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The Courts

Judge Allows McFlurry Machine Repair Lawsuit To Proceed (vice.com) 70

Posted by BeauHD from the right-to-repair dept.
An anonymous reader quotes a report from Motherboard: The McDonald's McFlurry is a delicious treat that people have a hard time finding because the machine breaks down all the time. Thanks to a third-party device made by an independent company called Kytch, the machines can be made to be easier to maintain and break down less. Taylor, the company that makes the McFlurry machine, has been engaged in a long-running legal dispute about whether Taylor could prevent Kytch devices from being used on the machines. Kytch just won an important victory in that long-running legal battle.

Before Kytch came along, Taylor had a repair monopoly on the McFlurry machine. When the thing broke down or hadn't been cleaned, the machine would shut down, and only a certified Taylor technician could get it going again. That's why it can be so hard to find McFlurries: the machines often break down and a tech has to be dispatched to get them running again. Kytch invented a device that allows McDonald's franchise owners to do basic repairs on the machines and get them running again. Taylor didn't like that and, according to a lawsuit filed by Kytch, started telling its franchise partners that Kytch devices could cause "serious human injury."

In July 2021, Kytch filed a restraining order against Taylor claiming that the company had stolen Kytch's trade secrets. Taylor had begun selling a device similar to Kytch's and Kytch has alleged that Taylor stole one of their devices and reverse-engineered it. Taylor pushed back on these allegations and the lawsuit, filing what's called a demurrer, a formalized objection to Kytch's request for a restraining order. In a court document filed on August 26, 2022, a judge allowed Kytch's restraining order to proceed. In its original filing, Kytch alleged 10 different claims against Taylor, including that it had falsely advertised its product and engaged in unfair competition. The judge agreed with Kytch on seven of these points. "The court will sustain Taylor's demurrer as to the second (tortious interference), sixth (intentional interference with business expectancy), and seventh (negligent interference with business expectancy) causes of action," the filing said. "The court rejects Taylor's other arguments and will overrule its demurrer on those grounds."
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Judge Allows McFlurry Machine Repair Lawsuit To Proceed More

Judge Allows McFlurry Machine Repair Lawsuit To Proceed

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  • No matter what the Franchisees get the short end of the stick. Certainly Kytch's product helps them but a machine that needs it all the time is the first problem. Seems like you'd have to run a number of locations as a Franchisee to work through death by a thousand cuts.

    • Re:franchisee (Score:5, Interesting)

      by splutty ( 43475 ) on Tuesday September 13, 2022 @06:55PM (#62879219)

      As long as McD and Taylor make a shitload of money on these 'repairs', they're going to fight tooth and nail against this.

      The really sad thing is that these same machines are used by other companies' franchisees (Like Burger King), but those companies don't have a repair agreement with Taylor, so those machines also don't have the "Only a Taylor repair technician can fix this" problem. They just give non-cryptic readouts and people have been 'fixing' those themselves without issues.

      I wonder how far a class action from all franchise owners about "Intentionally Sabotaged Machines" would go.

      • I wonder how long McD is gonna stand by when their main competitor gets all the customers because the ice cream machines work over there while they don't work at McD.

        • I wonder how long McD is gonna stand by when their main competitor gets all the customers because the ice cream machines work over there while they don't work at McD.

          Wendy's machines seem to work fine as well.

          • The Wendy's Frosty is quite different to the McFlurry. I like the Frosty but it is more akin to a thick milkshake than ice cream so it's not really comparable. The McFlurry is better compared against the Dairy Queen Blizzard. All McDonald's is doing by not fixing their broken machines is sending people who know that the Blizzard is better than the McFlurry over to Dairy Queen. Those are 10's of millions of dollars in lost sales.

            • Fair enough, I've never actually had a McFlurry, at least not in decades. Ice cream products are kind of Dairy Queen's specialty, with burgers and such as a sideline (the opposite of most other fast food joints) so I would expect them to be both good and reliable at that. And they are.

              • Re: (Score:2)

                by Xenx ( 2211586 )

                I would expect them to be both good and reliable at that. And they are.

                You would think that. I have one near where I work, and one near where I live. The one near my work doesn't have ice cream quite regularly. I don't say this from first hand, but my co-worker said it.. even saying he went there on Saturday and it was down/out. I don't frequent the one near my house, but I'd venture somewhere around 20-30% of the time there is no ice cream. I know there wasn't on Thursday.

            • A frosty is not a thick milkshake. It's a soft soft serve. It's never blended. It's made exactly the same way as any other soft serve treat. Its actual characteristic of interest though (since if you let it sit a bit, it will warm up enough to flow... more or less, given all the emulsifiers) is that it has about half as much sugar as a typical frozen treat. They give you a spoon with it for a reason, though.

              All McDonald's is doing by not fixing their broken machines is sending people who know that the Blizzard is better than the McFlurry over to Dairy Queen. Those are 10's of millions of dollars in lost sales.

              There's like five times as many McD's as DQs. In most markets, there is no DQ alternative.

        • Re: (Score:3, Informative)

          by geekmux ( 1040042 )

          I wonder how long McD is gonna stand by when their main competitor gets all the customers because the ice cream machines work over there while they don't work at McD.

          Well, they've been standing by allowing that exact problem to go on for years now.

          And last I checked, McDonalds is still quite bankruptcy-proof due to the fact that they are one of the wealthiest real estate owners on the fucking planet.

          That's not a fast-food business.

        • Re: (Score:2)

          by jonwil ( 467024 )

          Any lost profit to McDonalds Corporate (as opposed to franchisees) due to loosing sales of things that require these machines (or other things people would have bought at the same time) is more than made up for by all the profit McDonalds gets via their cut of the huge repair bills franchisees have to pay to Taylor to get the machines fixed.

          • Ok, then I won't have McFlurry at my restaurant. What a pity.

          • McDonald's hasn't been as exciting as it used to be for a long time .. I don't even want to talk about the visitors of this fast food .. The company has become much more aggressive towards those who want to take their franchise, and shifts the losses on such businessmen. There are many more convenient and profitable formats. Read more [stlouiswings.com] if you're interested in seeing how the Canadian grill bar is progressing. I was a bit bored one day and read about it on their website while waiting for my order. I think that

      • > I wonder how far a class action from all franchise owners about "Intentionally Sabotaged Machines" would go.

        No doubt they have some kind of individual arbitration clause.

      • Re: (Score:1)

        by Anonymous Coward

        not exactly sure how McDs is making a shitload of money off of the fact that their soft serve machines break every day and they need to pay to have some bullshit tech guy come out and charge them to fix it.

      • As long as McD and Taylor make a shitload of money on these 'repairs', they're going to fight tooth and nail against this.

        Guess I'm not understanding how exactly McDonalds is making a "shitload" of money NOT selling the ONLY product this expensive machine exists for.

        The main greedy one involved here, is Taylor. McDonalds is merely the stupid ignorant customer that agrees to purchase a specialized machine that is only sold to McDonalds stores, which requires a "maintenance agreement" unlike any other Taylor ice cream machine.

        The really sad thing is that these same machines are used by other companies' franchisees (Like Burger King), but those companies don't have a repair agreement with Taylor, so those machines also don't have the "Only a Taylor repair technician can fix this" problem.

        Correct. The other machines hardly ever break down because they are different hardware and are maintai

        • Re: (Score:3)

          by splutty ( 43475 )

          McD's has a deal with Taylor where McD's actually gets a part of the profit on the 'repairs'. (From what I recall, they own part of Taylor, but I'm a bit fuzzy on the specifics. There are a good number of Youtube videos explaining exactly how this relationship works).

          Basically McD's makes money off of every support call.

      • Re:franchisee (Score:5, Interesting)

        by tlhIngan ( 30335 ) <[ten.frow] [ta] [todhsals]> on Tuesday September 13, 2022 @09:23PM (#62879489)

        As long as McD and Taylor make a shitload of money on these 'repairs', they're going to fight tooth and nail against this.

        The really sad thing is that these same machines are used by other companies' franchisees (Like Burger King), but those companies don't have a repair agreement with Taylor, so those machines also don't have the "Only a Taylor repair technician can fix this" problem. They just give non-cryptic readouts and people have been 'fixing' those themselves without issues.

        I wonder how far a class action from all franchise owners about "Intentionally Sabotaged Machines" would go.

        Technically speaking, the McDonalds unit and everyone else's units are different. The firmware is the key part, and you're right - the firmware in the "other" category is more tolerant of faults and lets the user clear it. The McD's unit basically halts and requires a Taylor technician to clear it. (There is a service manual for the McD's unit floating around the Internet with all the necessary codes and diagnostics you do to fix it - and which ones are simply push a few buttons and which ones really require actual service).

        And the key parts are, Taylor was spun off from McDonald's so that's why they have such a chummy relationship, whereas it's more of a business relationship with other restaurant chains.

        As for a lawsuit, it's not going to make one iota of a difference.

        First, McDonald's franchisees are bound by their franchise agreement to use those machines, and to use Taylor service people. Even the mere thought of installing the Klytch device can invalidate the agreement. For a franchisee, this means losing your franchise. This includes the million dollar franchise fee, the physical restaurant and the equipment contained within. McDonalds will swoop in, lock up the doors and kick you and your employees out. They'll change the locks and invite a more accommodating franchisee to take over, and possibly even re-hire all the employees again.

        And McDonalds can do this because they have you two ways - they own the land your building is on (McDonalds makes most of their revenue not from royalties of food sales, but on real estate - see the movie Founder for why this is) thus enabling them to lock you out, and they have you by the legally binding contract known as the franchise agreement. Break the agreement and McDonalds will see you in court as a violation of contract law. But in the meantime (because the legal system will take months to years), violating that means your lease on the property is terminated, which means they get to swoop in and take your property (i.e., the building. The equipment inside is leased, not owned).

        That's why everyone uninstalled their Klytch devices when McDonalds sent their nastygram to all franchisees - it was less of a "they may damage your machine" type notice, and more of a "using these devices will be in violation of your franchise agreement" notice. The latter is basically what scared people to remove them.

        In the end, it doesn't even matter that Klytch wins their lawsuit - it will be for naught, since McDonalds controls what franchisees do via the agreement. Even when Klytch wins, forces Taylor to allow them to install it on their devices,, Taylor will just tell McDonalds to not allow the devices to be installed.

        The equipment is leased, the franchisees are bound by their agreement, and well, anyone caught risks losing it all.

        So it will be a hollow victory - Taylor will lose on the whole copying thing most likely and be forced to pay Klytch damages, but it doesn't matter - they're not going to be installed.

      • Re: (Score:2)

        by cob666 ( 656740 )

        I wonder how far a class action from all franchise owners about "Intentionally Sabotaged Machines" would go.

        McDonalds franchise agreement requires that the owner use that particular machine, which is made by Taylor specifically for McDonalds, suing Taylor would be pointless.

      • Also other chains allow their franchisees to use multiple manufacturers so Taylor has to compete. If Taylor machines are hard to repair, franchisees can replace them or not buy them in the first place.

    • Re: (Score:1)

      by Tablizer ( 95088 )

      The top dog always rigs it in their favor. Welcome to Capitalism!

    • Re:franchisee (Score:4, Informative)

      by williamyf ( 227051 ) on Tuesday September 13, 2022 @07:58PM (#62879331)

      No matter what the Franchisees get the short end of the stick. Certainly Kytch's product helps them but a machine that needs it all the time is the first problem. Seems like you'd have to run a number of locations as a Franchisee to work through death by a thousand cuts.

      Actually, franchisees are dying by self inflicted wounds:

      McDonald's allow Franchiees to buy machines from Carpigiani if they do not want Tayyor.
      https://www.carpigiani.com/en/... [carpigiani.com]

      Those machines are more reliable, and are user/employee serviceable as well, buuuuuuut:
      CARPIGIANI MACHINES COST MORE UPFRONT. (even if in the long runt, they end up having a lower TCO and a faster ROI).

      One true drawback is that Carpigiani's services organization has a samller footprint in the USoA than Taylor's. But, even if the nearest Carpigiani services center is a few blocks away, many McDonald's francisees still buy Taylor BECAUSE IT IS CHEAPER.

      • These cost trade-offs are a symptom of being squeezed too hard and also being at the mercy of someone else. You could buy the kickass machine today and they could cancel the product that requires it tomorrow.

      • Re: (Score:2)

        by suss ( 158993 )

        According to google, the Taylor machines cost 18000 dollars (how? are the innards made of gold?) and the Carpigiani less than 1000 on Alibaba. What's happening here? Do the Carpigiani machines get sold to McDonalds franchisees at an extreme markup?

  • how it got to this. Where is McDonalds corp in this fight?

    McFlurry machines going down and the company with a lock on repairs taking it's sweet, sweet time to fix? Why didn't McDonalds deal with this 10 years ago? This is a massive, multinational corp with TONS of money and clout. They could have purchased Taylor outright, stood up a competitor company to build a better unit, threatened Taylor to play ball a little nicer, or simply write the CEO's mistress a 500k check every year and "incentivize" bette

    • Re:Very confused as to (Score:4, Insightful)

      by sarren1901 ( 5415506 ) on Tuesday September 13, 2022 @07:27PM (#62879285)

      McDs is a real estate company. They don't actually care if the ice cream machine works and probably got a nice kick back for letting Taylor screw over the restaurant owners. They just do not care.

    • McDonalds, the corporation, is actually on Taylor's side because they get kick backs essentially from Taylor for the repairs. One thing you have to realize here is McD corp side isn't that invested in the success of individual franchise operations. They get most their income from other sources and their franchise locations having difficulty with ice cream sales just isn't that big an impact on their bottom line. So this means the repair bill kick backs are actually more valuable to them. How much, we do

    • Some have suggested that the only reason McDonalds isn't standing up for the franchises is that they are making money off it somehow, and that money can only come from Taylor Machines in the form of kickbacks for example. That argument is further strengthened by the stance McD took in regards to the usage of Kytch, ie they went out of their way to protect Taylor's service-scam.

      Of course, the above is just speculation since AFAIK no one has proved it to be true.

    • stood up a competitor company to build a better unit

      McDonald's allow Franciess to buy machines from Carpigiani if they do not want Tayyor.
      https://www.carpigiani.com/en/... [carpigiani.com]

      Those machines are more reliable, and are user serviceable as well, buuuuuuut:
      CARPIGIANI MACHINES COST MORE UPFRONT. (even if in the long runt, they end up having a lower TCO and a faster ROI).
      One true drawback is that Carpigiani's services organization has a samller footprint in the USoA than Taylor's. But, even if the nearest Carpigiani services center is a few blocks away, many McDonald'

      • Re: (Score:2)

        by gweihir ( 88907 )

        So essentially short-sightedness at the franchise takers? Makes sense. Too many people buy cheap tools to do their work and are then surprised when it ends up costing them more.

        • So essentially short-sightedness at the franchise takers? Makes sense. Too many people buy cheap tools to do their work and are then surprised when it ends up costing them more.

          Wrong.

          Taylor sells to many other fast food vendors. And basically all of them but McDonalds have issues maintaining and operating their hardware to provide product.

          Taylor manufactures a specific model to sell exclusively to McDonalds, which also mandates a specific service contract.

          Those two details tend to explain exaclty how Kytch came about as an answer to franchise owners tired of getting shaken down by McGreed, and how McGreed is fighting back because an ice cream hardware company and a real estate en

          • correction: all of them but McDonalds DO NOT have issues maintaining and operating their Taylor hardware. The Taylor machine sold to McDonalds is very specific in its inefficiency.

            • One of the benefits Kytch was providing to franchises was better repair instructions. For example for one notorious error code, the official repair manual instructed the operator to only to run an 8 hour diagnostic cycle and no other actions. The problem is that at the end of diagnostic cycle, the machine would keep displaying the same error code meaning it would be out of service continuously for 8 hours at a time. The Kytch's device would 1) show any additional codes not shown to the operator by the machi

            • Re: (Score:2)

              by gweihir ( 88907 )

              Sure. But how does that conflict with my statement? I did not say "buy form a cheap vendor", I said "cheap tools", because there is that other machine McDonalds allows which is better but more expensive.

              I do agree that this looks very much like a design intentionally made bad for continued fleecing of those that bought it because it was cheaper.

    • McDonalds doesn't want it fixed, they like it this way, see my other post.

  • Where I learned about this (Score:5, Informative)

    by jacks smirking reven ( 909048 ) on Tuesday September 13, 2022 @07:19PM (#62879269)

    It's got 10M views so hardly hidden but I did hear about this whole issue last year in a Johnny Harris documentary on Youtube if anyone hasn't seen it or want's to know what the longstanding issue is here.

    It's very well done, even my wife said "I can't believe I enjoyed a 30 minute video on McFlurry machines"

    The REAL Reason McDonalds Ice Cream Machines Are Always Broken [youtube.com]

  • I've noticed that the machine is broken a lot less these days in my area. Of course it is anecdotal and may or may not be related to this lawsuit.

  • who the fuck says?

    but thanks for telling me how to think and feel - very christian..

  • They are nothing more than big mixers.

  • I love dipping my snout into a good ol' McSlurry!

  • Food Theory: McDonalds WANTS It Broken! The Secret of McDonalds Ice Cream
    https://www.youtube.com/watch?... [youtube.com]

  • Could someone enlighten me what the problem with McFlurry Machines is to begin with? Going to my local McD, I never had problems getting a McFlurry or broken machines. McFlurry-Machines are those machines that are basically a motor in a box that a single-use-spoon gets clipped on for stirring. I never saw a display on those. They are usually switched on and of with a single mechanical switch.

    Is this somehow different in the US?

    • The problem is mainly in the US as one machine is notoriously broken all the time. Since McDonalds gets a cut of the repair fees, franchises are at their mercy. Overseas there may be more options and laws that would prevent McDonalds from doing that.
  • Haven't had a McDonald's McFlurry, oh well. Also, haven't been to a McDonald's in 20 years because I wanted a real meat burger. Too many other BETTER hamburger places. The Burger King Blizzard's are AWESOME, had a strawberry cheesecake last night. Along with their burgers, great meal and reasonable.

  • Mcd"s - Keeping you healthy (Score:3)

    by Registered Coward v2 ( 447531 ) on Wednesday September 14, 2022 @07:39AM (#62880409)

    McDonald's McFlurry is a delicious treat

    Really?

    that people have a hard time finding

    OMG, how will I maintain my obesity?

  • ...the irony would be of the individual right to repair was finally won/settled in precedent only because a vast corporate megalopoly like McDonald's finally took a side.

    That's very American.

  • ...at the end of Friday Night Lights. Instead he seems to have developed a split personality on the best way to repair a McFlurry machine.

  • I don't understand why MCD allows this issue to persist. It continues to damage the brand and I generally avoid McDonalds when I want a shake because I don't want to wait in line to find the machine is broken, which it seems to be half the time I go there. I know I'm not alone. This literally seems to be their biggest customer complaint and has been for over a decade. They seem to have churned through CEOs. You'd think one would make this a priority.

    I'm sure Burger King, Sonic, Krystals, Chick-fil-A, Arby's

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