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Customers placing their orders at McDonald's. KHemaz/GVN via Getty Images

McDonald's accused of AI-fueled price fixing in federal court — says lawsuit is 'filled with inaccuracies'

Chris Morris
Oct 8, 2026
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Fast food giant McDonald’s [NYSE: MCD], which has struggled with its integration of artificial intelligence in the past, is now facing a federal lawsuit that alleges the company has violated U.S. antitrust laws with its AI tool, which recommends prices to franchisees across the country.

The tool, the lawsuit alleges, shares nonpublic data that typically wouldn’t be shared with franchisees in the same market, including store-level sales. According to Reuters, the lawsuit accuses McDonald’s of using the nonpublic data to conspire with independent franchises and fix prices. It also says the tool is responsible for higher prices at McDonald’s locations throughout the country.

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McDonald’s said the lawsuit is “filled with inaccuracies” and it would defend itself.

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A long-running battle

McDonald’s has been fighting allegations that it’s using AI to set prices for a while now. The talk has grown so loud online that the company posted a page on its website — titled “Separating Fact from Fiction: AI Does Not Set Prices at McDonald’s” — to dispute the claims.

"AI does not set the price of a Big Mac or any other menu item," the company wrote. "It does not change prices. And it does not determine what an individual customer pays. McDonald’s does not use dynamic pricing. McDonald’s provides franchisees with tools, resources, research and recommendations to help them make informed decisions. Franchisees independently set menu prices at their restaurants."

The tool, the company continued, focuses on restaurant level market dynamics that change by geographic location and follows standard business practices, such as considering local costs, competition, customer demand and economic conditions.

While the tool does offer pricing recommendations, franchisees ultimately decide what’s the best value for their customers.

“A recommendation is exactly that: a recommendation, not a mandate,” the company wrote. “Franchisees are not required to accept a pricing recommendation.”

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Not the company’s first AI headache

McDonald’s, like many businesses, has been looking at the best way to take advantage of the benefits AI can offer, but the results so far have been somewhat mixed.

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In 2021, the company launched a two-year partnership with IBM, which saw it testing AI to take people’s voice orders at the drive-thru kiosks of over 100 restaurants. It ended the partnership in 2024, noting it was unclear whether the technology sped up the overall turnaround time for customers.

TikTok, at the time, was filled with videos of confused customers getting items they never asked for, ranging from nine sweet teas to two pats of butter.

“Cream packet? No! I just want a large water and a cup of ice cream. Not a ketchup packet! Oh, my God,” one customer exclaimed as she fought with McDonald’s AI in a video shared on TikTok.

Earlier this year, the company gave AI order-taking at the drive-thru another try and announced five locations where an automated system called ARCHY would take orders, letting employees focus on other duties. Testing for that system is still ongoing. The company told Moneywise that Archy is already taking real drive-thru orders in English and Spanish and getting them right more than 90% of the time.

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Chris Morris Contributing Writer

Chris Morris is a US based veteran journalist with more than 35 years of experience at many of the biggest digital news outlets. In addition to his activities as a writer, reporter and editor, Chris is also a frequent moderator and speaker at major conferences, including CES and South by Southwest.

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