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McDonald’s Sued for $900 Million Over Broken Ice Cream Machine Business

McDonald’s is being sued for $ 900 million by a company that created a product to fix the fast food chain’s infamous broken ice cream machines.

A lawsuit filed on Monday by tech startup Kytch seeks at least $900 million for contempt from McDonald’s Corporation, and founders Jeremy O’Sullivan and Melissa Nelson say it would have been a valuation of their company if the fast food giant hadn’t spread. “knowingly false” claims that their device was unsafe.

The Kytch device allows employees to diagnose broken ice cream machines.

They accuse the $180 billion company of false advertising and improper interference with its customer contracts. The suit says that McDonald’s has violated the company’s advertising laws, which would have negatively affected its business.

McDonald’s removed the devices from its machines as they violated their warranties, intercepted “confidential information”, and risked causing “serious human injury”.

In a statement sent to Insider, McDonald’s said it “owes it to our customers, crew, and franchisees to maintain our rigorous safety standards and work with fully vetted suppliers in that pursuit. Kytch’s claims are meritless, and we’ll respond to the complaint accordingly.”

After the devices were removed, Kytch sales dropped. In response, the small company filed a lawsuit on March 1 accusing McDonald’s of false advertising and wrongful breach of its customer contracts. The lawsuit also alleges that the restaurant chain defamed the Kitch name.

In 2019, O’Sullivan and Nelson created the device, also called Kytch, to help solve the problems of McFlurry manufacturers, long known for their failures, much to the ire of customers.

The machines, made by soft-serve machine maker Taylor, are sold to McDonald’s franchises for around $18,000 each, but have experienced repeated malfunctions that put them out of service.

O’Sullivan and Nelson added in a statement: “McDonald’s worked closely with its soft-serve machine manufacturer, Taylor Company, to spread false information about our company, to drive us out of the marketplace, and to line their own pockets.”

Over the years, breakdowns have become so numerous that they have become firmly established in popular culture, spawning many memes and even a break down-tracking website.

According to McBroken, a website tracking the chain’s broken ice cream machines, 12.57% of machines are currently out of use, with 36.73% not working in New York.

Despite the reportedly widespread issues surrounding ice cream machines, “McDonald’s has failed to meaningfully improve the machines, and the fast-food giant has even granted Taylor exclusive rights to supply kitchen appliances to more than 13,000 retail locations in the United States,” the lawsuit alleged.

O’Sullivan told Newsweek: “If their mission was to destroy Kytch, they absolutely succeeded. What has blown up in their face is this massive trail of really damning evidence of all the laws they’ve broken.”

He added that it took him and Nelson months, “if not a full year,” to gather all the evidence and data, and “convince very smart attorneys to take this data and litigate it against probably the most fearsome company to sue, which is McDonald’s.”

Nelson told WIRED Wednesday of the suit: ‘They’ve tarnished our name. They scared off our customers and ruined our business. They were anti-competitive. They lied about a product that they said would be released.

‘McDonald’s had every reason to know that Kytch was safe and didn’t have any issues. It was not dangerous, like they claimed. And so we’re suing them.’ 

O’Sullivan and his partner, meanwhile, are hopeful the truth will come out in court. 

‘We’re going to continue to get discovery. And it’s going to keep on tunneling into this heart of darkness,’ he told WIRED Wednesday. ‘We knew we would get to this point, and we know we’ll get to the truth. And we’re just going to keep tunneling.’ 

The suit is the second filed by Kytch following McDonald’s’ nixing of their products.

It will likely take many years to work out, but it’s one of the largest suits against a fast-food company.

Secondary editor and executive officer at Tech Business News. Contracting as an IT support engineer for 20 years Matthew has a passion for sharing his knowledge of the technology industry. He's also an advocate for global cyber security matters.

Matthew Giannelis
Matthew Giannelis
Secondary editor and executive officer at Tech Business News. Contracting as an IT support engineer for 20 years Matthew has a passion for sharing his knowledge of the technology industry. He's also an advocate for global cyber security matters.

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