DoorDash Sues NYC Over Data-Sharing Law

The delivery company is fighting a requirement to share customer data with restaurants.

September 17, 2021

DoorDash Delivery Man on Moped

NEW YORK—DoorDash has filed a lawsuit against the city of New York over a law that would require it to share customer information with restaurants, such as a customer’s name, phone number, email and delivery address, in order for restaurants to complete a customer’s order, reports the Wall Street Journal.

The law, which goes into effect in December, allows restaurants to use DoorDash’s trade secrets in order to compete with the delivery company, claims DoorDash. The delivery company says it would have to “modify its services in a way that will result in fewer resources being offered to restaurants, fewer earnings opportunities for delivery couriers and fewer choices for New York City customers,” according to the lawsuit.

The lawsuit also states that restaurants have no restrictions on what they can do with the information, and there aren’t requirements on how to store the data and keep the private information safe.

The issue of access to customer data when restaurants and convenience stores use third-party delivery services like DoorDash has grown contentious. Businesses that rely on the third-party model want to ensure the best customer service, reduce fees associated with the partnerships and access to customer data to help with marketing and loyalty programs. NACS Magazine covered the tradeoffs between using third-party delivery services and using store-owned services in “Delivery Dilemma” in the September 2021 issue.

Last week, DoorDash joined Uber and Grubhub in another lawsuit against New York City over a newly passed bill that permanently instates emergency delivery fee caps that were imposed during the pandemic. The bill creates a 15% fee cap for delivery services and a 5% cap for non-delivery services, and the delivery companies claim the caps are arbitrary. A similar lawsuit was filed by DoorDash and Grubhub in San Francisco after the city implemented a permanent 15% delivery fee cap.

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