McDonald’s Facing Federal Discrimination Lawsuit From Black Owner’s

McDonald’s is facing a lawsuit for discrimination. 52 Black former franchisees sued the fast-food giant because they said they were denied equal opportunity to economic success.

The lawsuit alleges McDonald’s pushed Black owners to purchase restaurants in areas with lower sales and increased cost to run them. Due to this Black owners faced more hurdles than white franchisees running the restaurants. They had higher costs of doing business, higher insurance, and often times they had to rebuild without any support. They also faced more inspections from headquarters than white owners.

Black owners were not offered the same financial support as white franchisees when they needed to rebuild or renovate restaurants. The lawsuit also states black franchisees were not allowed to purchase stores in neighborhoods where sales were higher.

The underperforming resturants brought in $2 million opposed to the stores in better areas which on average grossed $2.7 million between 2011 and 2016.

The 52 franchisees ran a total of 200 stores and are seeking approximately $1 billion in damages.

McDonald’s statement “These allegations fly in the face of everything we stand for as an organization and as a partner to communities and small business owners around the world.” 

“Not only do we categorically deny the allegations that these franchisees were unable to succeed because of any form of discrimination by McDonald’s,” the company said in Tuesday’s statement, “we are confident that the facts will show how committed we are to the diversity and equal opportunity of the McDonald’s System, including across our franchisees, suppliers and employees.”

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