Entertainment mogul Byron Allen is digesting the legal equivalent of a very unhappy meal.
McDonald’s pledged to more than double its spending on advertising — specifically with Black-owned businesses — to avoid allegations of racial discrimination during the height of the Black Lives Matter movement. Allen, the CEO of the Allen Media Group, accused the fast-food restaurant of reneging on its promise and sued them last May for some $100 million.
Allen lost and is planning to appeal.
A Los Angeles Superior Court judge has dismissed the suit, calling it “purely speculative” and ruling that McDonald’s still has time to make good on its promise and would likely win the case if it were allowed to continue.
“The court’s decision serves as confirmation of what we’ve said all along: this was just another frivolous lawsuit brought by Byron Allen as part of his smear campaign,” the fast-food giant said in a statement.
Nevertheless, Louis P. “Skip” Miller, a partner in the Miller Barondess LLP law firm, said Allen Media Group would appeal based on California law that bars “companies from making false statements to the public.”
McDonald’s made the pledge in May 2021 — a “four-year plan” to pump up its national media spending with Black-owned companies from 2 percent to 5 percent. Judge Mel Red Recana decided McDonald’s had not engaged in a “false promise,” as Allen’s group had alleged.
The ruling, in part, said that McDonald’s “still has about 11 months remaining in this year to perform on its promise and commit to spending the necessary amount with Black-owned media. It is purely speculative to conclude Defendant will not perform on its promise even if Defendant has not yet committed the amount needed in spending.”
The promise at issue was contained in a McDonald’s press release.
“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 percent to 10 percent of national advertising spend between 2021 and 2024. Spending with Black-owned properties, specifically, will increase from 2 percent to 5 percent of national advertising spend over this time period.”
Allen said it was all talk. McDonald’s countered that Allen was trying to extort them.
“The court dealt Mr. Allen a crushing blow by dismissing this case for good, ruling that he failed to show that his claims had even ‘minimal merit,’ ” the company stated. “McDonald’s long ago made clear that we would not allow Mr. Allen to perpetuate false narratives at our expense or succumb to his extortionist tactics. Moving forward, we will continue to collaborate with diverse-owned partners and remain committed to advancing inclusion and diversity efforts.”
Allen also was ordered to pay the legal fees for McDonald’s. It’s not like he can’t afford it, with the deep pockets that made possible his $14.3 billion offer to buy Paramount Global, which owns CBS and the Paramount Hollywood studio.
Allen also emailed Paramount Global senior executives and board last December, offering $3.5 billion for BET Media Group, which includes the BET cable channel, VH1, BET Studios and streaming service BET+. That’s $800 million more than Allen offered earlier in 2023.
So, it’s a pretty safe bet that he can afford to appeal the McDonald’s ruling. His lawyer says he’ll take it all the way.
“That lawsuit against McDonald’s is alive and well and is headed for trial,” Miller told Deadline.
The tension between McDonald’s and the Allen Media Group is hardly diminishing. Allen Media, which owns the Weather Channel, has a separate $10 billion lawsuit pending against McDonald’s in federal court. It alleges that the chain discriminates through racial stereotyping in its advertising practices, thus violating civil rights laws.
Miller said that Recana’s ruling “in no way affects” the second lawsuit.
