A class action lawsuit has been filed against Chipotle Mexican Grill, Inc., accusing the company of misleading customers by disguising service fees as taxes on delivery orders.
Plaintiffs Hudson Gill and Clair Awad filed the lawsuit on July 31 in the United States District Court for the Central District of California.
They allege that Chipotle includes a hidden “Service Fee” within the tax amount displayed during online food delivery orders, deceiving customers into believing they are paying higher taxes.
According to the complaint, Chipotle’s checkout page presents a subtotal, a $1.00 delivery fee, and a tax amount that actually includes both tax and service fees, which are not clearly itemized unless customers click on a drop-down menu.
This practice allegedly misleads consumers into paying significant service fees without their knowledge.
The lawsuit claims Chipotle’s actions violate California’s Unfair Competition Law and False Advertising Law, New York’s General Business Law, and include claims of quasi-contract, fraud, and unjust enrichment. The plaintiffs are seeking restitution, damages, and an order to prevent Chipotle from continuing these practices.
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The plaintiffs are represented by L. Timothy Fisher and his team at Bursor & Fisher.
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