McDonald's case highlights risks of libel

By Patricia Reaney

Reuters (London); 19th June 1997

When McDonald's decided to sue two environmental activists for libel seven years ago, the hamburger giant had no idea of the Pandora's box it was opening. It had simply hoped to stop the pair from printing allegations in a six-page pamphlet that its food was unhealthy, its staff exploited and that it damaged the environment.

But instead the world's biggest restaurant chain embarked on what some experts called a public relations diaster, costing an estimated 10 million pounds ($16.5 million).

"Faced with a similar dilemma, I would advise my clients to spend their money on a Porsche as they'll get far more satisfaction from it than they will ever get from a libel action," said British lawyer Tim Hardy.

Although the judge ruled on Thursday that Dave Morris and Helen Steel had defamed the hamburger giant and awarded 60,000 pounds damages to the corporation, he also decided that some of the allegations about cruelty to animals, low pay and exploitative advertising were true.

McDonald's declared victory but the trial generated so much unwanted publicity that experts wonder whether it was worth all the effort and money.

"Others who have taken a libel case forward know to their costs that in many ways you open yourself up to the original information, which you found upsetting, then being repeated ad nauseam and then reported," said David McNeil of the Law Society, a body for lawyers.

Stefano Hatfield, editor of the British advertising industry journal Campaign, agreed that libel was a risky business and McDonald's had paid a high price.

"It's been quite damaging, image wise," he said.

"They probably expected them (the activists) to go away and that they would be intimidated by the financial costs. I don't think they could have predicted the length of the trial. It developed a self-fulfilling notoriety."

England's longest trial dragged on for nearly three years, made headlines around the globe and spawned a book, television documentary and an Internet web site that has been accessed 12 million times.

Instead of gleaming golden arches and Ronald McDonald extolling the benefits of Big Macs, much of the media coverage portrayed the master of marketing as a big, bad Goliath out to destroy two crusading, penniless Davids.

But despite the negative aspects, McDonald's insists it has no regrets about pursuing the case and that the judgment represents a thorough audit of its business.

While a quicker result would have been welcome, McDonald's feared that if it didn't act, the allegations would have continued and people might have believed them.

"What if we had not challenged the allegations, what if people believed the allegations to be true and stopped coming to our restaurants? What if people stopped applying to make their careers with us, stopped investing in our stock? I think it is wrong to assume that if we had taken no action the allegations would have gone away," said U.K. head of communications Mike Love. ($ = 0.609 British Pounds)

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