McDonald's is being fined $1.8 million by the government of Sao Paulo for giving away toys with Happy Meals, following a complaint by a consumer defense group, reported Brazilian trade publication Meio & Mensagem, Ad Age 's editorial partner in Brazil.
The Instituto Alana, a Brazilian nonprofit, claimed that the free toy with a McLanche Feliz ("Happy Meal" in Portuguese) "distorts values" and encourages "unhealthy eating habits" among children. The institute's Children and Consumption Project filed a complaint with Procon-SP, part of the Sao Paulo government's Department of Justice and Defense of Citizens.
McDonald's defended itself by saying that the toys can be bought separately, but Alana claimed that this isn't made clear to customers and that the price of buying the toy is higher than that for a Happy Meal, reported Meio & Mensagem's Janaina Langsdorff.
Arcos Dorados, McDonald's largest franchisee in Latin America, said in a statement that the company does not discuss the details of unsettled lawsuits and has already filed an appeal. A final decision will be made within three months. Moreover, the company said, it adheres to voluntary regulations agreed to by other major food companies.
In fact, when Instituto Alana filed the same complaint with Brazil's self-regulatory body, Conar, it was rejected. Brazilian business magazine Exame reported in June that Conar's ruling said that the institute "hates small children" and "doesn't have the Stalinist right to decide how [parents should] raise children and form their habits."
Instituto Alana is run by Ana Lucia de Mattos Barretto Villela, one of the biggest shareholders of banking giant Itau. Barretto Villela, with a $3.2 billion fortune, is the 11th-richest person in Brazil, according to Forbes magazine.