UNITED STATES DISTRICT COURT FOR THE

NORTHERN DISTRICT OF ILLINOIS

EASTERN DIVISION

CHRISTINE CRAWFORD, et al.,

Case No.: 1:20-cv-05132

Plaintiffs,

Hon. Steven C. Seeger

v.

MCDONALD’S USA, LLC, a Delaware

limited liability company, and

MCDONALD’S CORPORATION, a

Delaware corporation,

Defendants.

REPLY IN SUPPORT OF DEFENDANTS’ RULE 12(B)(6)

MOTION TO DISMISS PLAINTIFFS’ AMENDED COMPLAINT

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TABLE OF CONTENTS

Page

ARGUMENT.................................................................................................................................. 2

I. PLAINTIFFS’ § 1981 CLAIMS ARE LARGELY TIME-BARRED AND 

INSUFFICIENTLY PLED. ................................................................................................ 2

A. Most of Plaintiffs’ § 1981 Claims Are Time-Barred.............................................. 3

B. Plaintiffs Fail to Plausibly Allege Intent to Discriminate....................................... 6

C. Plaintiffs Fail to Plead “But-For” Causation. ......................................................... 9

II. PLAINTIFFS’ BREACH OF CONTRACT CLAIM SHOULD BE DISMISSED.......... 11

A. Plaintiffs Have Not Pled an Actionable Breach of Any Obligations by 

McDonald’s........................................................................................................... 11

B. Plaintiffs’ Conclusory Allegations of “Unreasonableness” Are Insufficient 

to Support a Viable Breach of Contract Claim. .................................................... 15

C. The Amended Complaint Facially Demonstrates that Count II Is Largely 

Time-Barred.......................................................................................................... 16

III. THE FRAUDULENT OMISSION CLAIM FAILS AS A MATTER OF LAW. ............ 17

A. Plaintiffs Do Not Plead a Duty to Disclose in the Amended Complaint, nor 

Address the Required Element in Their Opposition Brief.................................... 18

B. Plaintiffs Fail to Plead Material Omissions with Particularity Under Rule 

9(b)........................................................................................................................ 19

C. Plaintiffs Cannot Establish that They Could Not Have Learned the Truth 

About the Alleged Omissions with Reasonable Inquiry....................................... 21

D. Given the Explicit Disclosures in the FA and FDD, Plaintiffs Cannot 

Establish Reasonable Reliance or McDonald’s Intent to Induce a False 

Belief..................................................................................................................... 22

E. Neither the Fraudulent Concealment Doctrine Nor the Discovery Rule 

Prevents Dismissal of the Fraudulent Omission Claim as Time-Barred. ............. 24

CONCLUSION............................................................................................................................. 25

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TABLE OF AUTHORITIES

Page(s)

Cases

7-Eleven, Inc. v. Spear,

No. 10-cv-6697, 2011 WL 2516579 (N.D. Ill. June 23, 2011)................................................23

Abazari v. Rosalind Franklin Univ. of Med. and Sci.,

40 N.E.3d 264 (Ill. App. Ct. 2015) ..........................................................................................20

Ace Hardware Corp. v. Landen Hardware, LLC,

883 F. Supp. 2d 739 (N.D. Ill. 2012).......................................................................................23

Adams v. City of Indianapolis,

742 F.3d 720 (7th Cir. 2014) .....................................................................................................8

Artista Records, LLC v. Doe 3,

604 F.3d 110 (2d Cir. 2010).....................................................................................................19

Ashcroft v. Iqbal,

556 U.S. 662 (2009)......................................................................................................... passim

Avon Hardware Co. v. Ace Hardware Corp.,

998 N.E.2d 1281 (Ill. App. Ct. 2013) ......................................................................................23

Barrington Press, Inc. v. Morey,

752 F.2d 307 (7th Cir. 1985) ...................................................................................................20

Bourke v. Dun & Bradstreet Corp.,

159 F.3d 1032 (7th Cir. 1998) .................................................................................................13

Brown v. Budz,

398 F.3d 904 (7th Cir. 2005) ...................................................................................................19

Cada v. Baxter Healthcare Corp.,

920 F.2d 446 (7th Cir. 1990) .....................................................................................................6

Camico Mut. Ins. Co. v. Citizens Bank,

474 F.3d 989 (7th Cir. 2007) ...................................................................................................13

Candell v. Shiftgig Bullpen Temp. Emp. Agency,

No. 17 C 3620, 2019 WL 2173797 (N.D. Ill. May 20, 2019) .................................................11

Car Carriers, Inc. v. Ford Motor Co.,

745 F.2d 1101 (7th Cir. 1984) .....................................................................................12, 13, 16

Chang v. McDonald’s Corp.,

No. 95-16012, 1996 WL 742455 (9th Cir. Dec. 19, 1996)................................................12, 15

Case: 1:20-cv-05132 Document #: 48 Filed: 02/02/21 Page 3 of 33 PageID #:1462
iii

Cohen v. Am. Sec. Ins. Co.,

735 F.3d 601 (7th Cir. 2013) ...................................................................................................22

Comcast Corp. v. Nat’l Ass’n of African Am.-Owned Media,

140 S. Ct. 1009 (2020).........................................................................................................9, 10

Commonwealth Edison Co. v. Elston Ave. Prop., LLC,

76 N.E. 3d 761 (Ill. App. Ct. 2017) .........................................................................................13

Cozzi Iron & Metal, Inc. v. U.S. Office Equip., Inc.,

250 F.3d 570 (7th Cir. 2001) ...................................................................................................23

Cromeens, Holloman, Silbert, Inc. v. AB Volvo,

349 F.3d 376 (7th Cir. 2003) ...................................................................................................15

Daniels v. Fed. Reserve Bank of Chi.,

No. 98 C 1186, 2004 WL 419796 (N.D. Ill. Mar. 4, 2004).......................................................5

Fischer v. Caterpillar, Inc.,

No. 11 C 1665, 2012 WL 851550 (N.D. Ill. Mar. 13, 2012).....................................................4

Guarantee Tr. Life Ins. Co. v. Kribbs,

68 N.E.3d 1046 (Ill. App. Ct. 2016) ..................................................................................24, 25

Hengel Inc. v. Hot N' Now, Inc.,

825 F. Supp. 1311 (N.D. Ill. 1993)..........................................................................................20

Hermitage Corp. v. Contractors Adjustment Co.,

651 N.E.2d 1132 (Ill. 1995).....................................................................................................25

HPI Health Care Servs., Inc. v. Mt. Vernon Hosp., Inc.,

545 N.E.2d 672 (Ill. 1989).......................................................................................................20

Iron Workers St. Louis Dist. Council Pension Fund v. Zenith Am. Sols., Inc.,

No. 13 C 7867, 2014 WL 3563295 (N.D. Ill. July 17, 2014)..................................................16

Juniel v. Park Forest-Chicago Heights Sch. Dist. 163,

161 F. Supp. 2d 910 (N.D. Ill. 2001), aff’d, 46 F. App’x 853 (7th Cir. 2002) ..........................6

LaSalle Bank Nat’l Assoc. v. Paramont Props.,

588 F. Supp. 2d 840 (N.D. Ill. 2008).......................................................................................14

Lefebvre Intergraphics, Inc. v. Sanden Mach. Ltd.,

946 F. Supp. 1358 (N.D. Ill. 1996)..........................................................................................21

Lemon v. Myers Bigel, P.A.,

No. 19-1380, 2021 WL 161978 (4th Cir. Jan. 19, 2021).........................................................10

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iv

Lentini v. McDonald’s,

No. 19-4596, 2019 WL 4746420 (D.N.J. Sept. 30, 2019).......................................................12

Limestone Dev. Corp. v. Vill. of Lemont,

520 F.3d 797 (7th Cir. 2008) .....................................................................................................4

Logan v. Wilkins,

644 F.3d 577 (7th Cir. 2011) .........................................................................................3, 16, 17

In re marchFIRST, Inc.,

589 F.3d 901 (7th Cir. 2009) ...................................................................................................17

McCauley v. City of Chicago,

671 F.3d 611 (7th Cir. 2011) .....................................................................................................7

McDonald’s Corp. v. C.B. Mgmt. Co.,

13 F. Supp. 2d 705 (N.D. Ill. 1998).........................................................................................15

McMahan v. Deutsche Bank AG,

938 F. Supp. 2d 795 (N.D. Ill. 2013).......................................................................................19

McReynolds v. Merrill Lynch & Co.,

694 F.3d 873 (7th Cir. 2012) .................................................................................................7, 8

Medscript Pharm., LLC v. My Script LLC,

77 F. Supp. 3d 788 (N.D. Ill. 2015).........................................................................................20

Nat’l Ass’n of African Am.-Owned Media, et al. v. Charter Commc’ns, Inc., et al.,

No. 2:16-cv-00609-GW-FFM (C.D. Cal. Aug. 20, 2020).......................................................10

Nat’l R.R. Passenger Corp. v. Morgan,

536 U.S. 101 (2002)...............................................................................................................4, 5

Ocean Tomo, LLC v. PatentRatings, LLC,

375 F. Supp. 3d 915 (N.D. Ill. 2019).......................................................................................22

Payne v. Abbott Labs.,

999 F. Supp. 1145 (N.D. Ill. 1998)............................................................................................3

Payne v. McDonald’s Corp.,

957 F. Supp. 749 (D. Md. 1997)..............................................................................................15

Pillows v. Cook Cty. Recorder of Deeds Office,

No. 18 C 7497, 2019 WL 2524149 (N.D. Ill. June 18, 2019) ...................................................9

Putzier v. Ace Hardware Corp.,

50 F. Supp. 3d 964 (N.D. Ill. 2014).............................................................................16, 19, 24

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v

Rivas v. Levy,

No. 11 C 02738, 2015 WL 718271 (N.D. Ill. Feb. 18, 2015)..............................................3, 25

Rocha v. Rudd,

826 F.3d 905 (7th Cir. 2016) ...................................................................................................19

Rubert v. King,

No. 19-CV-2781 (KMK), 2020 WL 5751513 (S.D.N.Y. Sept. 25, 2020) ..............................10

Sevugan v. Direct Energy Servs., LLC,

931 F.3d 610 (7th Cir. 2019) .............................................................................................11, 16

Siemer v. Quizno’s Franchise Co. LLC,

No. 07 C 2170, 2008 WL 904874 (N.D. Ill. 2008)............................................................18, 23

Simonian v. Weber-Stephen Prods. Co.,

272 F.R.D. 218 (N.D. Ill. 2011)...............................................................................................20

Swanson v. Citibank, N.A.,

614 F.3d 400 (7th Cir. 2010) .....................................................................................8, 9, 10, 11

TAS Distrib. Co., Inc. v. Cummins Engine Co., Inc.,

491 F.3d 625 (7th Cir. 2007) ...................................................................................................12

Tinner v. United Ins. Co. of Am.,

308 F.3d 697 (7th Cir. 2002) .....................................................................................................4

Venzor v. Gonzalez,

936 F. Supp. 445 (N.D. Ill. 1996)............................................................................................20

Vigortone AG Prods., Inc. v. PM AG Prods., Inc.,

316 F.3d 641 (7th Cir. 2002) ...................................................................................................23

Washington v. Hughes Socol Piers Resnick & Dym, Ltd.,

No. 18-CV-05162, 2020 WL 1503652 (N.D. Ill. Mar. 29, 2020)..............................................8

Wigod v. Wells Fargo Bank, N.A.,

673 F.3d 547 (7th Cir. 2012) ...................................................................................................18

Wilbern v. Culver Franchising Sys., Inc.,

No. 13 C 3269, 2015 WL 5722825 (N.D. Ill. Sept. 29, 2015)...................................................6

Statutes and Rules

42 U.S.C. § 1981.................................................................................................................... passim

Fed. R. Civ. P. 9(b) .....................................................................................................18, 19, 20, 25

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Even after amending their complaint in the wake of McDonald’s first motion to dismiss, 

Plaintiffs’ Amended Complaint contains the same fatal flaws found in their original complaint. 

Tellingly, in their opposition brief, Plaintiffs gloss over the glaring absence of specific factual 

allegations supporting any Plaintiff’s claims. In lieu of facts, Plaintiffs double-down on 

inflammatory rhetoric, bald accusations, and unadorned speculation. They recklessly and falsely 

accuse McDonald’s of “racism,” “redlining,” and “sharecropping,” incendiary terms designed to 

evoke feelings of anger, grief, and despair given the historic experiences of Black people in this 

country. But with nothing more than vague (and untrue) conjecture about discriminatory 

“policies,” improper inferences from cherry-picked data, and mischaracterization of a 25-year-old 

letter, Plaintiffs’ attempts fail to state a viable cause of action. Plaintiffs offer virtually no factual 

allegations about their franchise relationship with McDonald’s, including the locations of their 

individual restaurants, financial circumstances, operating conditions, inspections, renewals, 

interactions with regional managers, and conditions upon which they left the McDonald’s 

franchise. 

Moreover, notwithstanding Plaintiffs’ protests, the gravamen of the complaint—that 

against McDonald’s obvious economic interest in successful, profitable restaurants and 

franchisees, as well as protecting its well-known and valuable brand, the Company intentionally 

discriminated against Black owner-operators, nationwide and for decades, so that they would 

fail—remains fundamentally implausible and extraordinary. There is no factual support for the 

assertion that Black franchisees were limited to undesirable locations rejected by White 

franchisees. Indeed, that theory is contradicted by Plaintiffs’ own allegation that McDonald’s resold Plaintiffs’ restaurants to White owner-operators (See Amended Complaint (Dkt. 30) (“AC”)

¶ 189.)

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It is also evident from the face of the Amended Complaint that Plaintiffs seek to assert their 

§ 1981 claims based on events that occurred long before the beginning of the applicable two-year 

and four-year limitations period. All such claims should be dismissed as untimely. Plaintiffs’ 

attempts to evade the applicable statutes of limitations through the “continuing violation” doctrine, 

fraudulent concealment, and the discovery rule are meritless. Indeed, Plaintiffs’ primary evidence 

against McDonald’s is a 25-year-old letter, so they have no excuse for not bringing their claims 

earlier.

Plaintiffs’ remaining claims, for breach of contract and fraudulent omission, should also 

be dismissed. Plaintiffs’ contract claims rest on an obvious misreading of the terms of their 

franchise agreements with McDonald’s, and their opposition brief merely confirms as much. 

Similarly, Plaintiffs’ fraudulent omission claim continues to suffer from multiple fatal defects, 

including failing to: allege a duty to disclose, plead the claim with particularity, allege that they 

could not have discovered the supposedly omitted information through a reasonable inquiry, and 

establish reasonable reliance or an intent by McDonald’s to induce a false belief. Plaintiffs’ 

opposition does nothing to resolve these defects. Moreover, like their discrimination claims, 

Plaintiffs’ contract and fraud claims are largely time-barred.

In sum, Plaintiffs fail to address the fatal flaws of their Amended Complaint and dismissal 

with prejudice is warranted.

ARGUMENT

I. PLAINTIFFS’ § 1981 CLAIMS ARE LARGELY TIME-BARRED AND 

INSUFFICIENTLY PLED.

Plaintiffs’ own arguments demonstrate that their § 1981 claims are either time-barred or 

insufficiently pled, or both. 

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A. Most of Plaintiffs’ § 1981 Claims Are Time-Barred.

Plaintiffs do not dispute that their § 1981 claims have a two-year statute of limitations for 

pre-contractual activity and a four-year statute of limitations for alleged unfair treatment during 

the terms of their Franchise Agreements (“FAs”). Instead, Plaintiffs argue—incorrectly—that the 

statute of limitations cannot be resolved on a motion to dismiss. (Plaintiffs’ Opp. to Defendants’ 

Motion to Dismiss (Dkt. 44) (“Opp.”) at 7–8.) It is well established that it is appropriate to dismiss

a claim at the pleadings stage when the face of the complaint makes clear that the claims are timebarred. See Rivas v. Levy, No. 11 C 02738, 2015 WL 718271, at *4 (N.D. Ill. Feb. 18, 2015) 

(citing Logan v. Wilkins, 644 F.3d 577, 582–83 (7th Cir. 2011)). That is precisely the case here. 

As plaintiffs themselves admit, a “discrimination claim accrues when the plaintiff knows or has 

reason to know of the injury which is the basis of the action, which is generally the date of the last 

discriminatory act.” (Opp. at 10.) Plaintiffs do not dispute—and cannot dispute—that the 

Amended Complaint is based primarily on alleged acts of discrimination that occurred long before 

the limitations period—in some instances, decades in the past. Their professed ignorance of these 

acts, and inability to discover these acts, prior to their exit from the McDonald’s franchise system 

is contradicted by their own allegations and common sense. 

In particular, Plaintiffs try to avoid the statute of limitations by arguing that there is a 

“continuing violation” or, alternatively, that fraudulent concealment or the discovery rule should 

delay the running of the statute of limitations. (Opp. at 9–15.) None of these legal theories has 

any factual basis in the Amended Complaint. See, e.g., Payne v. Abbott Labs., 999 F. Supp. 1145, 

1150 (N.D. Ill. 1998) (“If the factual allegations of a complaint are insufficient to form the basis 

of tolling the statute of limitations based on the continuing violation doctrine, courts routinely 

dismiss plaintiff’s complaint as untimely.”). 

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The “continuing violation” doctrine does not apply here, where the conduct at issue is a 

series of discrete acts. In Nat’l R.R. Passenger Corp. v. Morgan, 536 U.S. 101 (2002), the Supreme 

Court held that that this doctrine does not apply to “discrete discriminatory acts.” Id. at 113. That 

is because “[d]iscrete acts such as termination, failure to promote, denial of transfer, or refusal to 

hire are easy to identify,” and each is “separate[ly] actionable.” Id. at 114. This is distinguishable 

from claims relating to acts that are not actionable individually but together form a claim. See 

Limestone Dev. Corp. v. Vill. of Lemont, 520 F.3d 797, 801 (7th Cir. 2008).

Plaintiffs’ § 1981 claims are based on discrete acts such as placing Plaintiffs in “poorperforming and dangerous locations,” requiring them to undertake unnecessary “rebuilds,” and 

giving them unwarranted bad grades after restaurant inspections. (AC ¶ 226.) Such acts, by their 

nature, cause harm that is immediately recognizable and cannot therefore constitute a continuing 

violation. See, e.g., Tinner v. United Ins. Co. of Am., 308 F.3d 697, 700–01, 708–09 (7th Cir. 

2002) (holding that transfer to a predominately African-American area, a conflict with a White 

office administrator, allegedly discriminatory application of the company’s dress code, denial of 

vacation, and termination were all discrete acts, not a continuing violation); see also Fischer v.

Caterpillar, Inc., No. 11 C 1665, 2012 WL 851550, at *3 (N.D. Ill. Mar. 13, 2012) (finding 

continuing violation doctrine inapplicable to § 1981 claims where “[t]he conduct alleged by 

[plaintiff] in this case involves discrete acts, such as when [plaintiff] was allegedly told that she 

would not be eligible to work overtime and when she was denied the opportunity to bid on other 

jobs.”).

Nor can Plaintiffs invoke the continuing-violation doctrine by pleading vague theories 

about McDonald’s supposed “discriminatory practices and policies.” (AC ¶ 161.) Morgan

forecloses the use of “pattern and practice” allegations to toll claims arising from discrete acts like 

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the ones alleged here. See 536 U.S. at 111–12. But even if a “pattern and practice” theory was

available, the “ongoing pattern must be shown through [plaintiffs’] individual claims of 

discrimination, not through other employees’ claims and not through a general pattern or 

practice.” Daniels v. Fed. Reserve Bank of Chi., No. 98 C 1186, 2004 WL 419796, at *6 (N.D. 

Ill. Mar. 4, 2004) (emphasis added). Thus, in Daniels, the court rejected the plaintiffs’ argument 

“that a continuing violation is demonstrated by each of [p]laintiffs’ allegations that the [defendant] 

had a long-held ‘pattern and practice’ of racial discrimination against African-Americans and that 

the [defendant’s] alleged discriminatory acts were similar, repetitive, and continuous.” Id. 

Similarly, Plaintiffs’ conclusory allegations of a pattern or practice, which lack any individualized 

support, do not toll the applicable statute of limitations.

Plaintiffs’ alternative theory—that fraudulent concealment or the discovery rule should 

delay the running of the statute of limitations—is equally without merit. As McDonald’s explained 

in its opening brief, nothing in the Amended Complaint suggests that it affirmatively concealed 

any misconduct; to the contrary, Plaintiffs themselves allege that McDonald’s was subject to 

public complaints of discrimination during the time-period in question. (McDonald’s Mem. in 

Supp. of Mot. to Dismiss (Dkt. 39) (“Mot.”) at 11–12.) Indeed, in their opposition, Plaintiffs rely 

heavily on a 1996 letter to the National Black McDonald’s Operators Association (“NBMOA”)—

a 47-year-old organization dedicated to ensuring that Black franchisees are protected and 

represented within McDonald’s—as evidence of discrimination by McDonald’s. (Opp. at 15–16.) 

Not only is this letter not evidence of discrimination (see infra at 7), but it indeed makes clear that 

Plaintiffs could have pled their claim 25 years ago. Plaintiffs offer no substantial argument to the 

contrary.

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Similarly, the discovery rule does not apply. It merely “postpones the beginning of the 

limitations period from the date when the plaintiff is wronged to the date when he discovers he 

has been injured . . . .” Cada v. Baxter Healthcare Corp., 920 F.2d 446, 450 (7th Cir. 1990) 

(emphasis added). Put differently, a “plaintiff’s claim accrues when he discovers that he has been 

injured, not when he determines that the injury was unlawful.” Juniel v. Park Forest-Chicago 

Heights Sch. Dist. 163, 161 F. Supp. 2d 910, 914 (N.D. Ill. 2001) (emphasis supplied), aff’d, 46 F. 

App’x 853 (7th Cir. 2002). Here, Plaintiffs were necessarily aware of their purported injury at the 

time the acts in question occurred because they claim that McDonald’s actions (frequent 

inspections and unreasonable grading, mandatory rebuilds, denial of financial assistance and 

rewrite) were not justified by the circumstances at the time. (See, e.g., AC ¶¶ 188, 203–04, 208–

09.) Plaintiffs’ reliance on Wilbern v. Culver Franchising Sys., Inc., No. 13 C 3269, 2015 WL 

5722825 (N.D. Ill. Sept. 29, 2015) is misplaced. There, the defendant claimed to have rejected the 

plaintiff’s application for a franchise opportunity in 2009, but never actually informed the plaintiff 

of that decision, who had no reason to know of it until the defendant terminated his existing 

franchise. Id. at *21–22. The court sensibly concluded that the plaintiff’s claim accrued when he 

learned of the denial and thereby discovered his injury. See id. Here, Plaintiffs are not claiming 

that McDonald’s failed to promptly notify them of any of the decisions that underlie their claim, 

so Wilburn is inapposite. 

Overall, the face of the Amended Complaint makes clear that most of Plaintiffs’ § 1981 

claims are time-barred and should be dismissed.

B. Plaintiffs Fail to Plausibly Allege Intent to Discriminate.

To the extent Plaintiffs’ § 1981 claims are not time-barred, dismissal is appropriate because 

they are insufficiently pled. Plaintiffs offer no real response to McDonald’s argument that intent 

to discriminate is a key element of the claim and the Amended Complaint contains no concrete 

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factual allegations supporting such intent. (Mot. at 12–16.) Indeed, Plaintiffs’ opposition fails to 

cite even one concrete factual allegation suggesting that any one of the Plaintiffs—much less all 

of them—was subject to intentional discrimination. (See Opp. at 15–18.)

Although Plaintiffs continue to argue that the 1996 letter sent to the NBMOA is an 

admission of past discrimination (Opp. at 15–16), it plainly cannot serve as evidence of intent for 

the 25 years since the letter was sent. Plaintiffs’ vague references to eleven “categories of ongoing 

practices” that McDonald’s supposedly applied in a discriminatory manner (see Opp. at 17) are 

also inadequate to substitute for concrete “factual content.” See Ashcroft v. Iqbal, 556 U.S. 662, 

678 (2009). The Supreme Court has made clear that broad allegations of a program to discriminate 

are insufficient; Plaintiffs are required to introduce hard facts making it plausible that there was, 

in fact, discrimination. See id. at 681–83. Similarly, in McReynolds v. Merrill Lynch & Co., 694 

F.3d 873 (7th Cir. 2012), the Seventh Circuit refused to credit plaintiffs’ theory that discriminatory 

intent underlay a company policy just because the plaintiffs said so. See id. at 885–87.1 Here, 

Plaintiffs plead no facts suggesting that the alleged “ongoing practices” even existed, much less 

that they were designed with an intent to discriminate.

The pleading deficiencies are particularly stark given the extraordinary theory asserted by 

Plaintiffs. As the Seventh Circuit has held, extraordinary theories require extraordinary pleading. 

McCauley v. City of Chi., 671 F.3d 611, 616–17 (7th Cir. 2011) (“A more complex case . . . will 

1 Plaintiffs seek to distinguish McReynolds on the ground that, there, the plaintiffs challenged a “race 

neutral” policy. (Opp. at 17.) This distinction is baseless as Plaintiffs do not identify any McDonald’s 

policy that is not race neutral. Unsurprisingly, McDonald’s has policies regarding the conduct at issue in 

the Amended Complaint: awarding of new restaurants, “rewrites” for existing restaurants, inspections, and 

so forth. (Mot. at 4–5; see also FDD, Ex. K (McDonald’s Rewrite Policy).) Plaintiffs do not allege that 

any of these policies expressly provides that Black owner-operators should be treated worse than other 

owner-operators, and of course, the policies do not contain any such requirement. Instead, Plaintiffs allege 

that McDonald’s race-neutral policies were applied in an intentionally discriminatory manner. That is 

indistinguishable from McReynolds and Iqbal.

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require more detail, both to give the opposing party notice of what the case is all about and to show 

how, in the plaintiff's mind at least, the dots should be connected.”) (quoting Swanson v. Citibank, 

N.A., 614 F.3d 400, 405 (7th Cir. 2010)). While Plaintiffs argue this rule only applies to claims 

involving “financial derivatives,” “tax fraud,” or “antitrust” violations” (Opp. at 19), that argument 

runs counter to judicial authority in the Seventh Circuit and the Northern District of Illinois, where 

courts have repeatedly applied the rule to complex race discrimination cases. See, e.g., Adams v. 

City of Indianapolis, 742 F.3d 720, 733 (7th Cir. 2014) (“This is a complex discrimination claim, 

and we have observed that under Iqbal and Twombly, ‘[t]he required level of factual specificity 

rises with the complexity of the claim.’”) (citing McReynolds, 694 F.3d at 887); Washington v. 

Hughes Socol Piers Resnick & Dym, Ltd., No. 18-CV-05162, 2020 WL 1503652, at *5 (N.D. Ill. 

Mar. 29, 2020) (“Because this is not an ordinary discrimination claim, it requires more than the 

ordinary allegations to put the defendant on notice of what the case entails and to connect the dots 

in a plausible way.”). As this Court recognized in its recent order staying discovery, it is hard to 

imagine a § 1981 case more complex than this one: it involves 77 individual plaintiffs (47 of whom 

assert § 1981 claims) who own “more than 300 restaurants” and seek “more than $1 billion in 

damages.” (Dkt. 45.) 

Ultimately, Plaintiffs’ theory that McDonald’s intentionally sabotaged Black franchisees 

is against the economic interest of McDonald’s and fundamentally implausible. Plaintiffs concede 

that McDonald’s earns more money when its restaurants earn higher revenues, but in a clear 

attempt to further a manufactured narrative, now argue that McDonald’s “had an incentive to place

Black franchisees in predominantly Black neighborhoods to target the Black consumers who live 

there, where White franchisees refused to operate.” (Opp. at 16.) This latest theory is not only 

unsupported by factual allegations, but also contradicted by the Amended Complaint itself, which 

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asserts that McDonald’s routinely resold Plaintiffs’ restaurants to White franchisees. (AC ¶ 189.) 

Nor does this theory offer any explanation for why McDonald’s would try to “force out” Black 

franchisees through unfair inspections and the various other practices alleged in the Amended 

Complaint—if McDonald’s, as Plaintiffs allege, wanted to keep Black owner-operators in Black 

neighborhoods. In sum, Plaintiffs offer no cogent, fact-based theory for why McDonald’s would 

intentionally engage in the conduct alleged in the Amended Complaint.

C. Plaintiffs Fail to Plead “But-For” Causation.

Dismissal is also appropriate because Plaintiffs do not allege any facts supporting a 

plausible inference that race was a “but-for” cause of their alleged injuries. See Comcast Corp. v.

Nat’l Ass’n of African Am.-Owned Media, 140 S. Ct. 1009, 1019 (2020); Pillows v. Cook Cty. 

Recorder of Deeds Office, No. 18 C 7497, 2019 WL 2524149, at *3 (N.D. Ill. June 18, 2019). As 

the Supreme Court has recently held, such causation must be supported at the pleading stage by 

concrete factual content under the Iqbal standard. See Comcast, 140 S. Ct. at 1014, 1019 (“[T]o 

determine what the plaintiff must plausibly allege at the outset of a lawsuit, we usually ask what 

the plaintiff must prove in the trial at its end”; remanding for an evaluation of the requisite but-for 

causation allegations under Iqbal).

 In their opposition brief, Plaintiffs identify no such factual content. Instead, they argue 

that they are not required to plead factual content showing but-for causation, relying primarily on 

the Seventh Circuit’s decision in Swanson, 614 F.3d at 405. (Opp. at 18–21.) Plaintiffs argue that

a § 1981 plaintiff need only allege “the type of discrimination that she thinks occurs (racial), by 

whom . . . , and when.” (Opp. at 20, citing Swanson, 614 F.3d at 405). This argument fails for 

multiple reasons.

First, Plaintiffs cannot overcome Swanson’s express proviso that, in “complex” cases, more 

factual detail is required. 614 F.3d at 405. As explained above, Plaintiffs are not even close to 

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pleading the level of factual detail required to state a complex discrimination claim. Plaintiffs rely 

on a single, unpublished, out-of-circuit decision reading Swanson for the proposition that 

discrimination cases are not “complex” cases. (See Opp. at 18–20 (citing Nat’l Ass’n of African 

Am.-Owned Media, et al. v. Charter Commc’ns, Inc., et al., No. 2:16-cv-00609-GW-FFM (C.D. 

Cal. Aug. 20, 2020)).) That decision is out of step with decisions in this Circuit, which have 

interpreted Swanson to require more factual content in “complex” discrimination cases. (See supra

at 7–8.)

Second, Plaintiffs’ position is irreconcilable with the Supreme Court’s decision in 

Comcast. Swanson did not even discuss but-for causation or the requirements of § 1981 (rather, 

as Plaintiffs concede, it concerned a different statute entirely). To the extent Plaintiffs try to create 

tension between Comcast and Swanson, the Supreme Court’s more-recent and more-specific 

decision governs. Indeed, multiple courts since Comcast have held § 1981 plaintiffs to their 

burden of supporting allegations of but-for causation with concrete facts. See, e.g., Lemon v. Myers 

Bigel, P.A., No. 19-1380, 2021 WL 161978, at *6 (4th Cir. Jan. 19, 2021) (finding that, “in the 

absence of plausible allegations that, for example, [] white partners were similarly situated,” 

plaintiff’s “allegation that she was subject to a different short-term leave application process than 

the firm’s white partners is by itself insufficient” to plead but-for causation under Comcast); 

Rubert v. King, No. 19-CV-2781 (KMK), 2020 WL 5751513, at *7 (S.D.N.Y. Sept. 25, 2020) 

(finding that “boilerplate assertion[s] unsupported by specific facts” that plaintiff was “fired 

because defendants saw him as another expendable Hispanic” and that “Walmart has a history of 

discrimination and illegal conduct” were insufficient to plead but-for causation). This Court 

should do the same.

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Finally, Plaintiffs fail to satisfy the Swanson standard which requires allegations, for each 

Plaintiff and each allegedly discriminatory act, who at McDonald’s allegedly committed it, and 

when it occurred. Nothing in Swanson permits Plaintiffs to conjure up a host of discriminatory 

“policies” based on mere say-so, while failing to allege the basic facts surrounding each 

discriminatory act at issue.

II. PLAINTIFFS’ BREACH OF CONTRACT CLAIM SHOULD BE DISMISSED.

Plaintiffs’ Amended Complaint fails to meet the requisite pleading standards for a breach 

of contract claim, ignores the plain language of the Plaintiffs’ contracts with McDonald’s, and 

facially demonstrates that the claim is largely time-barred. (See Mot. at 18–26.) Nothing in 

Plaintiffs’ Opposition corrects these fundamental deficiencies. As such, the breach of contract 

claim should be dismissed. 

A. Plaintiffs Have Not Pled an Actionable Breach of Any Obligations by 

McDonald’s.

As discussed in McDonald’s opening brief, Plaintiffs’ breach of contract claim does not 

focus on any contractual obligation of McDonald’s that was allegedly breached. (Mot. at 20–24.)2 

See Sevugan v. Direct Energy Servs., LLC, 931 F.3d 610, 614–15 (7th Cir. 2019). In response, 

Plaintiffs contend that Section 12 of the FA imposes a “reasonableness” standard on McDonald’s, 

and that Section 3 creates an obligation to provide “additional services” relative to other 

franchisees. (Opp. at 23–25.) Plaintiffs are wrong on both counts. 

2 Plaintiffs also fail to adequately plead their own substantial performance as well as necessary facts 

establishing when and how the FAs were breached. (Mot. at 24, 25 n.14.) Plaintiffs’ failure to address 

either of these points in their opposition provides an independent basis for dismissal of Count II. See 

Candell v. Shiftgig Bullpen Temp. Emp. Agency, No. 17 C 3620, 2019 WL 2173797, at *3 (N.D. Ill. May 

20, 2019) (failure to proffer a substantive response to an argument asserted in a dispositive motion results 

in forfeiture and is, in itself, a basis to grant the dispositive motion).

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1. Plaintiffs Admit that Section 12 of the Franchise Agreement Imposes 

Obligations on Plaintiffs, Not McDonald’s.

Plaintiffs do not dispute that Section 12 of the FA, entitled “Compliance with Entire 

System,” confers obligations on Plaintiffs, not McDonald’s. Thus, as a matter of law, McDonald’s 

cannot have breached Section 12. (Mot. at 21–22); see also TAS Distrib. Co., Inc. v. Cummins 

Engine Co., Inc., 491 F.3d 625, 631 (7th Cir. 2007) (“Only a duty imposed by the terms of a 

contract can give rise to a breach.”). 

Recognizing that Section 12 of the FA imposes no obligations on McDonald’s, Plaintiffs 

try to create and impose a reasonableness standard on McDonald’s with respect to operations, 

inspections, and renovations, on the basis of Paragraph 12(c), which states that franchisees “shall 

comply with the entire McDonald’s System,” by “[k]eep[ing] the Restaurant constructed and 

equipped in accordance with the building blueprints and equipment layout plans that are standard 

. . . or as such blueprints and plans may be reasonably changed from time to time by 

McDonald’s.” (FA ¶ 12(c) (emphasis added).) However, by its plain terms, the reasonableness 

language in Paragraph 12(c) relates only to changes by McDonald’s to its “blueprints and 

equipment layout plans,” and Plaintiffs make no claim that McDonald’s unreasonably changed 

these plans during the terms of their franchises.3 

3 Plaintiffs argue that Lentini v. McDonald’s, No. 19-4596, 2019 WL 4746420 (D.N.J. Sept. 30, 2019) 

establishes that the word “reasonably” in Paragraph 12(c) is ambiguous and can be read expansively. (Opp. 

at 24–25.) However, the Lentini court analyzed Paragraph 12(c) consistent with its explicit terms; the issue 

presented there was whether the changes made by McDonald’s to its blueprints and plans were reasonable, 

and the court held that because “Plaintiffs ha[d] adequately pled the unreasonableness of the changes, the[ir] 

breach of contract claim” could not be dismissed. Lentini, 2019 WL 4746420 at *4. The court said nothing, 

however, about whether the term “reasonably” in Paragraph 12(c) could be expanded as Plaintiffs argue 

here. Unlike the plaintiff in Lentini, Plaintiffs have not adequately pled “unreasonableness” see infra, or 

that the FA is ambiguous (an issue not raised in their Amended Complaint). See Car Carriers, Inc. v. Ford 

Motor Co., 745 F.2d 1101, 1107 (7th Cir. 1984) (“[I]t is axiomatic that the complaint may not be amended 

by the briefs in opposition to a motion to dismiss.”). And in any event, even the authority cited by Plaintiffs 

(Opp. at 24 n.6) have held that Section 3 of the FA is clear and unambiguous. See, e.g., Chang v. 

McDonald’s Corp., No. 95-16012, 1996 WL 742455, at *1 (9th Cir. Dec. 19, 1996). 

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Moreover, Section 12, which must be read as a whole, contains more specific provisions 

relating to each of the issues that Plaintiffs claim were subject to a reasonableness standard:

− Operations: Franchisee shall “[o]perate the Restaurant in a clean, wholesome manner

in compliance with prescribed standards of Quality, Service, and Cleanliness . . . .” 

(FA ¶ 12(a).)

− Inspections: “McDonald’s shall have the right to inspect the Restaurant at all 

reasonable times to ensure that Franchisee’s operation thereof is in compliance with 

the standards and policies of the McDonald’s System.” (Id. ¶ 12.)

− Renovations: Franchisee shall “[k]eep the Restaurant constructed and equipped in 

accordance with the building blueprints and equipment layout plans” and “[m]ake 

repairs or replacements required . . . .” (Id. ¶¶ 12(c), (e).)

Neither provision relating to Plaintiffs’ obligations with respect to operations or renovations uses 

the term “reasonable;” indeed, both state that a franchisee “shall” comply with the requirements 

contained therein. Only the opening portion of Section 12 regarding inspections contains the word 

“reasonable,” and it only relates to the times at which such inspections occur.4 In short, Plaintiffs’ 

effort to leverage the use of the word “reasonably” in Paragraph 12(c) into a contract-wide 

“reasonableness standard” with respect to McDonald’s rights regarding franchise operations, 

inspections, and renovations is unavailing. See Camico Mut. Ins. Co. v. Citizens Bank, 474 F.3d 

989, 993 (7th Cir. 2007) (courts interpret contracts using the “four corners” rule; the contract 

“speaks for itself” and the parties’ intentions “must be determined by the language used.”).5

4 As discussed in McDonald’s opening brief, Plaintiffs have alleged no facts to establish that their locations 

were inspected “outside of regular business hours.” (Mot. at 22.) Per Section 12 of the FA, the franchisee 

is obligated to “[o]perate the Restaurant seven (7) days per week throughout the year and at least during the 

hours from 7:00 a.m. to 11:00 p.m. . . .” (FA ¶ 12(g).) There are no facts pled indicating that any Plaintiff 

was subjected to inspections outside of these times. And in any event, even if Plaintiffs could establish that 

McDonald’s engaged in “unreasonable” inspections, it would at most provide a basis upon which to refuse 

such an inspection, and not a material breach of the FA. See, e.g., Commonwealth Edison Co. v. Elston 

Ave. Prop., LLC, 76 N.E. 3d 761, 767 (Ill. App. Ct. 2017).

5 To the extent Plaintiffs now assert ambiguity (Opp. at 21–22, 24), the Court should disregard such efforts 

because Plaintiffs did not raise this issue in their Amended Complaint. See Car Carriers, 745 F.2d at 1107. 

And in any event, there is no ambiguity in Section 12 of the FA. Bourke v. Dun & Bradstreet Corp., 159 

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2. Plaintiffs Ignore the Plain Language of Section 3 of the Franchise 

Agreement.

Plaintiffs also argue that Section 3 obligated McDonald’s to provide various forms of 

assistance to Plaintiffs as franchisees, even though they concede, as they must, that Section 3 of 

the FA is properly read to only pertain to “the operation of the Restaurant. . . .”6 (Opp. at 23–24; 

see also Mot. at 23 n.12; FA ¶ 3.) As discussed in McDonald’s opening brief, the FA and Franchise 

Disclosure Document (“FDD”) make clear that McDonald’s had no such obligation. (Mot. at 23.) 

See LaSalle Bank Nat’l Assoc. v. Paramont Props., 588 F. Supp. 2d 840, 856–57 (N.D. Ill. 2008) 

(dismissing breach of contract claim with prejudice where no provision of the contract required 

the actions plaintiff alleged were required of defendant). Plaintiffs largely fail to respond to this 

argument, other than to assert that the phrase “additional services, facilities, rights, and privileges” 

in Section 3 must create obligations beyond the contract. (Opp. at 23.) This interpretation is 

strained, inconsistent with the contract when read as a whole, and does not address McDonald’s 

fundamental argument that the “additional” assistance identified by Plaintiffs in their Amended 

Complaint was explicitly disclaimed by the FDD and the FA. (Mot. at 23.)7 

Moreover, the assistance that Plaintiffs claim they were denied does not relate to the 

“operation of the Restaurant” as contemplated by Section 3. Assistance like growth opportunities 

and the ability to participate in the NextGen program—claims that relate to the ability to own and 

operate additional franchises—are outside the realm of everyday restaurant operations, such as 

F.3d 1032, 1036 (7th Cir. 1998) (ambiguity is a question of law, and courts should enforce contracts 

according to their plain terms). 

6

“Restaurant” is defined in each FA to refer to the specific franchise location covered by that Agreement. 

(FA at 1; see also Mot. at 3 (FA “is specific to a particular restaurant and for a limited period”).)

7 Plaintiffs’ argument that Section 3 of the FA also applies to how McDonald’s imposes rebuild and 

renovation requirements for a given location (Opp. at 24) is nonsensical. Plaintiffs admit that the FA must 

be read as a whole (Opp. at 23–24), and Section 12—not Section 3—addresses Plaintiffs’ obligations 

regarding rebuilds and renovations. (See FA ¶¶ 12(a), (c), (e).)

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food, service, and supplying of equipment. And, as discussed in McDonald’s opening brief (Mot. 

at 23, n.12), efforts to read Section 3 beyond its plain language regarding restaurant operations

have been rejected by other courts, a point which Plaintiffs largely concede. (Opp. at 23, 24 n.6.)8 

B. Plaintiffs’ Conclusory Allegations of “Unreasonableness” Are Insufficient to 

Support a Viable Breach of Contract Claim. 

Plaintiffs next look to extra-contractual provisions to import a reasonableness standard into 

the FA. While they acknowledge that the implied covenant of good faith and fair dealing does not 

create an independent source of duties for the parties to a contract, they argue that it nevertheless 

creates a reasonableness standard that must be read into Paragraphs 3 and 12 of the FA. (Opp. at 

25–26.) As previously discussed (Mot. at 25–26), the implied covenant of good faith and fair 

dealing is simply an aid in construction and does not override the express terms of the contract. 

See Cromeens, Holloman, Silbert, Inc. v. AB Volvo, 349 F.3d 376, 396 (7th Cir. 2003); see also 

C.B. Mgmt., 13 F. Supp. 2d at 713 (“McDonald's simply exercised privileges expressly reserved 

in the agreements and we may not interject the duty of good faith to rewrite the contract.”).

Moreover, mere conclusory assertions of unreasonableness are insufficient to adequately 

plead a breach of contract. (Mot. at 22, 24–25.) Rather than addressing this argument, Plaintiffs 

simply repeat the same conclusory allegations that inspections of their restaurants were “increased, 

8 While Plaintiffs seek to distinguish McDonald’s Corp. v. C.B. Mgmt. Co., 13 F. Supp. 2d 705 (N.D. Ill. 

1998), the holding of that case is directly on point. There, the franchisee asserted that Section 3 of the FA 

conferred discretion upon McDonald’s to provide it financial assistance and defer termination, and because 

it had done so in the past with other franchisees, “McDonald’s failure to exercise that discretion in good 

faith constituted a breach of the franchise agreements.” Id. at 712. The court dismissed Plaintiffs’ claim, 

finding that Section 3 did not apply, as its terms related only to the “details of restaurant operations such as 

food, service and the supplying of standardized equipment,” not the actions challenged by plaintiff. Id.

(citation omitted). The two out-of-circuit cases relied upon by Plaintiffs (Opp. at 24 n.6) are in accordance. 

See Chang, 1996 WL 742455, at *1 (“[plaintiff] takes . . . [Section 3] out of context;” when read as a whole, 

Section 3 relates only “to the details of restaurant operation, such as food service and the supplying of 

standardized equipment,” not renewal of franchise terms); Payne v. McDonald’s Corp., 957 F. Supp. 749, 

756 (D. Md. 1997) (Section 3 does not impose obligations on McDonald’s to assist franchisee in the sale 

of a restaurant). 

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harassing, and targeted” (Opp. at 25; AC ¶ 243(b)) and that McDonald’s “unreasonably” required 

“high-cost” rebuilds or remodels (Opp. at 25; AC ¶ 243(a)). These allegations are not supported 

by well-pled facts about the circumstances that make McDonald’s exercise of its contractual rights 

unreasonable, and need not be accepted as true. (Mot. at 24.) See Iqbal, 556 U.S. at 678; see also 

Sevugan, 931 F.3d at 617 (affirming dismissal of complaint and rejecting plaintiff’s argument that 

defendant “unreasonably exercised its discretion” because the “complaint fail[ed] to allege how

[defendant] unreasonably exercised its discretion in setting” prices) (emphasis added). 

C. The Amended Complaint Facially Demonstrates that Count II Is Largely 

Time-Barred.

In response to McDonald’s limitations argument, Plaintiffs make the sweeping proposition 

that the breach of contract claim is timely alleged because “Plaintiffs allege facts to support each

alleged breach and proximity to their exit dates on or before 2010.” (Opp. at 5 (emphasis added).) 

But Plaintiffs do not identify a single factual allegation in support of this argument, nor is it 

supported by the allegations in the Amended Complaint. (See Mot. at 19–20.)

Plaintiffs’ attempt to invoke the fraudulent concealment statute to evade the statute of 

limitations (Opp. at 22) is similarly meritless. Plaintiffs cannot assert “bare allegations of 

fraudulent concealment, without more, [to] save the[ir] claim.” Logan, 644 F.3d at 587.9 Nor can 

Plaintiffs use their Opposition to invoke the fraudulent concealment statute when the Amended 

Complaint is silent on that issue regarding Count II.

10

 See Car Carriers, Inc., 745 F.2d at 1107.

9

In any event, Plaintiffs’ allegations do not meet the requisite standard for invoking the fraudulent 

concealment doctrine and should be disregarded. See Putzier v. Ace Hardware Corp., 50 F. Supp. 3d 964, 

978 (N.D. Ill. 2014) (fraudulent concealment doctrine inapplicable where plaintiffs did not allege 

“affirmative acts” by franchisor to “conceal the cause of action” and instead asserted vague allegations of 

“misleading” and “manipulated” information provided by franchisor) (emphasis added). 

10 Plaintiffs’ reliance on Iron Workers St. Louis Dist. Council Pension Fund v. Zenith Am. Sols., Inc., No. 

13 C 7867, 2014 WL 3563295 (N.D. Ill. July 17, 2014) is misplaced because, unlike the complaint in Iron 

Workers, the Amended Complaint here offers facts that demonstrate the breaches occurred well before the 

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Plaintiffs’ argument that their breach of contract claim cannot be dismissed at the pleading 

stage because the statute of limitations is an affirmative defense (Opp. at 22–23) is also incorrect, 

as reflected by Seventh Circuit precedent. See In re marchFIRST, Inc., 589 F.3d at 905 (affirming 

dismissal at pleading stage where complaint alleged triggering facts before the applicable statute 

of limitations); Logan, 644 F.3d at 582 (affirming dismissal where complaint revealed that relief 

was barred by the applicable statute of limitations and rejecting plaintiff’s “bare allegations of 

fraudulent concealment”). Despite Plaintiffs’ narrow view of the supposed breaches that occurred 

in “proximity to their exit dates,” (Opp. at 5 (emphasis added)), it is facially obvious that the 

allegations here relate to McDonald’s enforcement of its contractual rights in the 1990s and early 

2000s, well before the start of the limitations period in 2010. (Mot. at 20.)11 Therefore, any 

portions of Count II that took place prior to June 8, 2010 should be dismissed as untimely. 

III. THE FRAUDULENT OMISSION CLAIM FAILS AS A MATTER OF LAW.

In response to McDonald’s initial motion to dismiss, Plaintiffs repackaged their fraudulent 

misrepresentation claim into a claim of fraudulent omission in the Amended Complaint. (Mot. at 

26.) Yet in their opposition, Plaintiffs revert to their misrepresentation theory, arguing, for 

example, that they have pled their fraud claim by alleging “a scheme to defraud Plaintiffs through 

a false promise of ‘parity’ with White franchisees,”12 McDonald’s “use of misleading 

information,” and “misl[eading] Plaintiffs using . . . corporate and public statements of racial 

equality.” (Opp. at 5.) This claim of misrepresentation is simply not the claim pled in the 

start of the statute of limitations. (Mot. at 19–20.) See also In re marchFIRST, Inc., 589 F.3d 901, 905 (7th 

Cir. 2009). 

11 Despite invoking the fraudulent concealment statute, Plaintiffs do not identify when their breach of 

contract claims supposedly began to accrue; they simply allege that any accrual—whenever it would have 

occurred—was delayed because of the fraudulent concealment statute. (Opp. at 22.) This argument is 

unsupported by well-pled facts and should be disregarded. 

12 Notably, “parity” is not mentioned in the Amended Complaint in the context of the omission claim. 

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Amended Complaint, where Plaintiffs allege that McDonald’s made omissions about certain 

financial and operational information “throughout their franchise terms.” (AC ¶ 249.)13 This is 

yet another example of Plaintiffs attempting to create facts where there are none. Additionally, 

Plaintiffs’ opposition brief cannot cure their failure to allege the basic elements of a fraudulent 

omission claim. In particular, Plaintiffs do not even address their failure to plead the duty to 

disclose element. (See Mot. at 28–30.) Nor do Plaintiffs seriously address their inability to satisfy 

the pleading requirements of Rule 9(b), or the fact that the claim is time-barred. For all of these 

independent reasons, Count III should be dismissed with prejudice.

A. Plaintiffs Do Not Plead a Duty to Disclose in the Amended Complaint, nor 

Address the Required Element in Their Opposition Brief.

Other than a one sentence acknowledgement of the duty to disclose, Plaintiffs do not 

address their failure to plead this required element of a fraudulent omission claim. (See Opp. at 

26.) Plaintiffs’ lack of a substantive response is fatal to their claim and the Court need not proceed 

any further for purposes of dismissing the fraudulent omission claim. (Mot. at 28–30); see also

Wigod v. Wells Fargo Bank, N.A., 673 F.3d 547, 571 (7th Cir. 2012) (affirming dismissal of 

fraudulent concealment claim for failing to establish that the defendant was under a duty to disclose 

the omitted information to the plaintiff); Siemer v. Quizno’s Franchise Co. LLC, No. 07 C 2170, 

2008 WL 904874, at *7 (N.D. Ill. 2008) (dismissing fraudulent omission claim where “no duty to 

disclose exists” because “[i]t is well established under Illinois law that parties to a contract, 

including franchise contracts, do not owe a fiduciary duty to one another”).

13 Even if the operative complaint included a misrepresentation claim (it does not), as explained in 

McDonald’s first motion to dismiss, Plaintiffs cannot establish such a claim. (See Dkt. 25 at 25–32.)

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B. Plaintiffs Fail to Plead Material Omissions with Particularity Under Rule 9(b).

Plaintiffs also do not dispute that they must plead the “who, what, when, where, and how” 

required under Rule 9(b) for their fraudulent omission claim. (See Mot. at 30–32); see also Rocha 

v. Rudd, 826 F.3d 905, 911 (7th Cir. 2016). Instead, they cite to a string of cases addressing the 

sufficiency of “information and belief” allegations. (See Opp. at 31–32.) However, this fails to 

address McDonald’s argument that there are zero allegations—based upon information and belief 

or otherwise—in the Amended Complaint that describe any of the purported omissions with the 

specificity required under Rule 9(b), or even the general pleading standard under Iqbal.

The Seventh Circuit and Northern District of Illinois have clearly set forth what is required 

under Rule 9(b) for fraudulent omission claims, see, e.g., Rocha, 826 F.3d at 911 (“[Plaintiff] fails 

to provide the specific names, dates, times or content of the . . . omissions that give rise to the 

alleged fraud.”), including in franchise cases, see Putzier, 50 F. Supp. 3d at 985–86 (“Even when 

a plaintiff has limited information, the court still expects him to attempt to describe the who, what, 

when, where, and how of the fraud.”) (internal quotations omitted). Plaintiffs’ failure to plead any 

detail regarding the alleged omissions, including basic information such as dates, locations, 

McDonald’s representatives involved, the Plaintiffs involved, form, and content, requires

dismissal of Count III. See McMahan v. Deutsche Bank AG, 938 F. Supp. 2d 795, 805–06 (N.D. 

Ill. 2013) (dismissing fraudulent concealment claim because “[p]laintiffs must provide greater 

detail about the circumstances surrounding the omissions, including when and where they 

occurred, and what material facts should have been disclosed at what times”).14

14 Plaintiffs’ case law regarding “information and belief” allegations have no substantive bearing on this 

case. None of the cases involve fraudulent omission (some do not even involve fraud), and all simply stand 

for the unremarkable proposition that, under certain circumstances, a plaintiff may plead allegations based 

on information and belief. See Brown v. Budz, 398 F.3d 904 (7th Cir. 2005) (due process and equal 

protection); Artista Records, LLC v. Doe 3, 604 F.3d 110 (2d Cir. 2010) (copyright infringement); 

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Last, Plaintiffs admit that under Illinois law, omissions relating to future events or financial 

projections cannot support a fraud claim. (Opp. at 28; Mot. at 32.) Nevertheless, they assert that 

their allegations fall into an exception to this rule regarding promises of “future conduct.” (Opp. 

at 28). However, this exception only applies to promises of future, tangible conduct, not to 

“predictions or opinions regarding future business performance,” such as those alleged here. 

Barrington Press, Inc. v. Morey, 752 F.2d 307, 310 n.1 (7th Cir. 1985). Moreover, both cases 

cited by Plaintiffs for this point refer to exceptions based on fraudulent misrepresentations 

regarding future conduct, not fraudulent omissions, which is the basis for Plaintiffs’ Count III. See 

Hengel Inc. v. Hot N' Now, Inc., 825 F. Supp. 1311, 1322–32 (N.D. Ill. 1993); HPI Health Care 

Servs., Inc. v. Mt. Vernon Hosp., Inc., 545 N.E.2d 672, 682 (Ill. 1989). And in any event, even if 

the alleged omissions fell within this exception, such a claim is nevertheless subject to the 

requirements of Rule 9(b) and must be pled with specificity. See Hengel, 825 F. Supp. at 1321;

see also Venzor v. Gonzalez, 936 F. Supp. 445, 453 n.4 (N.D. Ill. 1996) (claims relating to promises 

of future conduct may be asserted as “promissory fraud,” but are “tempered by pleading . . .

hurdles” and require “specific, objective manifestations of fraudulent intent”). Because Plaintiffs 

have failed to plead material omissions with the particularity required under Rule 9(b), Count III 

must be dismissed. See Abazari v. Rosalind Franklin Univ. of Med. and Sci., 40 N.E.3d 264, 274 

(Ill. App. Ct. 2015) (dismissing fraudulent concealment claim because “the mere failure to disclose 

factors that could influence [financial data] in the future cannot support” such claim).

Medscript Pharm., LLC v. My Script LLC, 77 F. Supp. 3d 788 (N.D. Ill. 2015) (tortious interference, unfair 

competition, unjust enrichment, conversion, and various statutory claims); Simonian v. Weber-Stephen 

Prods. Co., 272 F.R.D. 218 (N.D. Ill. 2011) (false marketing). These cases are not only inapplicable, but 

are also irrelevant since Plaintiffs have not pled information and belief allegations for the eight supposed 

omissions. (See AC ¶ 249.) In fact, there is only one “information and belief” allegation in the entire 

Amended Complaint, and it is not about an omission McDonald’s allegedly withheld. (See id. at ¶ 175.)

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C. Plaintiffs Cannot Establish that They Could Not Have Learned the Truth 

About the Alleged Omissions with Reasonable Inquiry.

Other than a single sentence (Opp. at 32), Plaintiffs do not address McDonald’s argument 

that they failed to plead they could not have discovered the truth about the omissions through 

reasonable investigation. (Mot. at 34–35.)

15

 However, this sentence only addresses two of the 

omissions alleged by Plaintiffs in the Amended Complaint (franchise location and 

rebuild/renovation requirements), but not the other six alleged omissions. (Id. at 35; see also AC

¶ 249(b), (d), (e), (f), (g), (h).)

More significantly, Plaintiffs have not addressed McDonald’s argument that the documents 

and disclosures provided to Plaintiffs before they agreed to become franchisees directly addressed 

each of the alleged omissions. (Mot. at 32–34.) In fact, Plaintiffs admit that the “FA and FDD 

have information relating to franchise locations, fees, and renewal requirements.” (Opp. at 32.) 

As the FA and FDD contained information about the exact issues Plaintiffs now claim were 

fraudulently omitted, Plaintiffs were put on notice of these issues, signed contractual documents 

confirming their understanding of the same, and, therefore, cannot establish that they were unable 

to investigate or inquire into those issues. See Lefebvre Intergraphics, Inc. v. Sanden Mach. Ltd., 

946 F. Supp. 1358, 1367 (N.D. Ill. 1996) (dismissing fraudulent omission claim where the 

“complaint contains no allegations indicating that [plaintiff] took any steps to make a reasonable 

inquiry about [the omissions], or that [defendant] prevented it from making such an inquiry”).

15 Plaintiffs allege that McDonald’s “concealed information that would have revealed a pattern and practice 

common to all Black franchisees.” (Opp. at 26.) However, the fraudulent omission claim is not based on 

a discriminatory scheme; it is based on McDonald’s alleged concealment of certain information regarding 

franchise locations, financial performance, rebuild and remodel obligations, growth opportunities, 

renewals, inspections, and buyer qualifications from each of the Plaintiffs named in Count III. (See AC ¶ 

249.) Plaintiffs cannot conflate their discrimination claim with their fraudulent omission claim to avoid 

pleading the necessary elements for fraudulent omission, including that they could not have discovered the 

truth about the specific omissions, a required element Plaintiffs ignore until the last sentence of their 

opposition brief.

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D. Given the Explicit Disclosures in the FA and FDD, Plaintiffs Cannot Establish 

Reasonable Reliance or McDonald’s Intent to Induce a False Belief.

The opposition also misses the mark when it comes to the two reliance elements required 

for a fraudulent omission claim: intent to induce reliance and reasonable reliance. (Mot. at 32–

34); see also Cohen v. Am. Sec. Ins. Co., 735 F.3d 601, 613 (7th Cir. 2013). Plaintiffs’ narrow 

focus on the difference between integration and non-reliance provisions (Opp. at 29–31) prevents 

them from addressing the larger issue raised by McDonald’s; namely, that the terms of the FA and 

FDD agreed to by Plaintiffs explicitly undermine any supposed reliance or intention to induce 

reliance on the eight omissions alleged in the Amended Complaint. 

First, McDonald’s cited to numerous disclosures in the FA and FDD that relate to the 

subject matter of the alleged omissions, and McDonald’s disclaimer of any representations to the 

contrary. (Mot. at 4, 33–34.) However, Plaintiffs’ entire brief focuses on only one provision, 

Section 26 of the FA, which is an integration provision. (Opp. at 29–31.) Plaintiffs fail, however, 

to address the numerous other provisions referred to in McDonald’s motion, including ¶¶ 28(a), 

(c) and (i) of the FA, which explicitly provide that McDonald’s made no representations regarding 

“the future profitability of the” franchise, “no promise or representation as to the renewal of” the 

franchise “or the grant of a new franchise,” or any representations that were “not embodied [in the 

FA] or set forth in the [FDD].” The FA further provides that the franchisee “has had ample 

opportunity to contact existing franchisees . . . and to investigate all representations made by 

McDonald’s relating to the McDonald’s System.” (Id. ¶ 28(d).) “If the contract’s express terms 

address the claim at issue, not even a fraudulent inducement theory permits the Court to look past 

the contract’s express terms.” Ocean Tomo, LLC v. PatentRatings, LLC, 375 F. Supp. 3d 915, 930 

(N.D. Ill. 2019). That is precisely the case here, where the provisions in the FA and FDD explicitly 

address each of the omissions alleged by Plaintiffs, and Plaintiffs agreed in writing that 

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McDonald’s made no other representations. (See FA ¶ 28); see also Siemer, 2008 WL 904874, at 

*8 (dismissing fraudulent omission claim where contractual provisions stated that franchisees were 

aware of risks of investing, had been provided with the franchise disclosure documents, and that 

there were no representations made other than as provided therein).16

Second, Plaintiffs ignore the fact that McDonald’s is a franchisor and, thus, its disclosure 

obligations are governed by the FTC Franchise Rule. (Mot. at 4, 29–30, 33–34.) Plaintiffs make 

no allegation that McDonald’s failed to comply with its obligations under the Franchise Rule, nor 

that its disclosures in the FDD were false or misleading. The Northern District of Illinois has 

consistently held that when a franchisor fully complies with its disclosure obligations under the 

Franchise Rule, a franchisee cannot claim that information was fraudulently omitted or that it 

reasonably relied on such omissions. See, e.g., Ace Hardware Corp. v. Landen Hardware, LLC, 

883 F. Supp. 2d 739, 751–52 (N.D. Ill. 2012) (no reasonable reliance as a matter of law where 

franchise documents disclosed risk of operating a franchise, including that franchisor made no 

representations about financial success); 7-Eleven, Inc. v. Spear, No. 10-cv-6697, 2011 WL 

2516579, at *7 (N.D. Ill. June 23, 2011) (dismissing fraudulent omission claim where franchisees 

did “not allege that any of the [franchisor’s] disclosures . . . were inaccurate”); Avon Hardware 

Co. v. Ace Hardware Corp., 998 N.E.2d 1281, 1289 (Ill. App. Ct. 2013) (same).

16 Plaintiffs rely upon Vigortone AG Prods., Inc. v. PM AG Prods., Inc., 316 F.3d 641 (7th Cir. 2002) to 

argue that the presence of an integration clause does not bar a fraud claim. However, the contract at issue 

there did not contain disclaimer provisions such as are present here. In any event, the Seventh Circuit held 

that even in the absence of a non-reliance clause, there could be no reasonable reliance because the plaintiff 

was aware of the information it claimed was withheld and could not “close[] his eyes to a known or obvious 

risk.” Id. at 645; see also Cozzi Iron & Metal, Inc. v. U.S. Office Equip., Inc., 250 F.3d 570, 574 (7th Cir. 

2001) (same). Such is the case here. 

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E. Neither the Fraudulent Concealment Doctrine Nor the Discovery Rule 

Prevents Dismissal of the Fraudulent Omission Claim as Time-Barred. 

Plaintiffs’ invocation of the fraudulent concealment doctrine and the discovery rule does

not revive their untimely omission claim. Plaintiffs cannot plead fraudulent concealment for 

multiple reasons. First, Plaintiffs do not allege any affirmative actions by McDonald’s to conceal 

the alleged omissions; to the contrary, all the alleged omissions are directly addressed in the FA 

and FDD. (See Mot. at 32–35); see also Putzier, 50 F. Supp. 3d at 978 (rejecting application of 

the fraudulent concealment doctrine where “[p]laintiffs fail to allege any affirmative acts by 

[franchisor] that were calculated to conceal the cause of action” and “[i]nstead, Plaintiffs make 

vague allegations that [franchisor] provided misleading averages, manipulated sales projections, 

and concealed and suppressed accurate data”); see also Guarantee Tr. Life Ins. Co. v. Kribbs, 68 

N.E.3d 1046, 1056 (Ill. App. Ct. 2016) (fraudulent concealment doctrine did not apply where 

“allegations are unsupported by details regarding any specific false statements made by defendants 

or examples of documents that were falsified or destroyed”). Second, just like the franchisees in 

Putzier, Plaintiffs “insist that [their] alleged substantive fraud also constitutes fraudulent 

concealment,” but “the fraudulent conduct that forms the basis of [the underlying fraud claim] 

does not constitute fraudulent concealment absent a showing that the fraudulent conduct tended to 

deceive the plaintiff and prevent him from discovery of his claim.” Putzier, 50 F. Supp. 3d at 978 

(emphasis supplied). Here, Plaintiffs do not allege that McDonald’s omissions “tended to conceal 

the fraud,” nor could they in light of the extensive disclosures in the FA and FDD that cover the 

exact subject matter of the alleged omissions. Id; (see also Mot. at 33–35). Finally, under Illinois 

law, franchisors do not owe franchisees a fiduciary duty, and thus, “mere silence of the defendant 

and the failure of the plaintiff to discover his cause of action do not amount to fraudulent 

concealment.” Putzier, 50 F. Supp. 3d at 978–79.

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Plaintiffs’ newfound attempt to plead the discovery rule in their opposition brief (only 

fraudulent concealment is alleged in the Amended Complaint (see AC ¶ 251)) also fails. As 

discussed above (see supra Section I.A), under the discovery rule, “the statute starts to run when 

a person knows or reasonably should know of his injury and also knows or reasonably should 

know that it was wrongfully caused.” Kribbs, 68 N.E.3d at 1054. The Amended Complaint alleges 

eight omissions, all of which relate to the operation of Plaintiffs’ franchises and also underlie their 

breach of contract claim. (Compare AC ¶ 249 with ¶¶ 241, 243.) Therefore, Plaintiffs’ claim that 

they “did not know and had no reason to know [about the alleged fraudulent omissions] until after 

their respective exits from the franchise system, on or before 2015” (Opp. at 27) is contradicted by 

their own pleadings, and there is no basis on which to apply the discovery rule. See Hermitage

Corp. v. Contractors Adjustment Co., 651 N.E.2d 1132, 1135 (Ill. 1995) (the discovery rule is 

applied on a “case-by-case basis”). 

Finally, it bears reemphasizing that Plaintiffs have failed to allege basic information 

regarding the omissions that purportedly impeded their ability to discover their claims, including 

the dates of the supposed omissions, as required by Rule 9(b). (See Section III.B, supra.) The 

failure of Plaintiffs to meet their pleading burden and allege facts establishing that their claims are 

timely cannot preclude dismissal. See Rivas, 2015 WL 718271, at *4 (plaintiffs cannot rely upon 

“vague allegation[s]” that fail to “set[] forth any date[s]” to “overcome the statute of limitations 

problems in the complaint”).

CONCLUSION

For the foregoing reasons, McDonald’srequests that the Court dismiss Plaintiffs’ Amended 

Complaint in its entirety.

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Dated: February 2, 2021 /s/ Patricia Brown Holmes____ 

Patricia Brown Holmes

Amy Curtner Andrews

Raymond D. Rushing

RILEY SAFER HOLMES & CANCILA LLP

70 W. Madison Street, Suite 2900

Chicago, Illinois 60602

(312) 471-8700

pholmes@rshc-law.com

aandrews@rshc-law.com

rrushing@rshc-law.com

Ariel Schepers Wilson

RILEY SAFER HOLMES & CANCILA LLP

121 W. Washington Street, Suite 402

Ann Arbor, Michigan 48104

(734) 773-4900

awilson@rshc-law.com

Andrew Jason Wu (pro hac vice)

RILEY SAFER HOLMES & CANCILA LLP

456 Montgomery Street, 16th Floor

San Francisco, California 94104

(415) 275-8550

awu@rshc-law.com

Loretta E. Lynch (pro hac vice)

Susanna M. Buergel (pro hac vice)

Karen R. King (pro hac vice)

PAUL, WEISS, RIFKIND, WHARTON &

GARRISON LLP

1285 Avenue of the Americas

New York, New York 10019

(202) 373-3000

lelynch@paulweiss.com

sbuergel@paulweiss.com

kking@paulweiss.com

Counsel for McDonald’s USA, LLC and McDonald’s Corporation

Case: 1:20-cv-05132 Document #: 48 Filed: 02/02/21 Page 32 of 33 PageID #:1491
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CERTIFICATE OF SERVICE

The undersigned attorney hereby certifies that on February 2, 2021, she caused the 

foregoing document to be electronically filed using the CM/ECF system, which will send notice 

of this filing to all counsel of record. 

 /s/ Amy C. Andrews_____ 

Amy C. Andrews

Case: 1:20-cv-05132 Document #: 48 Filed: 02/02/21 Page 33 of 33 PageID #:1492