JUDGE'S RULING EXPECTED IN SWEEPSTAKES SETTLEMENT

McDonald's Plans to Conduct 15 Giveaways at a $1 Million Each

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CHICAGO (AdAge.com) -- McDonald's Corp. next month will learn whether its preliminary agreement to settle various class action lawsuits resulting from last year's promotional game scandal will be approved.

A Cook County, Ill., Circuit Court judge is expected to make a ruling on Sept. 17. If approved, McDonald's plans to give away another 15 $1 million prizes in a sweepstakes similar to the $10 million make-good game conducted last fall. It expects to run the giveaway around the end of 2002 or beginning of 2003 and will have awarded the entire $25 million originally stolen in the fraud scheme.

Lawsuits still pending
In the proposed settlement,

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Simon Marketing's insurance will cover the prize monies and implementation costs, with McDonald's covering costs not covered by insurance unless it recovers those funds from still-pending suits against its former promotion firm.

More than $6 million that wasn't awarded in the original games is being returned to franchisees national advertising fund, according to an electronic memo dated July 17.

McDonald's believes it is likely the settlement will be approved as submitted, it told owner operators and senior management in the memo.

Legal notices of the proposed settlement have begun appearing in major publications including USA Today, TV Guide and Parade Magazine.

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