The Federal Trade Commission (FTC) announced on Wednesday that it is distributing $23.8 million to 640,038 consumers and drivers following allegations that food delivery company Grubhub misled workers and engaged in deceptive practices.

The payouts resolve a lawsuit filed in December 2024 by the FTC and the Illinois Attorney General. Most recipients will receive a physical check in the mail, while some will receive funds through PayPal.

According to the complaint, Grubhub engaged in several unlawful practices across its business operations:

• Deceptive Earnings Claims: The company made misleading claims regarding potential driver compensation.
• Unauthorized Restaurant Listings: Grubhub listed as many as 325,000 unaffiliated restaurants on its platform without permission to artificially inflate its size, occasionally refusing removal requests to pressure businesses into paid partnerships.
• Account Restrictions: The platform restricted customers' access to their accounts and funds.

Under the terms of the settlement, Grubhub must implement operational changes. The company is now required to advertise driver earnings accurately, provide customers a process to challenge account restrictions, and obtain explicit consent from restaurants prior to listing them.

This FTC distribution comes one month after a federal judge approved a separate settlement worth nearly $25 million involving approximately 60,000 Grubhub delivery drivers in California. Other industry competitors, including DoorDash and Uber Eats, have also previously faced legal scrutiny over driver compensation, customer fees, and restaurant partnerships.