In the case, which was submitted to the California Superior Court, Uber claims that its main competitor intimidated eateries into exclusively partnering with DoorDash. According to Uber, DoorDash, which dominates the U.S. meal delivery market, threatens restaurants with fines of millions of dollars or with having their listings removed or demoted on the DoorDash app.
In particular, Uber asserts that DoorDash coerces eateries into entering into exclusive or nearly exclusive contracts for first-party delivery services, which means DoorDash is adamant about only accepting orders placed on eateries’ own websites.
The most well-known features of DoorDash and Uber Eats are their apps, which link eateries, customers, and gig economy workers. Customers use the applications to locate and place restaurant orders for items like pad thai, pizza, and egg rolls. The food is subsequently picked up and delivered to the customer by a gig economy worker.
However, the two businesses now face competition from their own white-label delivery services, DoorDash Drive on-Demand and Uber Direct, both of which debuted in 2020. While Uber and DoorDash handle the couriers in the background, these services are less expensive for restaurants and let customers place orders straight from their apps and websites.
Uber contends in its lawsuit that DoorDash utilized anticompetitive tactics to gain market share and that DoorDash manages first-party deliveries for over 90% of the biggest corporate eateries in America.
In an emailed statement, Sarfraz Maredia, Uber’s head of delivery for the Americas, said
“More than 1 million merchants partner with Uber Eats because we’ve helped them to reach more customers and provided them the freedom to decide how they want to grow their businesses with delivery,”
“We’ve increasingly heard complaints from restaurants that DoorDash’s tactics are limiting that freedom and punishing them for seeking better options. We hope this filing puts an end to those unfair practices so that restaurants can choose what’s best for them without fear of penalty or retribution.”
An unidentified “significant restaurant company” informed Uber that it would not proceed with a long-planned rollout of Uber Direct across multiple of its restaurant brands, according to one example from the lawsuit. This is because, according to Uber, DoorDash threatened to raise the prices it charges the restaurant business to utilize its third-party delivery services if it kept using Uber Direct.
Several customers have told Uber that they feel “like they have a ‘gun to their head,’ that DoorDash is a monopolist,’ and that they are being bullied by DoorDash,” according to the business, which claims that this was not an isolated incident.
Uber has asked for a jury trial; in this case, the corporation did not state how much it was liable for. However, Uber asserts that these anti-competitive actions have hindered the expansion of Uber Direct and lost the business “millions of dollars in revenue.”
