Court Denies DoorDash’s Motion to Dismiss Restaurant’s Suit

On Monday, Judge Thomas S. Hixson of the Northern District of California issued an order denying DoorDash’s motion to dismiss a lawsuit filed against it by Lona’s Lil Eats. The court also found this matter suitable for disposition without oral argument and vacated the hearing set for January 21, 2021.

In September, the restaurant filed a class-action complaint against DoorDash for deceptively representing that the parties had a partnership on its app when they did not. Specifically, Lona’s Lil Eats was allegedly listed on DoorDash, but was described as closed or unavailable and consumers were redirected to restaurants to which DoorDash was a legitimate partner. The plaintiff filed false advertising claims under the Lanham Act against DoorDash. 

DoorDash contended that Lona’s Lil Eats “failed to meet its pleading burden.” In particular, DoorDash asserted that Lona’s failed to plead “the existence of a ‘false statement’ with particularity” and that DoorDash made its alleged statements in a “commercial advertisement.” Additionally, according to DoorDash, Lona’s did not adequately plead “that DoorDash’s statements actually deceived or had a tendency to deceive any segment of DoorDash’s audience” and that the plaintiff suffered an injury. 

Specifically, DoorDash claimed that the plaintiff did not allege a false statement with the required particularity. The plaintiff contended that DoorDash showed two false statements and a true statement that were likely to mislead consumers, specifically that the restaurant was closed when it was open and that it was unavailable for pickup. The misleading statement is that the restaurant was “‘unavailable’ for delivery services because it was ‘too far away.’” The court ruled that Lona’s did sufficiently describe that DoorDash made the statements to Lona’s potential customers on its website and app and met the specificity requirement, refuting Doordash’s argument. 

First turning to the commercial advertisement component, the court noted that while DoorDash claimed that “‘a page on DoorDash’s website or app where a customer completes an order is not ‘commercial speech’ for purposes of a false advertising claim under the Lanham Act’ … But DoorDash doesn’t genuinely argue that the statements were not commercial speech.” Additionally, the court found that Lona’s alleged injury “to its commercial interests” as it relates to the misrepresentations that it was “closed” or “unavailable” which were “proximately cause(d) by DoorDash’s misrepresentations.” The court added that as a result of these purported allegations, which forced potential customers through DoorDash’s platform, Lona’s adequately alleged that DoorDash’s representations were made as part of commercial advertising or promotion.

DoorDash claimed that Lona’s failed “to offer any facts supporting its claim that DoorDash’s statements deceived consumers or had the tendency to deceive.” However, the court found that Lona’s sufficiently alleged that consumers were misled by DoorDash’s statements and representations. Additionally, the court stated that Lona’s sufficiently alleged injury.

Regarding Lona’s California’s False Advertising Law and California Unfair Competition Law allegations, the court stated that “(a) non-consumer plaintiff can allege false advertising claims under the UCL and FAL without alleging its own reliance, as long as the plaintiff has alleged a sufficient causal connection.” In particular, the court found that Lona’s adequately alleged an economic injury caused by DoorDash’s purported conduct, misleading statements, and false advertising. The court claimed that Lona’s plausibly alleged FAL and UCL claims. As a result, the court added that Lona’s has standing for an injunction.

DoorDash is represented by Benesch, Friedlander, Coplan & Aronoff LLP. Lona’s Lil Eats is represented by Chimicles Schwartz Kriner & Donaldson-Smith LLP, Carey, Danis & Lowe, and the Law Office of Francis J. Flynn, Jr.