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Tue Sep 1, 2020, 07:06 AM

Black former franchisees sue McDonald's for discrimination

Source: AP

By DEE-ANN DURBIN

More than 50 Black former McDonald’s franchise owners are suing the burger chain, saying the company steered them to less-profitable restaurants and didn’t give them the same support and opportunities given white franchisees.

The 52 plaintiffs, who owned around 200 U.S. stores before being forced to sell them over the last decade, are seeking compensation of $4 million to $5 million per store, according to the lawsuit. The suit was filed Tuesday in federal court in Chicago, where McDonald’s is based.

According to the lawsuit, McDonald’s steered Black franchisees to stores in inner-city neighborhoods with lower sales volumes and higher security and insurance costs. The company would provide them with misleading financial information or push them to decide quickly when a store became available, the lawsuit says.

Once Black franchisees owned a store, they would be asked to rebuild or remodel within a shorter period of time than white franchisees without the rent relief and other financial support given to white franchisees, the lawsuit says. Black franchise owners were also denied the chance to buy more profitable stores in better neighborhoods, it says.



FILE - This June 25, 2019 file photo shows a McDonald's sign outside the restaurant in Pittsburgh. More than 50 Black former McDonald’s franchise owners are suing the burger chain for discrimination. In a federal lawsuit filed Tuesday, Sept. 1 in Chicago, the 52 plaintiffs say McDonald's steered them to less-profitable restaurants and didn’t give them the same support and opportunities given white franchisees. AP Photo/Gene J. Puskar, File)


Read more: https://apnews.com/b17e8bd40fcebf05af98a40a5ad91e9f

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Reply Black former franchisees sue McDonald's for discrimination (Original post)
Omaha Steve Sep 1 OP
Sherman A1 Sep 1 #1
no_hypocrisy Sep 1 #2
robbob Sep 1 #3
no_hypocrisy Sep 1 #7
robbob Sep 1 #9
no_hypocrisy Sep 1 #10
bucolic_frolic Sep 1 #4
IronLionZion Sep 1 #6
Baitball Blogger Sep 1 #5
mountain grammy Sep 1 #8

Response to Omaha Steve (Original post)

Tue Sep 1, 2020, 07:21 AM

1. K&R

Hope that the get a good settlement.

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Response to Omaha Steve (Original post)

Tue Sep 1, 2020, 07:25 AM

2. Sounds like a Civil Rights violation.

My law firm had a bad experience with Mickey Dees (white franchisees).

On paper, they had a lucrative restaurant in Wildwood, NJ near the beach during the summer. But McDonalds forced them in bankruptcy and losing their franchise because it lost money. Not because they ran the store badly. Not because of "location, location, location." Our firm was able to prove that for eight weeks of summer, that the area suffered very bad weather (rained most of the time), the town decided to do road construction in front of their store, and on top of that, Burger King was having its $1.00 Whopper promotion. (McDonalds retaliated with its own $1.00 Big Mac and lost money with every sale.)

McDonalds doesn't support its franchisees and is content with punishing those that consistently turn a profit.

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Response to no_hypocrisy (Reply #2)

Tue Sep 1, 2020, 07:44 AM

3. Not sure I get the lawsuits?

Bad weather, unexpected town construction and a rival franchise deciding to give burgers away? Sounds like bad luck. What was the basis of your lawsuit against McD’s?

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Response to robbob (Reply #3)

Tue Sep 1, 2020, 09:27 AM

7. That McDonalds improperly and unlawfully revoked the franchise

for being unprofitable through poor management.

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Response to no_hypocrisy (Reply #7)

Tue Sep 1, 2020, 11:25 AM

9. Oh! Wow, I didn't even realize they could do that!

I assumed the franchise owner took on all burdens of profitability.

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Response to robbob (Reply #9)

Tue Sep 1, 2020, 01:14 PM

10. It's in the franchise agreement that you have a certain profit you need to achieve.

Our clients fell below that number for that summer and some months thereafter when the vacationers went home. And McDonalds revoked their franchise. And they went bankrupt from all the money they invested in the restaurants.

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Response to Omaha Steve (Original post)

Tue Sep 1, 2020, 07:51 AM

4. That's a red line under the golden arches

The company may have thought this a financial decision, but surely should have realized its implications. Sounds like the lawsuit has the statistics behind the methods they are alleging.

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Response to bucolic_frolic (Reply #4)

Tue Sep 1, 2020, 08:33 AM

6. Sounds like they have plenty of data to use as evidence

Law firms are reluctant to pursue a case like this without it. They must have enough to believe they can win.

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Response to Omaha Steve (Original post)

Tue Sep 1, 2020, 08:10 AM

5. I hope they win.

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Response to Omaha Steve (Original post)

Tue Sep 1, 2020, 09:45 AM

8. I wish I could say I was surprised ...

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