Liked Cheerios on Facebook? You Can Still Sue the Company

  • Like on Facebook
  • Share on Google+
  • Share on LinkedIn
Source: Thinkstock

Source: Thinkstock

General Mills (NYSE:GIS) announced via email on Saturday night that the company had removed a newly introduced arbitration clause from its site that would have reduced consumers’ ability to sue the food producer. In an unexpected turnaround, General Mills stated that due to consumer concerns, it would immediately discard the revised terms posted the previous week.

As reported in The New York Times, General Mills spokesperson Mike Siemienas wrote that due to objections to the company’s clause requiring that consumers agree to arbitration or other similar negotiations instead of forming a class action suit, it had removed the condition. The clause would have affected any consumer who purchased a General Mills product, interacted with the company via social media, entered one of their sweepstakes, or downloaded a coupon. General Mills, having paid $8.5 million last year to settle accusations of misleading health claims associated with its Yoplait brand, inserted the arbitration policy after a California judge ruled against their motion to dismiss a case alleging deceptive marketing associated with its Nature Valley brand.

The email was followed up with a blog post by Kirstie Foster, Director of External Communications for General Mills, who confirmed the removal after objections raised by a “misreading” of the change in Minnesota-based company’s terms and conditions. While the maker of brands such as Cheerios, Betty Crocker, and Green Giant still support arbitration as a method of streamlining customer complaints, Ms. Foster apologized on behalf of the company and assured the public that no arbitration clause had been enforced.

Credit card and mobile phone companies have increasingly introduced arbitration requirements into customer contracts since the Supreme Court’s 2011 ATT v. Concepcion decision, limiting consumers’ ability to file class action lawsuits. Advocacy groups argue that arbitration eliminates certain consumer protections provided in class action suits. General Mills would have been the first major food manufacturer to include an arbitration clause in its terms and conditions.

More Articles About:

To contact the reporter on this story: staff.writers@wallstcheatsheet.com To contact the editor responsible for this story: editors@wallstcheatsheet.com

Yahoo Finance, Harvard Business Review, Market Watch, The Wall St. Journal, Financial Times, CNN Money, Fox Business