KFC parent company sued over improper application of Cook County soda tax

Cook County’s penny-per-ounce sweetened beverage tax has led to another lawsuit alleging a restaurant applied the tax incorrectly.

Yum! Brands, the parent company of KFC, has been sued over allegations that employees at a KFC restaurant improperly applied the Cook County sweetened beverage tax to purchases. Commonly referred to as the “soda tax,” the sweetened beverage tax applies to both bottled beverages and fountain drinks that contain sugar or artificial sweetener.

Attorneys with the Chicago-based law firm Zimmerman Law Offices P.C. are representing plaintiffs who allege that a Franklin Park KFC erroneously applied the sweetened beverage tax when ringing up the plaintiffs’ purchases at the restaurant. In their lawsuit the plaintiffs allege that this resulted in the restaurant adding the beverage tax to the subtotal and illegally charging sales tax on the sweetened beverage tax. The plaintiffs are seeking class-action status for the lawsuit.

The lawsuit alleges that the two plaintiffs were overtaxed a combined $0.06, and that the KFC manager said the restaurant could not provide a cash refund.

The fried chicken chain’s parent company is just the latest business to be taken to court over Cook County’s penny-per-ounce sweetened beverage tax. Walgreens, McDonald’s, 7-Eleven and others have all faced lawsuits amid the county’s rollout of the new tax. The KFC case is not the first time Zimmerman Law Offices has entered the fray. The law firm filed a suit against 7-Eleven and has taken similar actions against other big brands such as Subway, PepsiCo and Jewel-Osco.

And Cook County officeholders were even warned ahead of time by concerned retailers that the new tax would lead to litigation, which was one of the main reasons the Illinois Retail Merchants Association brought a lawsuit against Cook County to stop the tax from going into effect.

But now that the genie has been let out of the bottle, it’s only a matter of time before another business is hit with a soda tax-related lawsuit. Yum! Brands’ cash registers were equipped with point of sale software the lawsuit alleges was improperly programmed. Other, smaller retailers with less sophisticated cash register systems could be especially vulnerable to these kinds of lawsuits.

The soda tax is also widely unpopular. An August poll of Cook County voters commissioned by the Illinois Manufacturers’ Association showed that nearly 87 percent of respondents disapproved of the tax. And although soda tax proponents such as Cook County President Toni Preckwinkle claim the tax is to improve public health, there’s evidence that Cook County residents aren’t buying that claim. This is despite a major advertising push by sweetened beverage tax advocate and former New York City Mayor Michael Bloomberg.

Bloomberg has vowed to “spend whatever it takes” to support the re-election of Cook County commissioners who support the tax, according to the Chicago Sun-Times.

A September poll of Cook County registered voters conducted by We Ask America sought to measure the efficacy of a $5 million ad campaign paid for by Bloomberg. The results showed that 87.5 percent of respondents answered that commissioners voted for the tax “for other reasons,” rather than to improve public health.

A bipartisan ordinance to repeal the sweetened beverage tax has been introduced. The ordinance has been referred to the Cook County Board Finance Committee, chaired by Commissioner John Daley, D-Chicago.

Daley voted in favor of the tax in November 2016. A hearing on the soda tax is expected to be held Oct. 10.