Doordash: Difference between revisions

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This had led a customer to file a class action suit against the company claiming "materially false and misleading" in app tipping feature.<ref name=":10" /><ref name=":14" /> The case was later moved to an arbitration hearing in August.<ref>{{Cite web |last=Casetext |date=2020-08-24 |title=Arkin v. DoorDash, Inc. |url=https://casetext.com/case/arkin-v-doordash-inc |url-status=dead |archive-url=https://web.archive.org/web/20230213085836/https://casetext.com/case/arkin-v-doordash-inc |archive-date=2023-02-13 |access-date=2025-06-27 |website=Casetext}}</ref> Facing negative exposure and bad press the company finally complied to change their payout policy.<ref>{{Cite web |last=Abril |first=Danielle |date=2019-11-12 |title=DoorDash’s New Tipping Policy Has Increased Driver Pay |url=https://fortune.com/2019/11/12/doordash-new-tipping-policy-worker-pay/ |url-status=live |website=Fortune}}</ref><ref>{{Cite web |last=Newman |first=Andy |date=2019-07-24 |title=DoorDash Changes Tipping Model After Uproar From Customers |url=https://www.nytimes.com/2019/07/24/nyregion/doordash-tip-policy.html |url-status=live |website=New York Times}}</ref> The lawsuit was settled by District of Columbia Attorney General Karl Racine for $2.5 million with most of the amount going to dashers, government and charity.<ref>{{Cite web |last=Kerr |first=Dara |date=2020-11-25 |title=DoorDash settles lawsuit for $2.5M over 'deceptive' tipping practices |url=https://www.cnet.com/tech/mobile/doordash-settles-lawsuit-for-2-5m-over-deceptive-tipping-practices/ |url-status=live |access-date=2025-06-27 |website=CNET}}</ref><ref>{{Cite web |last=Canales |first=Katie |date=2020-11-25 |title=DoorDash is paying $2.5 million to settle a lawsuit that accused the food delivery company of stealing drivers' tips |url=https://www.businessinsider.com/doordash-25-million-settlement-lawsuit-tipping-model-2020-11 |url-status=live |website=Business Insider}}</ref><ref>{{Cite web |last=OAC |date=2020-11-24 |title=AG Racine Reaches $2.5 Million Agreement with DoorDash for Misrepresenting that Consumer Tips Would Go to Food Delivery Drivers |url=https://oag.dc.gov/release/ag-racine-reaches-25-million-agreement-doordash |website=Office of the Attorney General for the District of Columbia}}</ref>

=== Antitrust litigation (2020) ===

==== Antitrust litigation (2020) ====

The Dacitashvili has filed against Grubhub, Doordash, Postmates and Uber Eats for having a majoritive monopoly over the food delivery market because of the way it selectively signed contracts with businesses to list them on the platform. Many of the clauses stated that delivery prices will be identical to dine in prices.<ref name=":15">{{Cite web |last=Allyn |first=Bobby |date=2020-05-14 |title=Restaurants Are Desperate — But You May Not Be Helping When You Use Delivery Apps |url=https://www.npr.org/2020/05/14/856444431/cities-crack-down-on-food-delivery-app-fees-as-restaurants-struggle-to-survive |url-status=live |access-date=2025-08-30 |website=NPR}}</ref><ref name=":16">{{Cite web |last=Stempel |first=Jonathan |date=2020-04-13 |title=Grubhub, DoorDash, Postmates, Uber Eats are sued over restaurant prices amid pandemic |url=https://www.reuters.com/article/us-health-coronavirus-food-delivery-laws-idUSKCN21V2C1/ |url-status=live |access-date=2020-08-30 |website=Reuters}}</ref> Plaintiffs argued that this increased the cost unfairly to dine-in customers because all defendants required the restaurants to cover the delivery fees ranging from 13% - 40% of revenue.<ref name=":15" /><ref name=":16" /> Keep in mind that restaurants like supermarkets runs on slim profit margins with the average being 3% - 9% total. This case seeks treble damages (multiply all damages by 3) for overcharges from the beginning of 2016 of April from the defendants delivery apps.<ref name=":15" /><ref name=":16" /><ref>{{Cite web |date=2020-04-13 |title=Case 1:20-cv-03000-LAK Document |url=https://s3.documentcloud.org/documents/6890558/DAVITASHVILI-v-Grubhub-ET-AL.txt |url-status=live |archive-date= |access-date=2025-08-30 |website=S3 Documentcloud}}</ref> Many preliminaries have happened since then but is unclear when the trial will actually begin.

~~"<blockquote>~~

==== Litigation for illegal unauthorized restaurant listing (2021) ====

===~~Driver strike~~ for ~~tip transparency~~ (2021)===

In may, Doordash was sued of adding restaurants to their service without business consent. the plaintiff Lona's Lil Eats in St. Louis filed a lawsuit against the company claiming that they were listed on the app without notice or consent; and then prevented any orders from going through despite the listing claiming it was "too far away" when the actual issue was that the business had not partnered with Doordash and payed the fee for the listing. Which such behavior is not lawful in California

In ~~July 2021~~, ~~DoorDash drivers went on strike to protest lack~~ of ~~tip transparency and~~ to ~~ask for higher pay~~. At the ~~time of the strike, and, as of June 2022, DoorDash did not allow drivers to see the full tip amounts prior to accepting a delivery~~ in ~~the app~~. ~~If customers tip over~~ a ~~set amount for~~ the ~~order total, Doordash hides a portion of~~ the ~~tip until~~ the ~~delivery is complete. The strike occurred after DoorDash rewrote its code to cut off access to Para, a third-party app~~ that ~~drivers~~ had ~~been using to see~~ the ~~full tip amounts~~.

=~~==Litigation for illegal unauthorized restaurant listing (2021)===~~

==== Lawsuit by the city of Chicago (2021) ====

In May 2021, DoorDash was criticized for unauthorized listings of restaurants who had not given permission to appear on the app. The company was sued by Lona's Lil Eats in St. Louis, with the lawsuit claiming that DoorDash had listed them without permission, then prevented any orders to the restaurant from going through and redirecting customers to other restaurants instead, because Lona's was "too far away," when in reality it had not paid DoorDash a fee for listing. This aspect of DoorDash's business practice is illegal in California.

In august, Chicago had filed a suit against both Doordash and Grubhub. Mayor Lori Lightfoot claimed these companies broke the law by using "unfair and deceptive tactics to take advantage of restaurants and consumers who were struggling to stay afloat during the COVID-19 pandemic.", which was actively denied by both companies alleged in the case.

===Lawsuit by the city of Chicago (2021)===

In ~~August 2021~~, ~~the city of~~ Chicago ~~sued DoorDash~~ and ~~GrubHub~~. ~~According to Chicago mayor~~ Lori Lightfoot~~, the~~ companies broke the law by using "unfair and deceptive tactics to take advantage of restaurants and consumers who were struggling to stay afloat during the COVID-19 pandemic." ~~DoorDash and GrubHub~~ denied the ~~suit's merits~~.

"<blockquote>

===Class-action lawsuit (2023)===

DoorDash has been accused of charging users of iPhone more than users on the Android platform. User testing claimed to show several instances of various fees and delivery charges being higher when using an Apple device. DoorDash denied these allegations in response to the ongoing US$1 billion class-action suit.

@@ Line 81: / Line 81: @@
 This had led a customer to file a class action suit against the company claiming "materially false and misleading" in app tipping feature.<ref name=":10" /><ref name=":14" /> The case was later moved to an arbitration hearing in August.<ref>{{Cite web |last=Casetext |date=2020-08-24 |title=Arkin v. DoorDash, Inc. |url=https://casetext.com/case/arkin-v-doordash-inc |url-status=dead |archive-url=https://web.archive.org/web/20230213085836/https://casetext.com/case/arkin-v-doordash-inc |archive-date=2023-02-13 |access-date=2025-06-27 |website=Casetext}}</ref> Facing negative exposure and bad press the company finally complied to change their payout policy.<ref>{{Cite web |last=Abril |first=Danielle |date=2019-11-12 |title=DoorDash’s New Tipping Policy Has Increased Driver Pay |url=https://fortune.com/2019/11/12/doordash-new-tipping-policy-worker-pay/ |url-status=live |website=Fortune}}</ref><ref>{{Cite web |last=Newman |first=Andy |date=2019-07-24 |title=DoorDash Changes Tipping Model After Uproar From Customers |url=https://www.nytimes.com/2019/07/24/nyregion/doordash-tip-policy.html |url-status=live |website=New York Times}}</ref> The lawsuit was settled by District of Columbia Attorney General Karl Racine for $2.5 million with most of the amount going to dashers, government and charity.<ref>{{Cite web |last=Kerr |first=Dara |date=2020-11-25 |title=DoorDash settles lawsuit for $2.5M over 'deceptive' tipping practices |url=https://www.cnet.com/tech/mobile/doordash-settles-lawsuit-for-2-5m-over-deceptive-tipping-practices/ |url-status=live |access-date=2025-06-27 |website=CNET}}</ref><ref>{{Cite web |last=Canales |first=Katie |date=2020-11-25 |title=DoorDash is paying $2.5 million to settle a lawsuit that accused the food delivery company of stealing drivers' tips |url=https://www.businessinsider.com/doordash-25-million-settlement-lawsuit-tipping-model-2020-11 |url-status=live |website=Business Insider}}</ref><ref>{{Cite web |last=OAC |date=2020-11-24 |title=AG Racine Reaches $2.5 Million Agreement with DoorDash for Misrepresenting that Consumer Tips Would Go to Food Delivery Drivers |url=https://oag.dc.gov/release/ag-racine-reaches-25-million-agreement-doordash |website=Office of the Attorney General for the District of Columbia}}</ref>
-=== Antitrust litigation (2020) ===
+==== Antitrust litigation (2020) ====
 The Dacitashvili has filed against Grubhub, Doordash, Postmates and Uber Eats for having a majoritive monopoly over the food delivery market because of the way it selectively signed contracts with businesses to list them on the platform. Many of the clauses stated that delivery prices will be identical to dine in prices.<ref name=":15">{{Cite web |last=Allyn |first=Bobby |date=2020-05-14 |title=Restaurants Are Desperate — But You May Not Be Helping When You Use Delivery Apps |url=https://www.npr.org/2020/05/14/856444431/cities-crack-down-on-food-delivery-app-fees-as-restaurants-struggle-to-survive |url-status=live |access-date=2025-08-30 |website=NPR}}</ref><ref name=":16">{{Cite web |last=Stempel |first=Jonathan |date=2020-04-13 |title=Grubhub, DoorDash, Postmates, Uber Eats are sued over restaurant prices amid pandemic |url=https://www.reuters.com/article/us-health-coronavirus-food-delivery-laws-idUSKCN21V2C1/ |url-status=live |access-date=2020-08-30 |website=Reuters}}</ref> Plaintiffs argued that this increased the cost unfairly to dine-in customers because all defendants required the restaurants to cover the delivery fees ranging from 13% - 40% of revenue.<ref name=":15" /><ref name=":16" /> Keep in mind that restaurants like supermarkets runs on slim profit margins with the average being 3% - 9% total. This case seeks treble damages (multiply all damages by 3) for overcharges from the beginning of 2016 of April from the defendants delivery apps.<ref name=":15" /><ref name=":16" /><ref>{{Cite web |date=2020-04-13 |title=Case 1:20-cv-03000-LAK Document |url=https://s3.documentcloud.org/documents/6890558/DAVITASHVILI-v-Grubhub-ET-AL.txt |url-status=live |archive-date= |access-date=2025-08-30 |website=S3 Documentcloud}}</ref> Many preliminaries have happened since then but is unclear when the trial will actually begin.
-"<blockquote>
+==== Litigation for illegal unauthorized restaurant listing (2021) ====
-===Driver strike for tip transparency (2021)===
+In may, Doordash was sued of adding restaurants to their service without business consent. the plaintiff Lona's Lil Eats in St. Louis filed a lawsuit against the company claiming that they were listed on the app without notice or consent; and then prevented any orders from going through despite the listing claiming it was "too far away" when the actual issue was that the business had not partnered with Doordash and payed the fee for the listing. Which such behavior is not lawful in California
-In July 2021, DoorDash drivers went on strike to protest lack of tip transparency and to ask for higher pay. At the time of the strike, and, as of June 2022, DoorDash did not allow drivers to see the full tip amounts prior to accepting a delivery in the app. If customers tip over a set amount for the order total, Doordash hides a portion of the tip until the delivery is complete. The strike occurred after DoorDash rewrote its code to cut off access to Para, a third-party app that drivers had been using to see the full tip amounts.
-===Litigation for illegal unauthorized restaurant listing (2021)===
+==== Lawsuit by the city of Chicago (2021) ====
-In May 2021, DoorDash was criticized for unauthorized listings of restaurants who had not given permission to appear on the app. The company was sued by Lona's Lil Eats in St. Louis, with the lawsuit claiming that DoorDash had listed them without permission, then prevented any orders to the restaurant from going through and redirecting customers to other restaurants instead, because Lona's was "too far away," when in reality it had not paid DoorDash a fee for listing. This aspect of DoorDash's business practice is illegal in California.
+In august, Chicago had filed a suit against both Doordash and Grubhub. Mayor Lori Lightfoot claimed these companies broke the law by using "unfair and deceptive tactics to take advantage of restaurants and consumers who were struggling to stay afloat during the COVID-19 pandemic.", which was actively denied by both companies alleged in the case.
-===Lawsuit by the city of Chicago (2021)===
-In August 2021, the city of Chicago sued DoorDash and GrubHub. According to Chicago mayor Lori Lightfoot, the companies broke the law by using "unfair and deceptive tactics to take advantage of restaurants and consumers who were struggling to stay afloat during the COVID-19 pandemic." DoorDash and GrubHub denied the suit's merits.
+"<blockquote>
 ===Class-action lawsuit (2023)===
 DoorDash has been accused of charging users of iPhone more than users on the Android platform. User testing claimed to show several instances of various fees and delivery charges being higher when using an Apple device. DoorDash denied these allegations in response to the ongoing US$1 billion class-action suit.