As It Happens6:30Burger King must defend its whopper size in court. Other fast food chains may follow
Anthony J. Russo says his firm’s lawsuits against four fast food giants is about a lot more than how much beef is in a burger.
The U.S. lawyer is working on three class-action lawsuits targeting four major brands — Burger King, Taco Bell, McDonald’s and Wendy’s. Each suit was filed on behalf of dissatisfied customers who allege the companies make their menu items look bigger and better in marketing than they really are.
“Today, it starts with the possibility of a fast food item that’s, you know, a few dollars in cost. Tomorrow, it’s an automobile or a vehicle or a home,” Russo, president of the Russo Law Firm, told As It Happens guest host Katie Simpson.
“If you don’t put some kind of stop measures in here, there’s no limit to what is going to be, you know, the truthfulness in the advertising. And that’s really the basis of our lawsuit.”
On Friday, he secured a small victory when the U.S. District Judge Roy Altman in Miami rejected Burger King’s bid to dismiss the suit.
Already, Russo’s firm has cited Altman’s opinion in its New York case against McDonald’s and Wendy’s, to justify letting that suit continue.
‘The plaintiffs’ claims are false’: Burger King
Burger King — a unit of Restaurant Brands International — denies the lawsuit’s allegations.
“The plaintiffs’ claims are false,” the company said in an emailed statement to CBC. “The flame-grilled beef patties portrayed in our advertising are the same patties used in the millions of Whopper sandwiches we serve to guests nationwide.”
The burger chain tried to have the suit tossed, arguing it’s not required to deliver burgers that look “exactly like the picture.”
Altman dismissed the lawsuit’s claims based on TV and online ads, saying he found none in which Burger King promised a burger “size,” or patty weight and failed to deliver it. But he said the company must defend against a claim that its depiction of Whoppers on in-store menu boards mislead reasonable customers, amounting to a breach of contract.
In his ruling, the judge said it was up to jurors to “tell us what reasonable people think.”
Neither McDonald’s, Wendy’s nor Taco Bell responded to requests for comment from CBC.
This image was taken from a lawsuit accusing Taco Bell of misleading customers about the amount of filling in its Crunchwraps and other menu items. (Siragusa vs. Taco Bell Corps)
Russo doesn’t necessarily disagree with Burger King’s statement.
“They may be the same patties, but … what you see is not what you get,” he said. “It’s our opinion and our allegations that the differences are very, very clear to the naked eye.”
The lawsuits include images of marketed menu items and compare them to the real deal to see if they pass what Russo calls “the eye test.”
The images on menus and ads, he says, portray “a big, thick, juicy burger, flame broiled, dripping with, you know, juiciness,” and topped with “bright green, fresh, crisp lettuce” and ripe tomato protruding from a “glistening bun.”
“In reality, what you see when you unwrap it … would be a very, very thin and greyish looking dried-out burger with maybe some wilted lettuce, you know, popping through on the sides,” he said.
A lawsuit against Wendy’s and McDonald’s accuses the fast food giants of misleading customers about the size of its burgers. These images, used in court filings, show a Wendy’s bacon cheeseburger as advertised versus a real one from a YouTube review. (Wendys.com, Usfoods72/Chimienti vs Wendys)
The lawsuits — each of which seeks at least $5 million US in damages — claim the difference comes down to deceptive practices by food stylists, people who design, prepare and style food for photography or videos.
One Wendy’s food stylist quoted in that lawsuit said she would use undercooked beef in order to make the patties appear larger than they are when served.
The allegations have not been proven in court.
Could pave the way for future lawsuits
New York lawyer Spencer Sheehan, who is not involved in the cases, called Altman’s ruling “a positive development” that could pave the way for other lawyers to bring similar lawsuits.
“As long as, you know, one judge somewhere has said that a course of action or a theory is OK, basically … that’s open season in a way,” he told CBC.
TOKYO (AP) — Japanese technology group SoftBank swung back to profitability in the July-September quarter, boosted by positive results in its Vision Fund investments.
Tokyo-based SoftBank Group Corp. reported Tuesday a fiscal second quarter profit of nearly 1.18 trillion yen ($7.7 billion), compared with a 931 billion yen loss in the year-earlier period.
Quarterly sales edged up about 6% to nearly 1.77 trillion yen ($11.5 billion).
SoftBank credited income from royalties and licensing related to its holdings in Arm, a computer chip-designing company, whose business spans smartphones, data centers, networking equipment, automotive, consumer electronic devices, and AI applications.
The results were also helped by the absence of losses related to SoftBank’s investment in office-space sharing venture WeWork, which hit the previous fiscal year.
WeWork, which filed for Chapter 11 bankruptcy protection in 2023, emerged from Chapter 11 in June.
SoftBank has benefitted in recent months from rising share prices in some investment, such as U.S.-based e-commerce company Coupang, Chinese mobility provider DiDi Global and Bytedance, the Chinese developer of TikTok.
SoftBank’s financial results tend to swing wildly, partly because of its sprawling investment portfolio that includes search engine Yahoo, Chinese retailer Alibaba, and artificial intelligence company Nvidia.
SoftBank makes investments in a variety of companies that it groups together in a series of Vision Funds.
The company’s founder, Masayoshi Son, is a pioneer in technology investment in Japan. SoftBank Group does not give earnings forecasts.
Shopify Inc. executives brushed off concerns that incoming U.S. President Donald Trump will be a major detriment to many of the company’s merchants.
“There’s nothing in what we’ve heard from Trump, nor would there have been anything from (Democratic candidate) Kamala (Harris), which we think impacts the overall state of new business formation and entrepreneurship,” Shopify’s chief financial officer Jeff Hoffmeister told analysts on a call Tuesday.
“We still feel really good about all the merchants out there, all the entrepreneurs that want to start new businesses and that’s obviously not going to change with the administration.”
Hoffmeister’s comments come a week after Trump, a Republican businessman, trounced Harris in an election that will soon return him to the Oval Office.
On the campaign trail, he threatened to impose tariffs of 60 per cent on imports from China and roughly 10 per cent to 20 per cent on goods from all other countries.
If the president-elect makes good on the promise, many worry the cost of operating will soar for companies, including customers of Shopify, which sells e-commerce software to small businesses but also brands as big as Kylie Cosmetics and Victoria’s Secret.
These merchants may feel they have no choice but to pass on the increases to customers, perhaps sparking more inflation.
If Trump’s tariffs do come to fruition, Shopify’s president Harley Finkelstein pointed out China is “not a huge area” for Shopify.
However, “we can’t anticipate what every presidential administration is going to do,” he cautioned.
He likened the uncertainty facing the business community to the COVID-19 pandemic where Shopify had to help companies migrate online.
“Our job is no matter what comes the way of our merchants, we provide them with tools and service and support for them to navigate it really well,” he said.
Finkelstein was questioned about the forthcoming U.S. leadership change on a call meant to delve into Shopify’s latest earnings, which sent shares soaring 27 per cent to $158.63 shortly after Tuesday’s market open.
The Ottawa-based company, which keeps its books in U.S. dollars, reported US$828 million in net income for its third quarter, up from US$718 million in the same quarter last year, as its revenue rose 26 per cent.
Revenue for the period ended Sept. 30 totalled US$2.16 billion, up from US$1.71 billion a year earlier.
Subscription solutions revenue reached US$610 million, up from US$486 million in the same quarter last year.
Merchant solutions revenue amounted to US$1.55 billion, up from US$1.23 billion.
Shopify’s net income excluding the impact of equity investments totalled US$344 million for the quarter, up from US$173 million in the same quarter last year.
Daniel Chan, a TD Cowen analyst, said the results show Shopify has a leadership position in the e-commerce world and “a continued ability to gain market share.”
In its outlook for its fourth quarter of 2024, the company said it expects revenue to grow at a mid-to-high-twenties percentage rate on a year-over-year basis.
“Q4 guidance suggests Shopify will finish the year strong, with better-than-expected revenue growth and operating margin,” Chan pointed out in a note to investors.
This report by The Canadian Press was first published Nov. 12, 2024.
TORONTO – RioCan Real Estate Investment Trust says it has cut almost 10 per cent of its staff as it deals with a slowdown in the condo market and overall pushes for greater efficiency.
The company says the cuts, which amount to around 60 employees based on its last annual filing, will mean about $9 million in restructuring charges and should translate to about $8 million in annualized cash savings.
The job cuts come as RioCan and others scale back condo development plans as the market softens, but chief executive Jonathan Gitlin says the reductions were from a companywide efficiency effort.
RioCan says it doesn’t plan to start any new construction of mixed-use properties this year and well into 2025 as it adjusts to the shifting market demand.
The company reported a net income of $96.9 million in the third quarter, up from a loss of $73.5 million last year, as it saw a $159 million boost from a favourable change in the fair value of investment properties.
RioCan reported what it says is a record-breaking 97.8 per cent occupancy rate in the quarter including retail committed occupancy of 98.6 per cent.
This report by The Canadian Press was first published Nov. 12, 2024.
