Kellogg To Pay $5M To Settle Rice Krispies Ad Suit

By Ryan Davis (January 11, 2011, 1:39 PM EST) -- Kellogg Co. has agreed to pay $5 million to settle a nationwide class action accusing it of promoting Rice Krispies by falsely claiming that the cereal boosts children's immune systems.

Kellogg and the named plaintiffs filed a joint stipulation of settlement Monday in the U.S. District Court for the Central District of California. It calls for the cereal giant to pay $2.5 million to consumers and donate $2.5 million worth of Kellogg products to charity.

The deal, which requires court approval, is the most recent in a string of settlements Kellogg has reached over its advertising practices, including an agreement to...

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