McDonald’s Faces Lawsuit Over AI-Driven Pricing System
McDonald’s is accused of using AI to set menu prices, allegedly driving up costs for customers.
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McDonald’s is facing a federal class-action lawsuit in Chicago, alleging that the fast-food giant uses artificial intelligence to set menu prices, potentially driving up costs for customers. The suit, filed by Michael Thomas of DeKalb, Illinois, claims that an AI pricing system enables McDonald’s and its franchisees to coordinate pricing strategies, resulting in higher prices for consumers.
Thomas, representing a class of customers, alleges that he regularly purchased the same items at different McDonald’s locations and paid varying prices. The lawsuit argues that the company’s AI-driven pricing engine, which has been in use since at least 2019, collects sales data from millions of daily transactions, including franchisees’ confidential figures, to recommend prices for each restaurant.
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The complaint states that McDonald’s has pressured franchisees to use the pricing tool and, starting in January 2026, required them to use the company’s approved pricing consultant and tools. It claims that the company tracks stores that deviate from the recommendations and has warned investors that pricing non-compliance could affect franchisee renewal or expansion opportunities.
McDonald’s is accused of using its data and franchised system to “nickel-and-dime consumers down to the last French fry,” according to the lawsuit. The company, however, has dismissed the claims as speculative and uninformed, stating that franchisees set their own prices and that recommendation tools are common across many industries.
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The suit also cites a 40 percent rise in average menu prices from 2019 to 2024, as reported in a May 2024 company fact sheet. The 2022 and 2023 annual reports are cited as crediting “strategic menu price increases” for revenue growth. The lawsuit alleges that McDonald’s is violating antitrust laws, including Section 1 of the Sherman Act, the Illinois Antitrust Act, and the Illinois Consumer Fraud and Deceptive Business Practices Act.
Thomas is seeking treble damages, an injunction, and attorneys’ fees. One section of the complaint is titled “An $18 Burger,” suggesting that the lawsuit is not only about pricing but also about the perceived value of McDonald’s menu items.
Reuters, which reported on the filing, noted that the suit references a previous Reuters story on McDonald’s pricing engine and similar class-action lawsuits against hotels and apartment rentals. The case highlights growing concerns about AI’s role in pricing strategies and its impact on consumer behavior.
Source: The Gateway Pundit
