DoorDash Files Another Lawsuit Against NYC

Online food ordering company DoorDash Inc. has filed a lawsuit against New York City stemming from a new law mandating that food delivery companies share customer data with restaurants, according to a Tuesday (Oct. 5) report from Reuters. The food delivery company argued that the city’s law violates customer privacy and provides an uneven playing field for restaurants to compete, according to the article.

The lawsuit is the latest round in the contentious battle between food delivery service providers and cities. Last month, Grubhub, DoorDash and Uber Eats filed a lawsuit against New York City for making permanent fee caps, which limit the portion of a sale that food delivery services charge restaurants to 20% total, including commission, transaction fees and marketing, as PYMNTS reported. The caps began as a short-term measure when delivery sales surged during the early months of the pandemic, as restaurant dining rooms were closed.

Read more: DoorDash Continues NYC Legal Battle With New Lawsuit

The most recent lawsuit is DoorDash’s second against New York City in the last week.

Following last month’s lawsuit, New York City Council's Committee on Consumer Affairs and Business Licensing adopted seven measures aimed to improve food delivery drivers’ working conditions. Among the measures the Council approved included setting distance limits, requiring delivery services to disclose how much of a tip goes to the driver, and establishing a minimum payment per trip.

More details: NYC Passes Delivery Driver Protections

In a pivot away from the bring-it-to-me model of DoorDash, Grubhub and Uber Eats, some restaurants are seeking help from tech solution providers in setting up their own ordering channels and hiring their own delivery staff, as PYMNTS reported. With that approach, restaurants would be responsible for services’ flat monthly fees instead of third-party aggregators’ pricey per-order portions, which can be as high as 30%. These solution providers, such as Lunchbox, Traiilo and BentoBox, also allow restaurants to interact directly with customers.

See also: Restaurants Seek In-House Alternatives to Third-Party Aggregators