Byron Allen, media mogul and owner of theGrio, is suing McDonald’s, seeking $10 billion in damages for racial discrimination.
On Thursday, Allen Media Group divisions Entertainment Studios Networks, Inc. — parent owner of theGrio — and Weather Group, LLC filed a lawsuit accusing McDonald’s of racial discrimination, and alleging McDonald’s discriminated against Allen’s media entities by refusing contracts and exhibiting a pattern of racial stereotyping.
Despite McDonald’s having an annual revenue of $100 billion, the lawsuit contends that the leading global food seller created an “African American” tier and gave smaller budgets and less-favorable pricing to Black media despite appealing to the general market. The suit charges that the fast-food giant refused to advertise on Allen’s digital outlets but readily did so on other white platforms.
Of McDonald’s $1.6 billion advertising budget, Black-owned sites only received a paltry $5 million or 0.3% of these funds, the suit alleges. The $5 million receievd by Black-owned sites even lagged behind the approximated $11 million salary of McDonald’s President and CEO Chris Kempczinski.
“This is about economic inclusion of African American-owned businesses in the U.S. economy,” said Allen, Founder/Chairman/CEO of Allen Media Group. “McDonald’s takes billions from African American consumers and gives almost nothing back. The biggest trade deficit in America is the trade deficit between White corporate America and Black America, and McDonald’s is guilty of perpetuating this disparity. The economic exclusion must stop immediately.”
Allen, along with Earl “Butch” Graves Jr. (President & CEO – Black Enterprise), Roland Martin (CEO, Nu Vision Media, Inc), Munson Steed (CEO of Rolling Out), Todd F. Brown PMP (Founder, Urban Edge Networks HBCU League Pass), and Junior Bridgeman of Ebony Media, were signees to a letter directed to Kempczinski over the apparent snubbing by McDonald’s.
The letter charges that despite McDonald’s being an ever-present part of the culture and worth billions, it has categorically discriminated against Black-owned media companies in the allocation of its advertising dollars.
The letter further notes that Black executives raised this issue “of economic exclusion and systemic racism” to then McDonald’s Chief Marketing Officer only to later assert that “the issue was ignored and not corrected.”
“We are not surprised that both Black employees/executives as well as the Black franchisees are suing McDonald’s for racial discrimination and unfair treatment. And now you are being sued for $10 billion by Black-owned media. Why?? Because we all firmly believe the culture at McDonald’s is racist and very toxic,” the letter continues.
“To be clear, this concerns Black-owned media and not minority-owned media, because “minority” includes White women and large corporations like McDonald’s often hide behind and tout their minority/diversity records while continuing not to do business with Black-owned media companies.”
The letter concludes with a demand for Kempczinski’s immediate resignation “if you continue to hold the position that Black-owned media does not deserve meaningful economic inclusion and we are not worth meeting with.”
In response, McDonald’s Corporation delivered a sttement to theGrio about their desire to increase spending in diverse-owned media and reaction to the lawsuit.
“Together with our Owner/Operators, we have doubled down on our relationships with diverse-owned partners. This includes increasing our spend with diverse-owned media from 4% to 10% and with Black-owned media from 2% to 5% of total national advertising over the next four years. Once we receive the complaint, we will review and respond accordingly.”
Additionally, McDonald’s shared their announcement about a four-year commitment to Increase national investments in diverse-owned companies from 4% to 10%, forge multi-year partnerships with diverse-owned media and production companies, content creators, and influencers and form an advisory board of external marketing and advertising subject matter experts.