U.S. Seventh Circuit - The FindLaw 7th Circuit Court of Appeals Opinion Summaries Blog

Subway Gets a Refund in Footlong Settlement

In a rare twist, Subway is going to get some bread back.

After a class action challenged the length of its footlong sandwich, Subway settled by promising to measure up and pay $520,000 to the plaintiffs' attorneys. An appeals court reversed in Subway Footlong Sandwich Marketing and Sales Practices Litigation, however, because the settlement did nothing meaningful for consumers.

"The settlement acknowledges as much when it says that uniformity in bread length is impossible due to the natural variability of the bread-baking process," said the U.S. Seventh Circuit Court of Appeals, calling the settlement "worthless."

And with that twist of the knife, the court sliced off the attorneys' dough.

What the Lawyers Ordered

The case rose out of a Facebook photo of a Subway Footlong sandwich measuring 11 inches long. A teenager posted it online, it went viral, and a class action soon followed.

A trial judge approved the settlement, but the appeals court was not satisfied. The panel blamed the plaintiffs' attorneys for a half-baked plan.

"In their haste to file suit, however, the lawyers neglected to consider whether the claims had any merit," the appeals court said. "They did not."

Discovery showed that the sandwiches were almost always at least 12 inches long, and rarely shrunk to less than a foot due to baking differences. Otherwise, they were uniform.

Change in Remedy

Rather than drop the "meritless" claims, the court said, the plaintiffs' attorneys shifted to a claim for injunctive relief. It was the right recipe for settlement, with the plaintiffs' attorneys getting $520,000 and the class representatives $500 each.

Theodore Frank, a professional objector, protested and appealed. The appeals court agreed with him and cited its own reasoning in another case, In re. Walgreen Co. Stockholder Litigation.

"A class settlement that results in fees for class counsel but yields no meaningful relief for the class 'is no better than a racket,'" Judge Diana Sykes wrote for the panel in remanding the case. "The settlement enriches only class counsel and, to a lesser degree, the class representatives."

Related Resources: