McDonald's was just hit with another racial-discrimination lawsuit seeking $10 billion over ad spending

McDonald's was just hit with another racial-discrimination lawsuit seeking $10 billion over ad spending
McDonald's is facing another racial-discrimination lawsuit.Andrew Kelly/Reuters
  • McDonald's is facing a new $10 billion racial discrimination lawsuit related to ad spending.
  • Byron Allen's media company alleges the company refused to run ads due to racial stereotyping.
  • McDonald's announced plans to more than double its spend with Black-owned media on Thursday.

McDonald's is being hit with another racial-discrimination lawsuit - this time, related to advertising spending.

On Thursday, two divisions of Allen Media Group sued McDonald's on allegations of discrimination. The company, owned by African-American entrepreneur and former stand-up comedian Byron Allen, is seeking $10 billion in damages.

According to the complaint, McDonald's has refused to advertise on Entertainment Studios networks or The Weather Channel due to racial stereotyping.

The lawsuit alleges that McDonald's relegated Entertainment Studios and The Weather Channel to a tier of media companies that target African Americans. According to the complaint, the company uses a different agency for this tier, allotting significantly less money than "the general market (i.e. white-owned media) budget."

Read more: Inside McDonald's reckoning on race amid billion-dollar lawsuits and unprecedented new efforts


McDonald's has been grappling with how best to reach a diverse customer base for years.

On Thursday, the company announced plans to grow its spend with "diverse-owned media" from 4% to 10% over the next four years, with Black-owned media growing from 2% to 5%. A representative for McDonald's said the company "will review the complaint and respond accordingly."

'We are starting to lose our younger African-American and multicultural consumers'

Last June, McDonald's executives discussed how best to attract more diverse customers in an internal meeting, a recording of which was obtained by Insider. In the meeting, McDonald's US chief marketing officer Morgan Flately discussed plans to work closely with Wieden & Kennedy New York and Burrell Communications in future efforts.

"We are starting to lose our younger African-American and multicultural consumers," Flatley said. "We need to make sure we are looking through the lens of our operators, our crew, and our people to better connect with African-American youth as we go forward. Today is the beginning of that journey for us."

Read more: 'Being silent is not an option': Inside McDonald's response to the George Floyd protests, as executives speak out and 1,100 restaurants face closures due to curfews and looting


McDonald's has faced a barrage of racial-discrimination lawsuits over the last two years. Lawsuits include:

In an interview with Insider in January, McDonald's global chief diversity, equity, and inclusion officer Reggie Miller said the company will "defend against these lawsuits even as we move forward with the actions needed to foster an environment where equitable opportunity is part of the lived experience."

"We spent the last year listening, reflecting, and strategizing about how to better run our business," Miller said. "We considered how, from crew to C-suite, we work as individuals and how our company interacts with the world.

"Now it is time to put thought and intention into action."