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Grubhub accused by L.A. County of deceiving customers

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Last week, Los Angeles County filed a lawsuit against the popular food delivery app Grubhub, accusing the company of misleading customers with hidden fees and false advertising practices. The lawsuit alleges that Grubhub has repeatedly violated California state law by promoting meals at a lower price than what customers ultimately pay at checkout. This practice, known as “bait-and-switch,” is illegal and deceptive to consumers.

One example cited in the lawsuit is the price of a turkey on rye half-sandwich from Langer’s Delicatessen-Restaurant in Los Angeles. While the advertised price on Grubhub may start at around $17, additional fees and sales tax can push the total cost of delivery to over $26. The lawsuit argues that this discrepancy between advertised prices and actual costs is unfair to consumers and constitutes false advertising.

In response to the lawsuit, a spokesperson for Grubhub stated that the company plans to defend itself vigorously in court. The company emphasized that it has always complied with applicable laws and disputed many of the allegations made in the lawsuit. However, the lawsuit raises significant concerns about Grubhub’s business practices and their impact on consumers, restaurants, and delivery drivers.

The lawsuit also highlights the issue of “junk fees” and surprise charges that have become increasingly common in the delivery app industry. A new state law set to take effect this summer aims to prohibit last-minute fees across various businesses, including delivery apps. The law is designed to ensure that the price consumers see upfront is the price they ultimately pay, without any unexpected additional charges.

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Furthermore, the lawsuit alleges that Grubhub’s practices harm not only its customers but also the restaurants and drivers who rely on the platform. Restaurants signing up for Grubhub were reportedly not adequately warned about the potential need to refund money to dissatisfied customers, even if the restaurant did not believe an error had occurred. In addition, the lawsuit claims that Grubhub gives preferential treatment to restaurants that pay higher marketing fees, potentially misleading consumers about the search results they see on the app.

Grubhub’s treatment of its delivery drivers also comes under scrutiny in the lawsuit. The company faced backlash in 2020 for introducing a new charge, called the driver benefits fee, which led to a decrease in driver earnings. The lawsuit alleges that Grubhub’s explanation of this fee may discourage customers from tipping, as it misrepresents drivers’ actual earnings and reliance on tips for income.

It’s important to note that this is not the first time Grubhub has faced legal action over its business practices. In 2022, the company settled a similar lawsuit with Washington, D.C., for $3.5 million after the district’s attorney general accused Grubhub of manipulating customers with hidden fees. A significant portion of the settlement funds went back to affected customers, reflecting the impact of Grubhub’s practices on consumers.

Overall, the lawsuit filed by Los Angeles County sheds light on the deceptive practices and unfair treatment that have raised concerns about Grubhub’s operations. It underscores the need for stronger consumer protections and transparency in the food delivery industry, especially as more consumers rely on these platforms for meal orders. As the legal proceedings unfold, it’s essential for regulators, businesses, and consumers to consider the implications of these allegations and work towards a fair and ethical food delivery marketplace for all stakeholders.

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Is now the right time to invest in gold as prices have cooled?

Now may be the time to buy gold following a recent lull in its price.

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The price of gold has climbed to record highs recently and has remained strong through much of April. And, that growth continued until the precious metal traded at around $2,390 per ounce on April 19, 2024. But since, growth in the price of the precious metal has cooled, with gold’s price now hovering around $2,300 per ounce.

This lull in gold’s price may represent an investment opportunity.

In general, investing is centered around buying assets when prices are low and selling them when prices are high – generating a profit on the difference between the two. So, considering the declines in gold’s price over the past few days, now may be the time to make your investment. But is buying gold during this lull in prices really a good idea?

Compare your gold investment options among leading brokers now.

Gold prices have cooled. Should you buy in now?

With gold’s price down from recent highs, you may be wondering if now is the right time to buy in. There are several reasons the dip in gold’s price may represent an opportunity to buy. Here are some of the biggest:

Prices may rise again

If looking at a gold price chart shows anything for certain, it shows that changes in the overall growth of the medal come in fits and spurts. Periods of price growth are typically followed by periods of declines and vice versa.

But with inflation rising in recent months – and with gold’s reputation as a safe-haven asset that can hedge against inflation – it only makes sense that the price of the precious metal will eventually start to head up again in the future. While attempting to time that directional change may be tricky, buying the precious metal while the price is down gives you the opportunity to take advantage of any upward movement that may be ahead.

Add gold to your portfolio now before prices have a chance to rise.

You may be able to make a quick profit

Gold isn’t known as an asset in which you can earn a quick return, but in today’s market, that may be the case. Don’t forget that in January, gold was trading at just $2,000 per ounce. And, by mid-April, the commodity’s price had climbed to around $2,400 per ounce. That’s about 20% growth in a matter of months, much of which happened since March 1 – an impressive climb for any investment asset.

Perhaps more importantly, gold’s price growth through the beginning of 2024 shows that the commodity doesn’t have to be a buy and hold style investment that you keep in a safety deposit box or precious metal depository for years to come. There’s also the possibility that the commodity’s price could climb further ahead, making it a compelling way to potentially generate a quick profit.

There are other benefits of investing in gold

There are other benefits of investing in gold that have little to do with the price growth seen thus far in 2024 – or the lull in prices seen over the past couple of days. Those benefits include:

Inflation protection: Gold has long been considered an inflation hedge, and for good reason. When inflation drives the prices of consumer goods and services up – and the value of the dollar down – gold’s price tends to rise. So, it could be used to maintain the value of your portfolio during inflationary economic conditions. That’s important in today’s economic environment as stubborn inflation continues to weigh on the value of the dollar.
Portfolio diversification: Gold’s price doesn’t always move in the same pattern that bonds or stocks do. So, mixing a reasonable amount of gold into your portfolio (up to 10% of your portfolio assets) as a diversifier could protect you from losses should one or more of your traditional portfolio assets fall in value. “If you have less than 5% – 10% of your net worth in commodities & FX (forex), you should absolutely consider adding exposure to gold and other precious metals,” says Vijay Marolia, money manager and managing partner at the wealth management firm, Regal Point Capital.

The bottom line

Gold’s price has fallen from recent highs – which may represent an opportunity to tap into growth ahead. However, gold isn’t simply a “buy while it’s low and sell while it’s a high” kind of investment opportunity. The commodity can also protect your portfolio from the stubborn inflation we’ve seen thus far in 2024 while acting as a diversification tool that could increase your risk-adjusted portfolio returns. So, consider adding gold to your portfolio today while it has the potential to grow in value.

Joshua Rodriguez

Joshua Rodriguez is a personal finance and investing writer with a passion for his craft. When he’s not working, he enjoys time with his wife, two kids, two dogs and two ducks.