McDonald’s in Talks on Games Scam Case

McDonald’s Corp. has been in talks to settle a lawsuit filed against the marketing firm whose employees allegedly hatched a scam involving the fast food giant’s promotional games, an attorney said Tuesday.

Ralph Shapiro, an attorney representing Simon Worldwide Inc., said talks with representatives of McDonald’s had been going on for several weeks. He said the talks are continuing in some aspects of the case, while they have ended in other areas.

“I can’t comment any more than that,” said Shapiro, a partner with the Los Angeles law firm of O’Melveny & Myers.

According to published reports, McDonald’s has informed its franchisees that it has ended talks with Los Angeles-based Simon Worldwide. In an e-mail to the franchisees, McDonald’s said issues surfaced that precluded pursuing an out-of-court agreement, and that it will proceed in its lawsuit against the promotions firm to recoup losses.

McDonald’s spokesman Walt Riker on Tuesday refused to comment on the report, citing the ongoing litigation.

In October, McDonald’s sued Simon Worldwide Inc., its subsidiary Simon Marketing, and Jerome Jacobson, the man allegedly at the center of the game scandal, as well as other defendants.

McDonald’s complaint claims Simon Marketing engaged in fraud, breach of contract, breach of fiduciary obligations and civil conspiracy.

Simon Marketing has sued McDonald’s seeking to recover damages resulting from McDonald’s decision to sever their relationship.