Suit says AI tool allows independently owned franchises to exchange nonpublic price and sales information
McDonald’s is facing a lawsuit in federal court over its alleged use of an AI tool to determine pricing across independent franchises, which prosecutors say violates antitrust laws and has unfairly inflated menu prices for Americans.
The vast majority of McDonald’s US stores are independently owned and are said to individually decide on prices under company policy. Antitrust laws require businesses to set prices independently from their competitors, as coordinating prices can stifle market competition and push up costs for consumers.
The lawsuit, filed on 2 October in a federal Chicago courtroom, alleges that McDonald’s AI tool is illegal because it amounts to independent franchise locations exchanging nonpublic price and sales data.
What. That’s ridiculous.
They individually agree to the recommended price or what? That curiously also works out with the recommended contracts, wages, design, costs of the design, maintenance and everything?
Either it’s all wrong, or the AI is also fine.
I’d assume they could increase prices within percentage points of a range provided by company policy based on differing supply costs or other possibly differing taxes by region.
I don’t think that single sentence is enough to condemn them on, without more info.
The AI price fixing is plenty fucked
Also, price is obviously not private info. Give me an hour and I’d be able to make a price list of every McDonald’s in my area.