Byron Allen Accuses McDonald’s of Breaking Pledge to Advertise With Black-Owned Media in $100 Million Lawsuit

The lawsuit suggests McDonald’s should have spent more than $50 million with Allen Media Group by now under its four-year plan

Byron Allen
Byron Allen attends TheGrio Awards 2022 at The Beverly Hilton in Los Angeles (Credit: JC Olivera/Getty Images)

Byron Allen’s media company has sued McDonald’s for $100 million, accusing the fast-food Goliath of not living up to its pledge to spend a set percentage of its billion-dollar annual advertising budget with Black-owned outlets.

Allen Media Group divisions Entertainment Studios and Weather Group filed the action late last week in Superior Court of California. The lawsuit alleges fraud and “false promise” in violation of state civil code, and seeks in excess of $100 million.

McDonald’s said in a statement to TheWrap on Monday: “While McDonald’s continues to invest in diverse initiatives to create real change in communities, Byron Allen files baseless lawsuits as part of a public smear campaign against our company to try to line his pockets. This latest action is straight from his standard litigation playbook, cherry picking allegations to create a false and misleading narrative that is inconsistent with the facts and calculated to distract from the markedly low ratings and reach of his media properties. McDonald’s has a long history of investment in diverse communities and partners, and we are proud of our record. We will not be coerced by these in terrorem tactics and will defend ourselves vigorously.”

The lawsuit says McDonald’s committed in 2021 to spending two percent of its ad budget with Black-owned media companies, jumping to five percent by 2024, but has failed to meet those commitments, then “rushed out a ‘plan’” when AMG called them out.

“This ‘plan’ was a lie,” the plaintiff’s state. According to the lawsuit: “AMG is by far the largest African American-owned media company in the country, and Plaintiffs represent over 90% of that category. As such, to fulfill its commitment, any allocation would require McDonald’s to spend in excess of $50 million annually to advertise on Plaintiffs’ properties.”

The suit does not suggest that McDonald’s made any legally binding commitments directly to Allen Media Group. AMG said it sent spend outlay proposals to McDonald’s after it made the public pledge, but was rebuffed.

AMG called the McDonald’s plan “a self-serving ploy to cast itself as racially sensitive and sympathetic — but really to intentionally mislead the public and with reckless disregard for the truth. McDonald’s had no intent to fulfill its commitment. It’s “plan” was and is a fraud.”