DoorDash sues New York City over customer data law, second weekday lawsuit

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NEW YORK: DoorDash Inc on Wednesday sued New York City over a new law requiring food delivery companies to share customer data with restaurants, claiming it violates customer privacy and allows restaurants to engage in unfair competition.

The lawsuit is the latest battle in a series of legal clashes between food delivery app companies and cities.

It was filed in Manhattan federal court six days after DoorDash, Grubhub Inc and Uber Eats sued the most populous city in the United States over a separate law capping the fees delivery companies charge restaurants .

Representatives from the New York City Legal Department were not immediately available for comment.

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Since the onset of the coronavirus pandemic, New York has tried to help restaurants that had complained about delivery app companies charging fees of up to 30%, but became more dependent on delivery as theaters dining rooms were closed or had limited capacity.

About 90,000 restaurants nationwide have closed temporarily or permanently during the pandemic, costing 1.5 million jobs, the National Restaurant Association said in June.

In Wednesday’s lawsuit, San Francisco-based DoorDash said New York had shown “naked animosity” by requiring food delivery companies to provide names, phone numbers, email addresses. e-mail and delivery addresses of customers to restaurants.

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DoorDash said it would allow restaurants to “take a free ride” on data in a “shocking and pervasive invasion of consumer privacy,” saying restaurants would not demand the same information from diners in person. .

He also said that “the most vulnerable populations, especially undocumented clients” could be harmed if data is mismanaged and shared with immigration authorities or hate groups.

Shortly after the start of the pandemic, New York City imposed temporary fee caps of 5% and 15% on food delivery apps, which businesses were hoping to end when restaurants resume operations more. normal.

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The cap cost DoorDash, Grubhub and Uber Eats hundreds of millions of dollars in revenue through July, the companies said.

DoorDash and Grubhub sued San Francisco in July over fee caps. Chicago sued the companies last month, claiming their deceptive practices mislead customers and hurt restaurants. DoorDash and Grubhub rejected Chicago’s claims.

The case is DoorDash Inc v City of New York, US District Court, Southern District of New York, No. 21-07695.

(Reporting by Jonathan Stempel in New York; editing by Jonathan Oatis)

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