Judge Dismisses Byron Allen’s $100 Million Lawsuit Against McDonald’s Over Ad Spending

A judge has dismissed the $100 million lawsuit that Byron Allen’s Allen Media Group filed last year in California state court against McDonald’s.

Allen’s lawsuit, filed last May in Los Angeles Superior Court, asserted that the fast good giant had reneged on its promise to spend more of its annual advertising budget with Black-owned media outlets. A judge ruled earlier this month that Allen’s legal materials had so far had not shown a likelihood of proving its assertions in court. Allen Media Group plans to appeal the decision. Allen Media Group has a separate $10 billion lawsuit pending against McDonald’s in federal court, alleging that it discriminates through racial stereotyping in its advertising practices, violating civil rights laws.

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Allen’s state suit hinged on a specific interpretation of claims McDonald’s made in a 2021 press release outlining its pledges to increase its spending with Black-owned businesses overall. The legal skirmishes in the case to date have parsed every word of McDonald’s statement. Arguments have revolved around the definition and contractual limitations of “commercial speech” by a business entity. Superior Court Judge Mel Red Recana came down on the side of McDonald’s in ruling that the corporate titan cannot be sued over a pledge in a press release.

At the time, McDonald’s said it would increase “the allocation of advertising dollars to diverse-owned media companies, production houses and content creators. McDonald’s total investment in diverse-owned partners – including Black, Hispanic, Asian Pacific American, Women and LGBTQ-owned platforms — 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.”

The judge rejected Allen’s assertions about McDonald’s obligations after making those statements as the nation marked the one-year anniversary of the shocking murder of George Floyd at the hands of Minneapolis police officers.

“The court finds Plaintiffs fail to establish by competent and admissible evidence that they have a probability of prevailing on the merits of their claim. The court finds the evidence is insufficient to make a prima face showing that: (1) Defendant did not perform on a promise or made apromise with no intention of performing at the time it was made; (2) Defendant intended to induce Plaintiffs to enter into a transaction, specifically Plaintiffs’ proposals to Defendant; or (3) Plaintiffs reasonably relied on a promise,” the judge wrote in his Feb. 2 ruling.

Allen attorney Louis R. “Skip” Miller said the decision would be appealed.

“We disagree with the decision. The California legislature enacted a law, Civil Code [Section] 1711, prohibiting companies from making false statements to the public,” Miller said. “This lawsuit seeks to uphold that law. We’re going to appeal this decision. It in no way affects Allen Media’s lawsuit pending in federal court for racial discrimination in contracting for advertising. That lawsuit against McDonald’s is alive and well — and is headed for trial.”

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