The ridiculous California law that allows consumers to sue companies for what they say about social- and public-policy issues is now being used to sue companies for what they don't say - or, more precisely, for not saying it loud enough.
The "truth-in-advertising statute" was deployed against Nike after it chose to defend itself against charges of abuse in its overseas factories by writing letters to editors and issuing a press release. There was never a ruling on whether the company lied - partly because under the law a company doesn't have to lie to be guilty and partly because after the US Supreme Court refused to rule on the constitutionality of the statute, Nike hurried to settle.
Now the same statute is being used to sue McDonald's for failing to follow through on a pledge to switch to a lower-fat cooking oil for its French fries. McDonald's said in September 2002 that it would make the change in order to cut trans-fat levels in its food and indicated that the change would be made by February 2003.
But when February came, the company announced that the change was taking longer than anticipated and would be delayed. In fact, McDonald's issued a press release in which Ralph Alvarez, US chief operating officer, said that "while speedy implementation is an admirable goal, we are most focused on the satisfaction of our customers and the quality of our products."
That explanation wasn't good enough for California talk-show host Katherine Fettke, who has filed a suit claiming that the company failed to disclose "to the public in an effective manner that it had not switched to a new, healthier cooking oil." Fettke claims that she would not have bought McDonald's French fries for herself and Happy Meals for her children several times last year had she known the oil switch had not taken place.
(That claim is quite unnecessary. Plaintiffs do not have to demonstrate that they were harmed by the company's communication - or lack thereof - to bring a suit under the statute.)
As absurd as it sounds, the way the law is written means McDonald's might well be guilty. After all, far more people are likely to have seen the initial story about McDonald's plans than the later announcement of a delay. Those people were, therefore, misled. It will presumably be argued that if reporters did not cover the second announcement as comprehensively as the first, McDonald's should've made up the coverage deficit with advertising.
The way the law is written, Fettke might have a case.