Chicago sues DoorDash, Grubhub for presumably by deceiving customers

A bellboy in bicycle carries a DoorDash bag during a delivery in New York, Wednesday 9 December 2020.

Michael Nagle | Bloomberg | .

The city of Chicago filed two radical lawsuits against DoorDash and Grubhub for allegedly deceiving customers e using unfair business practices.

The suits echo the long-standing claims of restaurant owners that platforms advertise delivery services for their businesses without their consent and hide the lower prices offered by restaurants directly to customers, outside of the platforms.

The city also claims both platforms use a “bait-and-switch”method for attract clients with low delivery costs, only to charge additional when they are about to place their order.

In separate declarations, both DoorDash and Grubhub have defined le cause “unfounded”.

A DoorDash spokesperson said the company “resisted with the city of Chicago during the pandemic, giving up taxes for restaurants, providing $ 500,000 in direct contributions, creating strong opportunities for earning and delivering food and other needs to communities in need. ”

In November, DoorDash stopped adding new restaurants that have no conventions with to his app. It also he said it will remove restaurants that don’t want to be listed within 48 hours of be warned.

“Every single accusation is categorically wrong and we will aggressively defend ours business practices, “a spokesperson for Grubhub said in a declaration. “We watch forward answer in court and we are confident that we will prevail. “

The city is trying to put an end to the alleged misconduct by giving a warrant more transparency, civil sanctions and restitution for consumers and restaurants harmed by their alleged practices.

The suits include additional specific complaints for each company.

The city claimed that Grubhub deceptively shared the phone numbers for customers to connect with restaurants, but would charge restaurants a commission for calls made through those numbers, even when they didn’t result in an order. The city also claimed Grubhub made “fake sites” for restaurants to unexpectedly attract customers to their platform.

The lawsuit claims that Grubhub’s marketing campaigns promoting local restaurants during the pandemic were deceptive, while allegedly forcing restaurants to extend their contracts and cover promotion costs. It also alleged Grubhub hacked Chicago’s 15% emergency cap on commission delivery platforms could take from restaurants.

The city claimed that DoorDash misled customers on how their advice for drivers would be used. This issue was the subject of a separate cause from the lawyer general of the district of Colombia. DoorDash said it changed his method of overturning before the lawsuit of the DC AG. He reached a $ 2.5 million deal with his office in November over those claims.

Chicago also alleged DoorDash tagged in misleading a $ 1.50 commission placed on each order as a “Chicago tax”. The city claimed that this incorrectly implied that the commission was required or paid in Chicago rather than DoorDash.

Subscribe to CNBC on Youtube.

WATCH: Delivery people are risking their lives to bring people groceries during the coronavirus – that’s what it is like for they

Read More About Business News around the World here!

Source

Denial of any Responsibility!
AsumeTech is a News Source that Publishes News from its Editorial Team and the Automatic News Aggregation around the News Media. All the Aggregated Content you find on our site is available freely over the Internet; each piece of Content includes the hyperlink to its Primary Source. We have just arranged that in our platform for Educational Purposes only. All the Copyrights and Trademarks belong to their Rightful Owners and all Materials to their Authors. If you are the Content owner and do not want us to publish your materials on our Website, please get in touch with us by email – [email protected]; we will remove the Content from our Website.