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McDonald's: US judge clears $10 billion lawsuit against fast


The plaintiff sees himself disadvantaged because of his skin color - and demands hefty damages. In the US state of California, McDonald's has to face a court case.

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Burger in McDonalds branch (icon image)

Photo: Robert Galbraith / REUTERS

A US federal judge has allowed a billion-dollar lawsuit against fast-food chain McDonald's over discriminatory advertising practices.

The African-American media entrepreneur Byron Allen accuses McDonald's of a "racist contract procedure" in the placement of ads.

McDonald's attorney, Loretta Lynch, said Tuesday that Allen's complaint was "about income, not race."

Allen, which owns Entertainment Studios Networks and Weather Group, is seeking $10 billion in damages.

In a lawsuit filed in May 2021, he accuses McDonald's of having established "a two-tier system based on skin color" that excludes him from the normal advertising market.

In December, a Los Angeles judge dismissed the lawsuit on the grounds that the allegations were not sufficiently substantiated.

However, after some legal back-and-forth, the same judge on Friday denied a request by the fast-food chain to dismiss the lawsuit, allowing it to go ahead.

Allegedly enormously unequal distribution of the budget

Allen says his company "received tens of millions of dollars in annual advertising revenue from McDonalds" under white ownership.

He also accused McDonalds of signing contracts with a different advertising agency for "African American media" that provided for a significantly smaller budget than for the rest of the market.

Only 0.3 percent of the chain's advertising budget is spent on ads at media companies owned by African Americans.

Former US Attorney Lynch, a partner in a law firm representing McDonald's, argues that the plaintiffs' allegations ignore both "legitimate operational reasons" for less investment in Allen's station and "long-established business relationships" with companies owned by a wide variety of people Origin.


Source: spiegel

All business articles on 2022-09-21

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