Have you ever felt cheated by a misleading tagline or wondered whether a company's 'scientific' claims could be backed up? You're not alone. These people were so sceptical about some of the world's biggest brands that they took them to court and came out on top.
Read on to discover some major cases where customers took on big companies – and made them pay for their words. All dollar amounts in US dollars.
In 1992, Hoover launched one of the most ill-thought-out marketing campaigns in history. Seeking to shift a backlog of vacuum cleaners gathering dust (rather than collecting it) in its warehouses, it announced to the British public that they could win two free return flights to America when they spent just £100 on a vacuum cleaner. Unsurprisingly, the company was inundated with interest, and simply couldn’t honour the deal as it was extremely unprofitable. This led to lots of disgruntled customers, not to mention a media firestorm.
Customers Harry Cichy and Sandy Jack set up the Hoover Holiday Pressure Group to hold Hoover accountable for what they had promised. Over the next few years, members of the group took the company to court on several occasions and won five cases. Hoover’s parent eventually paid out $72 million (£55m) in compensation to the 220,000 customers that had been promised a free flight. A number of Hoover executives were also fired for their role in the farrago, with lawsuits persisting until 1997 despite company spokesperson Caroline Knight claiming the matter was "over and done with."
A judge in New York has preliminarily approved a settlement to proceed in a lawsuit involving a maker of popular soft drinks. The class-action lawsuit was initially filed against A&W Concentrate Company, the producer of A&W Root Beer and Cream Sodas, in August 2020.
It claims the drinks maker “misleadingly stated on the front of the products’ labels” that its root beers and cream sodas were "Made With Aged Vanilla" – despite the vanilla taste being created using an artificial flavoring.
A&W has denied the claims, but now the court has sided with the claimants. It ruled that the corporation must pay a settlement of $15 million to customers who bought any A&W root beer or cream soda product that featured "Made With Aged Vanilla" on its label between 7 February 2016 and 2 June 2023.
Customers who can provide a receipt for their purchase are entitled to up to $25 in compensation, while customers who have no proof of purchase can receive a cash payment of $5.50. A&W has also been ordered to pay the original plaintiff LaShawn Sharpe, and her subsequent co-plaintiffs Jim Castoro and Steve Dailey, $5,000 each, in addition to covering their legal fees.
The lawyer representing the trio, Spencer Sheehan, is no stranger to these kinds of cases. Dubbed the "Vanilla Vigilante," Sheehan has filed around 100 lawsuits over the use of vanilla flavorings in products, according to Business Insider. But it's not just food and drinks companies that have come under fire in US courts.
When LA resident Trish Wiener bought products from Dannon’s Activia and DanActive yogurt brands, which claimed to be clinically proven to help regulate digestion and boost immunity, she was disappointed to find no positive effect. So she filed a lawsuit against the company.
Dannon had started marketing Activia and its “bifidus regularis” bacteria in early 2006. Yet Wiener’s lawsuit claimed Dannon’s marketing department invented the words “immunitas” and “regularis” and used them because they "sound scientific."
Both yogurts sell at a 30% premium over other brands because of their supposed nutritional benefits, which meant that Wiener was able to claim for an “economic injury” because she spent more money than she otherwise would have done based on the company’s claims.
The legal battle lasted two years, culminating in a class action settlement that was reached in federal court. The presiding judge ruled that Dannon would have to pay its customers up to $45 million (almost $63m today) in damages and remove the word “immunity” from its labels.
Rice Krispies is one of the world's most beloved breakfast cereals. But when a 2009 ad campaign for the cereal claimed it could boost children's immunity, Oregon's attorney general – as well as the Federal Trade Commission (FTC) and a number of private individuals – took issue with the claim, saying it wasn't backed up by scientific evidence. These lawsuits became one large class action lawsuit that wound up in the California federal court.
Plaintiffs argued that Rice Krispies did not have evidence to support its claims, and that Kellogg's had failed to disclose any information which indicated health or immunity benefits. In 2011 Kellogg's settled for $5 million, half of which would be given to people who purchased its products. That's the equivalent of $6.8 million in 2023.
Customers could claim for between $5 to $15 – that's $6.80 to $20.35 today – if they submitted forms for the price of cereal they purchased. Meanwhile the remaining $2.5 million would be given to charities in the form of donated Kellogg's products. The company also removed immunity claims from its packaging in 2010.
New Balance launched its $100 TrueBalance running shoes in 2010. Advertisements claimed that the shoes "activated" certain lower body muscles, allowing people to burn 8% more calories compared to wearing regular running shoes. However, three women – Kimberly Carey, Victoria Molinarolo, and Shannon Dilbeck – felt the claims didn’t stack up and filed a lawsuit against the footwear giant. Their complaint, filed in Massachusetts in 2011, stated that New Balance’s advertising was deceptive.
Lawyers for the women said: "Wearing the Toning Shoes provides no additional activation to the gluteus, hamstring or calf muscles, and does not burn any additional calories.” In August 2012 a judge ruled that New Balance would have to pay out $2.3 million ($3m in today's money) to settle the false advertising claims, with each of the three women receiving $5,000 ($6.6k in today's money).
On top of that, anyone who had joined the class action was entitled to a $100 refund for each pair of New Balance shoes they had purchased.
When Benjamin Careathers saw a Red Bull advert promising that the energy drink would give him "wings," he decided to put the claim to the test. After consuming the fizzy drink for 10 years and remaining firmly wingless, the New York resident took Red Bull to court for false advertising. Careathers claimed that the manufacturers had deliberately misled purchasers, who bought the drink in the hope that it would give them a competitive edge.
Plaintiffs David Wolf and Miguel Almaraz also filed lawsuits against the company, piling on the pressure for Red Bull to repond...
The case never made it to court, as Red Bull was concerned about the bad publicity it might bring. Instead, it settled for $6.5 million with Careathers and set aside a further $6.5 million to cover the cost of any additional refund claims, with each payment worth around $8.4 million in 2023 money. It also pledged to cover up to $4.75 million ($6.16 million today) of the plaintiff's class counsel fees.
Any customers who had bought Red Bull between 1 January 2002 and 3 October 2014 could apply for a refund if they also felt they'd been misled by the company's marketing. The total compensation was supposed to work out to about $10 per person who had drunk Red Bull since 2002, or two 'free' Red Bull products with a combined retail value of $15.
Tech giant Google is no stranger to controversy, but a recent ruling means the company is liable to lose millions. A class action lawsuit filed a decade ago claimed the company was guilty of "storing and intentionally, systematically and repeatedly divulging” users' search histories to third-party entities. Plaintiffs argued this was a violation of privacy law, as well as a breach of Google's own privacy pledge.
Google, which is owned by the parent company Alphabet, has maintained it's done nothing wrong. But it has agreed to comply with a preliminary court order to pay a settlement fee of $23 million, part of a ruling that will also require it to add privacy disclosures to its homepage.
Anyone who clicked on a Google Search result between 26 October 2006 and 30 September 2013 could be entitled to compensation, with the average payment expected to be around $7.70. Users had until 31 July this year to request repayment, with the final approval hearing for the settlement currently scheduled for October.
Now take a look at the big US companies who are bankrupt right now