Attorney General Kwame Raoul and the Federal Trade Commission (FTC) have announced a $25 million settlement with Grubhub Inc. The settlement addresses allegations of deceptive business practices by Grubhub that reportedly affected customers, delivery drivers, and restaurants.
The Attorney General's office began investigating Grubhub after receiving numerous consumer complaints. Working alongside the FTC, they conducted an investigation leading to a nationwide settlement.
“This settlement is the culmination of a multi-year investigation into deceptive and illegal business practices perpetrated by Grubhub,” Raoul stated. He expressed gratitude to FTC Chair Lina Khan for the collaboration between their offices, which resulted in relief for Illinois consumers. Raoul emphasized his commitment to holding companies accountable for deceptive practices.
FTC Chair Lina M. Khan commented on the investigation's findings: “Our investigation found that Grubhub tricked its customers, deceived its drivers, and unfairly damaged the reputation and revenues of restaurants that did not partner with Grubhub—all in order to drive scale and accelerate growth.” She highlighted that this action holds Grubhub accountable, ending these illegal practices and securing nearly $25 million for those affected by Grubhub’s tactics.
The investigation uncovered several issues with Grubhub's operations. It was alleged that the company misled consumers about delivery costs and benefits of a subscription service; misrepresented potential earnings to drivers; and listed restaurants on its app without consent or against explicit objections.
As part of the settlement, $24.8 million will be distributed as restitution to affected consumers nationwide. An additional $200,000 will support consumer education and enforcement efforts by the Illinois Attorney General’s office.
Preventative measures are also included in the settlement terms. Grubhub must clearly disclose all fees related to delivery upfront, provide verifiable proof of earnings claims made to drivers upon request, remove any unaffiliated restaurants immediately, and refrain from adding restaurants without permission in future.
The settlement was managed by several members of Raoul’s Consumer Fraud Bureau team: Consumer Protection Division Chief Susan Ellis; Consumer Fraud Bureau Chief Greg Grzeskiewicz; Deputy Bureau Chief Jacob Gilbert; Consumer Counsel Thomas James; Assistant Attorneys General William Wingo; and Wilton Person.