The Geico STD story is the new McDonald’s Hot Coffee story

The real story is binding arbitration.

8 min readJun 12, 2022

Here’s a media literacy rule of thumb: any time you hear about how the courts have done something outrageous and absurd to some poor, long-suffering, gigantic, wildly profitable corporation…dig deeper.

The canonical example is the “McDonald’s Hot Coffee Lawsuit” (aka Liebeck v. McDonald’s Restaurants). You know, that time that an old lady got burned by her McDonald’s coffee and then sued for for $2.7 million?! Most people heard that story — and they heard it for a reason.

https://en.wikipedia.org/wiki/Liebeck_v._McDonald%27s_Restaurants

The Hot Coffee story was propaganda — specifically, it was propaganda for the idea that corporations should be shielded from legal liability when they maim or even kill the public through gross negligence. The real Hot Coffee story is a lot more complicated than the “lady gets millions because her coffee was too hot” tale that circulated widely.

One of the best explorations of the Hot Coffee story is Adam Conover’s excellent “Adam Ruins The Hot Coffee Story” video from 2016. In that episode, Conover explains what really happened.

https://www.youtube.com/watch?v=Q9DXSCpcz9E

The coffee that burned Stella Liebeck in New Mexico in 1994 was served at 190°F. It caused third-degree burns that permanently disfigured Liebeck, required multiple skin grafts, and disabled her for two years. The surgery was so drastic that Liebeck lost 20% of her body-weight while she was recovering.

McDonald’s had a history of serving coffee that was dangerously hot. It had received 700 complaints about the matter, and had had to settle numerous claims from people who were horribly burned by its coffee. However, it declined to settle with Liebeck, who initially sought $20k to cover her medical expenses.

Denied a settlement, Liebeck sued. The jury did award $2.7m, but the judge clawed it back to $640k. Liebeck likely didn’t get that amount — she and McDonald’s reached a confidential settlement under threat of McDonald’s appealing.