Perhaps you’ve seen the TV commercial in which Frosted Mini-Wheats help children stay attentive in school and get the right answers.
No teacher will dispute that a child who had something to eat does better in school than a hungry student.
A class-action lawsuit was filed against Kellogg’s by a California resident (where else?) who alleged that the commercials, which said that clinical studies showed that a breakfast of Frosted Mini-Wheats helped improve children’s attentiveness by 20 percent, were “false advertising.”
The Kellogg Company settled the ridiculous case for its nuisance value, agreeing to:
- Pay the ambulance-chasing (or, in this case, cereal-chasing) attorneys $2.4 million in fees and “costs”;
- Set up a $2.75 million fund for consumers “injured” by the ad campaign, from which they could receive $5 per box of Frosted Mini-Wheats purchased, up to a maximum of $15;
- Provide $5.5 million “worth” of Kellogg food products to unidentified charities feeding the indigent.
And of course you and I will pay for this settlement at the cash reigister every time we buy a Kellogg’s product.
Kellogg also agreed to refrain for three years from claiming that its cereal improved attentiveness by 20 percent, though it would be allowed to claim that clinical studies “have shown that kids who eat a filling breakfast like Frosted Mini-Wheats have an 11% better attentiveness in school than kids who skip breakfast.” So this entire lawsuit, worth more than $10 million, including $2 million in attorneys’ fees, was based on a dispute over a possible nine percent differential in improved attentiveness of 8-12 year olds.
But there’s good news!
The most liberal Appellate Court in the nation — the “Ninth Circus” Court of Appeals in San Francisco — got it right, and tossed this exorbitant award out on its ear. (Perhaps the Court had a bowl of Frosted Mini-Wheats that morning.)
Hans A. von Spakovsky, Senior Legal Fellow at the Heritage Foundation (www.heritage.org) and a former commissioner on the Federal Election Commission, concludes:
Dennis v. Kellogg Company exemplifies the type of wasteful class action lawsuits that are continually being filed against American businesses in what amounts to legally sanctioned extortion. No wonder we have the most expensive and wasteful tort system in the industrialized world. It imposes huge and unnecessary costs on the entrepreneurs both large and small (not to mention their shareholders) who are the backbone of our economy.