In a statement, Illinois Restaurant Association CEO Sam Toia said he has long advocated "that any third party delivering restaurants’ food—or using their names, logos and menus—without consent is a serious issue for the industry. We appreciate the city of Chicago taking action to help restaurants protect their brands and businesses. Hopefully, this step will lead to all parties coming together to find a permanent resolution with guardrails in place moving forward."
Both Grubhub and DoorDash, the city alleges, “advertise order and delivery services from unaffiliated restaurants without their consent, leaving restaurants to repair reputational damage and resolve consumer complaints” caused by both companies, the release says. They also “lure customers into a bait-and-switch” with small upfront delivery fees at the beginning of the transaction, and then additional “misleading fees” at the end, according to the release, which says, “This increases the total cost of delivery by as much as six times the amount initially advertised.” Both companies also “hide that menu prices on their platforms are often significantly higher” than if customers ordered straight from the restaurant, the city says.
"It is deeply concerning and unfortunate that these companies broke the law” during the pandemic especially, Mayor Lori Lightfoot said in the release. It amounts to taking “advantage of restaurants and consumers who were struggling to stay afloat.”
The individual case against Grubhub alleges the company violated the city’s emergency 15% cap on restaurant commissions during the pandemic and in addition created “impostor websites” for restaurants that routed unsuspecting customers to Grubhub instead, the city said. The city says the suit also says the company’s campaigns to “save restaurants” during the pandemic simultaneously forced mom and pop businesses to “extend their contracts, cover the cost of promotions, and pay Grubhub full commissions on all orders.”
DoorDash, the suit against the company alleges, imposed a misleading $1.50 Chicago Fee on every order that implied the charge was required by or paid to the city, when “in fact DoorDash was the sole beneficiary. The company also misled customers into thinking they were tipping delivery drivers, when in fact the tip subsidized “DoorDash’s own payment to its drivers,” the city says in its release.
The city invited restaurants and customers that want "to inform the city about their experience with meal delivery companies” to email [email protected]