McDonald's Broken Ice Cream Machines Lead to "Right to Repair" Lawsuit
Now that it's getting warmer, the idea of going out for ice cream might be tempting. But it can be disappointing when you take the kids out for a vanilla cone at McDonald's only to find that the soft serve machine is broken.
This situation actually happens quite often, at least according to the internet (and McDonald's own Twitter feed). In fact, the most common complaint McDonald's receives online is about broken ice cream machines. The problem has even led to a website that tracks the broken McDonald's ice cream machines nationwide in real time. Each store uses one machine to make all of their frozen desserts—not only their soft serve cones and hot fudge sundaes, but also the trademarked McFlurry and milkshakes such as their signature seasonal Shamrock Shake. Considering that this one machine cranks out 60% of the restaurant's dessert sales, it's no small matter.
It's no surprise that McDonald's is one of the world's biggest restaurant chains. In terms of revenue, it is second in the world, after Starbucks. It is also second in terms of most international locations (after Subway), with over 90% of restaurants owned and operated as independent franchises. Yet franchise owners do not have an easy time with their ice cream machines, for several reasons.
Complicated Machines with Constant Breakdowns
McDonald's ice cream machines are highly complex, with numerous parts that can cause it to break down or begin leaking. Another issue is that the machines are difficult to clean, requiring a long heat-cleaning cycle every night in order to sanitize the machine from bacterial contamination.
Taylor Company makes the ice cream machines, which are developed specifically for use at McDonald's restaurants. An exclusive deal between McDonald's and Taylor means the ice cream machines must be serviced by Taylor. And because almost all restaurants are independently owned and operated, franchise owners rely on corporate to take care of the machines—which means delays until an approved technician can arrive on-site. In addition, the independent owner-operators of each McDonald's restaurant are responsible for paying for repairs. The delay and expense led some franchise owners to look for other options.
Franchisees Seek "Right to Repair"
The constant dysfunction of the machines and long delays for wait times led the Federal Trade Commission to investigate the issue in 2021. Even talk shows have discussed McDonald's ice cream machines as part of a larger "right to repair" movement.
In 2019, a tech startup called Kytch claimed to have found a solution to McDonald's franchisees' ice cream woes. Kytch developed a gadget that independent business owners could install into the machines and use to repair them without having to call and wait for a Taylor technician to arrive. The devices work by intercepting the machine's internal communications and use an app interface also developed by Kytch that allows franchisees to fix problems and also monitor the state of the machines.
McDonald's Slams "Kytch-y" Gadgets
McDonald's was not happy with this arrangement, and took efforts to resist implementation of the new devices within its stores. The company told franchisees that using Kytch created a "very serious safety risk for the crew or technician attempting to clean or repair the machine" and could result in "serious human injury." It also warned that the new devices jeopardized the business's confidential information. McDonald's further sent an email telling store owners that using Kytch's service would void the warranty on the machines. McDonald's prevented any more independent owner-operators from doing business with Kytch. Finally, the company promoted a new ice cream machine model also built by Taylor that would offer similar remote-monitoring features to the Kytch devices.
The result was detrimental to both the startup and customers. Kytch's sales took a significant dip after what was a fast-growing initial market of franchisees. To this day, one in seven ice cream machines worldwide remain broken. The purported new Taylor model that mimicked Kytch's features was never implemented across stores.
Kytch Takes McDonald's to Court
Kytch subsequently sued for libel, tortious interference of contract, and false advertising. In the complaint, filed in federal district court on March 1, Kytch claims that Taylor and McDonald's worked together to prevent Kytch from providing a less expensive service to restaurant owners, misleading franchise owners with false allegations that there were safety issues. Kytch is seeking compensatory and punitive damages, as well as injunctive relief.
Will it be a win for the "right to repair" movement?
Read Kytch's complaint and thousands more with a free trial of Westlaw Edge.
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