Food delivery firms sue NYC over fee cap law

Food-delivery companies are crying foul over fee caps. DoorDash, Grubhub and Uber Eats have sued New York City over its law that permanently caps commissions they can charge restaurants to use their platforms. The law also requires them to obtain operating licenses that are valid for two years.

The three companies filed the suit in federal court late Thursday. The companies contend the fees would harm them and the revitalization of restaurants.

They’re seeking an injunction that would block the city from enforcing the ordinance. They’re also demanding a jury trial and unspecified monetary damages.

The law in question seeks to limit the companies’ fees at 15% of food orders for deliveries and 5% for advertising and other non-delivery services.

That legislation comes after the city enacted temporary fee caps during the health crisis, when many restaurants were forced to close or rely on delivery and carry-out alone. In New York, the restaurant delivery market is almost evenly split among the three companies.

Over on the West Coast, San Francisco has also enacted a permanent fee cap on the services.

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