Grubhub has agreed to pay a $25 million settlement with the US Federal Trade Commission and Illinois Attorney General Kwame Raoul after being accused of misleading customers about order fees, adding restaurants without their consent, and deceiving drivers about pay. The company will cease these practices as part of the agreement.
The agencies initially sought a $140 million judgment against Grubhub but reduced it to what the company could afford. If Grubhub is found to have misrepresented its financial position, the full penalty will apply.
According to the lawsuit, Grubhub hid fees until the last minute, misled premium subscribers about avoiding fees, and blocked customers from using their gift card balances. Drivers were also told they could earn up to $26 an hour, but only the top 2% achieved these rates.
The FTC and Illinois alleged that Grubhub’s practices violated federal and state law, citing harm to both restaurants and diners. The company has denied some of the allegations, calling them “wrong, misleading or no longer applicable.”
Source: https://ca.finance.yahoo.com/news/grubhub-pay-25-million-misleading-171003454.html