Grubhub, Uber Eats, Postmates must face diners' lawsuit over U.S. restaurant prices

Source: Reuters

Grubhub, Uber Eats, Postmates must face diners' lawsuit over U.S. restaurant prices

Jonathan Stempel
Wed, March 30, 2022, 5:28 PM

NEW YORK (Reuters) - A U.S. judge on Wednesday said Grubhub, Uber Eats and Postmates must face an antitrust lawsuit by diners who accused them of driving up menu prices by exploiting their dominance in meal deliveries during the COVID-19 pandemic.

U.S. District Judge Lewis Kaplan in Manhattan said it was reasonable to infer that requiring restaurants to accept "no-price competition clauses" left them with "no choice but to raise prices" regardless of where diners ordered meals.

He also said diners plausibly alleged that Grubhub and Uber Eats' more restrictive clauses discouraged restaurants from using other platforms, despite their need to generate enough sales to stay afloat and offset low profit margins.

"Defendants' motion to dismiss is denied in its entirety," Kaplan wrote.

Diners claimed that the no-price competition clauses barred restaurants from charging lower prices for dining in or ordering takeout, while Grubhub and Uber Eats also forbade restaurants from charging less to customers who ordered on rival platforms.

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