D.C. Attorney General sues Grubhub over hidden fees and other issues

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Grubhub says it will aggressively defend itself in court

The District of Columbia’s Attorney General, Karl Racine, has filed a lawsuit against Grubhub over allegations that the company offered consumers delivery services from more than 1,000 Washington, D.C., restaurants without getting those restaurants’ consent.

On top of that, Racine claims that Grubhub charged consumers higher prices than what the restaurants did, then misrepresented the number of fees consumers were charged.

If Grubhub had been watching Racine’s previous moves against delivery companies, it likely knew that a lawsuit like this was possible. The attorney general has previously filed lawsuits against DoorDash and Instacart.

He accused DoorDash of misrepresenting how tips paid by consumers would be distributed to couriers. Instacart faced a separate lawsuit over its check-out screen, which Racine claimed was designed to deceive customers about the reasons behind a service fee.

Grubhub responds to lawsuit

In comments emailed to ConsumerAffairs, Grubhub refuted that it defied District of Columbia laws.

“We work hard to support DC restaurants and diners, and we continually review and enhance our operations to better serve them and meet their expectations," a Grubhub spokesperson said. 

“During the past year, we've sought to engage in a constructive dialogue with the DC Attorney General’s office to help them understand our business and to see if there were any areas for improvement. We are disappointed they have moved forward with this lawsuit because our practices have always complied with DC law, and in any event, many of the practices at issue have been discontinued. We will aggressively defend our business in court and look forward to continuing to serve DC restaurants and diners.” 

One of the lines that Racine claims Grubhub crossed was related to a promotion called “Supper for Support” – an offer made to consumers “as a way for them to save money, while at the same time supporting local independent restaurants that had been affected by the decline of business due to the Covid19 pandemic.”

The issue Racine has with the promotion was that it didn’t actually support restaurants at all. In fact, he said the restaurants were responsible for paying Grubhub commissions on the full, non-discounted price of the food total.

The Grubhub spokesperson said the Supper for Support promotion is no longer running but that it did, in fact, do “many things to support residents and restaurants in DC and across the country throughout the pandemic.”

“The terms of the Supper for Support program were clearly disclosed to restaurants, and they could decide if they wanted to participate or not,” Grubhub told ConsumerAffairs.

“In addition, diner-facing promotions for Supper for Support in no way stated or implied that participating restaurants were not financially obligated for the discounts. In promotions moving forward, Grubhub will disclose to diners when a diner promotion is funded by the restaurant.”

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