McDonald’s sued over AI pricing tool

McDonald’s is facing a proposed federal class-action lawsuit alleging that an AI-enhanced pricing tool helps coordinate menu prices among competing franchisees and raises prices for customers. The claims have not been tested in court, and the company denies that its tool sets or coordinates prices. Illinois resident Michael Thomas filed the complaint on October 2 in federal court in Chicago, seeking to represent customers nationwide. The suit accuses McDonald’s of violating antitrust law by using nonpublic restaurant data in recommendations shared with franchisees that may compete in the same markets. It seeks damages and an order preventing the company from enforcing agreements that restrict competition. The complaint alleges that McDonald’s pricing system uses store-level sales and other information to recommend menu prices across its U.S. restaurants. It says that, since at least 2019, recommendations have linked one restaurant’s price increases to whether nearby restaurants had already raised theirs. The filing also alleges that the company has leverage over franchisees and can pressure them to follow its recommendations.