The popular fast food chain Subway filed a lawsuit against the Canadian Broadcasting Corporation (CBC) as a result of a report the TV network aired last month, claiming that 50% of their chicken is not, in fact, chicken. The suit is for $210 million dollars in damages and was filed in a Canadian court.
According to the food chain’s own website, Subway is one of the fastest-growing franchises in the world, with 44,882 restaurants in 112 countries and territories as of December 27, 2016. The United States alone has 26,646 outlets. Although the company has been around for 51 years, its rapid rise in recent history has made it an easy target for lawsuits and controversy. For example; in 2015 Subway ended its long and successful marketing campaign with convicted child molester Jared Fogle after he was sentenced to 15 years in federal prison. Last year, Subway settled a federal lawsuit alleging that its foot-long heroes were less than a foot long, promising plaintiffs it would enforce the 12-inch standard.
Also In August 2015, food blogger and activist Vani Hari petitioned Subway in conjunction with the Natural Resources Defense Council, Friends of the Earth, and the Center for Food Safety, U.S. Public Interest Research Group. The petition asked the Fast Food Giant to commit to buying meat produced without the routine use of antibiotics and to provide a timeline for doing so. The petition came at a time when the media discovered that Subway had used azodicarbonamide as a bread conditioner, to whiten the dough and allow sandwich bread to bake more quickly. The ingredient is also used as a filler in yoga mats. This discovery caused a stir in the public court of opinion, as articles and blurbs were passed around the internet and social media.
Similarly, Subway’s healthy and fresh marketing is again under attack. In an episode of CBC Marketplace titled “The Chicken Challenge” that aired on February 24th, it was alleged that Subway’s oven-roasted chicken actually contained just 53.6% chicken and its strips were only 42.8% real chicken. There were also accusations that the chicken contained soybeans and other filler. The report came to those conclusions based on DNA testing done by Trent University in Peterborough, Ontario. In comparison, Marketplace also tested products from four other fast-food restaurants — McDonald’s, Wendy’s, A&W and Tim Hortons — and concluded that all were at least 86% real chicken. Chicken bought at a grocery store is usually 100%, the report said. Although the report aired on Canadian television, the news quickly went viral immediately in the United States as well. Articles and video clips of the show were routinely passed around social media. That video clip has since been removed from the CBC episode listings.
In their defense, Subway voiced its objection to the results almost immediately after the show aired. “Our recipe calls for 1% or less of soy protein in our chicken products,” Subway told CBC. “We will look into this again with our supplier to ensure that the chicken is meeting the high standard we set for all of our menu items and ingredients.” Subway performed their own lab tests on the Canadian suppliers chicken and came up with a different result. Subway then requested that CBC post a retraction. Subway told New York Post:
“despite our efforts to share the facts with the CBC about the high quality of our chicken and to express our strong objections to their inaccurate claims, they have not issued a retraction, as we requested. Serving high-quality food to our customers is our top priority, and we are committed to seeing that this factually incorrect report is corrected.”
As a result of the bad press that Subway has received, the sandwich chain has initiated a lawsuit in Canada against CBC claiming $210 Million in damages. Canadian defamation laws mirror the common law in the United States with some differences. Much like defamation in the United States, Canadian defamation law deals with a specific tort (cause of action). Cases of defamation of character result from a statement to a third party about an identifiable individual that is false and harms this person’s reputation, decreases the respect regard, or confidence in which a person is held, or induces hostile or disagreeable opinions or feelings against a person. An individual may then sue for damages based on these statements.
However, in stark contrast to the United States, Canadian libel law has been slow to change. In Hill v. Church of Scientology of Toronto, the Supreme Court of Canada reviewed the relationship of the common law of defamation and the Canadians’ Charter of Rights and Freedom. The Court rejected the actual malice test outlined in the U.S. Supreme Court decision New York Times Co. v. Sullivan, citing criticism of it not only in the United States but in other countries as well. In other words, it is easier to get a positive verdict for a defamation petitioner in Canada because they do not have to prove that the respondent purposely meant to do harm by their statements. All the petitioner has to do, is prove they were harmed by the statements in general.
Regardless as to how this plays out in court, what is certain is that between expensive lawyer retainers, arbitration costs, costly motions and (no doubt) years of upcoming litigation, both sides will be spending lots of bread.