The Trader Harbor
  • Business
  • Politics
  • World News
  • Stocks
  • Business
  • Politics
  • World News
  • Stocks

The Trader Harbor

Business

Grubhub to pay $25M to settle charges that it misled diners and drivers about costs and pay

by admin December 19, 2024
December 19, 2024
Grubhub to pay $25M to settle charges that it misled diners and drivers about costs and pay

Grubhub will pay $25 million to settle charges it misled customers about the cost of their delivery and drivers about how much they could earn on the food-delivery platform.

The Federal Trade Commission and the attorney general for the state of Illinois accused Chicago-based Grubhub of engaging ‘in an array of unlawful practices’ designed to ‘deceive’ diners and workers alike about the cost of doing business on the platform.

The agencies said they had uncovered messages that demonstrated Grubhub’s allegedly illicit tactics, including an internal message from a former executive stating that the tactic of adding service fees in a way that was “misleading, eroding trust,” and “truly more expensive” for consumers.

The upshot was often a final price sometimes more than double what it originally advertised to a platform user, the agencies said.

Grubhub also allegedly engaged in false advertising to attract drivers, citing hourly pay rates ‘well above what drivers could realistically expect to earn,’ according to a release accompanying the civil complaint.

Finally, Grubhub falsely advertised restaurants on its platform that had not signed up with it. According to the complaint, Grubhub has, over the course of its existence, as many as 325,000 unaffiliated restaurants on its platform, the agencies said.

In addition to the settlement payment, Grubhub must also make changes to its platform that include telling consumers the full cost of delivery, honestly advertising pay for drivers, and only listing restaurants that have given their consent.

“Our investigation found that Grubhub tricked its customers, deceived its drivers, and unfairly damaged the reputation and revenues of restaurants that did not partner with Grubhub — all in order to drive scale and accelerate growth,” FTC Chair Lina M. Khan said in a statement.

“Today’s action holds Grubhub to account, putting an end to these illegal practices and securing nearly $25 million for the people cheated by Grubhub’s tactics. There is no ‘gig platform’ exemption to the laws on the books.”

In a statement, Grubhub acknowledged the settlement and said it would make changes to its operations, but denied the charges.

‘While we categorically deny the allegations made by the FTC, many of which are wrong, misleading or no longer applicable to our business, we believe settling this matter is in the best interest of Grubhub and allows us to move forward,’ it said.

The agencies had sought a $140 million judgment against the company, but reduced it to what Grubhub is able to pay, the agencies said. If Grubhub is found to have misrepresented its financial position, the full penalty will apply, they said.

Grubhub is set to be sold to Wonder Group, a food delivery and takeout service headed by Marc Lore, the former head of Walmart’s eCommerce unit.

This post appeared first on NBC NEWS

0
FacebookTwitterGoogle +Pinterest
previous post
McKinsey & Co. to pay $650M to settle opioid consulting probe, ex-partner to plead guilty
next post
Starbucks union votes to authorize strike ahead of last scheduled bargaining session in 2024

Related Posts

‘Moana 2’ tops $1 billion, extending Disney’s box...

January 22, 2025

All the data so far is showing inflation...

April 27, 2024

UnitedHealthcare taps company veteran Tim Noel as new...

January 25, 2025

Trump Media plummets 10% as post-lockup selloff picks...

September 25, 2024

Home prices soar even higher in February, despite...

May 4, 2024

DOJ sues software firm RealPage for allegedly helping...

August 24, 2024

How Delta made itself America’s luxury airline —...

June 27, 2024

Ford joins list of companies walking back DEI...

August 30, 2024

PepsiCo buys prebiotic soda brand Poppi for nearly...

March 18, 2025

Home prices hit record high in June on...

August 31, 2024

    Stay updated with the latest news, exclusive offers, and special promotions. Sign up now and be the first to know! As a member, you'll receive curated content, insider tips, and invitations to exclusive events. Don't miss out on being part of something special.


    By opting in you agree to receive emails from us and our affiliates. Your information is secure and your privacy is protected.

    Latest

    • The Real Drivers of This Market: AI, Semis & Robotics

      August 31, 2025
    • S&P 500 Breaking Out Again: What This Means for Your Portfolio

      August 31, 2025
    • Epstein estate to hand over ‘birthday book’ to lawmakers, House Dem says

      August 31, 2025
    • Dyan Cannon denied White House entry after lying about her age on passport documents

      August 31, 2025
    • Israel eliminates Houthi prime minister in Yemen airstrike targeting senior government officials

      August 31, 2025
    • Sen. Bernie Sanders calls on RFK Jr. to resign following departure of CDC officials

      August 31, 2025

    Categories

    • Business (1,370)
    • Politics (4,370)
    • Stocks (1,619)
    • Uncategorized (45)
    • World News (1,363)
    • About us
    • Contact us
    • Privacy Policy
    • Terms & Conditions

    Disclaimer: TheTraderHarbor, its managers, its employees, and assigns (collectively “The Company”) do not make any guarantee or warranty about what is advertised above. Information provided by this website is for research purposes only and should not be considered as personalized financial advice. The Company is not affiliated with, nor does it receive compensation from, any specific security. The Company is not registered or licensed by any governing body in any jurisdiction to give investing advice or provide investment recommendation. Any investments recommended here should be taken into consideration only after consulting with your investment advisor and after reviewing the prospectus or financial statements of the company.

    Copyright © 2025 thetraderharbor.com | All Rights Reserved