The Attorney General of Washington, DC, filed a proceeding against Grubhub during the COVID-19 pandemic, alleging that he “charged a hidden fee and used deceptive marking tactics.”
The lawsuit alleges that the food delivery company used deceptive marketing tactics “to increase profits at the expense of consumers and local small businesses,” the Justice Secretary’s office said in a news release on Monday. Announced.
“Grubhub misleads local residents and increases profits by using local restaurants, despite the struggles of local consumers and small businesses during the COVID-19 pandemic.” Attorney General Karl Racine said in the announcement.
“Grubhub charged a hidden fee and used bait-and-switch, which is illegal. Besides, the company tricked users with promotions claiming to support local restaurants in the midst of a pandemic. But in reality, the program has reduced the profit margins of struggling restaurants while filling the profits of Grubhub. “
Racine created a fake website, Grubhub violated the district’s consumer protection law, did not disclose that the app was more expensive than restaurants, listed restaurants that did not register on the platform It claims to have caused damage to DC consumers. Other false advertising tactics.
The proceedings demanded that Grubhub “end deceptive marketing practices, be honest in prices and charges, provide compensation to affected consumers, and pay fines for violating district law.” I am.
In response, a Grubhub spokesman said:
“We are working hard to support DC restaurants and diners, and we are continually reviewing and strengthening our operations to better serve them and meet their expectations. For years, we have had constructive dialogues with DC law firms to help them understand our business and see if there is room for improvement. Our practice has always been. We are disappointed that they proceeded with this proceeding because they are compliant with DC law and in any case many of the practices in question have been discontinued. We are actively doing business in court. We look forward to continuing to serve DC restaurants and diners. “
Grubhub operates in over 4,000 cities in the United States. Consumers can order food through websites or apps and connect with “gig economy” workers who deliver food to consumers.
Food delivery companies like Grubhub make money by charging consumers and charging restaurants. According to Racine’s office, Grubhub made about $ 1.8 million in revenue in 2020.