Health Care and Insurance and Small Business

Banning 'McLawsuits': State bill outlawing fast-food litigation nears passage

February 27, 2006

A bill nearing the governor's desk would make it illegal to sue Indiana restaurants-including the state's ubiquitous fast-food joints-for those extra notches in the belt.

Commonly referred to as the "cheeseburger bill," the measure is part of a national effort by restaurants and small-business owners to protect themselves from enormous class-action lawsuits that have been filed against some national chains.

House Bill 1113 passed out of the Senate Committee on Corrections, Criminal, and Civil Matters on Feb. 14 by a 9-2 vote and headed to the Senate floor. It previously sailed through the House by a 76-21 margin.

The bill is part of the governor's agenda for 2006.

It also is a high priority for small businesses in Indiana. Although no obesity lawsuits have been filed here, just one could easily cripple a family diner.

"It's an important issue for us both in the state and nationwide," said John Livengood, president of the Restaurant and Hospitality Association of Indiana.

The state's 13,000 restaurants ring up an average of $500,000 in sales annually, with profits of about 5 percent-$25,000. Lawsuits could easily gobble up those profits if a restaurant had to defend its chili recipe.

Indiana trial lawyers conceded the bill is headed for a signing ceremony.

"It's going to pass," said Warren Mathies, from the Boonville-based law firm Long & Mathies, who represents trial attorneys.

Nonetheless, Mathies made an unsuccessful plea for legislators to exempt children from the bill when it was heard in the Senate committee.

Children at schools and day-care centers don't have much choice about what they eat, he argued, so school cafeterias need to shoulder some responsibility if they're putting trans-fat-filled cookies and artery-clogging beef on lunch trays.

"I don't buy that argument," countered Jason Shelley, state director of the National Federation of Independent Business, who declined to elaborate. Almost 90 percent of Shelley's members support the legislation.

And small-business owners aren't the only ones on board. A recent Gallup Poll showed 89 percent of Americans don't think restaurants should be liable for issues related to obesity.

Similar legislation has been proposed on the federal level, but it has stalled in the U.S. Senate. That's why advocates are taking the fight to the state level.

More than 20 states now have similar laws on the books, according to the American Legislative Exchange Council. Among them: Indiana's neighbors in Ohio, Illinois and Kentucky.

The legislation comes as a result of two high-profile lawsuits filed against fastfood companies including McDonald's, Burger King, KFC and Wendy's in the past four years. Both have been unsuccessful.

But the first class-action suit against big tobacco also failed, Shelley pointed out. That four-year court struggle ended in 1998 with states and plaintiffs' lawyers getting almost $250 billion out of the country's five largest tobacco manufacturers.

And those same lawyers are the ones getting into the ring against restaurants.

"The tobacco Nazis have moved over into the obesity arena," said Joe Lackey, president of Indiana Grocery and Convenience Store Association and executive director of the Indiana Soft Drink Association. "They are making it abundantly clear that their next target is the food industry."

Lackey testified in opposition to the bill. So did the Indiana Retail Council, the Indiana Chamber of Commerce, the Insurance Institute of Indiana and the Indiana Broadcasters Association.

What stake do television stations have in a bill about restaurants getting sued? Apparently, a big one. They're worried they'll be named in a suit by someone who got the idea to eat a cheeseburger after seeing a commercial during the nightly news.

That illustrates the absurdity of the situation for some.

"It's this court mentality that we seem to have nowadays," Lackey said. "Every time it snows or rains [grocery and convenience stores] have lawsuits filed against them" by people who slip and fall.

Those are fighting words for the American Trial Lawyers Association. While local trial attorneys may be conceding a few inches, their national counterparts are putting on the battle armor.

"The civil justice system has made our cars safer, our emergency rooms cleaner and our health care higher-quality," said spokeswoman Chris Mather. "We don't have pajamas that are as easily flammable as we used to. We don't have gas tanks that explode at a certain angle. That's because of successful court cases."

She pointed to Oreo cookies as one example of a lawsuit against a food company that made a difference.

In May 2003, a California attorney sued Nabisco, part of Northfield, Ill.-based Kraft Foods Inc., for not disclosing that Oreos contain trans-fat, which the National Academy of Sciences' Institute of Medicine has said is directly associated with heart disease.

While the lawsuit was unsuccessful, numerous food retailers now offer information about trans-fat on their labels.

"Court cases help to shine a light on problems," Mather said.

And the greasy spoon on the corner doesn't have much to worry about, said Mathies, since "it would be hard to prove a casual link" between heart disease and a single plate of biscuits and gravy.
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