Trials & Litigation

Federal suit over coffee machine bought at Starbucks settles for $250, but lawyer could get $175K

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A Michigan woman who sued Starbucks and Kraft Foods over promotional claims made about a single-serve Kraft coffeemaker sold at Starbucks shops has settled for $250 after a 2½-year federal court battle.

But the plaintiff’s legal counsel will get attorney fees under the deal, which are estimated at nearly $175,000, the Grand Rapids Press reports. Costs could add another $5,000-plus. A judge will decide exactly how much the defendants owe.

Pamella Montgomery agreed to the settlement after efforts to win class certification failed.

She said she had purchased a single-serve Kraft Foods Tassimo coffeemaker because it was advertised as the only one that used Starbucks coffee pods. But even as she bought the $100 machine, Montgomery alleged, Starbucks knew that it would soon begin making the pods exclusively for use by Tassimo competitor Keurig, the article reports.

Kraft and Starbucks confirmed the settlement—although they disputed Montgomery’s claims during the litigation—for what Kraft described as “a modest amount.”

Attorney Timothy McCarthy Jr. represents Montgomery. He said lawyers willing to take a contingency-fee case are often the only option for redress when individual shoppers suffer a loss.

“If you don’t have a consumer protection law … there would never be a remedy for consumers,” he said. “If lawyers never have a chance of getting paid, there would never be a claim filed.”

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