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Originally published April 17, 2014 at 7:50 PM | Page modified April 18, 2014 at 7:36 AM

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Download Cheerios coupon, give up right to sue General Mills?

General Mills has become one of the first, if not the first, major food companies to seek to impose what legal experts call “forced arbitration” on consumers if a customer downloads a coupon or joins the company’s website.


The New York Times

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Might downloading a 50-cent coupon for Cheerios cost you legal rights?

General Mills, the maker of cereals like Cheerios and Chex as well as brands like Bisquick and Betty Crocker, has quietly added language to its website to alert consumers that they give up their right to sue the company if they download coupons, “join” it in online communities like Facebook, enter a company-sponsored sweepstakes or contest or interact with it in a variety of other ways.

Instead, anyone who has received anything that could be construed as a benefit and who then has a dispute with the company over its products will have to use informal negotiation via email or go through arbitration to seek relief, according to the new terms posted on its site.

In language added Tuesday after The New York Times contacted it about the changes, General Mills seemed to go even further, suggesting that buying its products would bind consumers to those terms.

“We’ve updated our Privacy Policy,” the company wrote in a thin, gray bar across the top of its home page. “Please note we also have new Legal Terms which require all disputes related to the purchase or use of any General Mills product or service to be resolved through binding arbitration.”

But on Thursday, General Mills said that the updated legal policies did not apply to people who access its Facebook pages and Twitter accounts.

Asked for comment before the article was published, company representatives declined to make anyone available for interviews and issued a brief statement instead.

In an email received on Thursday, Mike Siemienas, a General Mills spokesman, said the “online communities” mentioned in the amended policy referred only to those online communities hosted by the company on its own websites.

He later elaborated in a second email: “No one is precluded from suing us merely by purchasing our products at the store or liking one of our brand Facebook pages. For example, should an individual subscribe to one of our publications or download coupons, these terms would apply. But even then, the policy would not and does not preclude a consumer from pursuing a claim. It merely determines a forum for pursuing a claim. And arbitration is a straightforward and efficient way to resolve such disputes.”

Lawyers had pointed out that the new terms were vaguely written, leaving them open to a wide range of interpretation. A pop-up notice on the company’s home page, for example, says that the new terms “require all disputes related to the purchase or use of any General Mills product or service to be resolved through binding arbitration.”

“It is very clear that if you do any number of things, you are covered by these changes,” said Julia Duncan, director of federal programs at the American Association for Justice, a trade group for trial lawyers. “If you use a coupon, go on their website, participate in a promotional campaign of any sort, sign up for email alerts or ‘participate in any offering by General Mills.’ That is so exceptionally broad that it may be possible anything you purchase from them would be held to this clause.”

News of the changes attracted interest on social media, where legal experts debated the enforceability of the company’s policy and consumers expressed a variety of opinions. “I’m not going to like this page. I do not agree to arbitration ...,” one visitor to the Cheerios Facebook page wrote.

Another person wrote, “Sorry Bisquick. As much as I love you, I am now boycotting you because General Mills is a tool of company.”

The change in legal terms, which occurred shortly after a judge refused to dismiss a case brought against the company by consumers in California, made General Mills one of the first, if not the first, major food companies to seek to impose what legal experts call “forced arbitration” on consumers.

“Although this is the first case I’ve seen of a food company moving in this direction, others will follow; why wouldn’t you?” said Duncan. “It’s essentially trying to protect the company from all accountability, even when it lies, or say, an employee deliberately adds broken glass to a product.”

A growing number of companies have adopted similar policies over the years, especially after a 2011 Supreme Court decision, AT&T Mobility v. Concepcion, that paved the way for businesses to ban consumers claiming fraud from joining together in a single arbitration. The decision allowed companies to forbid class-action lawsuits with the use of a standard-form contract requiring disputes be resolved through the informal mechanism of one-on-one arbitration.

Credit-card and mobile-phone companies have included such limitations on consumers in their contracts, and in 2008, the magazine Mother Jones posted a story about a Whataburger fast-food restaurant that had a sign warning customers that simply by entering the premises, they agreed to settle disputes through arbitration.

Companies have continued to push for expanded protection against litigation, but legal experts said a food company attempting to limit its customers’ ability to litigate against it raised the ante in a new way.

What if a child allergic to peanuts ate a product that contained trace amounts of nuts but mistakenly did not include that information on its packaging? Food recalls for mislabeling, including failures to identify nuts in products, are not uncommon.

“When you’re talking about food, you’re also talking about things that can kill people,” said Scott L. Nelson, a lawyer at Public Citizen, a nonprofit advocacy group.

“There is a huge difference in the stakes, between the benefit you’re getting from this supposed contract you’re entering into by, say, using the company’s website to download a coupon, and the rights they’re saying you’re giving up, Nelson said. “That makes this agreement a lot broader than others out there.”

Nelson said he did not think a court would agree to enforce the policy if a consumer merely visited a General Mills website, “but we really don’t know.”

“You can bet,” he said, “there will be some subpoenas for computer hard drives in the future.”



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