McDonald's Facing $10 Billion Racial Discrimination Lawsuit
An American federal court in the US has ruled that McDonalds must defend itself against a $10 billion lawsuit. Brought by media mogul Byron Allen, the lawsuit alleges that the fast food company doesn’t advertise with Black-owned media.
In a press release, Allen accused McDonalds of “...intentionally discriminat[ing] against AMG divisions Entertainment Studios and Weather Group through a pattern of racial stereotyping and refusals to contract.” He states that of an approx $1.6 billion annual advertising budget, “...McDonald's spends less than approximately $5 million each year on African American-owned media”. He adds: “Per the lawsuit, the McDonald's President and CEO Chris Kempczinski makes approximately $11 million per year, which is more than double what McDonald's spends per year on ALL of Black-owned media combined.”
In response to the release, McDonald’s lawyer Loretta Lynch told the press that the accusations are meritless. “Their complaint is about revenue, not race, and [the] plaintiffs’ groundless allegations ignore both McDonald’s legitimate business reasons for not investing more on their channels and the company’s long-standing business relationships with many other diverse-owned partners,” she said.
Allen, however, argues that his company’s alleged treatment reflects wider societal prejudices: “McDonald’s takes billions from African American consumers and gives almost nothing back. The biggest trade deficit in America is the trade deficit between White corporate America and Black America, and McDonald’s is guilty of perpetuating this disparity.”
Allen's legal counsel, David Schecter and Skip Miller, told BusinessInsider: "As alleged in our complaint, McDonald's has engaged in pernicious racial discrimination in violation of federal and state law. We are confident the jury will recognize the injustice that has occurred here and will award significant damages. We are looking forward to our day in court."
The case is due to be heard in May 2023.
