Panera Bread has agreed to pay $2 million to settle a class action lawsuit after allegedly misleading customers about the prices and fees for delivery orders.
Panera Bread customers who ordered food for delivery between Oct. 1, 2020 and Aug. 31, 2020 will be eligible for some settlement funds. However, they first need to submit a claim, according to the Kroll Settlement Administration, which was appointed to oversee the settlement. Customers would need to provide proof of purchase to verify the claim, which could either be the phone number they used to place the order or an email notice.
Customers whose claims are verified may receive vouchers valued at $9.50 each or an electronic cash payment of up to $12 from Panera Bread via PayPal. In exchange for agreeing to pay over $2 million to customers, Panera Bread would not be required to admit any wrongdoing, per the settlement terms.
What's Behind the Panera Bread Lawsuit?
In February 2023, three plaintiffs filed a class action lawsuit where they accused Panera of misleading customers about the cost of delivery fees and menu prices. Specifically, the lawsuit alleged that Panera promised to provide either free or low-cost deliveries at $1 or a flat rate to customers who ordered through the company's mobile app or website.
However, Panera allegedly marked up food prices for delivery orders by 5% to 7%. Per the lawsuit, a customer who ordered a sandwich through the app may have been charged an extra $1 for delivery compared to if they picked it up in the store. The extra fee was only displayed on the app or website after the customer chose delivery or pickup.
"This secret menu price markup was specifically designed to cover the costs of delivering food and profit on that delivery," the lawsuit read. "It was, in short, exclusively a charge for using Panera's delivery service and was, therefore, a delivery charge."
Other Lawsuits Against Panera Bread
Panera Bread also found itself at the center of other lawsuits late last year that alleged the caffeine contents of its Charged Lemonade drinks caused cardiac arrests that killed two separate people. A third separate lawsuit alleged that the beverage caused permanent heart issues, per USA Today.
A top Republican in the California Assembly also recently called for an investigation after it was previously reported by Bloomberg that Gov. Gavin Newsom pushed for an exemption to the state's new fast food minimum wage law to benefit a donor owning two dozen Panera Bread locations.
