Kentucky Fried Chicken (KFC), the quick-service restaurant brand owned by Yum filed a lawsuit against three companies in China. KFC alleged that the Chinese companies are spreading rumors on social media regarding its food quality, including chickens with eight legs.
KFC says the rumors were strange and non-sense
In its Chinese website, KFC strongly rejected the rumors that it is using genetically modified chickens with six wings and eight legs as strange and non-sense.
KFC filed lawsuits against Ying Chen An Zhi Chenggong Culture Communications Ltd., Wei Lu Kuang Technology, and Ling Dian Technology.
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The restaurant operator is demanding an apology and 1.5 million yuan ($242,000) from each of the three Chinese companies. KFC is also seeking an immediate stop on the infringements by the Chinese companies.
KFC argued that the Chinese firms that the three Chinese companies damaged its reputation by spreading false rumors regarding its products on social media. The restaurant operator said the Chinese companies are “misleading consumers” using ten micro-channel accounts through articles, microblogs, and photos.
Ms, Qu Cuirong, president of KFC in China said the rumor about the chickens with six wings and eight legs has been circulating since 2008. It started in the form of mail, BBS for the first two years, and now the Chinese companies are spreading rumors about it through microblogs and micro letters in social media.
China intensified campaign against internet rumors
Ms. Cuirong emphasized that companies are experiencing difficulty in protecting their reputation on the internet. The restaurant operator mentioned the “burden of proof” against the entities spreading the rumors as one of the challenges, and the reason as to why it took a long time for KFC to file legal charges.
KFC eventually decided to file lawsuits after the Chinese government intensified its campaign against internet rumors. According to the restaurant operator, the Chinese government issued legal guidelines regarding the matter, which provided KFC confidence and weapon to defend and protect its reputation.
Ms. Cuirong said the false rumors against KFC products seriously misled consumers and hurt the company’s brand.
Yum Brands, the parent company of KFC has been trying to regain consumers in China, which accounts approximately 50% of its revenue, The company’s financial performance has been negatively impacted by food safety scandals in China. Yum Brands’ China division declined 6% in the first quarter of 2015.