Latest news with #drippricing
National Post
13-06-2025
- Business
- National Post
Delivery services under legal scrutiny for alleged 'drip pricing'
The practice known as 'drip pricing' is front and centre again in an action by the federal Competition Bureau against DoorDash and in a proposed class-action lawsuit brought by a Toronto law firm against Uber Eats. Article content Drip pricing generally involves enticing customers by advertising low prices, but charging extra mandatory fees, usually when they are checking out. Article content Article content It continues to come under fire because 'disclosure around pricing and fees in various consumer transactions is, at times, less than thorough and transparent,' says Mike Robb, partner with London, Ontario-based law firm, Siskinds. Article content Article content Canada's competition watchdog is hauling DoorDash Inc. and its Canadian subsidiary before the Competition Tribunal, accusing them of portraying the online cost of delivery as lower than the price consumers ultimately pay. Article content The Competition Bureau says it investigated and is alleging DoorDash customers paid more, due to mandatory fees, added during checkout. Article content The extra fees, the bureau says, include charges such as extra amounts for delivering items a further distance and for placing smaller orders. The bureau alleges the discretionary charges were sometimes framed as taxes. Article content Article content Article content The bureau is asking the Competition Tribunal to order the company to stop the practice, cease portraying fees as taxes, pay a penalty and issue restitution to affected consumers. Article content Still, the bureau is standing its ground. 'Our litigation against DoorDash is another example of our efforts to ensure consumers are not misled and can trust the prices they see online. We urge all businesses to review their pricing practices and make sure they comply with the law,' said Matthew Boswell, commissioner of competition in a press release.
CTV News
13-06-2025
- Business
- CTV News
Uber Eats Canada is accused of drip pricing practices for food deliveries in proposed class action suit
Uber Eats Canada is charging customers hidden fees with their orders, a proposed class action lawsuit is alleging. The statement of claim filed against the food delivery platform with the Ontario Superior Court Justice last month alleges that Uber Eats has been hiding an additional service fee within its overall delivery costs. Based on the filings, Uber describes this fee as something that fluctuates depending on the customer's order size, which is 'typically 10% of the basket, calculated on the total before any promotions or discounts are applied.' The filings allege, however, that the service fee is fixed at a minimum of $2 for all food deliveries under $20 and a maximum of $4 for those above $40. The service fee is about 10 per cent of the items' order value for anything in between those price points. This fee was allegedly tucked underneath the 'Taxes & Other Fees' line item and did not clearly state its existence at any point prior to purchase, like when a user reviews menu prices for example. The documents note this additional cost was only applied to deliveries, not pick-up orders. Toronto-based law firm Koskie Minsky LLP—the class counsel—says doing this misrepresents the actual cost of app's delivery services, adding that by introducing and charging this fee by the transaction stage is a 'quintessential example of drip pricing practices.' Here is everything you need to know about the proposed class action lawsuit: What is drip pricing? This type of practice is seen when a company adds mandatory fees after advertising low prices to lure in customers, so the advertised prices are not actually attainable, Competition Bureau Canada says. It does not include additional fixed charges like the harmonized sales tax, for example. There are some telltale signs to look out for, Competition Burau Canada says, like if the price you see does not match up with what you pay or if you have to scroll down or read the fine print to find the actual cost of a product. How does this impact Uber One users? Uber One members pay just shy of $10 each month for a variety of perks, including five per cent off on orders and a free delivery fee over a minimum total of $15 from eligible restaurants. The proposed suit alleges the plaintiff, a Toronto-area woman who was an Uber One member from October 2023 to December 2024, paid a total of $28.50 in service fees across eight delivery orders—despite paying the monthly membership fees. The filings allege Uber Eats misrepresented the Uber One memberships and the benefits associated with it, saying that the service fee was charged to members every time a delivery order was placed—whether the $15 minimum spend was met or not. What did Uber say in response to the class action lawsuit? Uber Eats tells CTV News Toronto it could not comment on the proposed lawsuit, but said it is taking these 'allegations seriously.' 'We are committed to transparency and fairness in our pricing practices,' the statement reads. 'We are reviewing the claims thoroughly and will be defending the lawsuit.' Am I eligible for the Uber Eats class action lawsuit? Any Canadian who has placed an order for delivery on Uber Eats on or after May 16, 2023, may be eligible to participate in the lawsuit, as well as Uber One subscribers. The Toronto-based law firm says people do not need to actively sign up to become involved with the class action—instead, if people qualify under the class action description, they automatically qualify unless they choose to back out from the proceedings. There is a deadline to opt out of the class action if someone wants to pursue independent legal action, the firm adds. Koskie Minsky says those who remain in the class action will be notified of their involvement after the statement of claim has been certified. Do I have to pay legal fees for a class action? Koskie Minsky says the costs are handled on a 'contingency fee basis'—meaning class counsel will only be paid of the suit is successful at trial or settled. 'In that case, class counsel fees may be paid by the defendants or out of the settlement or judgment proceeds as approved by the court,' the firm says online. Class action members looking for some financial assistance may be able to look at the Class Proceedings Fund, which can provide support to approved plaintiffs for legal disbursements.
Globe and Mail
09-06-2025
- Business
- Globe and Mail
Competition Bureau sues DoorDash, alleging misleading price promotions
The Competition Bureau is taking legal action against DoorDash Inc. DASH-Q and its Canadian subsidiary, alleging the company promotes their online delivery services at a lower price than what consumers actually have to pay. The bureau said Monday that it had launched an investigation, finding that consumers could not purchase food and other items at the advertised price on DoorDash websites and apps owing to additional mandatory fees at checkout. This practice is what the bureau refers to as drip pricing and 'is deceptive because consumers are not presented with an attainable price upfront,' it said in a news release. The bureau alleges that certain fees presented on DoorDash platforms appear to be taxes, but are instead charges imposed at the company's discretion. The bureau filed its application against DoorDash with the Competition Tribunal, calling for the company to pay a penalty, end deceptive price and discount advertising, stop portraying fees as taxes, and issue a restitution to affected consumers who purchased items through DoorDash's platform. Trent Hodson, communications lead for DoorDash Canada, told The Globe and Mail in an e-mailed statement that transparency is a 'top priority' for the company and denied the allegations of misleading customers. The bureau's statement notes that DoorDash charges consumers numerous mandatory fees to deliver orders made online, including service fees, delivery fees, expanded range fees, small order fees and regulatory response fees. Opinion: Canada needs a wartime competition policy DoorDash has engaged in the alleged conduct of drip pricing for close to a decade, acquiring nearly $1-billion in mandatory fees from customers, according to the bureau. In one case, the bureau said, a customer in Quebec tried to order an item from a sushi shop through DoorDash that was originally advertised as $6.25, but could not purchase the item without paying the obligatory fees, including a $1.99 delivery fee and service fee ranging from $1.99 to $3.99. These charges appear to be in addition to tax fees. Throughout the order process, these types of fees are often hidden or are not in close proximity to the initially stated prices. The bureau uses this example to establish their argument that DoorDash omits or hides obligatory fees from the price representation until checkout, rendering the advertised price of $6.25 unattainable. 'The Competition Bureau has been fighting against this misleading practice for years,' Commissioner Matthew Boswell said in the release. 'Our litigation against DoorDash is another example of our efforts to ensure consumers are not misled and can trust the prices they see online.' Mr. Hodson of DoorDash Canada said in his statement that 'All fees on DoorDash, which support the high-quality operations of our platform, are clearly labeled and disclosed to consumers throughout the ordering process – including a final review before payment. 'To be crystal clear, DoorDash does not hide fees from consumers or mislead them in any way. [The Competition Bureau's] application is a misguided and excessive attempt to target one of Canada's leading local commerce platforms. It unfairly singles out DoorDash, and we intend to vigorously defend ourselves against these claims.' This is not the first time the bureau has sought legal action against a company alleging misleading prices. Last September, the bureau won a deceptive marketing case against Cineplex Inc. for engaging in drip pricing by adding a mandatory $1.50 online booking fee and ordered the company to pay a financial penalty of more than $38.9-million. Last June, the bureau reached an agreement with SiriusXM Canada to address concerns over a mandatory additional fee on subscription plans that increased the monthly cost by 10 to 20 per cent. Currently, the bureau is pursuing legal action against Canada's Wonderland for alleged false or misleading price claims.
CTV News
09-06-2025
- Business
- CTV News
Competition Bureau sues DoorDash, accuses firm of misleading customers with fees
A DoorDash sign is posted on the door of a Dunkin' Donuts franchise, Feb. 27, 2023, in Methuen, Mass. (AP Photo/Charles Krupa, File) TORONTO — Canada's competition watchdog is suing DoorDash Inc. and its Canadian subsidiary for marketing its online delivery services at a lower price than what consumers actually wind up paying. The Competition Bureau says an investigation found DoorDash customers were unable to purchase food and other items at prices advertised on DoorDash's websites and mobile apps because of mandatory fees added at checkout. The extra charges range from service and delivery fees to amounts sought for couriering things a further distance or placing smaller orders. The bureau says the charges were sometimes framed as if they were taxes and resulted in consumers paying higher prices than advertised, amounting to a deceptive practice known as drip pricing. The bureau alleges DoorDash used drip pricing for close to a decade, making nearly $1 billion from mandatory fees paid by customers. It wants the company to stop the practice, cease portraying fees as taxes, pay a penalty and issue restitution to affected consumers, but DoorDash says the requests are 'misguided' because it does not hide fees from consumers or mislead them in any way. This report by The Canadian Press was first published June 9, 2025. Tara Deschamps, The Canadian Press
CBC
09-06-2025
- Business
- CBC
Competition Bureau sues food delivery company DoorDash, alleging misleading price promotions
The Competition Bureau said on Monday that it is suing the online food delivery company DoorDash for allegedly misleading consumers by advertising its services at a lower price than what customers actually end up paying. "A Bureau investigation found that consumers were unable to purchase food and other items at the advertised price on DoorDash's websites and mobile applications due to the addition of mandatory fees at checkout," said the readout from the agency. "This practice is commonly known as drip pricing and is deceptive because consumers are not presented with an attainable price upfront." The bureau filed an application with the Competition Tribunal, which handles cases related to Canada's competition laws. It's seeking an outcome that would have DoorDash pay a penalty and compensate affected customers, in addition to ending what it refers to as "deceptive" price and discount advertising and the portrayal of fees as taxes.
