Grubhub to pay DC $3.5 million

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There is group 3.5 million was ordered to be paid To settle a lawsuit from the District of Columbia, the company misled customers by charging them hidden fees for their orders. According to A press releaseGrubhub must pay $800,000 in civil penalties to DC, and the remaining $2.7 million will be “reimbursed to affected customers.”

In March, D.C. Attorney General Carl Racine sued the group, accusing it of falsely promising customers “free” online orders and “unlimited free delivery” to those who subscribe to Grubhub Plus. The lawsuit alleges that the practice is “deceptive” because Grubhub still takes a service fee for non-pickup orders placed by Grubhub Plus customers and charges both a delivery and service fee for standard orders.

It also cited several questionable business practices, such as Grubhub bundling service charges on the same line as sales taxes on the checkout page, something the company recently stopped doing. Grubhub was there before Accused of listing restaurants on the platform without their permission to expand the Service, and A series of microsites was launched Grubhub mimics restaurants’ real sites to send orders. At the time the suit was filed, Grupp denied the claims “Many of the practices at issue have been discontinued,” he said.

“Resolving this lawsuit is in the best interest of our business, and the matter has now been resolved,” Group spokeswoman Lisa Dee said in a statement. on the edge. “Grubhub is committed to supporting all restaurants and diners, and is taking a number of steps to ensure price transparency.”

As part of the settlement, Grubhub must place a “refundable credit” on the accounts of affected customers, which applies to anyone at the restaurant who “paid a small order or service charge on an order placed through the Grubhub Platform.” DC anytime from January 1, 2016 to December 31, 2022. Affected customers will be divided into three groups based on how often they use the platform, with those in the first group receiving at least $4.50 and the next at least $7. Finalists will receive a minimum of $10. If the account owner does not recover the credit within 90 days of receipt, Grubhub must send them a check with the amount owed.

“Grubhub’s hidden fees and misleading marketing tactics are designed to make more money for the company”

In addition to payments, the platform must make several changes, such as prominently displaying any additional charges to customers at checkout, listing each charge on separate lines, and closing or changing ownership of microsites created for restaurants. DC. Grubhub Plus needs to stop telling members they can get “free delivery” and now disclose when prices for certain menu items are higher than advertised at restaurants. In the update Post it on its websiteThe group said it agreed to “provide additional clarity to our restaurants and thousands of restaurant partners.”

“Grubhub used every trick in the book to charge customers more than they should have, and worse, they did so at the height of the global pandemic when county residents were already struggling to make ends meet,” Racine said in a statement. . “Grubhub’s hidden fees and misleading marketing tactics are designed to get the company extra money at the expense of DC residents, but we’re not letting them get away with it.”

UPDATE, 2:06PM ET: Updated to include a statement from a Grubhub spokesperson.


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