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FTC Distributing $23.8 Million to 640,038 Consumers Under Grubhub Settlement

Payments stem from a December 2024 lawsuit by the FTC and the Illinois Attorney General; accounts of the settlement's total size differ.

By AI ReporterUpdated Aug 14, 2026, 2:51 a.m. ET
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More on this incident

The Federal Trade Commission is distributing $23.8 million to 640,038 consumers, including Grubhub drivers and customers, TechCrunch reported. Yahoo Finance reported the payments are going out mostly by mailed check, with some sent via PayPal. The money is consumer redress rather than a penalty, paid out under the settlement of a case brought in federal district court. Accounts of the settlement's overall size differ: JD Journal reported that Grubhub agreed to pay $25 million, most of it earmarked for consumer refunds, and that the proposed order carried a $140 million monetary judgment that was mostly suspended based on an inability to pay. The case stems from a lawsuit the FTC and the Illinois Attorney General filed against Grubhub in December 2024. According to TechCrunch and Yahoo Finance, the complaint accused the food delivery company of making misleading claims about how much drivers could earn, restricting customers' access to their accounts and money, and listing restaurants on its platform without permission. The complaint alleged Grubhub had as many as 325,000 unaffiliated restaurants listed to make its platform appear larger, and that it sometimes refused to remove restaurants that asked to be taken off, instead allegedly trying to convince some to enter paid partnerships. JD Journal described a broader set of allegations, reporting that regulators alleged Grubhub misrepresented delivery costs by advertising low-cost or free delivery while disclosing additional fees only near the end of checkout, promoted Grubhub+ as providing "free" delivery though subscribers still incurred charges, created barriers to canceling subscriptions, removed account access containing gift card balances without adequate , and advertised hourly driver earnings of up to $40 per hour in certain markets that only a small percentage of drivers achieved, continuing after a federal of Penalty Offenses. JD Journal reported the platform listed hundreds of thousands of restaurants that never agreed to join. Grubhub to the resolution, which also required the company to change its practices around advertising driver earnings, account restrictions and restaurant listings, according to TechCrunch. Yahoo Finance reported the settlement required changes to how the company advertises driver earnings, handles account restriction challenges, and obtains restaurant before listing. JD Journal reported the overhaul covered fee disclosure, subscription cancellation, driver earnings substantiation and unauthorized restaurant listings. The allegations in the complaint were not adjudicated.

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Revision history

  1. Version 314 Aug 2026, 06:51current

    Added Yahoo Finance reporting on payment method (mailed check and PayPal) and its account of the required practice changes, including restaurant consent before listing.

  2. Version 213 Aug 2026, 12:58

    Added JD Journal reporting on the $25 million payment, the mostly suspended $140 million judgment, and the broader fee-disclosure, subscription-cancellation and driver-earnings allegations.

  3. Version 113 Aug 2026, 00:59current

    First published.

  4. Version 113 Aug 2026, 00:18current

    First published.

  5. Version 113 Aug 2026, 00:25

    First published.

  6. Version 113 Aug 2026, 00:59current

    First published.

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