McDonald’s Sued by Former Black Franchise Owners for Racial Discrimination

McDonald’s Corporation has been sued by 52 Black former franchise owners who has accused the fast-food giant of racial discrimination, reports Reuters.

Lawsuit filed against McDonald’s

The lawsuit, filed Monday night in the U.S. District Court for the Northern District of Illinois, accused McDonald’s of steering Black franchisees to restaurants in undesirable locations in inner-cities for years.

McDonald’s Alleged Racial Discrimination franchise

Those restaurants were destined to fail, and often had lower sales and higher operating costs, according to the lawsuit.

The Black former franchisees say their annual average sales of $2 million were $700,000 below the national average for U.S. McDonald’s owners between 2011 and 2016, according to the suit.

Many of the 52 former owners from 18 states, including Georgia, Texas and New York, said they lost their businesses in the past four years.

Denies allegations

McDonald’s has denied allegations of treating Black franchisees differently, or that they were unable to succeed because of discrimination.

It also said that while it may recommend store locations, franchisees make the decisions.

“McDonald’s stands for diversity, equity and inclusion,” Chief Executive Chris Kempczinski said in a video to employees.

“Our franchisee ranks should and must more closely reflect the increasingly diverse composition of this country and the world.”

The plaintiffs sued five weeks after McDonald’s updated its corporate values, pledging a greater focus on diversity.