Chick-fil-A has reportedly agreed to pay customers $4.4 million in discounts or gift cards to settle a class-action lawsuit against the chain over misleading delivery fees.
The Atlanta-headquartered company faced a lawsuit earlier this month in the U.S. District Court for the Northern District of Georgia alleging the company engaged in “fraudulent and untruthful conduct” by offering free or discounted shipping on orders over the Chick-fil-A app and website promised.
The six plaintiffs in the lawsuit, two from Virginia and one each from Arkansas, Maryland, South Carolina and Texas, said the grocery chain added a “secret menu markup” for delivery of menu items that undermined the company’s “promise of free or low-cost “Delivering products” was fulfilled. “Cost delivery obviously incorrect,” the complaint states.
Before the COVID-19 pandemic, the restaurant chain charged a $4.99 delivery fee, the lawsuit says. However, because lockdown measures were enacted at the start of the COVID shutdown, Chick-fil-A claimed to “lower its delivery fee to FREE, $2.99, or $3.99” to boost business, the lawsuit says. At the same time, the company “secretly increased its menu prices on delivery orders simply to cover delivery costs and profits – without even once disclosing the manipulation to customers,” the lawsuit says.
As a result, food prices for deliveries were 25% to 30% higher, the lawsuit said. An example from the lawsuit: A 30-piece order of chicken nuggets would cost $5 to $6 more if delivered via delivery than if picked up or ordered at the restaurant.
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Chick-fil-A did not admit guilt in the case but will set up a $1.45 million cash fund and a $2.95 million gift card fund for consumers, the website Top Class Actions reported .
Chick-fil-A and plaintiffs’ attorneys did not respond to USA TODAY’s requests for comment.
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An unspecified number of customers are expected to receive either $29.25 in cash or a $29.25 Chick-fil-A gift card as part of the settlement, the website Top Class reported Actions. If the settlement fund is not large enough to cover all claims, prorated payments will be made, the website says.
Keep an eye on your inbox as those eligible for a reward will be notified via email. Chick-fil-A agreed to provide the settlement administrator with the email addresses needed to inform students.
If you divide the total amount of $4.4 million by the proposed settlement amount of $29.25, there are potentially 150,427 affected customers.
As part of the settlement, Chick-fil-A will also disclose on its app and website that prices for menu items may be higher for delivery orders.
“Plaintiffs allege that by omitting, concealing, and misrepresenting material facts about (Chick-fil-A’s) delivery service, (the company) induced consumers to make online grocery purchases that they otherwise would not have made,” it said it compared to Chick-fil-A.
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