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Wednesday, April 24, 2024

McDonald’s won burger battle in Oslo

McDonald’s Restaurants has won a lawsuit filed by two of its franchise holders in Norway. An Oslo city court harshly criticized McDonald’s management, however, and agreed with the plaintiffs that “a negative business culture” may exist at the company.

The suit had been filed by franchise holders who claimed they were forced by McDonald’s to sell cheap hamburgers, for only NOK 10 (just over USD 1), in order to entice customers into the restaurants. The franchise holders claimed they had to sell the burgers at a loss, and sued for compensation.

Newspaper Dagens Næringsliv (DN) reported this week that the court found there was no evidence of contract violation or violation of Norwegian competition laws that would provide a basis for compensation. The court blasted McDonald’s Norge, however, over “the lack of transparency in the system.” The court also criticized McDonald’s for making “one-sided” decisions that have great impact on francise holders. That can indicate “a culture where disagreement is swept under the carpet,” the court stated, and that in turn can “express a negative business culture.”

The franchise holders had also claimed they felt threatened by the American boss of McDonald’s Norge, Lauren Cody. The court charaterized a controversial email from Cody as “extremely direct” and containing “a clear warning.” Cody testified that she was surprised her mail, which called any attempt to raise the price of the hamburgers as “risky moves,” had been interpreted as threatening.

The two franchise holders were ordered to pay court costs and legal fees amounting to NOK 1.3 million. An appeal was pending. staff



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