YouTuber MrBeast is suing the ghost kitchen behind MrBeast Burger to stop production of his popular burger, claiming the company is exploiting his brand to expand instead of focusing on the quality of the food.
The lawsuit was filed in the U.S. District Court for the Southern District of New York on Monday.
“Because Virtual Dining Concepts was more focused on rapidly expanding the business as a way to pitch the virtual restaurant model to other celebrities for its own benefit, it was not focused on controlling the quality of MrBeast Burger’s customer experience and products,” the suit stated.
MrBeast whose real name is Jimmy Donaldson, contracted Virtual Dining Concepts, based in Orlando, Florida, to launch the MrBeast Burger concept in 2020 during the Covid-19 pandemic. The business objective of operating a ghost kitchen was “simple,” the lawsuit said. The partnership would create a virtual restaurant featuring MrBeast-branded food and would work with existing restaurants that would prepare the meals and share a “significant” portion of income. The items could be ordered through food delivery services, eliminating the need for brick and mortar table service.
Adam Friedlander/The New York Times/Redux/File
The MrBeast burger from the virtual food delivery chain run by YouTube celebrity Jimmy Donaldson in New York, February 24, 2021.
The lack of quality quickly became apparent, the lawsuit said, materially and irreparably harming the MrBeast brand and reputation. Because of that injury, the lawsuit claims Donaldson has the right to terminate the breached contract and close the MrBeast burger business.
Beast Investments is asking for a jury trial, royalties it says it is owed and an “accounting of all income and expenses of the MrBeast Burger business,” and for VDC to stop further use of the MrBeast brand, MrBeast’s likeness, name , image and intellectual property rights.
In a statement, VDC said the complaint was filled with “inaccuracies” and that the lawsuit was retaliation for the company not agreeing to a new deal with Donaldson. The company said it is filing its own claims against him.
“When VDC refused to accede to his bullying tactics to cede more of the business to him, he filed this ill-advised and meritless lawsuit that sought to undermine the MrBeast Burger brand and terminate his existing contractual obligations without cause,” the statement said.
Donaldson has 172 million subscribers — more than any other individual creator on the platform, YouTube said. He is built his empire by staging increasingly expensive and eye-catching stunts, along with generous cash gifts and philanthropic acts – such as bankrolling cataract surgeries to hundreds of blind people to help them see again.
Some of the reviews of the burger, according to the lawsuit: “disgusting,” “outrageous” and even “inedible.”
Donaldson claimed in the suit that more than half of MrBeast Burger’s virtual restaurants have reviews of fewer than two out of five stars. E.g, MrBeast Burger in New York has 2.1 stars Yelp. The burger brand has expanded to hundreds of locations globally. Many customers blame the MrBeast brand for the bad burgers, the lawsuit claims.
The suit alleges that VDC has registered several trademarks of the MrBeast brand in various countries throughout the EU Canada, Thailand, Singapore, Mexico and Malaysia without Donaldson’s knowledge or permission.
“Because the entire business is based on the enormous global value of the MrBeast brand, it is MrBeast itself, and not Virtual Dining Concepts, that has borne the brunt of the (justified) attacks and criticism,” the lawsuit states.
And “while this company has made millions of dollars, MrBeast has not received a dime,” the lawsuit claimed.
The lawsuit said Beast Investments granted VDC the right to use his name, images and likeness.
“Because MrBeast has spent years developing his brand into one of the most valuable in the world,” the lawsuit said, “it was an essential part of their agreement that MrBeast retain strict control over the use of his name, image, likeness and brand of the MrBeast Burger company.”
Donaldson claimed that VDC immediately capitalized on MrBeast Burger’s initial success (Donaldson’s video document the launch, “I opened a restaurant that pays you to eat at it,” is over 160 million views on Youtube).
In 2022, a physical MrBeast Burger opened in the American Dream mall in New Jersey and sent fans crowded in the store on his debut.
The lawsuit claimed that Donaldson himself raised concerns about the quality of the burgers. In a tweet in June, Donaldson said he enjoys running Feastables, his snack line, “100 times more” than burgers.
“…(T)he problem with Beast Burger is that I can’t guarantee the quality of the order,” he tweeted. “Unfortunately, when working with other restaurants, it’s impossible to control.”