Yum Brands Sues Grubhub

Just days after the announcement of Grubhub’s acquisition by Dutch delivery company Just Eat Takeaway for $7.8 billion, the third-party delivery brand is back in headlines for a lawsuit filed by Yum Brands, which claims that Grubhub violated terms of a 2018 contract with the Taco Bell and KFC parent company.

The contract, which was struck as part of an agreement for Yum Brands to purchase a three-percent stake in Grubhub, stipulated that Grubhub would provide favorable pricing to Yum Brands restaurants. On June 2, Grubhub CEO Matt Maloney terminated that contract, claiming Yum’s agreements with Grubhub competitors Uber Eats and Postmates violated the terms of the deal. Yum denies that such a non-compete was stipulated in the contract and is asking Grubhub to revoke its termination of the contract and enter into negotiations.

The lawsuit claims that Grubhub reached out directly to franchisees to impose a new pricing structure that violated the original terms of the companies’ agreement. “The new fees will mean that consumers will have to pay nearly 40% more for Grubhub deliveries of food from Yum’s restaurants,” according to CNBC.

Third-party delivery services have come under fire recently for exorbitant fee structures, which some cities have moved to cap.

Read more at cnbc.com.