Chick-fil-A has reportedly agreed to pay customers $4.4 million in rebates or gift cards to settle a class action suit filed against the chain for misleading delivery fees.
The Atlanta-headquartered company faced a suit filed earlier this month in U.S. District Court for the Northern District of Georgia alleging the company had been “deceptive and untruthful” in promising free or low-priced deliveries of orders via the Chick-fil-A app and website.
The six plaintiffs in the suit, two from Virginia and one each from Arkansas, Maryland, South Carolina and Texas, said the food chain added a “secret menu upcharge” for menu items being delivered that made the company’s “promise of free or low-cost delivery patently false,” according to the complaint.
Prior to the COVID-19 pandemic, the restaurant chain charged a $4.99 delivery fee, the suit alleges. But as the lockdown measures were issued early in the COVID shutdown, Chick-fil-A “claimed to reduce its delivery fee to FREE, $2.99 or $3.99,” to boost business, the suit charges. At the same time, the company “secretly raised its menu prices on delivery orders only in order to cover the costs of delivery and profit – without once disclosing the manipulation to customers,” according to the suit.
As a result, food prices on deliveries were 25% to 30% higher, the suit charges. An example in the suit: a 30-piece order of chicken nuggets would cost $5 to $6 more when ordered for delivery than when picked up or ordered at a restaurant.
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Chick-fil-A did not admit guilt in the case but will create a $1.45 million cash fund and $2.95 million gift card fund for consumers, the website Top Class Actions reported.
Chick-fil-A and attorneys for the plaintiffs did not return USA TODAY’s requests for comment.
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An unspecified number of customers are expected to get either $29.25 in cash or a $29.25 gift card from Chick-fil-A as part of the settlement, the Top Class Actions site reported. If the settlement fund is not large enough to fund all claims, proportionate payments will be made, the site states.
Keep an eye on your inbox because those eligible for a reward will be notified by email. Chick-fil-A agreed to give the settlement administrator the email addresses needed to inform class members.
If you divide the total of $4.4 million by the proposed $29.25 settlement amount, there’s a potential 150,427 affected customers.
As part of the settlement, Chick-fil-A will also put disclosures on its app and website stating that prices on 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) deceives consumers into making online food purchases they otherwise would not make,” the Chick-fil-A settlement states.
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Jessica Roberts is a seasoned business writer who deciphers the intricacies of the corporate world. With a focus on finance and entrepreneurship, she provides readers with valuable insights into market trends, startup innovations, and economic developments.
