LOS ANGELES, CA – Media entrepreneur Byron Allen’s $10 billion racial discrimination case against McDonald’s will go to trial Wednesday, according to the ruling by U.S. District Judge Fernando M. Olguin, reported by Variety.
The case involves allegations that the fast-food chain forced Black-owned media out of general-market ad budgets, and sent them down a lower “African American tier,” Variety wrote.
The ruling—in what Judge Olguin called a “close call” —raises serious issues about corporate advertising racial stereotyping, reported Variety, adding the judge noted in a 25-page ruling the accusations “are deserving of jury scrutiny and such matters deserve a full hearing, not summary judgment.”
Allen, the president of Entertainment Studios, parent company of the Weather Channel, has accused McDonald’s of cutting off his restaurants from high-paying advertising.
“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,” Allen said in a statement to Variety.
Allen added, in Variety, “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.”
McDonald’s has denied wrongdoing, branding them as “utterly baseless” in a Variety statement. The firm claimed to invest in advertising on the basis of business strategy and reach, and added it did so on the basis of metrics and not on the basis of race.
The lawsuit—which originally began in 2021—also raises general issues of fair corporate advertising, Variety reported, noting Allen argues McDonald’s spending drives systemic inequality by feeding racial bias into the media, and discrimination by the company has denied his shops millions of potential sales each year, an allegation at the heart of the lawsuit’s social justice dimension.
The trial, explained Variety, is poised to shed light on how major corporations allocate advertising budgets and whether such practices contribute to systemic inequities.
Allen’s case, if successful, could set a significant precedent for addressing racial disparities in corporate decision-making, Variety stated.
Variety wrote the litigation continues to show the intersection of racial justice and corporate responsibility, and the systematic discrimination against media representation in the advertising industry.
