Grubhub has agreed to pay $25 million to settle a lawsuit with the Federal Trade Commission and Illinois Attorney General Kwame Raoul. The lawsuit accused Grubhub of engaging in unlawful practices, such as misleading customers about delivery costs, deceiving drivers about potential earnings, and listing restaurants on its platform without permission.

The agencies claim that Grubhub obscured the true cost of delivery services, resulting in final prices that were often double the original advertised price due to hidden fees. Additionally, they allege that Grubhub’s ads inflated hourly pay rates for drivers, painting a misleading picture of potential earnings.

Furthermore, Grubhub had as many as 325,000 unaffiliated restaurants on its platform, causing harm to both these restaurants and customers according to the FTC. As part of the settlement, Grubhub is required to cease these practices. Grubhub stated that they deny the allegations made by the FTC, but believe that settling the matter is in the company’s best interest to move forward.

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