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McDonald's sued for spending less on advertising in Black-owned media companies

This suit was filed by two companies owned by Allen: Entertainment Studios Networks Inc. and Weather Group LLC.
A McDonald's restaurant is pictured in Encinitas, California. (REUTERS)
Published on May 21, 2021 12:28 PM IST
AFP | , Washington

Two companies owned by a Black US business mogul have sued McDonald's alleging the fast food giant discriminates again Black-owned media companies.

The suit was filed in Superior Court of California and seeks $10 billion in damages.

It is part of a drive by the mogul, Byron Allen, to get major US corporations to spend more advertizing money on Black-owned media.

This suit was filed by two companies owned by Allen: Entertainment Studios Networks Inc. and Weather Group LLC.

Allen Media Group/Entertainment Studios produces movies and owns more than a dozen television stations.

The lawsuit argues that McDonald's spent approximately $1.6 billion on television ads in the United States in 2019 but only 0.31 percent of that went to Black-owned media.

The two companies filing the suit did not say how they arrived at the $1.6 billion figure.

"This is about economic inclusion of African American-owned businesses in the US economy," Allen said in a statement.

"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," Allen added.

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McDonald's intentionally discriminated against Entertainment Studios and Weather Group through a pattern of racial stereotyping and refusals to contract, the lawsuit states.

A McDonald's spokesperson told the Wall Street journal it would review the lawsuit.

Earlier Thursday, McDonald's announced it would more than double the advertising money it pays to media companies owned by Blacks, Hispanics, women and other underrepresented groups over the next four years.

Spending with Black-owned properties will increase from 2 percent to 5 percent of national advertising spend over this time period.

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