DoorDash is looking to dismiss a lawsuit by Uber accusing it of unfair business practices, referring to the allegations as “cynical and a calculated scare tactic.”
Uber claims DoorDash uses coercive tactics to force restaurants into exclusive or near-exclusive contracts.
More specifically, the lawsuit alleges DoorDash has threatened restaurants with higher fees, reduced search rankings, and even removal from its app unless they agree to use DoorDash’s first-party delivery service, Drive On-Demand, instead of competitors like Uber Direct. The lawsuit also alleges some restaurant executives have privately expressed frustration with DoorDash’s tactics but feel they have no alternative due to DoorDash’s market power.
DoorDash vehemently denied the accusations and referred to Uber as a “frustrated competitor seeking to avoid real competition.”
“It’s disappointing behavior from a company once known for competing on the merits of its products and innovation,” DoorDash said in response to the lawsuit. ” … The fact is that merchants have the choice of who they work with, and they choose DoorDash because it works for them and helps them deliver a better guest experience.”
The dispute centers on whether DoorDash’s exclusive and preferred partnership agreements violate state competition laws. DoorDash argues that such agreements are standard across industries, often pro-competitive, and similar to Uber’s own contract terms.
DoorDash argues the lawsuit is more about Uber avoiding competition than promoting it. It also accuses Uber of trying to deter merchants from working with DoorDash and “using legal threats to win business it hasn’t earned.”
“Uber’s two-faced approach is striking. To investors and the media, they boast of their scope and size,” DoorDash said. “To the court, they suddenly play the victim that needs protection. Uber can’t have it both ways. We will vigorously defend ourselves against Uber’s meritless lawsuit while continuing to focus on what matters most: helping merchants grow and serve their customers in an increasingly competitive landscape.”
A hearing on DoorDash’s motion to dismiss is scheduled for July 11.
In response, Uber stood by its lawsuit and allegations toward DoorDash.
“It seems like the team at DoorDash is having a hard time understanding the content of our complaint. When restaurants are forced to choose between unfair terms or retaliation, that’s not competition — it’s coercion. Uber will continue to stand up for merchants and for a level playing field. We look forward to presenting the facts in court,” an Uber spokesperson said in a statement.
