DoorDash, Grubhub and Uber Eats are suing New York City over its cap on the amount meal-delivery services can collect from restaurants.
In a complaint filed on Thursday in Manhattan federal court, the companies say the 15 per cent cap interferes with their right to freely negotiate contracts and will probably result in higher prices for consumers and lower earnings for restaurants and delivery drivers. The city’s ordinance is “nothing more than unconstitutional, harmful, and unnecessary government overreach that should be struck down”, the companies said.
The New York City Council originally instituted the fee limit in May 2020 on a temporary basis. Councillors said it was necessary to protect restaurants struggling during the Covid pandemic from high commissions charged by the delivery apps. The council made the cap permanent in August.
Jitse Groen, chief executive of Just Eat Takeaway, which owns Grubhub, said in a Friday morning tweet that the company had worked hard during the pandemic to support restaurants in New York and across the country. He called the cap “unprecedented and unconstitutional”.
“Price controls increase delivery fees for consumers, and therefore lead to a reduction of orders for both restaurants and couriers,” Mr Groen said. “While Grubhub remains willing to engage with the City Council, we unfortunately are left with no choice but to take legal action.”
The city’s law department did not have an immediate response to the complaint.
Shares of DoorDash rose as much as 1.3 per cent on Friday morning after the news, while Uber’s stock increased as much as 1.2 per cent. Just Eat Takeaway’s American depositary receipts fell 0.4 per cent while earlier gaining as much as 0.8 per cent.
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The biog
Age: 59
From: Giza Governorate, Egypt
Family: A daughter, two sons and wife
Favourite tree: Ghaf
Runner up favourite tree: Frankincense
Favourite place on Sir Bani Yas Island: “I love all of Sir Bani Yas. Every spot of Sir Bani Yas, I love it.”
The five pillars of Islam
1. Fasting
2. Prayer
3. Hajj
4. Shahada
5. Zakat
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It has 40 members, eight of whom are women. The members represent the UAE population through each of the emirates. Abu Dhabi and Dubai have eight members each, Sharjah and Ras al Khaimah six, and Ajman, Fujairah and Umm Al Quwain have four.
They bring Emirati issues to the council for debate and put those concerns to ministers summoned for questioning.
The FNC’s main functions include passing, amending or rejecting federal draft laws, discussing international treaties and agreements, and offering recommendations on general subjects raised during sessions.
Federal draft laws must first pass through the FNC for recommendations when members can amend the laws to suit the needs of citizens. The draft laws are then forwarded to the Cabinet for consideration and approval.
Since 2006, half of the members have been elected by UAE citizens to serve four-year terms and the other half are appointed by the Ruler’s Courts of the seven emirates.
In the 2015 elections, 78 of the 252 candidates were women. Women also represented 48 per cent of all voters and 67 per cent of the voters were under the age of 40.
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Tonight's Chat is a series of online conversations on The National. The series features a diverse range of celebrities, politicians and business leaders from around the Arab world.
Tonight’s Chat host Ricardo Karam is a renowned author and broadcaster who has previously interviewed Bill Gates, Carlos Ghosn, Andre Agassi and the late Zaha Hadid, among others.
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