Pressure on $MCD stock isn't letting up!
McDonald's faces a lawsuit in Chicago claiming its AI pricing tool is used for illegal price coordination across thousands of U.S. restaurants.
The lawsuit was filed by Illinois customer Michael Thomas, who is seeking to make it a nationwide class action. He claims the platform, which draws data from millions of daily transactions, recommends prices to franchisees and company-owned locations.
Franchisees compete with each other, and according to the lawsuit this amounts to algorithmic price fixing in violation of antitrust laws. The plaintiff notes that prices in the chain rose by 40% between 2019 and 2024 according to the company's own data. That's quite a massacre, by the way.
$MCD denies the allegations. According to the company, the tool doesn't set prices but merely recommends them, and the final decision rests with franchisees.
But the lawsuit argues that new standards this year evaluate operators based on how they use the company's tools, effectively turning recommendations into requirements.
Well, we'll see how it all unfolds. $PEP earnings this week may reveal more about investor sentiment for similar dividend stocks. I don't hold the company in my portfolio, but I'll be watching the results.
