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Comment by tartoran | Hacker News Reader

> I don't see anything intrinsically wrong with what GrubHub is doing, but I could see them needing to clearly note the relationship. There are lots of personal shopping/delivery services which phone in orders and go pick something up without having a pre-existing relationship with the restaurant.

The problem is that Grubhub is not asking permission to list the business on their site and it borders on abusive behavior. The said business may have an ordering system already or a phone number to order because they simply don't to share a hefty cut with Grubhub. Why they don't simply ask for permission? Because some restaurants wouldn't give it and Grubhub forces their hand. I think this is what this lawsuit is about.

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> The problem is that Grubhub is not asking permission

But nothing says they have to as far as I know? Do you have to ask permission from an author before you resell a book you own?

> because they simply don't to share a hefty cut with Grubhub

They don't have to share a cut in this case. The restaurant still gets the full retail price that they set. Grubhub marks up on top of that or takes it as a loss as I understand.

> Why they don't simply ask for permission?

They don't want to. Do they need any more reason than that?

Yes they have to ask for permission to present themselves as an agent of the company, which they do when they present their own phone number as the restaurant phone number. So I imagine the lawsuit will have many legs to stand on.

This is business, which has many rules. Its not just 'do whatever you like as long as it makes money'.

Are they claiming to be the restaurant? Or just saying you can phone this number and get the advertised product, which is true?

>Are they claiming to be the restaurant? Or just saying you can phone this number and get the advertised product, which is true?

Here's an example. The site linked (menupages.com) is owned by Grubhub/Seamless. The telephone number is not the actual phone number of the restaurant, and attempting to order through this site gives no hint that you're using Grubhub/Seamless.

https://menupages.com/tropical-sensation/953-amsterdam-st-ne...

While search engines seem to have backed off putting GrubHub's fake websites near the top of searches, this has been a widespread practice by them for a long time[0]:

"The company has registered a lot of fake websites. GrubHub has registered either a bit more than 23,000 websites, according to the New Food Economy, or 34,000 over the last nine years, per the New York Post’s report. The last domain GrubHub registered was in May, when the Post detailed the company’s practice of creating phone numbers for restaurants in order to drive up its own sales."

[0] https://www.grubstreet.com/2019/07/everything-you-need-to-kn...

> Yes they have to ask for permission to present themselves as an agent of the company

That's not necessarily true (yet), that's literally what this legal case is about.

No, that is already true under existing law. Presenting yourself falsely as an agent of a company, and profiting from that, is fraudulent misrepresentation.

>Yes they have to ask for permission to present themselves as an agent of the company, which they do when they present their own phone number as the restaurant phone number. So I imagine the lawsuit will have many legs to stand on.

Except they don't. In fact, they register domain names and set fake websites that say they are the restaurant when they're not. They set up phone numbers that route through Grubhub/Seamless and charge their outrageous commissions even for pickup orders.

While there are many places where delivery services are useful, in places where delivery was already ubiquitous (e.g., NYC), the high commission fees and deceptive practices have forced many low and mid-priced restaurants to close because orders through these services take all their profit and a bunch more, making businesses that had been profitable for years or even decades unprofitable and forcing them to close their doors.

Aside from reducing the number and diversity of restaurants, sucking profit out of such transactions that are way beyond any value provided will also end up costing consumers (that's you) more too.

cf: https://www.theverge.com/2019/6/28/19154220/grubhub-seamless... https://www.theverge.com/2020/5/15/21260609/grubhub-phone-ca... https://www.eater.com/2019/8/6/20756799/yelp-grubhub-phone-n...

In your book example, I am buying a book from you. A better example would be you buy search ads for the author's name, create a website with a button "Contact the author" which goes to you, and then you sell me the book.

And I’m buying the food from GrubHub who buy the food from the restaurant. Like if I buy a book from a bookshop who buy it from the publisher.

> A Like if I buy a book from a bookshop who buy it from the publisher.

No it is not the same, because there is no business agreement between Grubhub and the restaurant here unwilling and unaware restaurants aren't "kitchens" working for Grubhub.

Grubhub wouldn't dare pulling that stunt with McDonalds or BurgerKing and list their products, use their corporate identity and sandwich pictures without an agreement or striking a deal before hand.

They are preying on smaller restaurants because they know it's harder for the little guy to fight back, it's the very definition of predatory behaviour. You just don't see anything wrong with that.

> because there is no business agreement between Grubhub and the restaurant

You don’t need an agreement to resell product that you have purchased.

Or is everyone on HN now suddenly in favour of scrapping the first sale doctrine and allowing manufacturers to control if you can resell your property?

Madness. If GrubHub are able to buy the product they should be able to resell it.

> You don’t need an agreement to resell product that you have purchased.

You are ignoring 80% of my argumentations to make your sophistic point, and then complaining "about everyone on HN", you're just being disingenuous.

We're talking about prepared food here (and potentially fraud), not books. And you talk to me about "first sale doctrine" in relation to prepared food claiming everybody here is ignorant?

Approximately nobody thinks that grubhub shouldn't be able to resell the food.

However they should be very clear that this is what they are doing, and that issues with the food are now their responsibility.

We wouldn't be having this conversation if GH/Uber/etc. were clearly advertising "Call us at xxx-xxx-xxxx, we'll order takeout for you and deliver it".

If they pick up the phone when you call and say "This is grubhub, how can we help you?" we'd be in different territory.

As soon as you make it ambiguous about who you are ordering from, this is an issue of misrepresentation. Even if it does apply, first sale doctrine is a red herring.

The difference is you know you're buying from the bookshop and not from the publisher. And the publisher knows the bookshop is selling the books under its own name, not free-riding on the publisher's name and brand recognition.

Lots of people have already explained this to you on many different comment threads in many different ways.

Why should they need to ask for permission?

Businesses operate in the public sphere; they have physical addresses and show up in business listings, so their locations and info aren't private. The use of the logo for commercial purposes could be a concern; I could see an argument perhaps saying that the businesses should have more control over their trademarked property in the sense that there could be confusion of whether they're working with Grubhub (they're certainly not endorsing Grubhub).

But apart from that, use of the business's information (including name) to describe what restaurants Grubhub will pick up from is nominative fair use. If I make a list of "businesses in my home town," McDonald's can't use trademark law to keep their name off my list. Same deal here.

Again, it’s misrepresentation: if they had a website and phone staff who made it very clear that they were unaffiliated with the listed business they would not be getting sued any more than a travel agent gets sued for buying airline tickets.

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