Top Dem Says Uber-Grubhub Deal Is 'Pandemic Profiteering'

By Anne Cullen
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Law360 (May 14, 2020, 11:55 AM EDT) -- House antitrust leader Rep. David Cicilline has ripped into Uber's reported plan to pick up food delivery giant Grubhub, bashing both companies as predatory and saying the move "marks a new low in pandemic profiteering."

"Uber is a notoriously predatory company that has long denied its drivers a living wage," the Rhode Island Democrat, chair of the Judiciary Committee's antitrust subcommittee, said in a statement earlier this week. "Its attempt to acquire Grubhub — which has a history of exploiting local restaurants through deceptive tactics and extortionate fees — marks a new low in pandemic profiteering."

News of the potential deal surfaced Tuesday when the Wall Street Journal reported Uber was considering a bid for Grubhub to bolster its own food delivery business, Uber Eats. It's not yet clear if such a deal will materialize. A spokesperson for Grubhub declined to comment and Uber did not respond to press inquiries Thursday.

Cicilline has previously called for a moratorium on merger activity during the pandemic and said in this week's statement that the Uber deal is the type of combination he was hoping to keep at bay.

"We cannot allow these corporations to monopolize food delivery, especially amid a crisis that is rendering American families and local restaurants more dependent than ever on these very services," Cicilline said. "This deal underscores the urgency for a merger moratorium, which I and several of my colleagues have been urging our caucus to support."

The lawmaker was also part of a congressional coalition that called on the Federal Reserve and the U.S. Department of the Treasury to bar large corporations that receive coronavirus relief aid from scooping up struggling businesses.

In a letter to the agencies Wednesday, Cicilline and a pair of former presidential hopefuls, Sens. Elizabeth Warren, D-Mass., and Amy Klobuchar, D-Minn., said funding from a federal rescue package needs to come with strings attached to restrict businesses from undertaking any mergers that might be bad for competition.

--Additional reporting by Nadia Dreid and Elise Hansen. Editing by Marygrace Murphy.

For a reprint of this article, please contact reprints@law360.com.

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