Johnny Rockets Lawsuit Results in $37 Million Settlement

In August 2013, a woman initiated a class action lawsuit against Johnny Rockets restaurant for unlawfully printing the last four digits of her credit card, the expiration date, her name and brand of card, on her receipt, thereby revealing too much of the customer’s personal information. This was a violation of the Fair and Accurate Credit Transactions Act (FACTA).

Results of the Lawsuit

The outcome of the lawsuit was a $37 million judgment that includes statutory and punitive damages, despite the restaurant filing a Chapter 7 bankruptcy.

The Johnny Rockets FACTA class action lawsuit was certified in December 2014. The motion for final approval and judgement at a fairness hearing in November was granted by U.S. Magistrate Judge John E. McDermott.

An incentive award of $5,000 was granted to a woman for representing the class. The $27 million judgment also provides for attorneys’ fees in the amount of $24,313 and court costs that totaled $10,468.

Individuals of the Johnny Rockets FACTA class action lawsuit include “all consumers who, at any time during the period of January 18, 2012 to March 15, 2013 made a purchase or other transaction at the Johnny Rockets Calabasas Restaurant using their credit card or debit card.”

During this time, it is estimated that 33,735 issued debit and credit card receipts were not in compliance with FACTA rules. There were no objectors to the terms of the settlement and no class member requested exclusion, according to court documents.

Attorneys at Parker Waichman LLP are actively reviewing potential lawsuits on behalf of individuals who are seeking advice and information on legal issues. Parker Waichman law firm offers free, no-obligation case evaluations.

FACTA Law Background

The Fair and Accurate Credit Transactions Act (FACTA) was designed to protect consumers from identity theft by raising security, privacy, and information sharing. To this end, on November 22, 2003, FACTA was passed by the U.S. Congress as an amendment to the Fair Credit Reporting Act (FCRA). It requires businesses to truncate (abridge) credit and debit card numbers and suppress printing of card expiration dates on electronically printed consumer receipts.

But, numerous merchants allegedly failed to meet FACTA compliant requirements and consumers have filed hundreds of lawsuits comparable to the Johnny Rockets FACTA class action lawsuit against merchants who it is claimed printed a truncated account number and the expiration dates on receipts. Plaintiffs argued that those merchants “willfully” violated FACTA.

Statutory damages of $100 to $1,000 per willful FACTA violation is given by FACTA law. There is no cap on damages awarded under FACTA law.

Johnny Rockets’ Overhaul and Update

In April 2016, the 30-year-old chain surprised fans when it announced plans to scrap its iconic diner décor and atmosphere, which includes dancing servers in white paper caps, jukeboxes, red-vinyl booths, and stainless-steel counters. The new look was unveiled in a restaurant in Syracuse, New York. Since that time, Johnny Rockets has revamped 33 restaurants as it closes 2016 with a record growth of nearly 50 more locations around the world, reports The Orange County Register.

San Diego and Orange restaurants will be the first in Southern California to adopt the new image. The update of the Johnny Rockets scheduled for early February 2017, will have a few more “bells and whistles.”

It will be among a handful of the chain’s 400 restaurants testing self-ordering kiosks powered by iPads. This technology is being tried out in five restaurants, including one in Santa Monica.

The global president of operations and development James Walker, said the kiosks are meant to speed up service for diners waiting for tables or looking for takeout, not as a replacement for employees.

Johnny Rockets Lawsuit Results in $37 Million Settlement

Johnny Rockets Lawsuit Results in $37 Million Settlement

Walker said the majority of the revenue driven from kiosk orders are take-out sales. The company is investing about $170,000 at restaurants with a kiosk system. The investment return is expected to be realized in two years.

The 18-year-old Orange location will also unveil other updates, including menu enhancements and new technologies. Walker said the changes are designed to push Johnny Rockets’ commitment to quality and freshness, according to The Orange County Register.

In 2016, John Maguire, chief executive of the parent company of Friendly’s, was named chief executive of Johnny Rockets. The leadership change follows three years after Johnny Rockets was bought by Sun Capital Partners, a private equity company with a huge stake in FIC Restaurants, Friendly’s parent company.

Legal Information and Advice

Parker Waichman LLP has years of experience representing clients in fraudulent or negligent business lawsuits. If you or someone you know is seeking legal information or advice, we urge you to contact Parker Waichman attorneys at 1-800-YOURLAWYER (1-800-968-7529).

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