Grubhub ordered to pay $3.5 million in Washington DC deceptive practices suit
Reading Time: 2 minutesD.C.-area customers stand to receive $2.7 million collectively.
Do you ever order food online and realize what you thought would be a $12 chicken sandwich is actually more like a $50 chicken sandwich?
That’s exactly what happened to a bunch of D.C.-area Grubhub customers. The food delivery company has been ordered to pay a whopping $3.5 million after it was found violating the District of Columbia’s Consumer Protection and Procedures Act.
‘Grubhub misled District residents and took advantage of local restaurants to boost its own profits, even as District consumers and small businesses struggled during the COVID-19 pandemic,’ D.C. Attorney General Karl Racine said in a statement when he first sued Grubhub in March. ‘Grubhub charged hidden fees and used bait-and-switch advertising tactics — which are illegal. On top of that, the company deceived users with a promotion that claimed to support local restaurants during the heart of the pandemic. But in reality, this program cut into struggling restaurants’ profit margins while padding Grubhub’s bottom line.’
The AG’s complaint alleged that Grubhub imposed hidden fees on users and listed items at higher costs than the restaurants’ very own menus did, the DCist reported.
Customers in the area will collectively receive $2.7 million of the settlement directly, which Racine told ABC News will be given in ‘a refundable credit and if the credit is not used within 90 days the money will be sent to customers in the form of a check.’ The company will also have to detail each fee associated with its service at checkout.
Grubhub did not immediately respond to MediaDownloader’s request for comment, but in a statement to ABC News said that settling was in ‘the best interest of our business’ and that the issue is now ‘resolved.’ The company added that it is ‘committed to supporting all restaurants and diners, and is taking a number of steps to ensure price transparency.’
Reference: https://mashable.com/article/grubhub-lost-dc-settlement
Ref: mashable
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