McDonald’s faces another federal lawsuit alleging that the company discriminated against Black franchisees — and this time the allegations are coming from current operators, who are seeking to make the complaint a class action.
The complaint against the Chicago-based fast food giant, filed Thursday in U.S. District Court for the Northern District of Illinois, names as plaintiffs two brothers who own McDonald’s franchises in Tennessee. James Byrd, a franchisee for 31 years, operates two restaurants and Darrell Byrd, a franchisee for 22 years, operates another two.
Their allegations are similar to those in a lawsuit filed in September by 52 Black former McDonald’s franchisees. They allege McDonald’s has a “predatory” growth strategy that steers Black franchisees to less profitable locations in Black communities, with lower sales volumes and higher security costs, and excludes them from financial support and growth opportunities offered to white franchisees. Those practices, the suits allege, have caused the number of Black franchisees to fall by half since its peak in 1998 and the cash flow gap between white and Black franchisees to more than triple.
The Byrds have lost 10 restaurants between them as a result of the company’s “misconduct,” the suit alleges.
“This model pushes Black franchisees further into debt, allowing McDonald’s to deem Black franchisees ineligible for growth and/or renewal, while offering White franchisees newer, safer, and more profitable locations,” the suit alleges.
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