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Uber Eats faces discrimination allegations over free delivery from Black-owned restaurants

Megan Rose Dickey
·2-min read
TOKYO, JAPAN - APRIL 11: Uber Eats delivery men ride bicycles through the Kabukicho entertainment area on April 11, 2020 in Tokyo, Japan. Tokyo Governor Yuriko Koike has requested that businesses including schools, athletic facilities, bars and restaurants to temporarily close or operate under reduced hours. The action follows a state of emergency that covers 7 of Japans 47 prefectures as the Covid-19 coronavirus outbreak continues to spread throughout the country. (Photo by Tomohiro Ohsumi/Getty Images)
TOKYO, JAPAN - APRIL 11: Uber Eats delivery men ride bicycles through the Kabukicho entertainment area on April 11, 2020 in Tokyo, Japan. Tokyo Governor Yuriko Koike has requested that businesses including schools, athletic facilities, bars and restaurants to temporarily close or operate under reduced hours. The action follows a state of emergency that covers 7 of Japans 47 prefectures as the Covid-19 coronavirus outbreak continues to spread throughout the country. (Photo by Tomohiro Ohsumi/Getty Images)

Uber says it has received more than 8,500 demands for arbitration as a result of it ditching delivery fees for some Black-owned restaurants via Uber Eats.

Uber Eats made this change in June, following racial justice protests around the police killing of George Floyd, an unarmed Black man. Uber Eats said it wanted to make it easier for customers to support Black-owned businesses in the U.S. and Canada. To qualify, the restaurant must be a small or medium-sized business and, therefore, not part of a franchise. In contrast, delivery fees are still in place for other restaurants.

In one of these claims, viewed by TechCrunch, a customer alleges Uber Eats violates the Unruh civil Rights Act by "charging discriminatory delivery fees based on race (of the business owner)." That claim seeks $12,000 as well as a permanent injunction that would prevent Uber from continuing to offer free delivery from Black-owned restaurants.

“We’re proud to support black-owned businesses with this initiative, as we know they've disproportionately been impacted by the health crisis," Uber spokesperson Meghan Casserly said in a statement to TechCrunch. "We heard loud and clear from consumers this was a feature they wanted—and we’ll continue to make it a priority."

The website soliciting customers says eligible people can make up to $4,000 in compensation if they have paid a delivery fee in California since June 4, 2020.

The arbitration demands are not super surprising, given that Sen. Ted Cruz said he expected Uber to face discrimination lawsuits from restaurants without Black ownership.

It's also worth noting that the representative for the customer listed in the complaint is Consovoy McCarthy, whose partners include President Donald Trump lawyer William Consovoy and others.

TechCrunch has reached out to Consovoy McCarthy and will update this story if we hear back.

These complaints are reminiscent of one Microsoft is facing, though not at as high of a level. Earlier this month, the U.S. Department of Labor essentially accused Microsoft of "reverse racism" (not a real thing) for committing to hire more Black people at its predominantly white company.

Meanwhile, this is just one of many legal battles Uber is facing these days. On the worker side of Uber's business, a California appeals court judge recently upheld a ruling granting a preliminary injunction to force both Uber and Lyft to reclassify their workers as employees. However, that has yet to go into effect. That means all eyes are on Proposition 22, a California ballot measure backed by Uber, Lyft, DoorDash and Instacart that seeks to keep gig workers classified as independent contractors.