That whole "is-it-beef-or-isn't-it" lawsuit against Taco Bell back in January was dropped, but much like a Meximelt gone wrong, the nasty after-effects linger. A top Taco Bell exec said recently that "The negative sales that resulted from the lawsuit have lasted longer than any one of us thought."
Sales have tumbled as forecasters say the chain's "light users" stopped buying chalupas after the lawsuit and haven't returned. Sales tumbled five percent last quarter; earnings for this quarter don't look so great either. Execs say Taco Bell will roll out some new products and "more compelling" advertising to improve matters. Maybe bring back the talking dog? Or bring in Elmo?