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TIL McDonald's payed 16.6 million for another companies failure


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#1 iargue

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Posted 25 September 2012 - 10:32 AM

http://www.bizjourna...16/daily16.html
http://www.nytimes.c...settlement.html

From 1995 to 2000, mcdonalds hired Simons Wordwide Inc to handle their Monopoly game. During that time, one of the staff perpetrated fraud and handed out the best prizes to his friends, and split the money gained from it.

A federal case was launched, the people involved arrested, and many of them jailed. Mcdonalds took that time to sue the company involved for Breach of Contract. That was thrown out by a judge, and they ended up paying the company that cost them million in fraud, 16.6 million dollars for "breach of contract",

It appears as though Mcdonalds has the shittiest lawyers in the world it seems.

#2 Waser Lave

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Posted 25 September 2012 - 10:45 AM

It didn't work out too well for Simon Worldwide Inc. apparently since they ended up losing their two main customers and shutting down.

#3 Boggart

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Posted 25 September 2012 - 10:57 AM

I dunno, I sued McDonalds for making me fat and I lost all my money. At least I"m thin now because I can't afford food.

#4 Mew

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Posted 25 September 2012 - 11:03 AM

I bloody well knew someone was keeping all the good properties and instant win cards to themselves!

#5 Guest_coltom_*

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Posted 25 September 2012 - 11:09 AM

I really don't understand what you don't understand about this. Individuals committed crimes. The courts did not find that company that had hired these individuals was involved. Therefore, McDonalds had no grounds to break their contract.

I love the precedent you want to set. If Exxon the company was liable for each action of any of its employees, even if the employee was taking that action on their own, then environmental protection would be a whole lot easier.

#6 iargue

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Posted 25 September 2012 - 02:50 PM

I really don't understand what you don't understand about this. Individuals committed crimes. The courts did not find that company that had hired these individuals was involved. Therefore, McDonalds had no grounds to break their contract.

I love the precedent you want to set. If Exxon the company was liable for each action of any of its employees, even if the employee was taking that action on their own, then environmental protection would be a whole lot easier.


The company put him directly in charge of distribution of the most valuable pieces, and did not supervise or investigate his actions. This a direct and blatant failure on their part to do their job. Mcdonalds contracted them to fairly distribute the pieces to its customers, in which they wholefully failed.

The court did not find that the company was not in violation, the judge said it didn't belong in federal court.

If a company fails to do their job, then there should be no penalty for breach of contract. Mcdonalds just has shitty lawyers.

It didn't work out too well for Simon Worldwide Inc. apparently since they ended up losing their two main customers and shutting down.


That is why you supervise your workers.

#7 Guest_coltom_*

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Posted 25 September 2012 - 03:50 PM

I suppose I'll believe that McDonalds had the best lawyers money could buy, hardly strains the mind. Therefore, the conclusion is that McDonalds did not have claim in fact, therefore could not succeed in their claim.



#8 Deathscythe

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Posted 25 September 2012 - 08:42 PM

Yes, in most cases, a company is liable for its employee's actions. However, if the employee does something that is not reasonably under his obligation to the company, it is possible to argue that the company is not liable. Either way, Mcdonalds is a big enough company to take a hit of 16.6 million in its stride. Especially since it made over 5.5 billion last year.

#9 iargue

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Posted 25 September 2012 - 10:08 PM

I suppose I'll believe that McDonalds had the best lawyers money could buy, hardly strains the mind. Therefore, the conclusion is that McDonalds did not have claim in fact, therefore could not succeed in their claim.


Your second sentence doesn't even make sense....

And your first sentence is incorrect. See their lawsuit regarding coffee being too hot.

#10 Sweeney

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Posted 25 September 2012 - 10:17 PM

If a company fails to do their job, then there should be no penalty for breach of contract.


You really ought to type slower.

Your second sentence doesn't even make sense....


Yes, it does.

#11 Boggart

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Posted 26 September 2012 - 05:40 AM

Monopoly is still being played in my country. I got two railroads. yay.

#12 artificial

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Posted 26 September 2012 - 05:53 AM

Codex GC is starting to become more and more like mainstream media. A delayed feed of the Reddit frontpage :(

#13 Guest_coltom_*

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Posted 26 September 2012 - 05:54 AM

1967 George C. Scott, the movie was the Flim-Flam Man. There is a cameo by my step-brother's crazy uncle. However the point is that in one scene George sells a punch-card board to a local business. A punch-card has hundreds of little numbers, you pay a quarter or nickle back then. If you punch out a little rolled up piece of paper with a prize on it, you win the prize. So George was the seller, then his young protege comes in, with the location memorized for the prizes, and wins the Grande ($10) and second ($5) prize, plus George had sold the store owner the board for a dollar or two in the first place.

I have pondered that. The store owner didn't actually lose any money if he put out the punchboard and sold chances to an unsuspecting public. It was the public that actually lost there opportunity cost to win.

The same with McDonalds. McDee was going to give out a prize, so they were not out of anything. It did not distract from the contest, because no one knew what was going on until after the contest was over. So what was the claim that McDees had? What was their damages.

Oh sure, some damage in reputation, but do you blame the victim for the actions of a thief?

Edited by coltom, 26 September 2012 - 05:55 AM.


#14 iargue

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Posted 27 September 2012 - 10:11 AM

Yes, it does.


If there was another comma in there it would.

#15 Guest_coltom_*

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Posted 27 September 2012 - 10:19 AM

When you can't argue substance you argue form. Always the definitive sign of a lost argument.

#16 Sweeney

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Posted 27 September 2012 - 10:52 AM

If there was another comma in there it would.


No, It makes sense as it is.

#17 iargue

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Posted 27 September 2012 - 01:16 PM

1967 George C. Scott, the movie was the Flim-Flam Man. There is a cameo by my step-brother's crazy uncle. However the point is that in one scene George sells a punch-card board to a local business. A punch-card has hundreds of little numbers, you pay a quarter or nickle back then. If you punch out a little rolled up piece of paper with a prize on it, you win the prize. So George was the seller, then his young protege comes in, with the location memorized for the prizes, and wins the Grande ($10) and second ($5) prize, plus George had sold the store owner the board for a dollar or two in the first place.

I have pondered that. The store owner didn't actually lose any money if he put out the punchboard and sold chances to an unsuspecting public. It was the public that actually lost there opportunity cost to win.

The same with McDonalds. McDee was going to give out a prize, so they were not out of anything. It did not distract from the contest, because no one knew what was going on until after the contest was over. So what was the claim that McDees had? What was their damages.

Oh sure, some damage in reputation, but do you blame the victim for the actions of a thief?


Its almost impossible to argue with you because I read what you are saying, and I can't decide if you are insane or not.

I do not know why you even included that movie part... but okay.

McDonald loses a lot from what happened. They lose the money that they gave away in the prizes, and then afterwards, they had to give away a second set of prizes to attempt to appease the people. All in all, they lost around 5 million dollars from the event (Probably more), as well as a hit to their reputation.

In the story owner does lose money. First he pays for the board, and then he pays the 10 and 5 dollar prizes. Depending on how many people purchased a chance at it before it was won, he either lost or mad a tiny profit. In the McDonald's case, the consumers lose out massively because they have 0% chance to win the prizes that they wanted to win.

This in return negatively effects every single event that they attempt to launch in the future. People will refuse to join it and the event is useless. A bad reputation is a bad thing for any company. As such, the failure of the company that they have a contract with hurts Mcdonalds massively.

This entire incident happened because of gross negligence on the behalf of the contractor, and as such, they violated their contract.

#18 Deathscythe

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Posted 27 September 2012 - 09:11 PM

It's true that damage to reputation can hurt a company badly. But I don't think Maccas has taken much of a hit, people expect cheap fast food and that's what they get. Anything else is just an extra.

#19 artificial

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Posted 28 September 2012 - 12:20 AM

Its almost impossible to argue with you because I read what you are saying, and I can't decide if you are insane or not.


lold


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