The federal government wants to make it legal for McDonald’s franchise owners to use a third-party hacking device to fix chronically broken ice cream machines after the fast-food giant was sued because it didn’t allow them to do so.
The Federal Trade Commission and the antitrust unit of the Department of Justice are asking the US Copyright Office to approve an exemption to copyright law that would allow business owners to repair “commercial and industrial equipment.”
The feds said that not allowing business owners to hire third-party repair people limits competition and makes repairs more costly, according to comments filed Thursday amid deliberations seeking the exemption to Section 1201 of the Digital Millennium Copyright Act (DMCA).
Broken-down soft-serve machines cost business owners $625 in lost sales per day, the agencies estimated in their filing with the Copyright Office.
Since business owners aren’t legally permitted to fix the machines on their own or to hire a third-party technician, they need to wait for an authorized technician, which usually takes around 90 days, the comment noted.
The agencies want the exemptions to apply to commercial soft serve machines, proprietary diagnostic kit, programmable logic controllers and enterprise IT, according to the filing, which was first reported by The Verve.
“In the Agencies’ view, renewing and expanding repair-related exemptions would promote competition in markets for replacement parts, repair, and maintenance services, as well as facilitate competition in markets for repairable products,” they wrote in the filing.
Last year, iFixit, the popular e-commerce site, asked Congress to approve the copyright exemption that would allow their technicians to fix the machines.
Exemptions to DMCA Section 1201 are issued every three years, as per the Register of Copyrights’ recommendation.
In 2021, the FTC launched an investigation into complaints by McDonald’s franchise owners who said they were losing business due to McFlurry machines that kept on breaking down.
The problem was compounded by customer complaints. One McDonald’s fan even made a website that tracks broken machines in real-time.
The site, McBroken, indicated that as many as 10% of McDonald’s locations nationwide have a broken ice cream machine at any given time.
In 2022, a couple sued McDonald’s for $900 million after the company denied franchise owners the chance to use their high-tech gadget that enabled quick repairs of the $18,000 ice cream machines – which are manufactured exclusively by Taylor.
Jeremy O’Sullivan and his partner, Melissa Nelson, created the device called Kytch, which comes in the size of a mobile phone and is planted inside the machine.
The device intercepts the machine’s internal communications and sends them via WiFi to a smartphone or web interface, where owners can troubleshoot the problem.
Word of Kytch’s effectiveness started to get around, prompting franchise owners to adopt the technology.
But when the parent company got wind of it, they warned that the hacking device violated the warranties of the ice cream machines while also posing a risk of “serious human injury.”
In November 2020, McDonald’s told its franchisees not to use Kytch devices — halting the start-up’s fast-growing sales.
Kytch sued Taylor in 2021 after Taylor allegedly obtained one of Kytch’s devices and reverse-engineered it to create its own internet-connected monitoring product.
The Post has sought comment from McDonald’s, Taylor, and Kytch.
[Notigroup Newsroom in collaboration with other media outlets, with information from the following sources]
