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Judge declares NYC law on sharing food delivery customers' data unconstitutional
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Judge declares NYC law on sharing food delivery customers' data unconstitutional
Oct 3, 2024 1:20 AM

NEW YORK, Sept 24 (Reuters) - A federal judge on Tuesday

declared unconstitutional a New York City law requiring food

delivery companies to share customer data with restaurants.

U.S. District Judge Analisa Torres in Manhattan ruled in

favor of DoorDash ( DASH ), Grubhub and Uber Eats

, saying the law violated the First Amendment by

improperly regulating commercial speech.

New York City adopted the law in the summer of 2021, one of

multiple measures to help its thousands of restaurants recover

from the COVID-19 pandemic.

Delivery companies were required to provide restaurants with

customers' names, delivery addresses, email addresses and phone

numbers, as well as order contents.

Though the city said the requirements protected restaurants

from delivery companies' "exploitive practices," it agreed not

to enforce the law while the companies sued.

The companies argued that the law violated the privacy

rights of customers and threatened their data security.

They also said it harmed their own businesses because

restaurants could use the data for marketing and "poach

customers away."

Nicholas Paolucci, a spokesman for the city's law

department, said: "We are carefully reviewing the court's

ruling."

Torres said the city did not demonstrate it had a

substantial interest in helping restaurants collect customer

data from the delivery companies, and said it had less intrusive

means to achieve that goal.

She said these means included letting customers decide

whether to share data, offering financial incentives for the

companies to share data, and subsidizing online ordering

platforms for individual restaurants.

DoorDash ( DASH ) said the decision "rightly recognized how this law

would have violated bedrock First Amendment rights of how we

protect New Yorkers' data," while Grubhub said it "reinforces

the privacy protections that New Yorkers deserve."

UberEats and its lawyers did not respond to requests for

comment.

The law had drawn support from the New York City Hospitality

Alliance, a restaurant and nightlife industry trade group.

Its executive director Andrew Rigie said Torres' decision

"hurts small businesses and consumers. We urge the city to

appeal."

The cases in the U.S. District Court, Southern District of

New York, are DoorDash Inc ( DASH ) v. City of New York, No. 21-07695;

Portier LLC v, City of New York, No. 21-10347, and Grubhub Inc

v. City of New York, No. 21-10602.

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