Uber's suit against DoorDash could reshape food delivery industry

Uber's litigation against food delivery service competitor DoorDash could "interrupt the status quo" of the industry, according to a business attorney, as the outcome may shake up competition practices. Another legal expert suggested Uber may not have a strong case.

Uber accused DoorDash of tortious interference, claiming in a lawsuit filed Friday that DoorDash forces restaurants to work exclusively with it by threatening penalties such as raising fees or demoting restaurants on the DoorDash app if they use other services. This interfered with Uber's existing contracts by causing restaurants to terminate agreements with them, the complaint claims.

Darrell P. White, business litigation expert and attorney at Irvine-based Kimura London & White LLP, said in an interview Tuesday, "This litigation could greatly impact a number of industries, including restaurant and hospitality. There's a real possibility that this case could interrupt the status quo and open up competition for fees - which may help the consumer in the end.

White noted that the plaintiff focused on the impact on restauranteurs and consumers, "adding salacious accusations such as 'restaurant-customers feeling like they have a "gun to their head."'

"They did not include any eye-popping figure, when everyone reading this (complaint) understands the damages could be just that," he wrote in an email.

"First-party and third-party delivery services impact clients in the restaurant industry, especially franchises. So, framing the impact on "end-customers" (i.e. consumers), is smart," White said.

Uber claims DoorDash's conduct constitutes unfair business practices and unfair competition, causing Uber to lose millions of dollars in revenue. Uber Technologies, Inc. v DoorDash, Inc., CGC-25-622395 (S. F. Super. Ct., filed Feb. 14, 2025)

According to data firm Earnest Analytics, as of November 2024, DoorDash led the national delivery market with a share of 62.7%, followed by Uber with 25% and Grubhub with 6.2%.

The complaint claims DoorDash leverages its leading position in the market to "coerce" restaurants that depend on the app for deliveries into exclusive arrangements and enables DoorDash to threaten penalties if restaurants do not comply with its demands. The complaint claims some punitive charges include fees that are between 10% and 30% for orders.

Eric Goldman, associate dean for research and professor at Santa Clara University School of Law, gave a different view in an email: "It is disorienting to see Uber complain about another company's business practices given the many times Uber has engaged in terrible business practices and to complain about being bullied by another company when Uber has twice the market cap of the purported bully.

"The complaint flirts with antitrust issues throughout but doesn't allege any antitrust violations. It only says DoorDash 'violates the policy and spirit of antitrust law.'

"The complaint suggests that DoorDash is using its strong position in one market to obtain unfair advantages in another market by tying together its offerings. A tying arrangement is a standard basis for antitrust claims, but none were brought," Goldman wrote.

"There are clearly some bruised feelings at Uber about losing deals it felt like it was entitled to get."

Goldman added that the high-stakes industry sees competitors "tweak on each other" to gain any edge on their rivals, including litigation.

Lead attorney for Uber, Kathleen R. Hartnett of Cooley LLP, based in San Francisco, was approached for comment but the firm instructed requests for comment be sent to Uber's press team.

Sarfraz Maredia, head of Uber's Delivery business for the Americas, said: "We've increasingly heard complaints from restaurants that DoorDash's tactics are limiting that freedom and punishing them for seeking better options. We hope this filing puts an end to those unfair practices so that restaurants can choose what's best for them without fear of penalty or retribution."

"Uber's case has no merit," DoorDash said in a Wall Street Journal article. "Their claims are unfounded and based on their inability to offer merchants, consumers, or couriers a quality alternative."