Grubhub settlement: Meal delivery service to pay $3.5M settlement for deceptive practices, hidden fees

WASHINGTON– Grubhub has been ordered to pay a $3.5 million settlement after the District of Columbia filed a lawsuit alleging the food delivery company’s fraudulent practices.

On Friday, Attorney General Karl Racine in Washington, DC, announced the ruling against Grubhub “for collecting hidden fees from customers and using deceptive marketing techniques to increase profits in violation of the district’s consumer protection laws.”

The District of Columbia sued Grubhub in March for alleged violations of the district’s Consumer Protection and Procedures Act.

Customers in the DC area will receive a total of $2.7 million, which Racine says “will be paid back to affected customers.”

“Those with active Grubhub accounts will receive a refundable credit, and if the credit isn’t used within 90 days, the money will be sent to customers in the form of a check,” he said.

In addition, the food delivery platform has to pay $800,000 in civil penalties to the District of Columbia.

“Grubhub used every trick in the book to trick customers into paying far more than they owed, and worse, they did so at the height of a global pandemic when district residents were already struggling to make ends meet coming,” Racine said in a statement.

He added, “Grubhub’s hidden fees and deceptive marketing tactics should give the company an extra dollar at the expense of DC residents – but we’re not letting them get away with it. No business, big or small, can benefit from DC residents without consequences.”

As part of billing, GrubHub must more clearly identify additional charges associated with your order.

“Settling this lawsuit is in the best interests of our company and the matter is now resolved,” the company said in a statement. “Grubhub is committed to supporting all restaurants and diners and is taking a number of steps to ensure price transparency.”

Copyright © 2022 ABC News Internet Ventures. Grubhub settlement: Meal delivery service to pay $3.5M settlement for deceptive practices, hidden fees

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