Applebee's 'Hidden Drink Prices' Lawsuit Gets Dismissed – As It Should Be

It’s fair to say that class action lawsuits get their share of bad press. Some of the most common criticisms include allegations that they’re frivolous, a waste of time, and generally make mountains out of mole hills. Often, these criticisms are based on a misunderstanding of specific cases, or because commentators confuse class action lawsuits – a legal process that allows multiple similarly situated individuals to band together – with cases where one person sues a company over a personal matter.

In truth, class action lawsuits are more often than not about a company misleading or hurting its customers in some small, but not insignificant, way. They’re about leveling the playing field and bringing consumers together to take on big companies.

That said, sometimes they do get a bit silly – and in these cases, courts have an important role to play in making sure meritless lawsuits don’t move forward. In a recent suit against Applebee’s, common sense has prevailed, and earlier this week a New York judge upheld the dismissal of a rather unusual case.

Plaintiff Candice Watkins filed a proposed class action after noticing that Applebee’s failed to list the price of certain drinks on its menus. This, according to the suit, violated New Jersey’s Consumer Fraud Act, which makes it illegal for businesses to sell products without listing the prices clearly. Violations of the Truth-in-Consumer Contract, Warranty and Notice Act were also alleged.

It’s certainly annoying to not know how much an item is, but does Applebee’s failure to list the individual prices for all of its soda, beer, wine, coffee and tea threaten to mislead consumers? If you buy something and only later discover that it costs more than you thought, that’s clearly a problem – but, ultimately, Watkins was unable to convince the court that Applebee’s menus posed the risk of misleading customers. Essentially, the court found that failure to list prices in this instance was not the same as an intentional attempt to mislead customers or trick them into paying more than they thought:

“[…] Omitting certain prices from restaurant menus does not pose the same risk of misleading a consumer into failing to enforce her legal rights as an affirmative misrepresentation.”

To support her case, Watkins pointed to a previous lawsuit filed against TGI Friday’s in which a customer was charged more for a beer at the restaurant than he would have been had he ordered an identical drink at the bar. In upholding that decision, courts ruled that the “undisclosed price differential” violated consumer protection laws. In the case of Applebee’s menus, though, there is no price differential and the price itself is not the focus of the suit. Although Watkins – who also named IHOP and the two restaurants’ parent company DineEquity, Inc. in the lawsuit – argued that New Jersey law requires businesses to list all prices at the point of sale, it was not enough for the proposed class action to continue. An amended complaint and a motion for reconsideration have now been dismissed, putting an end to the lawsuit. Applebee’s, presumably, couldn’t be happier. There’s no word yet whether Watkins will be returning there in the future.

So, what does this case show us? That class action lawsuits are frivolous? Or that, while some frivolous suits might be filed, a robust legal system can more than handle them, ensuring only legitimate lawsuits continue? There are worse things in life than not knowing, at a single glance, how much a glass of soda is. While it’s certainly important that businesses list their prices accurately and openly, let’s remember what class action lawsuits are for: bringing companies to justice when they mislead or hurt consumers.