Uber has filed a lawsuit in California against its competitor DoorDash, accusing the food delivery service of engaging in anticompetitive behavior. Uber claims that DoorDash coerces restaurants into exclusive partnerships by threatening penalties or lowering their rankings on the DoorDash app. This alleged conduct has reportedly cost Uber millions in lost revenue. Uber seeks unspecified damages and a court order to force DoorDash to change its business practices.
Sarfraz Maredia, head of Uber Eats Americas, stated that restaurants nationwide have complained about DoorDash's tactics, which leave them with no choice but to comply or face consequences. DoorDash has dismissed the lawsuit as baseless, asserting that Uber's claims lack factual support and that Uber fails to offer a better alternative for merchants, consumers, or couriers.
Uber also alleges that a major restaurant company abruptly withdrew from their platform due to DoorDash's punitive threats to increase commission rates. Additionally, Uber accuses DoorDash of imposing "punitive fees" that could raise costs by 10% to 30% if customers choose to use both services. DoorDash has denied these allegations.
This lawsuit marks a new battleground in the intensifying competition between the two companies in the rapidly growing food delivery market. Both companies derive significant revenue from restaurant services, including delivery fees and advertising on their platforms. Uber recently reported its second consecutive year of profitability, while DoorDash announced its second profitable quarter since going public in 2020.
According to Earnest Analytics, DoorDash holds a 62.7% share of the U.S. delivery market, followed by Uber Eats at 25% and Grubhub at 6.2%. A report by Intouch Insight highlights DoorDash's superior customer satisfaction, promotional offerings, and delivery accuracy compared to its main competitors.
