Food delivery giant Grubhub has agreed to pay a $25 million settlement after allegations of deceptive business practices by the Federal Trade Commission (FTC) and Illinois Attorney General Kwame Raoul. The company will make significant changes to its operations, including removing surprise fees from delivery totals and providing clearer refund policies.
Grubhub’s settlement comes after an investigation found that the company misled users about delivery costs, hourly pay rates, and listed up to 325,000 restaurants without permission. The FTC had initially ordered Grubhub to pay $140 million but partially suspended the payment due to the company’s financial struggles.
Under the settlement, most of the funds will be used for customer refunds. The agreement requires Grubhub to improve its business practices, including stopping misleading claims about driver earnings and providing a simple way to cancel subscriptions.
Source: https://www.axios.com/2024/12/18/grubhub-lawsuit-settlement-ftc