In a significant development, DoorDash, Grubhub, and Uber Eats have reached a settlement with New York City officials regarding a case challenging the city’s legislation that capped fees charged by third-party food delivery services to local restaurants. This settlement comes after years of legal proceedings, culminating in a joint stipulation and order signed by U.S. District Judge Gregory H. Woods on April 29, 2025. The order stays the case pending final resolution.
Under the terms of the settlement, all deadlines in the case are temporarily suspended, and the parties have agreed to work towards a final resolution, including the potential dismissal of the action. The settlement resolves not only this case but also other related litigation pending in the Supreme Court of the State of New York.
The legal dispute began in 2021, when DoorDash, Grubhub, and Uber Eats filed suit against the city over a law that imposed a cap on the commissions these platforms could charge restaurants. The fee cap was initially introduced in response to the economic hardships faced by local restaurants during the COVID-19 pandemic. Although the law was intended as a temporary measure, it was made permanent in 2022.
The delivery apps argued that the fee cap was an unconstitutional “government overreach,” violating their contractual rights with restaurants. They sought both monetary damages and a court order to invalidate the legislation. In response, the city argued that the fee caps were necessary to ensure the survival of local restaurants and did not unfairly harm the delivery platforms.
Judge Woods’ order marks a turning point in the case, which has seen multiple legal challenges from DoorDash and its competitors, including a series of similar lawsuits filed against other cities and states. The settlement now paves the way for a more collaborative future between delivery services and New York City officials.
“We have always believed that collaborative solutions, not courtrooms, are the best path forward,” said a spokesperson for DoorDash. “We are glad to have reached a settlement with the city, taking an important step toward creating a more sustainable future for local restaurants and ensuring fairness for delivery workers across New York City.”
Grubhub, its co-defendants, and the City of New York were represented by legal teams from Gibson Dunn & Crutcher LLP and the New York City Law Department, respectively.
The case, DoorDash Inc. et al. v. City of New York, is being heard in the U.S. District Court for the Southern District of New York, under case number 1:21-cv-07564.
