McDonald's Sued in Chicago Federal Court Over AI-Assisted Menu Price Coordination

McDonald's (MCD) faces a proposed nationwide class action filed in federal court in Chicago accusing the chain of illegally coordinating menu prices across franchised and company-owned restaurants through an AI-powered pricing system. The lawsuit alleges McDonald's conspired with independent franchisees to fix prices using algorithms trained on nonpublic data, potentially affecting millions of customers. The filing follows a Reuters report that McDonald's uses machine-learning technology to analyze millions of daily transactions across nearly 14,000 restaurants and provide pricing recommendations based on local demand, operating costs and competition. The plaintiff's attorney accused the company of using its data and franchise network to raise prices. McDonald's denied the allegations, calling them speculative and uninformed. It said AI does not set the price of a Big Mac or any other menu item, franchisees make their own pricing decisions, recommendations are not mandatory, and it does not use dynamic pricing or set prices based on individual customers' willingness to pay.