apply its lessons.
"This is exactly the opinion we were hoping for," Frank said in an interview. "It affirms the principle that when attorneys bring class actions to benefit only themselves, it's an abuse of the system, and courts should not tolerate it."
Read the full article at Reuters.