UNITED STATES: A U.S. judge has mandated that McDonald’s Corp defend itself in the $10 billion lawsuit filed by media mogul Byron Allen, who claims that the fast-food company engaged in “racial stereotyping” by refusing to advertise in Black-owned media.
According to a ruling made on Friday by U.S. District Judge Fernando Olguin in Los Angeles, Allen may attempt to demonstrate that McDonald’s broke both federal and Californian civil rights laws by excluding his networks from receiving the “vast bulk” of its advertising funds.
Allen claimed that McDonald’s had denied his Entertainment Studios Networks Inc. and Weather Group LLC. This company operates the Weather Channel tens of millions of dollars in annual revenue by placing them on an “African American tier” with a different advertising agency and a much smaller advertising budget.
Olguin referenced claims that since the establishment of Entertainment Studios in 2009, it had made numerous fruitless attempts to secure a contract with McDonald’s, whose “racist” corporate culture had damaged Allen, without passing judgment on the truth of the charges.
Olguin wrote, “Taken together and construed in the light most favourable to plaintiffs. Plaintiffs have alleged sufficient facts to support an inference of intentional discrimination.”
Allen claimed in a statement that the situation was “concerning the monetary integration of firms owned by African Americans in the American economy. McDonald’s robs African American customers of billions while providing virtually nothing in return.”
According to the lawsuit, 40% of fast food consumers are Black, yet in 2019, McDonald’s only allocated 0.3% of its $1.6 billion U.S. advertising budget to Black-owned media.
McDonald’s promised to increase national ad expenditure with Black-owned media to 5% from 2% by 2024 in May 2021.
Last November, Olguin dismissed a previous iteration of Allen’s lawsuit, concluding there was no evidence of intentional and willful prejudice against his enterprises.
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