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Friday, May 27, 2022

DoorDash, Grubhub Accused of Overcharging Customers: Chicago Lawsuit

  • Chicago officials on Friday sued DoorDash and Grubhub, alleging they misled customers.
  • They “broke the law during these incredibly difficult times,” Mayor Lori E. Lightfoot said.
  • “This lawsuit is without merit and a waste of taxpayer resources,” DoorDash said.

Chicago on Friday filed lawsuits against food-delivery services DoorDash and Grubhub, alleging that both broke the law by misleading customers during the pandemic.

“It is deeply concerning and unfortunate that these companies broke the law during these incredibly difficult times, using unfair and deceptive tactics to take advantage of restaurants and consumers who were struggling to stay afloat,” Mayor Lori E. Lightfoot said in a statement

The lawsuits included a list of shared allegations against both companies, along with specific allegations aimed at each individually.

Both “[h]ide that menu prices on their platforms are often significantly higher than the prices available if ordering directly from the restaurant,” the city said.

DoorDash published a statement refuting the city’s claims, saying: “This lawsuit is without merit and a waste of taxpayer resources. Chicagoans should be outraged.”

Chicago said both apps were adding restaurants to their platform without first asking them. “That is false,” DoorDash said in the statement.

But DoorDash also said that restaurants “previously listed on our platform without first having signed a contract can notify us that they no longer wish to be listed on DoorDash, and we honor such requests.”

doordash delivery driver

A Doordash delivery biker.

Carlo Allegri/Reuters


Chicago officials alleged that Grubhub created fake telephone numbers and websites for restaurants. The “imposter websites” looked like each restaurant’s real website, “but route unsuspecting consumers to Grubhub,” the city also alleged.

Chicago also alleged that Grubhub violated an emergency cap of restaurant commissions, which were set at a maximum of 15%. 

Insider has reached out to Grubhub for comment.

City officials said DoorDash misled customers into thinking they were tipping their delivery drivers and riders, but only used the “tip” to subsidize payments to the delivery people.

Customers also were misled about a “Chicago Fee,” which went to DoorDash rather than the city, according to the lawsuit. 

“The suit also makes a variety of claims about the prices consumers agree to pay when they place an order on DoorDash — all of which are false,” DoorDash said.

Chicago said the lawsuits were the “first comprehensive law enforcement actions” against food-delivery services in the US.

 

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