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Outbreak News

Chi-Chi's checks to arrive soon

By Jason Cato


Wednesday, December 21, 2005

Checks should start arriving in a few weeks for nearly 5,000 people who claimed part of an $800,000 lawsuit settlement against Chi-Chi's following a hepatitis A outbreak two years ago at a restaurant in Beaver County.

Though nearly 10,000 people got shots to help stave off the illness following the fall 2003 incident involving tainted green onions at the Chi-Chi's in the Beaver Valley Mall, only 4,931 returned the necessary forms by the Oct. 24 deadline, said Bill Marler, the Seattle lawyer who handled the class action lawsuit. Each of those people will receive a check for $162.23.

Marler, who specializes in food-poison cases, said he thinks the settlement is fair -- especially since it involved people who simply got shots and did not necessarily contract the disease.

"It's in line with similar settlements we've made in the past," he said.

Some 660 people developed hepatitis A after eating at the Center Township Chi-Chi's in October or November 2003. Four people died.

About 550 lawsuits were filed against the restaurant chain by those people and their families. Marler handled 75 of those cases and has settled them all, including a settlement of $6.25 million for Richard Miller, of Beaver, who needed a liver transplant after contracting hepatitis A.

The company has paid more than $40 million to settle cases.

Marler said fewer than 10 lawsuits remain outstanding, including a case for one of the deceased. He expects those to be settled soon and credits the speedy settlements in large part on the fact that Chi-Chi's had already filed for bankruptcy when the outbreak occurred.

"I think Chi-Chi's and their insurance companies have done a remarkable job at getting this done," Marler said. "It doesn't seem short in real people's time, but in a legal sense it's gone fairly quickly."

Chi-Chi's had filed for bankruptcy shortly before the 2003 food-poisoning incident.

The chain and its insurers are suing their food suppliers to get reimbursed for settling the lawsuits. Green onions grown on Mexican farms were implicated by the U.S. Food and Drug Administration and the Centers for Disease Control and Prevention in Atlanta as the source of outbreaks in Beaver County and three southern states.

Chi-Chi's also is seeking an additional $55 million, claiming the outbreak nixed a plan to sell the chain as part of a Chapter 11 bankruptcy plan.

The restaurant chain liquidated in September 2004, selling 76 remaining restaurants to Outback Steakhouse Inc., of Tampa, Fla., for $42.5 million. Proceeds from the liquidation covered the $800,000 settlement, Marler said. A Three Amigos restaurant has opened in the former Beaver Valley Mall Chi-Chi's.

Tracy Polovina, of Charleroi, Washington County, ate at the Beaver County restaurant and later got shots with her husband and children Alexis, then 3, and Eli, then 1. Though she'll take the checks when they arrive and deposit them in her children's savings accounts, Polovina doesn't think it was fair the way Chi-Chi's image was ruined.

"It wasn't their fault," Polovina said. "For everyone to make a big deal about it was wrong. Chi-Chi's was a really good place, and I loved it."

In addition to the payments to individual claimants, Marler said $150,000 was included in the settlement for fees and costs. Of that, $50,000 will be divided among Beaver, Center Area and Monaca high schools for scholarships. Another $25,000 will be donated to a college or university food science or safety program in the United States.

The remainder of the money was used to cover advertising and mailing costs associated with the settlement.

Jason Cato can be reached at jcato@tribweb.com or 412-320-7840.

More on this outbreak: Chi-Chi's Hepatitis A Outbreak

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