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Byron Allen's McDonald's discrimination lawsuit thrown out

Byron Allen

(Reuters) — A U.S. judge has dismissed a $10 billion lawsuit against McDonald's Corp. by media entrepreneur Byron Allen, who accused the fast-food chain of racial discrimination for not advertising with Black-owned media.

U.S. District Judge Fernando Olguin in Los Angeles wrote on Tuesday that two companies owned by Mr. Allen did not offer enough factual evidence to show that McDonald's “intentionally and purposefully discriminated against them.”

According to Mr. Allen's complaint, McDonald's has refused to advertise with lifestyle channels owned by his Entertainment Studios Networks since their 2009 launch, or with The Weather Channel since Mr. Allen bought its parent, Weather Group, in 2018.

Mr. Allen also said McDonald's spent just 0.3% of its $1.6 billion U.S. ad budget in 2019 with Black-owned media though Blacks represent 40% of fast-food customers, an allocation that reflected “racial animus and racial stereotyping.”

But the judge said Mr. Allen didn't show his companies pushed hard enough to contract with McDonald's only to be rebuffed, or that McDonald's treated comparable white-owned networks better.

Judge Olguin said Mr. Allen can file an amended complaint.

“We will be adding more details to the complaint as directed by the court; and fully expect the case to go forward with discovery and trial,” Louis "Skip" Miller, a lawyer for Mr. Allen, said in an email on Wednesday.

“This case is about revenue, not race,” Loretta Lynch, a lawyer for McDonald's, said in a statement. “We believe there is no evidence supporting this meritless case.”

McDonald's pledged in May to boost national ad spending with Black-owned media to 5% from 2% by 2024.