I. BACKGROUND INFORMATION/ADDITIONAL PERSPECTIVES

In 1986, a group called London Greenpeace which is an activist body campaigning on a variety of environmental and social justice issues, produced and distributed a leaflet entitled ‘What’s Wrong With McDonald’s? – Everything They Don’t Want You To Know’ outside a McDonald’s store in the United Kingdom. It criticized almost all aspects of the corporation’s business accusing that McDonald’s: is complicit in Third World starvation; buys from greedy rulers and elites and practices economic imperialism; wastes vast quantities of grain and water; destroys rainforests with poisons and colonial invasions; sells unhealthy, addictive junk food; alters its food with artificial chemistry; exploits children with its advertising; is responsible for torture and murder of animals; poisons customers with contaminated meat; and exploits its workers and bans unions.

At first, McDonald’s ignored the London Greenpeace campaign but when it grew and was taken up seriously by more and more groups around the world in 1989, they decided to take extreme measures against the group. McDonald’s hired seven private investigators to spy on the London Greenpeace to find out who was responsible for the production and distribution of the leaflet. And to be able to file a libel case they will need names of individuals. So the spies penetrated to the group to get names and addresses, took letters sent to the group, got fully involved to the group’s activities, stole documents and took photographs. In 1990, McDonald’s filed libel cases on five members of the group. The company wanted those five to retract what they said in the leaflet and apologize. Three of the five retracted and apologized but two of them decided that they would fight in court to ensure that McDonald’s wouldn’t succeed in silencing their critics. And this was the start of the 20-year battle of the McLibel Two – Helen Steel and David Morris – and the burger giants McDonald’s corporation. The McLibel case became the longest ever UK libel trial on March 13, 1995; the longest civil case in British history on December 11, 1995; and the longest of any kind in English history on November 1, 1996. It was a David-and-Goliath battle. Because there was no Legal Aid or the public money for libel cases in the UK, gardener Helen Steel and local postman David Morris had to defend their selves against McDonald’s ₤10 million legal team. It was even more difficult for them to defend their selves because Richard Rampton QC, McDonald’s hired attorney, who is also one of Britain’s top libel lawyers, was able to convince the judge to hear the trial without the presence of a jury with the argument that the scientific evidence neccessary to examine the links between diet and disease are too complicated for the ordinary people of a jury to understand. And without a jury, the McLibel Two lost the chance of having a very likely sympathetic decision in favor of them. But fortunately for the two, the McLibel Support Campaign was set up to generate solidarity and financial support. There were also lawyers who backed them up for free though for some occassions only. This case which was coined as the ‘biggest corporate PR disaster in history’ might have won McDonald’s a ₤30,000 damage fee when Mr. Justice Bell ruled that Helen and David had indeed libeled McDonald’s but it caused them their first ever loss in their fifty year existence that they even planned to close at least 175 stores worldwide. And this was all the result of facing a corporate crisis through legal methods and ignoring the ability of the PR Department to instigate the problem.

II. SITUATIONAL ANALYSIS
I will use the following factors in the analysis of this case study: LIS.
• Legal
The McDonald’s corporation decided to take on the issue through legal actions against the London Greenpeace. It did even resort to drastic measures that required them to hire private spies to find out who they can sue regarding the production and distribution of the leaflet. I believe that this measure, when made known to the public, did a great effect in their company’s image because that can be considered as an illegal act – deception, prying on people and interfering with someone else’s lives. Another extreme measure that the corporation tried to do was to offer the activists money just to stop them from criticizing its business but when the McLibel Two were not persuaded they just continued with the case and hired one of the Britain’s top lawyer when it comes to libel cases. And they brought the famous Richard Rampton at a pre-trial stage, its not even the trial proper yet. An additional factor which I believe aggravated the people’s support to the Helen and David: the burger giants even made it sure that there will be no jury present during the trial which leaving the two only their selves as their defendants and no jury who might have sympathize with them.
But the company’s fault with legal matters did not end there. Just before the trial proper was due to start, in March 1994, McDonald’s produced 300,000 copies of a leaflet to distribute to their customers through their burger outlets. It stated that it was not about freedom of speech but rather about the right to stop people telling lies. In a neat legal move, Helen and David issued a counterclaim against McDonald’s over the accusation that the company’s critics like them are liars. This meant that, as well as they have to improve that their criticisms about its business was true, McDonald’s would have to prove that they are false and that Helen and David knew that they were false for them to prove that the leaflets were libelous.
The corporation’s choice to do this using legal measures has caused them ₤10 million in legal fees and though the verdict of the court states that the company was indeed libeled by Helen and David, it did not recoup the significant legal costs of the company because both the defendants were unemployed and therefore effectively bankrupt.
The bottom line is that their choice caused them nothing but expenses and wasted time and effort. It even damaged their company’s reputation.

• Industry Since McDonald’s opened its first store in the United States on April 15, 1955, the company has expanded into over 100 countries worldwide. This inexorable spread of western multinationals into every corner of the globe created a system which drained out local economies into the hands of a very few, and very rich people. McDonald’s seem to be everywhere and this is a result of the most extensive, expensive and systematic marketing strategy which even includes deceptive advertising. The company was so embarassing to produce a two contrasting statements with regards to the deceptive public leaflet that they once gave out to people. It said there that every time one eats at McDonld’s, one will eat good, nutritious food. And when this case came up because of Helen and David they suddenly changed statements when their internal company memo said “We don’t sell nutrition and people don’t come to McDonald’s for nutrition. Another angle in promoting their industry is through exploiting the children. The advertisements created for the McDonald’s corporation were gretaly targetting the kids. Their premise is that the children love Ronald McDonald and so they’ll eat the food that Ronald McDonald’s love. And parents have strong objection in the influence that this has over their own children. These deceptive but strong advertisements made the McDonald’s expansion a reality. And this was resisted and criticized by trade unionists, local residents, nutritionists and many others in almost every town and country where they’ve planned a new store. With these points promoted by the McLibel Two in their advocacy, the corporation did not only suffered from great sum of legal costs but with profits loss as well. Profits dropped from a high of £104.3 million in 2001, to £83.8 million in 2002, and sharply to £23.6 million in 2003. This was the first time in the 50 years of existence of the burger giant McDonald.
• Social
Companies should look at its responsibilities to its publics. And these publics include the employees, the consumers, and the activist groups. In this case, the company was not able to assess the importance of all of the publics involved. Just like for example when the company decided to file a case against the London Greenpeace. They didn’t pay attention to the threat it may put on them the first time that it distributed the leaflet. They haven’t seen it as someting that can be a crisis to the company until it started to pose a harm to the company. They did not have issues mangement techniques, they just focused on legal matters, thinking that it was the best way to fight the activists which is a very sensitive kind of public. They did not bother to know how big London Greenpeace was, or if there are branches in the other parts of the world, or how many members might they have, the members that might be influenced and might influence others. The corporation should know how to get to know their publics and not just be aggressive filing cases against someone.
Also with the company’s employees -- the issues on racism, illegal hours work, underaged staff, and anti-union practices. These things were a major part in making a point for the Helen and David argument. Because the company did not give importance to its public, a very important public at that, the employees, they gathered many statements that did nothing but convict them of their crime. This only showed that the company is not committed in doing their social responsibility to its public.
III. CONSEQUENCES
The consequences for McDonald’s for choosing legal actions over PR litigation on this case has earned the company the coined term McLibel: The Biggest Corporate PR Disaster in History. It also caused them ₤10 million legal fees just for defending the case. It also exceeded three records in the Guiness Book of Records: the longest libel trial, the longest civil case trial; and the longest in any kind in English history. And this records are meaningless because what they consider as a legal victory is actually never going to bring them back the expenses that they incurred and the wasted time and effort that they used for this case. This case also gave them their first ever profit loss in their fifty years of existence as a food company which amounted to a big 71% loss. After this case they were forced to close down 175 stores worldwide and it was also reported that Ed Rensi, President of McDonald’s Corporation, had, along with his staff, been removed as Chief Executive following falling US market share, promotional flops and franchisee discontent.

IV. CONCLUSION
After reading and researching about the topic, I therefore conclude that the biggest mistake that the McDonald’s did that caused them such great loss was resorting to legal measures instead of investing in Issues Management and Crisis Management Techniques. Having this kind of PR management is crucially important so as to avoid ₤10 million legal costs and just end with a meaningless legal victory.
This study also made me realize that it is really important to consider the health and welfare of the differnt publics of the company like its employees and consumers to ensure a stable income for the business.

V. PERSONAL LEARNINGS AND INSIGHTS With this study I realized the effects of an untoward treatment with the activists that criticize a company when it comes to solving a crisis. When you're not communicating with the group that seems to give the company a problem it's not a solution after all. I learned that it is important to know a lot of information about the persons or groups that try to bring down your company – their strenghts, weaknesses, opinions about the business, and why and how did they end up with those kinds of opinions. I believe that these things will help a company in battling the consequences that it may face during a crisis. The social involvement of a company with its publics was also being stressed here. It is important for a company to recognize its duties and to perform them well in order to protect their reputation. I also discovered that quick response to a certain issue is an effective technique to save a company's image. The duty of the company to announce the important matters and give their statements regarding the issue immediately was given emphasis in this study. I also learned that good ethics results to good profits. A company should practice ethical standards in all the aspects of its business may it be advertising or employee relations so as to produce a good output for the company.

VI. REFERENCES

http://en.wikipedia.org/wiki/McLibel_Case

http://www.mcspotlight.org/case/trial/story.html

http://www.mcspotlight.org/issues/intro.html

http://www.mcspotlight.org/campaigns/current/mcspotlight/faq.html#

http://topdocumentaryfilms.com/mclibel/

http://www.essays.cc/free_essays/d5/arn179.shtml