U.S. Food Industry Dodging Big, Fat Lawsuits

One of the darkest days for many restaurant owners in the United States came in the summer of 2002, with the filing of a lawsuit that accused McDonald’s of making two of its loyal teenage customers in New York fat and unhealthy.

Late-night television comedians had a field day with the suit, but restaurant owners were not laughing: Pelman v. McDonald’s marked the second time in two months that lawyers tried to hold food companies responsible for America’s obesity crisis.

Food and restaurant companies, fearing they would be hammered with enormous judgments like the tobacco industry was, immediately began fighting back, waging an aggressive campaign to make it impossible for anyone to sue them for causing obesity or obesity- related health problems.

The National Restaurant Association, based in Washington, and its 50 state organizations, which represent large chains like McDonald’s and small independent businesses, led the campaign. Almost three years later, they have had astounding success. Twenty U.S. states have enacted versions of a “common- sense consumption” law. They vary slightly in substance, but all prevent lawsuits seeking personal injury damages due to obesity from ever being tried in their courts. An additional 12 states have similar pieces of legislation pending.

The existence of these “common- sense consumption” laws across almost half the United States reveals how an organized and impassioned lobbying effort, combined with a receptive legislative climate, can quickly alter the legal framework on a major public- health issue like obesity.

Although plaintiff’s lawyers are confident that there are ways around the new state laws, the measures, along with a class action reform bill that President George W. Bush signed into law this year, will probably make it harder for lawyers in obesity cases to win the kind of outsized awards seen in tobacco cases.

In most states, lobbyists for food companies and restaurants helped write the legislation and did much of the legwork in state capitols. Restaurant owners and food company executives personally visited state lawmakers, testified at hearings and steered campaign contributions to important lawmakers. Executives from Kraft and Coca- Cola showed up in Texas, for instance, to lobby for that state’s common-sense consumption bill, which was signed into law by Governor Rick Perry last month.

According to data from the Institute on Money in State Politics, in the 2002 and 2004 election cycles, the food and restaurant industry gave a total of $5.5 million to politicians in the 20 states that have passed laws shielding companies from obesity liability.

In Colorado, Pete Meersman, president and chief executive of the Colorado State Restaurant Association, started pushing for an obesity lawsuit bill after attending a conference in July 2003 that was organized by the National Restaurant Association. The conference was a gathering of executives from all 50 state organizations and the looming threat of more obesity litigation was a big topic of conversation.

“We wanted to make sure that frivolous lawsuits like this never made it to the discovery stage, which is where these things get expensive for businesses,” said Meersman, referring to Pelman and an earlier lawsuit filed by the same attorney that also named KFC, Burger King and Wendy’s as defendants.

As the United States grapples with the doubling and tripling of obesity rates in the past 25 years, the food industry stands firmly against efforts to make food or restaurant companies legally accountable for the problem. The National Restaurant Association and the 50 state associations lead a coalition of food industry interests, including the Grocery Manufacturers Association, the American Beverage Association and the Food Products Association.

Much of the food and restaurant industry acknowledges that obesity is a serious public-health issue. According to the Centers for Disease Control, 30 percent of American adults are obese and at risk for a host of associated disorders, like heart disease, diabetes, high blood pressure and arthritis. But they maintain that the best way to address this problem is through voluntary actions and consumer education.

“Our members are making a whole range of changes, everything from adding more fruit and salads to menus, to offering whole wheat bread as an option and selling more bottled water,” said Sue Hensley, a spokeswoman for the National Restaurant Association. “Lawsuits are just not productive.” Many trial lawyers disagree especially those who have worked on tobacco litigation and watched national smoking rates decline. They say lawsuits are an effective way to get food companies to change the way they operate and the kinds of products they sell. Since the surgeon general issued a “call to action” in 2001, warning that obesity could wipe out many of the health gains Americans have achieved in recent decades, the plaintiff’s bar has been threatening to turn food into the next tobacco.

Fast food companies are tackling serious obesity problems in Europe, too. To improve its nutrition reputation in England, for example, McDonald’s now offers and advertises an array of salads, as well as porridge and fruit for McBreakfast.

In late January, the U.S. restaurant industry suffered a setback when a panel of three federal appeals judges reinstated one aspect of the McDonald’s suit a deceptive practices claim alleging that the company has falsely presented its fast food as nutritionally beneficial to consumers. Three days later, McDonald’s chief financial officer, Matthew Paull, told investors that the company was setting aside new reserves for legal charges, though he did not say whether the funds were being earmarked for the obesity lawsuit.

John Banzhaf, a George Washington University Law School professor and an outspoken supporter of tobacco litigation, acknowledged that public opinion was not currently in favor of obesity litigation. But he added that the situation for tobacco was similar 15 years ago when people began suing cigarette companies for making smokers sick. “People laughed and said, ‘You won’t even get one of these cases to a jury,’” Banzhaf recalled. “Today it’s, ho hum, there’s another verdict.”