EvilCorporations.com | Corporate Accountability Reporting
Grubhub Inc. · Class Action · 2019–2024
Grubhub Hid Fees from California Customers for Years
The food delivery giant inflated menu prices, buried fees, and advertised “free delivery” while quietly charging extra. California consumers paid the price.
🔴 High Severity
TL;DR
Grubhub collected delivery fees, service fees, and a special “CA Driver Benefits Fee” from California customers while making false and misleading representations about what those fees actually covered and how much food really cost. The company also advertised “free delivery” for Grubhub+ subscribers while simultaneously charging other fees that made delivery anything but free. A class action covering California customers from January 2019 through 2024 forced a settlement worth up to $5 million, with affected customers eligible for a $10 site credit. Grubhub walked away without admitting a single thing.
Demand honest pricing from every platform you use. Your money and your trust are not Grubhub’s to manipulate.
$5M
Maximum settlement fund for California customers
$10
Site credit each eligible customer can claim
5+ yrs
Class period: Jan 2019 through 2024
$200K
Grubhub’s capped admin cost to process claims
10,000
Opt-outs required for Grubhub to cancel the deal
7 yrs
Sunset period on new fee-transparency obligations
The Allegations: A Breakdown
Core Allegations
What Grubhub did to customers ordering delivery in California
| 01 | Grubhub made false or misleading representations about its delivery fees, service fees, and “CA Driver Benefits Fee” on California delivery orders from at least January 2019 through 2024. | high |
| 02 | Menu prices displayed on the Grubhub platform during the class period were alleged to be inflated beyond what restaurants actually charged, deceiving customers about the true cost of their food. | high |
| 03 | Grubhub advertised “free delivery” for Grubhub+ members while other fees continued to apply on those same orders, making the “free delivery” claim actively misleading. | high |
| 04 | The “CA Driver Benefits Fee” was presented as a specific, defined charge related to driver welfare; plaintiffs alleged the representations surrounding it were false or misleading. | medium |
| 05 | Customers ordering through both Grubhub.com and Seamless.com (powered by Grubhub) were exposed to the same allegedly deceptive fee structures and price representations. | medium |
| 06 | The alleged misconduct persisted for more than five years, from January 24, 2019 through the date of preliminary approval in 2024, exposing a large and sustained pattern rather than a one-time error. | high |
Regulatory and Legal Failures
How consumer protections were stretched and delayed
| 01 | Grubhub repeatedly used its arbitration clause to remove cases from court, forcing individual consumers into a private dispute resolution process that strongly favors corporations. | high |
| 02 | Plaintiff Sznitko won an arbitration demand in December 2021, but that arbitration award was initially denied before a Superior Court vacated it in August 2022. The path to any accountability took years. | high |
| 03 | Grubhub removed multiple cases to federal court before plaintiffs could consolidate their claims, a legal maneuver that lengthens timelines and increases costs for consumers. | medium |
| 04 | Despite settling for up to $5 million, Grubhub faces no admission of liability, no finding of wrongdoing, and no financial penalty beyond the settlement fund itself. No executive faced any personal consequence. | high |
Profit Over Transparency
How hidden charges benefited Grubhub at consumers’ expense
| 01 | By inflating menu prices and stacking fees, Grubhub extracted more revenue per transaction from customers who had no easy way to verify what restaurants actually charged. | high |
| 02 | The “free delivery” advertisement for Grubhub+ subscriptions was used as a retention and growth tool, bringing in subscription revenue while still applying charges that undermined the core promise. | high |
| 03 | Settlement costs are capped at $5 million plus $200,000 in administration, meaning the financial consequence of more than five years of alleged deception remains limited relative to Grubhub’s scale of operations. | medium |
Economic Harm to Consumers
What California delivery customers actually lost
| 01 | California consumers who ordered through Grubhub or Seamless between January 2019 and 2024 paid fees and prices they were allegedly deceived about, with no simple mechanism to get a refund. | high |
| 02 | The settlement award of $10 per eligible customer is a site credit, meaning relief must be spent back on Grubhub rather than returned as cash, limiting how meaningful the compensation actually is. | medium |
| 03 | Customers who opt out of the settlement receive nothing and must pursue individual claims, which is economically irrational for most people given the small per-transaction amount at issue. | medium |
| 04 | If Valid Claims exceed the $5 million cap, individual awards are reduced proportionally, meaning that a high participation rate shrinks each person’s already minimal compensation further. | medium |
Corporate Accountability Failures
What Grubhub avoided, admitted, and walked away from
| 01 | The settlement explicitly states that it is not an admission of liability, wrongdoing, or negligence. Grubhub officially maintains that its pricing representations were entirely truthful and legal. | high |
| 02 | The agreement prohibits both parties and their counsel from making any public statements or media comments suggesting Grubhub did anything wrong, shielding the company from further reputational harm. | high |
| 03 | Grubhub retains the right to cancel the entire settlement if more than 10,000 class members opt out, giving the company substantial leverage over whether consumers receive any relief at all. | medium |
| 04 | New fee-transparency obligations secured through the settlement sunset automatically after seven years, meaning that even these modest changes are temporary rather than permanent structural reforms. | medium |
| 05 | Each class representative receives only a $1,000 incentive award for taking on years of litigation risk, while class counsel may receive up to 20% of the $5 million maximum fund in attorneys’ fees. | low |
What Changes (For Now)
As part of the settlement, Grubhub agreed to display fees and taxes as separate, prominent line items on orders and to stop advertising “free delivery” for Grubhub+ members on orders where other fees apply. Where space permits, the platform must note that other fees may apply. These requirements expire automatically seven years after the settlement’s effective date. Grubhub may still advertise “$0 delivery” phrasing for Grubhub+ under certain conditions.
Timeline of Events
Jan 2019
Start of the class period. Grubhub begins allegedly misrepresenting delivery fees, service fees, the CA Driver Benefits Fee, and menu prices to California consumers.
Feb 9, 2021
Plaintiff Sznitko files a putative class action in Los Angeles Superior Court. Grubhub removes the case to federal court and moves to compel arbitration.
May 3, 2021
Plaintiff Stout files a separate complaint in San Francisco Superior Court. Grubhub again seeks arbitration and the case is removed.
Dec 30, 2021
Arbitrator issues a final award denying the relief requested in Sznitko’s arbitration demand. Plaintiffs continue pursuing accountability.
Aug 11, 2022
Superior Court vacates the Sznitko arbitration award, reopening the path for court action against Grubhub.
Nov 21, 2022
Plaintiffs Wang, Bogaert, Perkins, Recco, and Bak file a new case in Alameda County. Grubhub removes to federal court and moves to compel arbitration again.
Nov 2023
All prior litigation is dismissed. Parties consolidate into a single class action: Wang et al. v. Grubhub Inc., filed October 3, 2023 in Los Angeles Superior Court.
Nov 2023
Settlement agreement executed. Grubhub agrees to a $5 million maximum fund and new fee-disclosure obligations, without admitting any wrongdoing.
Oct 10, 2024
Preliminary approval hearing scheduled in Los Angeles Superior Court before Judge Kenneth R. Freeman. Class members await notice and the claims process.
Direct Quotes from the Legal Record
QUOTE 1
Core Allegation: False fee representations
Core Allegations
“Plaintiffs further allege that Defendant’s representations regarding its delivery fees, service fees, ‘CA Driver Benefits Fee’ and menu prices on its delivery orders during the Class Period were false or misleading.”
💡 This is the core of the case. Grubhub told customers one thing about what they were paying and why, while the actual fee structure told a different story.
QUOTE 2
Free delivery advertising while other fees applied
Profit Over Transparency
“Grubhub will not advertise ‘free delivery’ for Grubhub+ members… on Grubhub+ orders where other fees apply and in these instances will, space permitting, note that other fees may apply.”
💡 Grubhub’s own settlement terms confirm the “free delivery” claim was deceptive. The fact that this had to be negotiated means it was happening beforehand.
QUOTE 3
No admission of wrongdoing, ever
Corporate Accountability Failures
“Defendant expressly denies any liability or wrongdoing of any kind associated with the claims alleged in the Action or Prior Litigation.”
💡 Grubhub paid up to $5 million but insists it did absolutely nothing wrong. The money flows; the accountability does not.
QUOTE 4
Settlement not an admission of liability
Corporate Accountability Failures
“This Agreement is not to be construed or deemed as an admission of liability, culpability, negligence, or wrongdoing on the part of Defendant.”
💡 This boilerplate language is how corporations pay settlements without consequence. The legal system allows it, and that is itself a structural problem.
QUOTE 5
Media gag: no one can say Grubhub did anything wrong
Corporate Accountability Failures
“The Parties and their counsel shall not make, publish, circulate or cause to be made, published or circulated any statements that represent or suggest any wrongdoing by Defendant.”
💡 The settlement legally silences the attorneys who fought this case. Grubhub paid not just for the settlement, but for the right to control the narrative afterward.
QUOTE 6
Grubhub can void the deal if enough people opt out
Corporate Accountability Failures
“In its sole discretion and at its sole option, Defendant has the unconditional right, but not the obligation, to terminate this Agreement if the total number of opt-outs exceeds 10,000 persons.”
💡 Grubhub holds a trapdoor on the entire settlement. If enough consumers choose not to participate, the company can walk away from all obligations.
QUOTE 7
Settlement relief is store credit, not cash
Economic Harm to Consumers
“‘Settlement Award’ means a $10 site credit for use on the Grubhub App or website pursuant to Section IV.E.”
💡 The relief for years of alleged deception is a $10 voucher that must be spent on Grubhub. The company keeps the customer relationship while calling it compensation.
QUOTE 8
Fee transparency obligations expire after seven years
Corporate Accountability Failures
“These provisions will sunset seven years after the Effective Date.”
💡 Even the minimal fee-disclosure rules won in this settlement are written to disappear. Grubhub’s transparency obligations are temporary by design.
Commentary
What exactly did Grubhub allegedly do to deceive customers?
▾
Plaintiffs allege that Grubhub misrepresented delivery fees, service fees, and a special “CA Driver Benefits Fee” on California orders. Beyond the fees themselves, the complaint targets menu prices displayed on the app, which were allegedly inflated beyond what restaurants actually charged. Together, these practices meant that consumers consistently paid more than what was honestly advertised, without knowing it. This is not a billing error. It is a systematic pricing model where opacity was the product.
How serious is this case?
▾
A $5 million settlement covering more than five years of alleged deception affecting every California Grubhub customer is significant in scope. The fact that Grubhub fought the case through multiple arbitration attempts, federal court removals, and years of litigation before settling tells you how seriously the company treated these claims. No executive has faced personal liability. No court has made a finding of wrongdoing. That means the financial hit to Grubhub is manageable, and the structural incentives to repeat this behavior remain largely intact.
Why did Grubhub settle without admitting anything?
▾
Settling without an admission of liability is standard corporate litigation strategy. It caps financial exposure, avoids setting a legal precedent that could be used in future cases, and eliminates the reputational damage of a court finding of wrongdoing. For Grubhub, paying up to $5 million to avoid a trial where evidence would become public, where a judge could rule on the merits, and where an admission could fuel further legal action in other states was almost certainly the rational business calculation.
What are the real-world consequences for the people harmed?
▾
California residents who ordered delivery through Grubhub for over five years paid inflated prices and misleading fees on every single transaction. The compensation available through this settlement is a $10 store credit, redeemable only on Grubhub. For people who placed dozens or hundreds of orders over five years, each with hidden markups, $10 in Grubhub credit is not justice. It is a public relations gesture dressed as accountability. The harm is real. The remedy is minimal.
Is the “free delivery” claim the most damaging part of this case?
▾
The “free delivery” allegation is arguably the most viscerally deceptive because it directly targeted subscribers who paid for Grubhub+ specifically to get free delivery. These customers made a recurring financial commitment based on a promise Grubhub allegedly didn’t keep. When you sell a subscription on the basis of “free delivery” and then charge other fees that offset or exceed what a non-subscriber would pay, you are not offering free delivery. You are offering a rebranded fee structure.
Why did it take so long for customers to see any relief?
▾
The timeline exposes a structural reality: corporations have tools to delay accountability that ordinary consumers don’t. Grubhub invoked arbitration clauses, removed cases to federal court, and contested proceedings at every stage beginning in 2021. The plaintiffs first filed claims nearly three years before the settlement agreement was signed. Every delay cost consumers legal fees, time, and the real possibility that cases would simply collapse before reaching any resolution. This is not a bug in the legal system. It is a feature that reliably benefits large corporations.
Does this settlement actually change anything about how Grubhub operates?
▾
Modestly and temporarily. Grubhub agreed to display fees and taxes as separate, visible line items and to stop advertising “free delivery” for Grubhub+ on orders where other fees apply. Both of these changes sunset after seven years. No structural change to the pricing model is required. No executive faces accountability. No independent oversight monitors compliance. The settlement trades years of alleged deception for a temporary and narrow transparency requirement that the company can abandon by 2031.
Is Grubhub alone in these practices?
▾
Food delivery fee manipulation is an industry-wide problem. Multiple platforms have faced complaints, regulatory scrutiny, and legal action over inflated menu prices, opaque fee structures, and misleading marketing. Grubhub is being held to account here, but the broader pattern reflects a delivery economy built on information asymmetry: platforms know exactly what restaurants charge and exactly what consumers pay. Consumers do not. That gap, deliberately maintained, is where the deception lives.
What can I do to prevent this from happening again?
▾
If you ordered through Grubhub in California between January 2019 and 2024, file a claim at the settlement website to receive your $10 credit. Beyond that: compare prices directly on restaurant websites before placing app orders, check what fees apply before checkout, and support legislative efforts to require transparent fee disclosure in app-based delivery. In California, contact your state assembly member and ask them to support permanent, not sunset-limited, fee transparency requirements for all delivery platforms. When enough consumers opt into class actions instead of out of them, the financial calculus for corporations changes.
💡 Explore Corporate Misconduct by Category
Corporations harm people every day — from wage theft to pollution. Learn more by exploring key areas of injustice.
- 💀 Product Safety Violations — When companies risk lives for profit.
- 🌿 Environmental Violations — Pollution, ecological collapse, and unchecked greed.
- 💼 Labor Exploitation — Wage theft, worker abuse, and unsafe conditions.
- 🛡️ Data Breaches & Privacy Abuses — Misuse and mishandling of personal information.
- 💵 Financial Fraud & Corruption — Lies, scams, and executive impunity.
