(Reuters) – McDonald’s Corp has been sued by 52 former black franchise owners who accuse fast-food giants of racially discriminating against frustrated, crime-ridden neighbors and forcing them to fail.
File photo: On March 17, 2020, a sign was seen at a McDonald’s restaurant in Queens, New York, USA. Reuters / Andrew Kelly / File photo
In a complaint seeking damages of illion 1 billion, the plaintiff said that McDonald’s did not offer black franchisees lucrative restaurant locations and growth opportunities on the same terms as white franchises, with a public commitment to diversity and black entrepreneurship.
In a statement early Tuesday, McDonald’s denied the allegations, saying the franchise was unable to succeed due to discrimination.
“We are confident that the facts will show how committed we are to the diversity and equal opportunity of the McDonald’s system, including our franchisees, suppliers and employees,” the statement added.
The lawsuit alleges that McDonald’s sued plaintiffs under a 20-year franchise agreement with stores that required high-end security and insurance costs, and that its average annual sales of 2 2 million from 2011 to 2016 were 700 700,000 nationwide. The note ban has always resulted, they said.
Plaintiff’s attorney Jim Ferraro said in a phone interview that “it’s a systematic placement in quality places, because it’s black.” “Revenue at McDonald’s is driven by only one thing: location.”
Prosecutors are suing in Chicago federal court five weeks after McDonald’s updated its corporate values, promising to focus more on diversity.
Chief executive Chris Kempzinski told CNBC in June that diversity was “crucially important” and needed to touch on “every single aspect” of his business.
He also defended McDonald’s records, saying the Chicago-based company “has made more millionaires in the black community than any other corporation on the planet, but still has.”
Ferraro called the claim a “total hogwash” and said the number of black franchises had fallen from 377 to 186 since 1998.
McDonald’s 14,400 U.S. More than 90% of the restaurants were recently operated by about 1,600 franchisees.
The company updated its values before Chief Executive Steve Easterbrook filed a lawsuit against three employees for concealing their estimated .841.8 million spare package for concealing inappropriate sexual relations.
Easterbrook said the lawsuit was “in vain.”
Reported by Jonathan Stampel in New York and Bhargava Acharya in Bangalore; Edited by Cynthia Ter Sturman and Kevin Liffey
.
