Grubhub, DoorDash Challenge San Francisco’s Delivery Fee Cap (1)

Grubhub Inc. and DoorDash Inc. say San Francisco imposes “unnecessary” and “unconstitutional” price controls on food delivery through third-party platforms, according to their suit in the Northern District of California.

The city and county of San Francisco enacted an ordinance that prevents restaurants and third-party platforms from negotiating the price platforms restaurants charge for their services, according to the complaint filed in the U.S. District Court for the Northern District of California. The ordinance “permanently dictates” the economic terms for a dynamic industry, the companies alleges.

“Left unchecked, the ordinance’s interference with voluntary, private contracts between businesses would set a ...