Last May, Byron Allen’s Allen Media Group sued food giant McDonald’s, accusing the company of backing out on its commitment to allocate a larger portion of its yearly advertising budget to Black-owned media platforms.
Allen said McDonald’s “lied” when it pledged in May 2021 to increase national ad spending with Black-owned media to 5% from 2% by 2024.
In court filings, the media entrepreneur said he would know if the food giant was honoring that promise because his media empire represents more than 90% of Black-owned media. He added that he relied on McDonald’s pledge when seeking new business from the company, only to be rebuffed, according to Reuters.
Moreover, the lawsuit sought $100 million plus punitive damages, arguing that McDonald’s violated a California anti-fraud law against making false promises.
However, on Friday, February 2, a Los Angeles Superior Court judge dismissed the case, noting that McDonald’s did not engage in a “false promise,” as the plaintiffs claim. The judge noted that the food giant still has more time to redeem its promise since 2024 had just begun and has not passed.
“The court finds Plaintiffs’ evidence fail to make a prima facie showing of Defendant’s nonperformance or intent not to perform at the time the alleged promise was made. The May 20, 2021 press release states, in relevant part, that Defendant is ‘accelerating the allocation of advertising dollars to diverse-owned media companies, production houses and content creators.
‘McDonald’s total investment in diverse-owned partners … will more than double, moving from 4% to 10% of national advertising spend between 2021 and 2024. Spend with Black-owned properties, specifically, will increase from 2% to 5% of national advertising spend over this time period.’
“As Defendant points out, this action was filed before 2024 and this year just begun and has not passed. It is unclear how Plaintiffs can make a prima facie showing of Defendant’s nonperformance when its deadline period has not even passed,” the judge noted in his ruling.
Meanwhile, Allen Media Group says it plans to challenge the ruling through an appeal while simultaneously continuing to pursue its $10 billion lawsuit against McDonald’s in federal court, citing discriminatory advertising practices based on racial stereotyping and alleging violations of civil rights laws.
