Byron Allen’s Allen Media Group (AMG) has filed a $10 billion lawsuit against McDonald’s for racial discrimination.
According to Deadline, Allen is accusing the company of not giving Black-owned media a fair amount from their advertising budgets. The lawsuit, which was filed in the Superior Court of California in Los Angeles, alleges that the popular fast food company is racial stereotyping and violating federal and state laws by refusing to contract with AMG’s Entertainment Studios and Weather Group.
African Americans reportedly represent 40% of U.S. sales at McDonald’s, but Black-owned media gets less than $5 million out of the company’s $1.6 billion in annual television advertising.
“Together with our Owner/Operators, we have doubled down on our relationships with diverse-owned partners,” McDonald’s said in a statement to Deadline. “This includes increasing our spend with diverse-owned media from 4% to 10% and with Black-owned media from 2% to 5% of total national advertising over the next four years. Once we receive the complaint, we will review and respond accordingly.”
Allen and other Black media owners sent a letter to McDonald’s CEO Chris Kempczinski urging the company to commit 5% to 15% of its advertising and marketing payout to Black-owned media.
Last year, REVOLT reported that 52 former franchisee owners filed a lawsuit against McDonald’s for racial discrimination alleging that the company systematically discriminated against the Black franchise owners by “offering better financial support and more favorable locations to their White counterparts.”
The former owners also stated that the fast-food chain gave them less time than their white counterparts to rebuild or renovate their restaurants and offered them less support financially. According to the lawsuit, the number of Black franchise owners has declined from almost 400 in 1998 to less than 200 today.
The complaint also accuses McDonald’s of “systematically” steering the Black franchise owners towards stores in locations that needed more security and profited less than others.