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DoorDash, Grubhub, and Uber Eats Settle With NYC Over Cap Fees

By  |  April 30, 2025
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DoorDash, Grubhub, and Uber Eats have reached a settlement with New York City, temporarily halting a years-long legal battle over legislation that limited the fees third-party delivery platforms could charge restaurants. The agreement was formalized in a joint stipulation and order signed by U.S. District Judge Gregory H. Woods on April 29, 2025, per a statement issued as part of the court filing.

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    The litigation dates back to 2021, when the three delivery giants sued the city over a law introduced during the COVID-19 pandemic. The law, which placed caps on commissions charged by delivery apps, was initially presented as a temporary relief measure to help struggling local eateries. However, the cap was made permanent in 2022, prompting the companies to escalate their legal challenge. According to a statement, the platforms argued that the law amounted to unconstitutional interference in their business operations, specifically claiming it infringed on their contractual arrangements with restaurants.

    Read more: DoorDash Proposes $3.6 Billion Acquisition of Deliveroo

    As part of the recent settlement, all legal deadlines in the case have been paused while both sides work toward a permanent resolution. The agreement also encompasses related legal actions currently underway in New York State Supreme Court. Per a statement, the parties have agreed to explore dismissing the case entirely, depending on the outcome of ongoing discussions.

    City officials have consistently defended the legislation, asserting that the caps were crucial to protecting small businesses from excessive fees that threatened their financial viability. They maintained that the regulations struck a balance between supporting local restaurants and regulating large corporate platforms.

    The settlement represents a shift from prolonged litigation to potential collaboration, potentially setting a precedent for how similar disputes may be addressed in other jurisdictions. According to court records, the order issued by Judge Woods stays the federal case while negotiations proceed, leaving room for a comprehensive conclusion that could reshape the relationship between food delivery companies and municipal regulators.

    Source: USA Herald