A federal judge has approved Black media mogul Byron Allen‘s $10 billion discrimination lawsuit against McDonald’s, which he accuses of unfairly advertising with Black-owned media companies.
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In 2021, Byron Allen, founder and CEO of Entertainment Studios/Allen Media Group, filed a racial discrimination lawsuit against McDonald’s, that same day it announced it would boost its national ad spending on Black-owned media to 5% from 2% by 2024. The fast-food chain also announced it would increase spending on Hispanic-, Asian-American-, women-, and LGBTQ-owned platforms. In his complaint, Allen said about 40% of McDonald’s customers are Black, but they only spent less than $5 million of its $1.6 billion advertising budget in 2019 on Black-owned media.
Allen’s lawsuit alleges that McDonald’s violated federal and California civil rights laws by deeming his networks ineligible for the “vast majority” of its advertising dollars. The suit claims the fast food giant violated these laws by maintaining a separate, lower ad tier for companies that produce content mainly for Black audiences. Specifically, Byron Allen said McDonald’s placed his Entertainment Studios Networks, Inc. and Weather Group LLC, which owns the Weather Channel, on an “African American tier,” depriving them of tens of millions of dollars of annual revenue.
In his lawsuit, Byron Allen also referenced messages from McDonald’s CEO Chris Kempczinski to Chicago Mayor Lori Lightfoot in 2021, which saw him allegedly blaming the death of two Black and Latino children on their parents. One of the children, Jaslyn Adams was fatally shot while sitting in a car with her father in a McDonald’s parking lot. Kempczinski allegedly wrote, “The parents failed those kids which I know is something you can’t say. Even harder to fix.”
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On November 30, U.S. District Judge Fernando Olguin found that McDonald’s may have violated civil rights laws by placing Byron Allen‘s networks on meager advertising tiers, mainly reserved for companies targeting Black audiences. Judge Olguin claimed the decision was a “close call,” however, he ruled that there was enough evidence indicating that Allen’s Entertainment Studios and The Weather Channel television network were excluded from McDonald’s much larger general market budget, thus allowing the case to head to a trial by jury.
Judge Olguin explained, “The evidence is unclear or, at a minimum, disputed as to whether the general advertising agency regularly evaluated proposals – including plaintiffs’ proposals – regarding generally targeted content. Plaintiffs have thus identified sufficient evidence to support their relegation theory.”
According to The Hollywood Reporter, McDonald’s said that the ruling “simply means that neither party met the high standard for dismissal” and that the case must still be considered by a jury. A statement from McDonald’s read, “We are prepared to show that this case is utterly baseless. McDonald’s invested in media properties that aligned with the company’s business strategy and, like any other rational business, declined to invest in those that had low ratings or failed to reach the company’s target audiences.”
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Defending its practices, McDonald’s boasted that it uses objective criteria to evaluate its media partners, adding that Byron Allen’s companies had insufficient viewership and failed to meet its usual threshold of 60 million viewers and that it has “no news” restriction that prevents it from advertising with The Weather Channel.
Reacting to the federal judge approving his $10 billion discrimination lawsuit against McDonald’s for allegedly not advertising with Black media, Allen said, “We have overwhelming evidence against McDonald’s — who has been sued by its Black executives, Black franchisees, and their global head of security — for racial discrimination. It is time for the McDonald’s Board of Directors, stockholders, and civil rights organizations nationwide to call for the resignation of CEO Chris Kempczinski, who was caught sending racist text messages about Black and Hispanic people.”
Note: before this decision, Byron Allen first sued McDonald’s accusing them of lying when it pledged to increase national ad spending with Black-owned media to boost sales and avoid any racial discrimination lawsuits near the height of the Black Lives Matter movement. However, in February 2024, the fast-food giant defeated Allen. A Los Angeles judge ruled that the company still had more time to fulfill its promise.
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