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MarketScreener Homepage  >  Equities  >  Nyse  >  McDonald's Corporation    MCD

MCDONALD'S CORPORATION

(MCD)
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McDonald's urges dismissal of Black former franchisees' discrimination lawsuit

10/23/2020 | 08:48pm EST
The McDonald's logo is seen outside the fast-food chain McDonald's in New York

(Reuters) - McDonald's Corp on Friday urged a U.S. judge to dismiss a lawsuit by dozens of Black former franchise owners who accused the fast-food giant of racial discrimination for selling them underperforming stores, saying it did not want them to fail and never promised success.

In a filing in the federal court in Chicago, McDonald's said its franchise agreements made clear the obligations and risks of owning restaurants, which was "fatal" to the claim it defrauded the 52 plaintiffs, who operated more than 200 stores and have been seeking as much as $1 billion in damages.

McDonald's, which is based in Chicago, also said many of the plaintiffs' claims were too old, and that there was no proof it made or broke promises that would support their "expansive" claim of longstanding, companywide discrimination.

"On its face, this claim is illogical as it suggests the company somehow has an interest in undermining its franchisees and seeing them fail," McDonald's said. "Success is promised to no one, and plaintiffs' struggles - while regrettable - are simply not a basis for a claim against McDonald's."

Lawyers for the plaintiffs did not immediately respond to requests for comment.

The Aug. 31 lawsuit accused McDonald's of steering prospective Black franchisees to stores in depressed, crime-ridden neighborhoods requiring high security and insurance costs and where sales lagged the nationwide average.

While McDonald's has denied treating Black franchisees differently, Chris Kempczinski told employees in August that its franchisee ranks "should and must more closely reflect the increasingly diverse composition of this country and the world."

McDonald's has also denied discrimination claims in a separate lawsuit filed by two Black executives in January in the Chicago court.

They said McDonald's harsh grading of stores and other "strong-arm" tactics drove a disproportionate number of Black franchisees from its system.

(Reporting by Jonathan Stempel in New York; Editing by Marguerita Choy)

By Jonathan Stempel


© Reuters 2020
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Financials (USD)
Sales 2020 19 317 M - -
Net income 2020 4 738 M - -
Net Debt 2020 33 603 M - -
P/E ratio 2020 33,6x
Yield 2020 2,38%
Capitalization 158 B 158 B -
EV / Sales 2020 9,90x
EV / Sales 2021 8,63x
Nbr of Employees 205 000
Free-Float 44,8%
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McDonald's Corporation Technical Analysis Chart | MCD | US5801351017 | MarketScreener
Technical analysis trends MCDONALD'S CORPORATION
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Income Statement Evolution
Consensus
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Mean consensus BUY
Number of Analysts 33
Average target price 240,00 $
Last Close Price 211,51 $
Spread / Highest target 25,3%
Spread / Average Target 13,5%
Spread / Lowest Target -1,19%
EPS Revisions
Managers
NameTitle
Christopher Kempczinski President, Chief Executive Officer & Director
Enrique Hernandez Independent Chairman
James R. Sappington Executive VP-Operations & Technology Systems
Kevin M. Ozan Chief Financial Officer & Executive Vice President
Daniel Henry Global Chief Information Officer & Executive VP
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