Food delivery company DoorDash is facing a substantial $1 billion class action lawsuit from a customer who alleges that the company discriminates against iPhone users by charging them higher fees compared to Android users. Kameron Masters filed the lawsuit in the Northern District of California, claiming that DoorDash consistently imposes additional charges known as “expanded range delivery” fees on iPhone users for orders placed outside the normal delivery area.
The lawsuit argues that DoorDash disproportionately targets iPhone users with these charges and charges them more for deliveries, likely due to studies showing that iPhone users have higher incomes. The suit describes these practices as nothing more than opportunistic money-making tactics. According to the complaint, DoorDash’s “express delivery” fee does not result in faster order arrival, and other fees, such as “city” or regulatory response fees, create a false impression that they are imposed by local governments.
Masters’ lawsuit alleges that DoorDash’s pricing structure and app algorithms generate varying fees for consumers without providing a clear explanation for the discrepancies. A similar class-action lawsuit was filed in the U.S. District Court of Maryland on May 5, further highlighting the growing legal challenges facing DoorDash.
DoorDash, however, denies any wrongdoing and dismisses the new lawsuit as a baseless “copy-and-paste job.” The company has paid a $2.5 million settlement in a previous lawsuit in 2019, which accused DoorDash of misleading customers about how it distributed tips to drivers between 2017 and 2019. Additionally, the firm settled a lawsuit in November 2020 that alleged it redirected customer tips toward drivers’ base pay without full disclosure.
The current lawsuit seeks to represent all individuals who have paid delivery fees, hidden marketing fees, or hidden commissions to DoorDash. Masters aims to have the case heard by a jury, stating that DoorDash deceives unsuspecting consumers into paying more while failing to provide the promised services. The suit also argues that DoorDash’s pricing practices result in the annual deprivation of millions, if not billions, of dollars from consumers.
An analogy provided in the lawsuit draws attention to the absurdity of the situation, comparing it to a scenario where the price of eggs in a grocery store changes each time a different person examines them, or worse, being charged more for eggs based on the customer’s smartphone or appearance.
DoorDash’s spokesperson vehemently denies the allegations, stating that the lawsuit is riddled with false and misleading claims. The company insists that it does not charge higher fees based on the type of phone a customer uses and considers any assertion to the contrary to be entirely unfounded.
As this legal battle unfolds, DoorDash faces mounting scrutiny over its pricing practices and allegations of deceptive behavior. The outcome of this class action lawsuit will likely have significant implications for the company’s future operations and relationships with its customer base.
