McDonald's Settles Fat Lawsuit for $8.5 Million

February 15, 2005

Fast food giant chain McDonald's has agreed to donate $7 million to the American Heart Association to settle lawsuits over the type of fat it uses in its cooking.

The burger and fries restaurant chain will also spend $1.5 million to raise awareness of the unhealthy effects of trans fats, as part of the settlements reached over an action brought by the San Francisco Web site, bantransfats.com, and a separate nationwide class action suit brought with a plaintiff named Katherine Fettke.

Trans fats are meant to increase the shelf-life of cooking oil, but health experts say they boost cholesterol levels considerably.

Bantransfats.com brought its lawsuit against McDonald's because the food chain failed to live up to a promise it made in September 2002 to customers that it would reduce its use of trans fats. Plaintiffs claimed in the lawsuits that McDonald's did not take sufficient steps to inform the public that it had not changed the oil.

The settlements require McDonald's to give effective notice to the public that the oil was not changed.

In addition, McDonald's will donate $7 million to the American Heart Association to be used for public education regarding trans fat and encouraging substitutions.

McDonald's is also required to spend up to $1.5 million on publishing notices to ensure that the public knows the status of its trans fat initiative. If the cost of publishing the notices is less than $1.5 million, the difference will be donated to the American Heart Association.

McDonald's will pay $7,500 to bantransfats.com, and $7,500 to plaintiff Katherine Fettke which she said she is donating to charity.

McDonald's will pay legal fees, costs and expenses to plaintiffs' counsel, in an amount to be determined by the court, which will be separate from and in addition to the $7 million donation to the American Heart Association and the $1.5 million to notify McDonald's customers about the delay.

The California Superior Court for Marin County has entered an order preliminarily approving the settlement.

McDonald's noted that its continuing with its "ongoing initiative" to remove trans fats from its cooking.

"McDonald's has been successful in reducing TFA levels in our Chicken McNuggets, Crispy Chicken Sandwich and McChicken Sandwich. Meanwhile, TFA information is available to McDonald's customers in our restaurants and on our McDonald's Web site," the company said in a statement, adding, "It is important to note, McDonald's continues to work hard on our initiative to reduce TFAs in our cooking oil."