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Uber Eats, GrubHub, and DoorDash team up to sue NYC over new fee caps
The city just passed a new law restricting the amount delivery services can charge restaurants.
A couple of weeks ago, the New York City Council approved new legislation that restricted the amount that delivery services can charge restaurants for using their platforms. Now, Uber Eats and a couple more services have come together to sue the city over these new changes.
According to a new report from Reuters, Uber Eats, GrubHub, and DoorDash have come together and filed a lawsuit against NYC as a result of the new legislation. The trio’s federal suit aims to stop the city from establishing a cap on the fees that the companies can charge to restaurants.
“Those permanent price controls will harm not only Plaintiffs, but also the revitalization of the very local restaurants that the City claims to serve,” reads the lawsuit filed late last week. The suit claims that the new legislation is unconstitutional, as it “interferes with freely negotiated contracts.”
READ MORE: Doordash is making all its employees perform deliveries once a month, and some aren’t happy
New York City sees it a bit differently, however. The official legislation comes as a result of temporary caps enacted during COVID lockdowns when many restaurants were on the brink of shutting down completely. The city has now decided to make the 15% commission cap a permanent fixture.
Uber Eats, GrubHub, and Doordash all have a substantial foothold in New York City, so it makes sense for them to team up against this new law that will negatively affect all of their businesses. As of now, it looks like the case is going to federal court, so we will have to wait and see how everything plays out.
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