Uber Eats, Postmates settle misconduct probe with Chicago for $10M

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Uber Eats, Postmates settlement overview: 

• Who: Uber Technologies Inc. reached a settlement with the City of Chicago.
• Why: The settlement ends claims that Uber’s meal delivery platforms engaged in illegal conduct.
• Where: The Postmates and Uber Eats settlement was made in Chicago.

Uber Technologies Inc. agreed to a $10 million settlement with the City of Chicago to end claims that its meal delivery platforms Uber Eats and Postmates engaged in misconduct.

In a settlement made between Uber and the City of Chicago Nov. 30, the city agreed to end its investigation into the delivery platforms in exchange for the $10 million payment. Uber denies the city’s allegations.

The city’s claims stemmed from the alleged listing of Chicago restaurants on Uber’s UberEats and Postmates apps without the eateries’ consent.

The city also contends that Uber deceptively advertised that Eats Pass and Postmates Unlimited subscribers would receive “free delivery” or “$0 Delivery Fees” and deceptively advertised that certain eateries were “exclusive to” or “only on” the platforms.

Finally, Chicago alleged that Uber quietly linked its platforms to the “Order” buttons on restaurants’ business listings on Google Search and Google Maps without the restaurants’ knowledge.

Chicago Mayor Lori Lightfoot says the Uber Eats and Postmates settlement reflects the city’s commitment to a fair marketplace that protects businesses and consumers from illegal activity.

“Chicago’s restaurant owners and workers work diligently to build their reputations and serve our residents and visitors,” she says in a statement. “That’s why our hospitality industry is so critical to our economy, and it only works when there is transparency and fair pricing.”

Postmates, Uber Eats settlement includes payment to restaurants

The $10 million settlement includes a $3.33 million payment Uber already made to Chicago in September 2021 after the city penalized the company for illegal fees during the pandemic. 

It also includes a new payment of $2.25 million to restaurants that were charged commissions above the limits set by the city’s emergency fee cap, $2.5 million in commission waivers to restaurants listed without their consent and a $1.5 million payment to cover the city’s investigation costs and fees.

In related news, last year, a consumer hit Uber Eats with another class action lawsuit alleging it illegally overcharges its New York food delivery customers on sales tax when using promotions, raking in more than $5 million in additional benefits for itself at the customer’s expense. 

What do you think of the Postmates and Uber Eats settlement? Let us know in the comments!

The city of Chicago is represented by Celia Meza and Stephen J. Kane of the City of Chicago Department of Law.

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