What did the settlement agreement require Checkersrallys to provide to class members without documented out-of-pocket expenses?

According to Checkersrallys's 2025 Franchise Disclosure Document, a settlement agreement stemming from two civil complaints (the Cotter Complaint and the Dinh Complaint) required Checkersrallys to provide specific compensation to class members. These complaints alleged failure to secure customer data and provide adequate notice of data breaches. The settlement agreement, approved by the court on August 25, 2021, outlined two forms of compensation for class members.

Specifically, Checkersrallys was required to either reimburse class members for documented out-of-pocket expenses up to $5,000 or, for those without such documentation, provide $20 in restaurant vouchers. This dual approach allowed for compensation to be distributed to all affected class members, regardless of whether they could provide proof of direct financial loss. Notice of the settlement was then provided to the settlement class.

For a prospective Checkersrallys franchisee, this litigation and settlement highlight the importance of data security and compliance with consumer protection laws. While this particular settlement is concluded, it demonstrates the potential financial and legal ramifications of failing to protect customer data. Franchisees should ensure they understand and adhere to Checkersrallys's data security protocols and maintain adequate cybersecurity measures to prevent similar issues from arising in their own operations.