McDonald’s Settles Racial Discrimination Lawsuit with Franchisee for $33.5 Million

McDonald’s has agreed to pay $33.5 million to a Black franchisee who filed a racial discrimination lawsuit against the QSR franchise in February, according to the Associated Press. Herb Washington, a former baseball player and owner of more than a dozen McDonald’s locations in Pennsylvania, filed a lawsuit in February that claimed the company favored white owners and denied him the opportunity to buy restaurants in more affluent communities.

“McDonald’s has targeted me for extinction,” Washington said when he originally filed the suit. “The arches are in full-scale retaliation mode against me.” He also added that the company had demanded he sell some of his stores before he could receive contract extensions for others.

Washington agreed to drop the lawsuit and exit his franchise agreement as part of the settlement. McDonald’s said in a statement Thursday that the amount it was paying Washington for 13 franchises was “no more than what we deem a fair price for the value of the restaurants.”

“While we were confident in the strength of our case, this resolution aligns with McDonald’s values and enables us to continue focusing on our commitments to the communities that we serve,” the company said. “Discrimination has no place at McDonald’s.”

In September 2020, more than 50 Black former franchise owners filed a $1 billion discrimination lawsuit against the company. A suit in January also accused the company of pushing Black executives from senior leadership under former CEO Steve Easterbrook and current CEO Chris Kempczinski, as well as forcing Black operators out of the system.