The class-action case was filed by an investor late last year

Chipotle won a class-action lawsuit filed by a shareholder in late 2024 claiming the chain was skimping on portion sizes. The U.S. District Court for the Central District of California found this week that the online “viral criticisms” about portion sizes were not sufficient evidence to support claims of fraud against the restaurant chain, according to Bloomberg Law.

The accusations picked up steam last year following a review from social media influencer Keith Lee, who claimed in a May TikTok review that Chipotle’s chicken portion was “crazy low.” The post generated more than 2.3 million engagements. The lawsuit also cited a Wells Fargo analyst’s report showing that the portion sizes of 75 burrito bowl orders from different locations were inconsistent.

“Chipotle’s portion sizes were inconsistent and left many customers dissatisfied,” alleges plaintiff Michael Stradford in his Nov. 11, 2024, complaint in a California federal court.

“The company understated how difficult it would be to convince customers of the ‘overall value proposition of its menu’ given that the Company provided customers with highly inconsistent (and in the view of some customers, lacking) portion sizes,” the suit said, adding that the company acted fraudulently by making no changes to its policy on portion sizes even as customers were complaining on social media about them.

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During Chipotle’s second quarter 2024 earnings call, then-CEO Brian Niccol acknowledged some “outlier” restaurants with low scores on portion sizes and said the company would sharpen its focus on training and investments to ensure more consistency.

“We’ve probably found about 10% or more of restaurants that we view as outliers that needed to be retrained (and) re-coached to be executing against what we believe are the right standards,” he said. “At the same time, we collectively said we do not go back one inch on our equity of generous portion sizes. For 90% of our restaurants, they’re doing business as usual. This really was something where we doubled down as a system, but we really needed to kind of train up roughly 10% of the system.”

Contact Alicia Kelso at Alicia.Kelso@informa.com

Source https://www.nrn.com/fast-casual/chipotle-wins-lawsuit-over-portion-sizes