The City of Chicago has landed an $18 million settlement with the food delivery giant DoorDash. The case, which unpacks a slew of deceptive business practices leveraged against restaurants, consumers, and drivers, has come to a close with the city's government left standing as the assertive protector of fair market play. According to the official announcement, Mayor Brandon Johnson called the settlement a testament to Chicago's "commitment to standing up for workers and small businesses."
"This settlement demonstrates Chicago’s commitment to standing up for workers and small businesses while maintaining a fair and honest marketplace," Johnson claimed, alluding to the relief and justice aimed at the workers, small businesses, and residents who were impacted by these practices. During this prominent period of third-party meal delivery companies, likely made essential amidst pandemic conditions, the lawsuit emerged from an investigation spearheaded by the city into their operations.
Falling under scrutiny, DoorDash found itself accused of several infractions. They listed restaurants on their platform without obtaining permission, obscured the full cost of services from consumers initially, and even wrongfully advertised a "Chicago Fee" that was unrelated to any city-imposed charge. As said by the city, DoorDash also failed to reveal that menu prices on the platform were consistently higher than those directly from restaurants. One allegation that resonated with consumers was the misleading tip policy of DoorDash; rather than going straight to drivers, these gratuities were instead used to supplement driver wages. Corporation Counsel Mary B. Richardson-Lowry echoed the city's sentiments, emphasizing that "Chicagoans deserve transparency, honest service, and confidence that their tips support workers and local business."
Details of the agreement underline a host of reparations. Restaurants that had been listed without consent stand to receive $3.25 million. Eligible businesses not presently on the platform will soon be instructed on payment procedures by DoorDash. Additionally, the settlement stipulates that $5.8 million in credits is to go towards delivery commissions and market promotions for currently enlisted restaurants. This doesn't even touch on the $4 million in credits meant for Chicagoans with active DoorDash accounts, set to kick in come January 28, 2026. Meanwhile, $500,000 is earmarked for drivers, as a supplementary gesture to a prior agreement with the Illinois Attorney General concerning the same tipping issue. DoorDash has also committed $4.5 million to cover the legal costs incurred by the city in prosecuting the case. To ensure that consumers can foster trust in the marketplace, rendering it stronger and more equitable, Commissioner of the Chicago Department of Business Affairs and Consumer Protection Ivan Capifali vowed to hold businesses to account for their actions. Lawyers from the Department of Law’s Affirmative Litigation Division and Cohen Milstein Sellers & Toll PLLC represented the City in this case.
