Day 045 - 03 Nov 94 - Page 30


     
     1        rule something, and we did change our procedures from it.
     2        I do remember that.
     3
     4   Q.   If it helps with your memory, it says here:
     5
     6        "....and that McDonald's have given the ad firm which ran
     7        the contest a fee of $25,000 with which it was obliged to
     8        pay for all the prizes awarded."
     9
    10        In other words, the implication is that they were
    11        advertising $500,000 as prizes, knowing that $25,000 would
    12        cover the eventual payouts?
    13        A.  I believe, again, this happened well before I joined
    14        the company, but I do remember reading that there was a
    15        case, in fact, and that the procedures and rules and
    16        guidelines that we have set up took that into effect.
    17
    18   Q.   It says:  "McDonald's signed a consents degree and the
    19        actual charges were dropped." That sounds-----
    20        A.  That sounds correct, yes.
    21
    22   Q.   While I am going through these specific things, do you
    23        remember the controversy over the promotion of the Quarter
    24        Pounder when it was first introduced in the early 70s?
    25        A.  Yes, I do.
    26
    27   Q.   And the USDA had actually analysed the Quarter Pounder and
    28        found that it was not actually a quarter pound?
    29        A.  I think that was the inception of the pre-cooked
    30        weight; it was a quarter pound of beef before cooking and
    31        that some weight loss accompanied it during the cooking.
    32        So all of our Quarter Pounder advertising has a overlay on
    33        it that talks about pre-cooked weight.
    34
    35   Q.   But it did not at the time, did it; and is that what the
    36        official complaints were?
    37        A.  That is what I remember it to be, yes.
    38
    39   Q.   So were the complaints that they considered that you were
    40        being deceptive?
    41        A.  Yes.  Obviously, they would not have done that if they
    42        did not think we should have had some disclosure that it
    43        was pre-cooked weight versus post-cook weight.  It was not
    44        done intentionally.  I was not part of it at the time.
    45        I am just sort of recalling some of the discussions that we
    46        had.  We do start with a quarter pound of beef, but it has
    47        some weight loss.
    48
    49   MS. STEEL:  Are McDonald's encouraged to -- or, in each
    50        locality, community, whatever -- are McDonald's operators, 
    51        managers, whatever you want to call them, encouraged to 
    52        join The Chamber of Commerce? 
    53        A.  Certainly.  It is good business.
    54
    55   Q.   The local school board?
    56        A.  Well, they are encouraged to be active in their
    57        community.  Some of them are active from a political point
    58        of view; some of them are active from a community relations
    59        point of view; some of them are active with children and
    60        teaching; some are active activity in charities; and some

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