abcnews.go.com
Grubhub to Pay $25 Million to Settle Deceptive Practices Allegations
Grubhub will pay $25 million to settle allegations of deceptive business practices, including misleading customers about costs, deceiving drivers, and listing restaurants without consent; the company denies wrongdoing but will make platform changes and remove unaffiliated restaurants.
- What are the key findings of the investigation into Grubhub's business practices, and what immediate actions will the company take to address them?
- Grubhub will pay $25 million to settle allegations of deceptive business practices with the Illinois attorney general and the Federal Trade Commission. The settlement includes $24.8 million in restitution to consumers and $200,000 for consumer education. Grubhub denies wrongdoing but agrees to platform changes to improve transparency on fees and driver earnings.
- What are the potential long-term consequences of this settlement for Grubhub's reputation and business model, and what systemic changes in the industry might result from this case?
- This settlement highlights the increasing scrutiny of online platforms' business practices and the potential for significant financial penalties for deceptive conduct. The changes Grubhub agrees to implement may influence other platforms' transparency measures. The remediation plan for affected consumers will be determined after court approval.
- How did Grubhub's alleged deceptive practices impact consumers, drivers, and restaurants, and what broader implications does this settlement have for the online food delivery industry?
- The settlement resolves allegations that Grubhub misled customers about delivery costs and subscription benefits, deceived drivers about earnings, and listed restaurants without consent. The investigation, launched after numerous consumer complaints, found Grubhub engaged in illegal practices to drive scale and growth. Grubhub will remove unaffiliated restaurants from its app.
Cognitive Concepts
Framing Bias
The headline and opening paragraphs frame Grubhub negatively, emphasizing the allegations of deceptive practices and the substantial settlement. The attorney general and FTC's statements are prominently featured, while Grubhub's denial is presented later and less forcefully. This framing might shape the reader's perception of the situation before they get to Grubhub's side of the story.
Language Bias
The article uses language that leans towards portraying Grubhub negatively. Words and phrases like "tricked," "deceived," "unfairly damaged," and "illegal practices" are used to describe Grubhub's actions. While these may be accurate reflections of the allegations, using more neutral terms like "misleading" or "allegedly engaged in practices that violated regulations" might be less charged and offer a more balanced portrayal.
Bias by Omission
The article omits details about the specific types of deceptive practices Grubhub engaged in beyond general descriptions. It doesn't specify the number of restaurants affected by unauthorized listings or provide examples of misleading statements to drivers. While acknowledging Grubhub's denial, the article doesn't offer counterarguments or further evidence. The lack of specifics could limit the reader's ability to fully grasp the extent of the alleged deception.
False Dichotomy
The article presents a somewhat simplistic dichotomy between Grubhub's alleged deceptive practices and its denial of wrongdoing. The complexities of the case, potential mitigating factors, and nuances of the legal arguments are not explored.
Sustainable Development Goals
The settlement addresses deceptive practices by Grubhub that disproportionately affected consumers and independent restaurants, promoting fairer market competition and potentially reducing economic disparities. The restitution payment directly benefits consumers who were misled, and the removal of restaurants from the platform without consent protects small businesses from unfair practices.