THE TINY STARTUP KYTCH labored hard to invent and sell a device designed to repair McDonald’s notoriously faulty ice cream machines, only to have the fast-food Goliath shatter their business like so many would-be McFlurry consumers’ expectations. Kytch is now attempting to exact chilling revenge worth over a billion dollars.
Kytch filed a long-awaited court action against McDonald’s late Tuesday night, accusing the firm of misleading advertising and tortious interference in its customer contracts. Melissa Nelson and Jeremy O’Sullivan, cofounders of Kytch, are seeking at least $900 million in damages.
Kytch has been selling a phone-sized device designed to be put into McDonald’s ice cream dispensers since 2019. The Kytch devices would intercept the ice cream machines’ internal communications and send them to a web or smartphone interface, allowing owners to remotely monitor and troubleshoot the machines’ numerous flaws, which have become so well-known among McDonald’s customers that they’ve become a full-fledged meme. The two-person startup’s new allegations against McDonald’s center on emails issued by the fast-food giant to every franchisee in November 2020, urging them to quickly remove Kytch devices from their ice cream machines.
Those emails informed franchisees that the Kytch gadgets not only breached the warranties of the ice cream machines and intercepted their “private information,” but also constituted a safety risk and may result in “severe human injury,” an allegation that Kytch denies as untrue and defamatory. Kytch also points out that McDonald’s used the emails to sell a new ice cream machine developed by its longtime appliance manufacturing partner Taylor, which would have comparable features to Kytch. Meanwhile, the Taylor devices have yet to see widespread public adoption beyond a few test installations.
According to Melissa Nelson, cofounder of Kytch, the emails didn’t just result in damaged McDonald’s ice cream machines around the world. (According to McBroken.com, which records the situation in real-time, approximately one in every seven machines in the United States remained out of function on Monday.) They also stifled Kytch’s rapidly expanding sales just as the startup was going off. “They’ve ruined our reputation. They frightened our consumers away and wrecked our business. They were anti-competitive in nature. They misled about a product that was supposed to be released “Nelson explains. “McDonald’s had every reason to believe Kytch was safe and trouble-free. It wasn’t as dangerous as they promised. As a result, we’re using them.”
Kytch had some early success in fixing McDonald’s ice cream headaches before it found itself in battle with soft-serve superpowers. Its internet-connected add-on device assisted franchisees in avoiding issues such as hours of downtime when Taylor’s fussy daily pasteurization cycle failed. WIRED contacted McDonald’s restaurant owners who loved the device; one said it saved him “certainly thousands of dollars a month” in lost revenue and repair bills. Kytch claims to have 500 clients and to be doubling its sales every quarter by the end of 2020—all of which vanished when McDonald’s instructed its franchisees to stop using Kytch’s gadgets.
Whatever McDonald’s motive, Kytch wants to find the answer in the documents resulting from their complaint.