DoorDash says its users are not misled and that its fee structure is clearly stated multiple times before buyers place an order.CARLO ALLEGRI/Reuters
DoorDash Inc. DASH-Q and its Canadian arm are denying the fees on its website and apps are false or misleading and are asking that the Competition Bureau’s recent legal action against the companies be dismissed.
DoorDash filed a response Thursday with the Competition Tribunal, arguing against the Commissioner of Competition’s June legal application, which alleged the company’s online delivery pricing misled consumers.
The online food delivery service company says its fees are not obligatory or fixed, and do not mislead customers, despite claims in the Commissioner’s application.
The lawsuit alleged that the company offered low prices to attract consumers, but then laid on mandatory fixed fees at checkout to raise prices in a practice known as “drip pricing.”
In a news release, the Bureau said it investigated DoorDash’s practices and found consumers could not buy items on the company’s website or mobile applications for the advertised prices. It alleged the company had been operating with drip pricing for nearly a decade and made almost $1-billion from buyers through the practice.
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The Commissioner is asking the tribunal to stop DoorDash from continuing its alleged deceptive practices, pay a penalty and issue restitution to customers.
DoorDash, however, said its users are not misled and that its fee structure is clearly stated multiple times before buyers place an order, and is transparent about its discounts and how they are applied.
Even if it had operated with drip pricing, which it denies, DoorDash argues that its price representations are not in contravention of the Competition Act.
In its filing, the company contested what it said was the Commissioner’s interpretation of drip pricing, stating that the Competition Act doesn’t require companies to display “all-in” prices, but only to give consumers all the information they need to make an informed purchase decision.
DoorDash said none of its fees are unavoidable within the meaning of the Competition Act. It defended the fee structure on its websites and mobile apps, which include a website called TryCaviar.com. Users can, for example, select pickup instead of delivery, it said.
In its June lawsuit, the Commissioner said the application only relates to DoorDash’s promotion of the supply or use of its delivery services.
Some prices are subject to certain subtotal and distance conditions, and others can be waived with a subscription, DoorDash said.
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“The Commissioner mischaracterizes DoorDash’s fee structure and representations made regarding that fee structure, and incorrectly asserts that DoorDash’s fee representations are false and misleading in a material respect,” the company said in its filing.
The Commissioner’s lawsuit also alleges some DoorDash fees are incorrectly portrayed as government-imposed.
DoorDash denied that claim, stating the fees are described in detail on displays accessible from the cart, checkout and merchant store pages. That includes the British Columbia Regulatory Response Fee which was in response to 2024 legislation that increased app-based, ride-hailing, delivery work pay and, as a result, the company’s operating costs in the province.
DoorDash said in its filing the majority of its users are “tech savvy,” who are familiar with its fee structure “and they continue to, repeatedly, use the Marketplaces to connect with their favourite merchants.”
The company also maintains it should not be subject to a financial penalty or reimbursement.