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The Courts Businesses

Grubhub Hit With Lawsuit for Listing Restaurants Without Permission (eater.com) 154

Two restaurants have initiated a potential class-action lawsuit against GrubHub for allegedly listing 150,000 restaurants to its site without the businesses' permission. From a report: The Farmer's Wife in Sebastopol, California and Antonia's Restaurant in Hillsborough, NC filed the suit with Gibbs Law Group, accusing Grubhub of adding their restaurants to its site despite not entering into a partnership, which causes "significant damage to their hard-earned reputations, loss of control over their customers' dining experiences, loss of control over their online presence, and reduced consumer demand for their services." Grubhub has explicitly made this false partnership part of their business strategy. Last October, CEO Matt Maloney said the company would be piloting a new initiative of adding more restaurants to its searchable database without entering into an official partnership with them, so customers would believe they had more delivery options with Grubhub, and wouldn't switch to competitors.

It works like this: if you happened to order from a non-partnered restaurant, "the order doesn't go directly to the restaurant," says the lawsuit. "It goes instead to a Grubhub driver, who must first figure out how to contact the restaurant and place the order. Sometimes it's possible to place orders with the restaurant by phone, but other times the restaurant will only accept orders in person. The extra steps often lead to mistakes in customers' orders and often the restaurant won't receive the order at all." Grubhub also wouldn't warn restaurants before they were listed, which led to restaurants suddenly being inundated with Grubhub orders they never expected. Often, Grubhub would list outdated menus with the wrong prices, or include restaurants that don't even offer take-out, leading to canceled orders. The lawsuit includes screenshots from the pages Grubhub created for The Farmer's Wife and Antonia's, using their respective names and logos. The Farmer's Wife alleges the pages are "inaccurate and suggests that The Farmer's Wife is offering to make food that it does not actually make and has never made," which the lawsuit claims hurts the restaurant's reputation, and leads customers to become frustrated with service the restaurant never agreed to provide in the first place. And both restaurants say the language Grubhub uses suggests a partnership that doesn't exist, and in Antonia's case, was actively declined when Grubhub approached them.
Further reading: Even If You're Trying To Avoid Grubhub By Calling Your Favorite Restaurant Directly, Grubhub Could Still Be Charging It A Fee; Meal-Delivery Company GrubHub is Buying Thousands of Restaurant Web Addresses, Preventing Mom and Pop From Owning Their Slice of Internet.
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Grubhub Hit With Lawsuit for Listing Restaurants Without Permission

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  • Before Slashdot (Score:5, Insightful)

    by ArchieBunker ( 132337 ) on Thursday October 29, 2020 @01:59PM (#60662924)

    Gets their panties in a bunch over this please read the article first. Some of these are higher end restaurants that don't even offer takeout. So someone places an order and their order gets declined or its no longer on the menu. The angry customer leaves bad reviews for something the restaurant didn't even know was happening or had any control over.

    • by Anonymous Coward

      Hmm, I was expecting the opposite. That folks here would call out Grubhub for the asshole scumbags that they are for assuming they're something special/important and can dictate terms to anyone they want.

      • Re:Before Slashdot (Score:5, Informative)

        by roc97007 ( 608802 ) on Thursday October 29, 2020 @03:03PM (#60663236) Journal

        Hmm, I was expecting the opposite. That folks here would call out Grubhub for the asshole scumbags that they are for assuming they're something special/important and can dictate terms to anyone they want.

        Knowledgeable people, most geeks, and people familiar with the process would most probably see who was really at fault. Ma and Pa Kettle would most likely blame the restaurant.

        For instance, my wife is knowledgeable enough to do online banking and work with the various online applications to do with her job. She happens to be deathly afraid of COVID and has been working from home since the outbreak.

        She wanted indian food. She knew the names of several restaurants in the area, and wanted to have food delivered from one of them.

        She got tangled up online, had a lot of canceled orders and it was just a mess.

        She asked me to look at it. I found that every restaurant on which I did a google search gave me as the first result, something that looked like the restaurant but was really a link to grubhub. The issues she was having just as in TFA, were that grubhub was offering services that the restaurant didn't provide, and in some cases menus that were no longer current.

        It was a little challenging to find the restaurant's own native website. I don't know if this is an artifact of google or some arrangement between grubhub and google or some kind of perfidy that grubhub was doing, but it seemed like everything I clicked ultimately went to grubhub.

        Finally I found a restaurant on wife's list that (a) offered takeout, and (b) for which I could find the actual native website, we made our order, and I went and got it.

        We've done this a few times since then, with similar issues, although negotiation was easier after I knew what to look for. The impression I've gotten these last few months is that some restaurants tolerate grubhub, and others deeply resent it. That being the case, I'm not surprised at all that lawsuits eventually occurred.

        But circling back to your point, you and I can see through this and figure out who the real culprit is. Regular non-geeks, probably not. In my example, wife and I have been together something like 30 years, and I've been a geek all my life, and was an early adopter of the internet (military contractor) long before regular people knew what it was. Yet, my wife, who's been with me since I was pounding out code on a VT100 attached to a 300 baud modem, hasn't absorbed enough computer lore in that time to see through Grubhub's sketchy business model.

        • Re:Before Slashdot (Score:5, Insightful)

          by BrainJunkie ( 6219718 ) on Thursday October 29, 2020 @03:32PM (#60663412)

          It was a little challenging to find the restaurant's own native website. I don't know if this is an artifact of google or some arrangement between grubhub and google or some kind of perfidy that grubhub was doing

          Grubhub spends far more on SEO than any neighborhood Indian restaurant does or can, because of the scale at which they operate. That and because of the way Google is doing ads these days large operators like Grubhub can buy a big chunk of the first page of results for a lot of the popular terms for finding restaurants near you.

          • It was a little challenging to find the restaurant's own native website. I don't know if this is an artifact of google or some arrangement between grubhub and google or some kind of perfidy that grubhub was doing

            Grubhub spends far more on SEO than any neighborhood Indian restaurant does or can, because of the scale at which they operate. That and because of the way Google is doing ads these days large operators like Grubhub can buy a big chunk of the first page of results for a lot of the popular terms for finding restaurants near you.

            That must be it. Even for a very specific restaurant, it seemed like the entire first page of results all went to Grubhub.

            • It was a little challenging to find the restaurant's own native website. I don't know if this is an artifact of google or some arrangement between grubhub and google or some kind of perfidy that grubhub was doing

              Grubhub spends far more on SEO than any neighborhood Indian restaurant does or can, because of the scale at which they operate. That and because of the way Google is doing ads these days large operators like Grubhub can buy a big chunk of the first page of results for a lot of the popular terms for finding restaurants near you.

              That must be it. Even for a very specific restaurant, it seemed like the entire first page of results all went to Grubhub.

              ...or yelp, and then from there to Grubhub.

          • Re:Before Slashdot (Score:5, Insightful)

            by larryjoe ( 135075 ) on Thursday October 29, 2020 @05:24PM (#60663818)

            It was a little challenging to find the restaurant's own native website. I don't know if this is an artifact of google or some arrangement between grubhub and google or some kind of perfidy that grubhub was doing

            Grubhub spends far more on SEO than any neighborhood Indian restaurant does or can, because of the scale at which they operate. That and because of the way Google is doing ads these days large operators like Grubhub can buy a big chunk of the first page of results for a lot of the popular terms for finding restaurants near you.

            Isn't this just one of the unspoken truths about Google's core business model? Paid search is good for the ad buyer and good for Google. Google's claim is that paid search is also good for the consumer because Google is a good custodian of permitting only "good" ads. We've seen over and over again that the welfare of non-paying consumers will always be a lesser consideration compared to paying ad buyers. This situation will happen over and over again because that's what the economics of the business model dictate. Google should not be blamed for chasing dollars because all companies do that, but they should be blamed for the false propaganda that it is acting in the interests of the consumer.

          • Re:Before Slashdot (Score:4, Insightful)

            by WierdUncle ( 6807634 ) on Thursday October 29, 2020 @07:33PM (#60664164)

            Grubhub spends far more on SEO than any neighborhood Indian restaurant does or can, because of the scale at which they operate.

            This does seem to be a business model that allows Grubhub to be parasitic on genuine businesses. There is nothing wrong with offering a listing service for small businesses, such as the old Yellow Pages, but Grubhub is not doing that, as far as I can see.

            The trouble I see is that a bit of negative publicity, due to a Grubhub mistake, could severely damage a restaurant's reputation and future custom, and the restaurant could do nothing about it until it is too late. You do not get that sort of thing from a small ad in the Yellow Pages.

        • by spitzak ( 4019 )

          I have found that searching for the restaurant on Google maps and then clicking on the Website link in the information about the restaurant will usually work. You can't click on the "Menu" or "Reserve a Table" as those go to grubhub and opentable, possibly without the restaurant's permission.

        • An issue the place I work for sometimes has... Rather than walk into the restaurant to pick up the order the delivery person will use the drive-up window lane. So not only does it take longer for them to get and deliver the order, it makes our other customers have to wait longer to place theirs.

          Then when I'm elsewhere in town on my day off I'll hear, "By the time I got the stuff it was...cold / the ice cream had melted / the drinks were watered down."

          I assure them that's not our fault. But when I've mention

    • by nospam007 ( 722110 ) * on Thursday October 29, 2020 @02:21PM (#60663028)

      by ArchieBunker ( 132337 )

      "Gets their panties in a bunch over this please read the article first."

      Apostate!
      You read TFA?

      With a low 6 figure uid?
      Wait 'til your dad finds out you're using his account!

    • by DontBeAMoran ( 4843879 ) on Thursday October 29, 2020 @02:36PM (#60663088)

      HE READ THE ARTICLE! GET HIM!

    • Re:Before Slashdot (Score:5, Informative)

      by Inglix the Mad ( 576601 ) on Thursday October 29, 2020 @02:36PM (#60663092)
      We had this happen with a local, not even high-end, sushi joint. They allowed take-out if you came in and ordered, but you had to come in because it was also a sit-down joint so they could give accurate times for completion. Unfortunately they had a lot of seasonal items, and of course GrubHub never pays attention so they apparently kept getting orders for things that haven't been on the menu in months. After posting on their FaceBook page, they didn't have a regular webpage, they started getting questions about why they weren't updating the menu on a different page. The sushi joint was rightfully angry, and they kept telling people that wasn't their page. They actually posted a sign on their main entrance specifically saying they didn't sign up to deliver with GrubHub, and that the menu wasn't correct. This actually got so bad they rounded up about six other local places that were in the same situation and all of them threatened to get a single lawyer and file a class action lawsuit.

      A rare instance where they won without a lawyer, GrubHub shut down the deceptive pages. When the pandemic hit, and everyone was pretty much forced to do takeout, guess which delivery option wasn't chosen? No GrubHub delivery option for those seven places.
      • A rare instance where they won without a lawyer, GrubHub shut down the deceptive pages.

        This is a pretty open and shut case of trademark infringement - GrubHub is using these restaurants' name in their publications (website) without permission.

        The problem is that GrubHub's strategy appears to be to infringe everyone's trademarks, and relent when a restaurant finds out and complains about it. Meanwhile continuing to infringe the trademarks of the restaurants which don't find out about it. The courts need

        • by sjames ( 1099 )

          I am often skeptical of trademark claims, but in this case, GrubHub is very definitely creating confusion and it's quite clear that it is doing so willfully. This is exactly the situation where my sympathies turn to the trademark holder.

        • That is pretty negligent. Tell them to go to the local web shop, and for $1000 or so they can get a reasonable site set up and managed, with no technical knowledge of their own. Claim the address on Google (the web shop will show them how) and they will get good ranking on Google.

          There comes a point where you need basic business acumen. There is probably web shop within a a mile of where they operate from that would be happy to set them up.

          • by dryeo ( 100693 )

            There's a pandemic on, many restaurants don't have a spare thousand dollars to spend. Even before the pandemic, many a small restaurant was barely paying the owner a wage.

        • by dryeo ( 100693 )

          How many small restaurants trademark their name?
          Personally, I think this shit should be criminally charged as fraud or such, or identity theft.

        • Re: (Score:2, Interesting)

          by Anonymous Coward

          This is a pretty open and shut case of trademark infringement - GrubHub is using these restaurants' name in their publications (website) without permission.

          That isn't at all how trademarks work, and quite rightly you should have noticed that there's no trademark related claims in the lawsuit.

          A trademark protects something which always belongs to only you - your company image.

          No, they really don't. A trade mark protects your chosen mark within a trade. Not your image or reputation.
          That's why the lawsuit is actually claiming damages based on their reputation. That is a crime too, and one that can easily be shown grubhub is doing.

          We are allowed to use a companies mark *so long as it is to represent the mark*, and so long as it is specifically

    • Not just confusing eat-in with takeout, but actually adding dishes the restaurant doesn't make to the menus Grubhub advertise on behalf of their victims.

      Grubhub even added takeout Vietnamese food to the menu of a Michenlin-starred Thai restaurant in San Francisco. [sfchronicle.com]
    • You are completely wrong on the pulse of Slashdot, I for one hope places like grubhub get sued into oblivion along with all the other self serving middlemen type businesses that have popped up lately.
      • by dryeo ( 100693 )

        Should be a criminal charge resulting in the business being suspended for a few years. If I impersonated someone else, put in a change of address or did a sim swap thingy to head off there contacts, I expect I'd end up in jail for a while.

  • by Archtech ( 159117 ) on Thursday October 29, 2020 @02:00PM (#60662928)

    The issue is whether Grubhub should be allowed to become a business intermediary between a restaurant and its potential customers, without seeking that restaurant's consent. That certainly doesn't look fair to me.

    If it just wanted to list restaurants, there doesn't seem to be any reason why it shouldn't.

    But obviously Grubhub is in it for the money, which presumably must come from either the customer or the restaurant - or both.

    • Re: (Score:2, Redundant)

      by Luthair ( 847766 )
      If any of the restaurants have trademarked their names Grubhub is clearly doing business under the trademarked name. If they framed the situation properly maybe they could get away with it but....
      • by iggymanz ( 596061 ) on Thursday October 29, 2020 @02:15PM (#60662994)

        No! Grubhub is *taking orders* and doing delivery, inserting itself as middleman *without permission*, even to restaurants that don't do carry-out. Can you see the problem yet?

        • by Junta ( 36770 )

          I think he is agreeing that it's a problem. That grubhub is violating Trademark by claiming to represent that brand, when they really have no affiliation. So among other things at *least* it would seem to be going against the trademarks of the restaurant owner.

        • by Ed Tice ( 3732157 ) on Thursday October 29, 2020 @03:11PM (#60663272)
          No I don't see that as a problem. One time I was half drunk and didn't feel like leaving my dorm room but was out of beer. So I told my friend that I would pay for the next case of beer if he walked down to the corner liquor store. And he agreed So now he was an intermediary without consent of that business. The issue isn't becoming an intermediary its the creating of the market confusion where the customers don't realize they are dealing with the intermediary. Heck I could have made a business out of gathering up 2am Taco Bell orders for my dorm and making one trip. Nobody would have objected. Its the lack of transparency.
        • by Sloppy ( 14984 )

          It really depends on how they do it.

          As you know, iggymanz, many people are big fans of the countersink flanges that you manufacture. You're famous, right up there with the legendary Wilson. But with your fame came a secondary market, due to people selling their used countersink flanges, having to deal with your rather limited shipping capabilities (no personal criticism intended), etc.

          As it happens, last year I started having hydraulic torque leak at unacceptably-low RQMs, and I contacted another poster in

          • by dryeo ( 100693 )

            This is closer to you claiming to be an authorized Iggymanz (TM) countersink flanges reseller.

      • I am a lawyer, but this is not legal advice. You don't get any of that unless you pay my retainer.

        Note that simply by using a name in trade, an enforceable "common law trademark" is created. Not nationally, but in the particular market area.

        hawk, esq.

    • by gmack ( 197796 ) <gmackNO@SPAMinnerfire.net> on Thursday October 29, 2020 @02:10PM (#60662970) Homepage Journal

      The part that you are missing is that Grubhub then takes orders for that restaurant but doesn't tell the restaurant what is going on. They have had delivery drivers show up, take a table and then ask for the food in a "to go" box. How is the restaurant supposed to guarantee the quality of the food if it has been placed on a table, taken back to the kitchen before being put in a box?

      To top it off, when the food arrives cold or badly packed, it is the restaurant that ends up with the bad ratings and damaged reputation.

      The restaurant also takes the heat for no longer on the menu items that then can't be delivered to the customer.

      • I honestly do not understand how this could possibly be legal from a food safety point of view.
    • by Sloppy ( 14984 ) on Thursday October 29, 2020 @02:26PM (#60663062) Homepage Journal

      The issue is whether Grubhub should be allowed to become a business intermediary between a restaurant and its potential customers, without seeking that restaurant's consent. That certainly doesn't look fair to me.

      I'd further narrow it down to that combined with how it's represented to the end customer. It should be ok for grubhub to resell food without the permission of the restaurant. First sale doctrine, after all. But they shouldn't be able to do it in the guise of being a partner rather that a middleman.

      If customers are getting confused and blaming restaurants, then I think that would support restaurants' claims that grubhub is violating their trademarks. OTOH if grubhub presents the transaction such that customers understand who is really responsible for what, then no harm done.

      I'm totally cool with grubhub being aggressive, just don't cross the line into dishonesty. Isn't that what we all want?

    • It's not necessarily illegal (or even wrong) to become an intermediary without somebody's consent. What is illegal (and wrong) is being deceptive where customers don't realize that they are dealing with an intermediary which is what GrubHub is doing and for which they should be severely penalized.
    • by AuMatar ( 183847 )

      So you're saying it should be illegal to buy something from a store, turn around, and sell it to someone else? Because that's all Grubhub is doing. There's nothing wrong with that.

      • No. We are saying it should illegal to LIE about your service. They are CLAIMING to be the restauarant, not grubhead and then instead act as an intermediadry.

        No one is claiming Grubhub can not run an "order from anywhere and we will try to go there, buy it, and return it to you" business.

        We are saying stop lying and claiming to have an agreement with the organization and pretending you are directly sending the order to the restaurant.

    • Bingo!

    • It can be worse. Last year an expensive San Francisco Chinese restaurant took legal action against either GrubHub or DoorDash (Can't recall which) for offering their menu even though they do not sell take-out at all. It was believed that they were getting food from another source and selling it as being from the high-end place including items the real restaurant did not have on their menu. They started getting complaints from customers that the food was very different and not good when ordered from the deli
  • But, but, but!!! (Score:2, Insightful)

    by Anonymous Coward

    ... were just the yellow pages, but with a driver.

    If that were the case you would have entered into a relationship with Grubhub just as you would have with the Yellow Pages. People forget you had to pay to get a listing. Clicking on the Grubhub link would put you directly in touch with the restaurant - not some third party intermediary that has little to no clue as to what's going on.

    Hopefully this ends poorly for Grubhub.

  • Why don't the restaurants include a card that informs the customer about their own on-line ordering, and warns them about unauthorized middlemen and the risks of using such.

    • by ugen ( 93902 )

      How would the restaurant know when to include such a card (since the Grubhub driver is pretending to be their customer and not telling them the order is for a 3rd party)? Or should they include a card like that in every "to go" order?

    • by nagora ( 177841 )

      Why don't the restaurants include a card that informs the customer about their own on-line ordering, and warns them about unauthorized middlemen and the risks of using such.

      What card? Are you suggesting they post these out to everyone in the area? The story says that some places are getting a lot more orders than they used to - more than they can cope with, so a lot of that is people that have never been over the door before.

  • Not new (Score:5, Insightful)

    by ledow ( 319597 ) on Thursday October 29, 2020 @02:42PM (#60663116) Homepage

    I work for schools.
    One day, I took a call from a parent complaining like mad that their child had missed school because she got the day we reopened for term wrong. She said she'd looked up the dates and that we weren't supposed to be back for another day.

    I asked her where that was, so that I could find it and correct it, expecting it to be on the school website.

    Nope. It was something along the lines of "school opening times dot com". Some completely unrelated third-party. But obviously they were spamming all the names of all the registered schools in the country into their pages.

    So whenever you search for the school name and opening times or term dates, you'll get their page instead.

    I wouldn't mind, but their dates weren't even vaguely correct, they obviously just put the same dates for all schools on every page, make the page appear to be something to do with our school (using the name, etc in the text) and take ad revenue and clicks because of it.

    I had to tell the parent, firstly, don't just google for that stuff, because there's no guarantee that you'll end up on a reliable site at all. Secondly, we ONLY have control over our domain name and website... use that and ignore anything else. And thirdly, don't shout at us for it being "wrong" on a website that we didn't even know existed, let alone have control of.

    We complained to the website in question, they just wanted to sign us up so they could "get the right dates" by us paying them money and giving them information that's already clearly on our website anyway. We demanded they removed all reference to our school name. And it was only because our school name was very unique and not something that you could just claim was for another school, they reluctantly agreed but still keep trying to sell us a page on their website to host the right dates "alongside other schools so parents can find it easily". I told them where to go, and the penalties in law for passing off as another company name (and, yes, we were a registered company and registered charity).

    But such places are rife, if you go looking for them. It just so happened this one came above us in Google for whatever the parent had searched for, and they were stupid enough to believe them over the actual school website just a few entries below it.

  • In some states they must take down ones for people found not guilty for free!

  • Comment removed based on user account deletion
  • Boycott Grubhub, Doordash, etc. There's plenty of alternatives.

    If you don't like using the phone for ordering, some of the point-of-sale companies are helping restaurants put their menu and ordering system online. One of my go-to places is encouraging people to use their Square page (as in the payment processor), since they don't charge the restaurant a 30% fee and the tip actually goes to the restaurant rather than a driver or company. Clover is also doing something similar, as far as I can tell.

    There's al

    • The best alternative, as always, is to learn to cook your own food. If you don't have time for that, maybe reflect on why your life is that way.
      • Hard to cook when you might be on vacation and your hotel room doesn't have any kind of a kitchen. Otherwise, yes that's true.

  • by azcoyote ( 1101073 ) on Friday October 30, 2020 @08:15AM (#60665534)

    https://themargins.substack.com/p/doordash-and-pizza-arbitrage [substack.com]

    This pizzeria owner found that DoorDash had not only tried to take over delivery for his restaurant without permission, but they misrepresented the price of his pizza. The good news: he was actually able to make money off of their greedy stupidity.

Keep up the good work! But please don't ask me to help.

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