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Tag: class actions

  • Burgers and tacos don’t look like they do in ads. Lawsuits are trying to change that | CNN Business

    Burgers and tacos don’t look like they do in ads. Lawsuits are trying to change that | CNN Business

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    New York
    CNN
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    When it comes to food advertising, what you see is rarely what you get. A flurry of recent lawsuits wants to change that.

    Over the past few years, lawyers have been bringing class action suits against fast food companies, alleging that they’re misrepresenting food in their marketing.

    Lawyers James Kelly and Anthony Russo, in particular, have been leading the charge, bringing cases against Taco Bell, Wendy’s, McDonald’s, Burger King and Arby’s. These companies use ads that don’t match up with their actual food, the suits allege.

    As evidence, the complaints feature images of food marketing alongside shots of their real-life counterparts. In the ads, burgers look tall, heaped with meat and cheese, topped with golden, rounded buns. But in the photos of burgers bought from a real fast food location, they’re flat, with meat and cheese barely peeking out of limp, white buns. Tacos are no different: In Taco Bell’s ads, Crunchwraps look hearty and plump. In photos in the lawsuit, they look flat and nearly empty. The suits are ongoing.

    “We saw a record number of food litigation lawsuits filed from 2020 to 2023, with hundreds of new suits every year,” said Tommy Tobin, a lawyer at Perkins Coie and Lecturer at UCLA Law, adding that “food litigation is a fast-growing area of law.”

    The explosion has been largely driven by the efforts of a handful of lawyers, including Russo and Kelly, said Bonnie Patten, executive director of Truth in Advertising, a nonprofit organization that focuses on protecting consumers from false advertising.

    Their cases focus on quantity, she said, essentially arguing that food in ads appears more bountiful than what customers actually get. Other lawyers, like Spencer Sheehan, focus on how food is described. Sheehan, a New York lawyer, has filed hundreds of class action suits focusing on misleading words on packaged foods — like use of the word “vanilla” on foods made with little or no actual vanilla.

    Major chains have also been targeted for how they describe food. Last year a class action suit was brought against Starbucks claiming that the chain is misleading buyers of its “Refreshers” beverages by naming them for ingredients they don’t have. The complaint states that, for example, “the Mango Dragonfruit and Mango Dragonfruit Lemonade Refreshers contain no mango,” and that in fact “all of the products are predominantly made with water, grape juice concentrate, and sugar.” Starbucks argued, among other things, that the fruits mentioned indicate a flavor rather than an ingredient.

    “The allegations in the complaint are inaccurate and without merit,” a Starbucks spokesperson said in a statement, adding, “we look forward to defending ourselves against these claims.”

    For a judge or jury to side with the plaintiffs in false advertising claims, lawyers have to successfully make the case that the ads would trick a “reasonable consumer,” Tobin, explained.

    “Under this standard, a court asks whether a reasonable consumer would be misled by the product’s marketing or labeling,” he said.

    The courts will have to draw the line between false advertising and just, well, advertising — which might be trickier than it sounds.

    Burger King, in a bid to dismiss the lawsuit against it, argued that its ads are fair.

    “Reasonable consumers viewing food advertising know” that food in ads “has been styled to make it look as appetizing as possible,” Burger King argued in a recent filing. That “innate” knowledge, plus the fact that a Whopper patty is always made with a quarter pound of beef, as promised, means that the ads are fine, according to Burger King.

    “The plaintiffs’ claims are false,” a Burger King spokesperson said in a statement about the lawsuit. “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.” Arby’s, McDonald’s, and Taco Bell did not respond to requests for comment. Wendy’s declined to comment, citing the ongoing litigation.

    Lawsuits claim that burgers from McDonald's, Burger King and Wendy's don't look as they appear in ads.

    For Russo, that argument doesn’t cut it. He’s more concerned with what he calls the “common-sense eyeball test.” The fast food chains targeted in his suit, he said, are failing.

    “If you look at what their advertisements are showing, and you look at what on a regular basis, every consumer is getting … [there’s] a glaring disparity,” he said. “You could talk about weight … you could talk about volume, those are all the things the experts get into,” he said. But if the image is drastically different from the product, he argues, those details don’t matter.

    In the Burger King case, a judge recently agreed to punt the question of what is “reasonable” to a jury, refusing to dismiss the case in full as Burger King requested.

    Starbucks will also have to face many of the claims brought against it in the class action. “Plaintiffs have adequately alleged that a significant portion of the general consuming public could be misled by the names of the at-issue beverages,” a recent order states.

    For Patten, a reasonable consumer is an “average consumer.” The legal system, she said, often expect more from a reasonable consumer than she would from an average one.

    “Trial courts tend to have a very high opinion of who the reasonable consumer is,” she said. “And I think as a result of that, will dismiss a lot of these types of class actions, taking the position that the reasonable consumer of course knows that this type of advertising exaggerates the quality and quantity of food.”

    But Patten has heard from many complaining about this specific discrepancy, between how much food they expect due to advertising, and how much food they actually get.

    “We get it for burgers, we’ve gotten it for buckets of chicken, all sorts of different kinds of fast food,” she said.

    When it comes to allegations of false advertising, there are more egregious questions than whether a taco on the screen matches a taco in the hand. And Patten’s not convinced that class actions are the way to go — if they’re not dismissed, they often get settled, offering the defendant certain protections and giving consumers a small sum of cash, while their lawyers walk away with a larger bundle.

    But with people watching their budgets, it’s worth examining whether customers are getting as much food as they expect from major fast food chains.

    When people are “using their limited resources to purchase this, and then they’re not being provided with the quantity of food they’re expecting — that is an issue, no doubt.”

    The suits, and the attention they’ve received, can help inform the public of what to really expect, Patten said.

    They “can help educate consumers and make more savvy purchasers of their dinners,” she said. “The best defense against deceptive marketing is an educated consumer.”

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  • US judge set to decertify Google Play class action | CNN Business

    US judge set to decertify Google Play class action | CNN Business

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    A US judge plans to free Google from having to defend against a class action by 21 million consumers who claimed it violated federal antitrust law by overcharging them in its Google Play app store.

    Monday’s decision by US District Judge James Donato in San Francisco could significantly reduce damages that Google, a unit of Alphabet, might owe over the distribution of Android mobile applications.

    Consumers claimed they would have paid less for apps and enjoyed expanded choice but for Google’s alleged monopoly. Google has denied wrongdoing.

    Donato said his Nov. 2022 class certification order should be thrown out because his decision, also announced Monday, not to let an economist testify as an expert witness for the consumers eliminated an “essential element” of their argument for certification.

    The judge said he couldn’t decertify the class immediately because Google had been appealing his November order. He directed lawyers for Google and the consumers to try resolving that issue before a Sept. 7 hearing.

    The class action included consumers from 12 US states and five territories, who were not part of a similar case against Google brought by various state attorneys general.

    Class actions let plaintiffs sue as a group, and potentially obtain larger recoveries at lower cost than if they were forced to sue individually.

    Lawyers for the consumers did not immediately respond to requests for comment. Google and its lawyers did not immediately respond to similar requests.

    The case is part of wide-ranging antitrust litigation that includes 38 states and the District of Columbia, and companies including Epic Games and Match Group.

    The case is In re Google Play Store Antitrust Litigation, US District Court, Northern District of California, No. 21-md-02981.

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  • George R. R. Martin, Jodi Picoult and other famous writers join Authors Guild in class action lawsuit against OpenAI | CNN Business

    George R. R. Martin, Jodi Picoult and other famous writers join Authors Guild in class action lawsuit against OpenAI | CNN Business

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    New York
    CNN
     — 

    A group of famous fiction writers joined the Authors Guild in filing a class action suit against OpenAI on Wednesday, alleging the company’s technology is illegally using their copyrighted work.

    The complaint claims that OpenAI, the company behind viral chatbot ChatGPT, is copying famous works in acts of “flagrant and harmful” copyright infringement and feeding manuscripts into algorithms to help train systems on how to create more human-like text responses.

    George R.R. Martin, Jodi Picoult, John Grisham and Jonathan Franzen are among the 17 prominent authors who joined the suit led by the Authors Guild, a professional organization that protects writers’ rights. Filed in the Southern District of New York, the suit alleges that OpenAI’s models directly harm writers’ abilities to make a living wage, as the technology generates texts that writers could be paid to pen, as well as uses copyrighted material to create copycat work.

    “Generative AI threatens to decimate the author profession,” the Authors Guild wrote in a press release Wednesday.

    The suit alleges that books created by the authors that were illegally downloaded and fed into GPT systems could turn a profit for OpenAI by “writing” new works in the authors’ styles, while the original creators would get nothing. The press release lists AI efforts to create two new volumes in Martin’s Game of Thrones series and AI-generated books available on Amazon.

    “It is imperative that we stop this theft in its tracks or we will destroy our incredible literary culture, which feeds many other creative industries in the US,” Authors Guild CEO Mary Rasenberger stated in the release. “Great books are generally written by those who spend their careers and, indeed, their lives, learning and perfecting their crafts. To preserve our literature, authors must have the ability to control if and how their works are used by generative AI.”

    The class-action lawsuit joins other legal actions, organizations and individuals raising alarms over how OpenAI and other generative AI systems are impacting creative works. An author told CNN in August that she found new books being sold on Amazon under her name — only she didn’t write them; they appear to have been generated by artificial intelligence. Two other authors sued OpenAI in June over the company’s alleged misuse of their works to train ChatGPT. Comedian Sarah Silverman and two authors also sued Meta and ChatGPT-maker OpenAI in July, alleging the companies’ AI language models were trained on copyrighted materials from their books without their knowledge or consent.

    But OpenAI has pushed back. Last month, the company asked a San Francisco federal court to narrow two separate lawsuits from authors – including Silverman – alleging that the bulk of the claims should be dismissed.

    OpenAI did not respond to a request for comment on Wednesday.

    “We think that creators deserve control over how their creations are used and what happens sort of beyond the point of, of them releasing it into the world,” Sam Altman, the CEO of OpenAI, told Congress in May. “I think that we need to figure out new ways with this new technology that creators can win, succeed, have a vibrant life.”

    US lawmakers met with members of creative industries in July, including the Authors Guild, to discuss the implications of artificial intelligence. In a Senate subcommittee hearing, Rasenberger called for the creation of legislation to protect writers from AI, including rules that would require AI companies to be transparent about how they train their models.

    More than 10,000 authors — including James Patterson, Roxane Gay and Margaret Atwood — also signed an open letter calling on AI industry leaders like Microsoft and ChatGPT-maker OpenAI to obtain consent from authors when using their work to train AI models, and to compensate them fairly when they do.

    But the AI issues facing creative professions doesn’t seem to be going away.

    “Generative AI is a vast new field for Silicon Valley’s longstanding exploitation of content providers. Authors should have the right to decide when their works are used to ‘train’ AI,” author Jonathan Franzen said in the release on Wednesday. “If they choose to opt in, they should be appropriately compensated.”

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  • Meta agrees to pay $725 million to settle lawsuit over Cambridge Analytica data leak | CNN Business

    Meta agrees to pay $725 million to settle lawsuit over Cambridge Analytica data leak | CNN Business

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    New York
    CNN
     — 

    Facebook parent company Meta has agreed to pay $725 million to settle a longstanding class action lawsuit accusing it of allowing Cambridge Analytica and other third parties to access private user information and misleading users about its privacy practices.

    The proposed settlement would end the legal battle that began four years ago, shortly after the company disclosed that the private information of as many as 87 million Facebook users was obtained by Cambridge Analytica, a data analytics firm that worked with the Trump campaign. The data leak sparked an intense international scandal for Facebook, drawing the scrutiny of regulators on both sides of the Atlantic.

    The lawsuit involved obtaining millions of pages of documents from Facebook and other related parties and hundreds of hours of depositions, including dozens of current and former Facebook employees.

    The users settling with Facebook called the agreement the “largest recovery ever achieved in a data privacy class action and the most Facebook has ever paid to resolve a private class action” in a motion to approve the settlement filed Thursday. They estimated that between 250 and 280 million people may be eligible for payments as part of the class action settlement.

    The settlement is pending approval from a judge, who will hear the motion in March.

    “We pursued a settlement as it’s in the best interest of our community and shareholders,” Meta spokesperson Dina Luce said in a statement. “Over the last three years we revamped our approach to privacy and implemented a comprehensive privacy program. We look forward to continuing to build services people love and trust with privacy at the forefront.”

    Meta did not admit wrongdoing as part of the settlement. In the motion to approve the settlement, the users who brought the suit pointed to changes Facebook has made in the wake of the Cambridge Analytica breach, including restricting third-party access to user data and improving communications to users about how their data is collected and shared.

    The Cambridge Analytica leak began with a psychology professor who harvested data on millions of Facebook users through an app offering a personality test, then gave it to a service promising to use vague and sophisticated techniques to influence voters during a high-stakes election where the winning presidential candidate won narrowly in several key states.

    A 2020 report by the UK Information Commissioner’s Office later cast significant doubt on Cambridge Analytica’s capabilities, suggesting many of them had been exaggerated. But the improper sharing of Facebook data triggered a cascade of events that has culminated in investigations and lawsuits.

    The scandal prompted a global outcry that led to hearings, an apology tour from Zuckerberg and various changes to the platform. Facebook agreed in 2019 to a $5 billion privacy settlement with the US Federal Trade Commission over the privacy breach, and to a $100 million settlement with the US Securities and Exchange Commission over claims that it misled investors about the risks of misuse of user data.

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  • OpenAI, maker of ChatGPT, hit with proposed class action lawsuit alleging it stole people’s data | CNN Business

    OpenAI, maker of ChatGPT, hit with proposed class action lawsuit alleging it stole people’s data | CNN Business

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    CNN
     — 

    OpenAI, the company behind the viral ChatGPT tool, has been hit with a lawsuit alleging the company stole and misappropriated vast swaths of peoples’ data from the internet to train its AI tools.

    The proposed class action lawsuit, filed Wednesday in a California federal court, claims that OpenAI secretly scraped “massive amounts of personal data from the internet,” according to the complaint. The nearly 160-page complaint alleges that this personal data, including “essentially every piece of data exchanged on the internet it could take,” was also seized by the company without notice, consent or “just compensation.”

    Moreover, this data scraping occurred at an “unprecedented scale,” the suit claims.

    OpenAI did not immediately respond to CNN’s request for comment Wednesday. Microsoft, a major investor into OpenAI, was also named as a defendant in the suit and did not immediately respond to a request for comment.

    “By collecting previously obscure personal data of millions and misappropriating it to develop a volatile, untested technology, OpenAI put everyone in a zone of risk that is incalculable – but unacceptable by any measure of responsible data protection and use,” Timothy K. Giordano, a partner at Clarkson, the law firm behind the suit, said in a statement to CNN Wednesday.

    The complaint also claims that OpenAI products “use stolen private information, including personally identifiable information, from hundreds of millions of internet users, including children of all ages, without their informed consent or knowledge.”

    The lawsuit seeks injunctive relief in the form of a temporary freeze on further commercial use of OpenAI’s products. It also seeks payments of “data dividends” as financial compensation to people whose information was used to develop and train OpenAI’s tools.

    OpenAI publicly launched ChatGPT late last year, and the tool immediately went viral for its ability to generate compelling, human-sounding responses to user prompts. The success of ChatGPT spurred an apparent AI arms race in the tech world, as companies big and small are now racing to develop and deploy AI tools into as many products as possible.

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