McDonald’s has opted to settle a class action rather than risk further litigation of allegations that it falsely advertised its chicken products as being halal (prepared according to Islamic dietary law). See Settlement Agreement, Ahmed v. McDonald’s Corp., No. 11-014559-CZ (Mich. Circ. Ct. filed Nov. 23, 2011). The suit, filed in Michigan state court, targeted two Dearborn-based McDonald’s franchises that allegedly served non-halal McNuggets and McChicken sandwiches after advertising those products as being halal.
A portion of the settlement proceeds will be paid to a pair of Michigan-based Muslim organizations. Of the $700,000 settlement fund, $274,000 will be paid to the Health Unit on Davison Avenue, Inc., a medical clinic serving a predominantly Muslim clientele, and approximately $172,000 will go to Dearborn’s Arab American National Museum. The settlement agreement also provides for $233,333 in attorneys’ fees and a $20,000 incentive award for the named plaintiff.
The parties acknowledge the decision to forego direct payments to class members — customers at just two McDonald’s franchises — describing such disbursements as being “impractical,” and touting the settlement’s benefits to Michigan’s Muslim community. See Settlement Agreement at 9-10. Notice of the settlement is to be posted in numerous area mosques.
Though modest by class action standards, the Ahmed settlement is likely to send a signal to defendants facing similar claims involving religious dietary restrictions that settlement is more prudent than risking a substantial judgment attendant to class certification and subsequent findings of liability.