750 F.Supp.3d 285
S.D.N.Y.2024Background
- New York City enacted the Customer Data Law requiring food delivery platforms (like DoorDash, Uber Eats, and Grubhub) to share detailed customer data with restaurants upon request, unless the customer opts out.
- The law intended to help local restaurants compete by giving them access to customer information, including full name, email, phone number, delivery address, and order contents.
- Plaintiffs (DoorDash, Uber Eats, Grubhub) sued, alleging the law violated the First Amendment, Takings Clause, and Contract Clause of the U.S. Constitution, as well as exceeded the City's police powers under the NY Constitution.
- The parties cross-moved for summary judgment, with enforcement of the law stayed pending the court's decision.
- The court focused solely on the First Amendment claim, finding it dispositive and declining to reach the other constitutional and state law issues.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Does the law implicate the First Amendment? | Law compels speech by requiring disclosure of proprietary customer data to competitors. | It's regulation of conduct, not speech; platforms are mere intermediaries. | Yes; the compelled disclosure is protected speech. |
| Is the speech commercial, and what scrutiny applies? | Law regulates non-commercial speech; strict scrutiny should apply. | Law regulates commercial speech; rational basis (Zauderer) applies. | Commercial speech; intermediate scrutiny applies. |
| Does the law survive intermediate scrutiny? | No substantial government interest; less restrictive alternatives available. | Substantial interest in supporting restaurants and fair competition. | No; law fails intermediate scrutiny. |
| Must the court reach other constitutional/state law claims? | All claims should be adjudicated. | Should decide only what's necessary. | No; remaining claims denied as moot. |
Key Cases Cited
- Sorrell v. IMS Health Inc., 564 U.S. 552 (compelled disclosure of data for commercial purposes implicates First Amendment)
- Zauderer v. Office of Disciplinary Counsel, 471 U.S. 626 (rational-basis for compelled factual disclosures about own products/services in advertising)
- Central Hudson Gas & Elec. Corp. v. Pub. Serv. Comm’n of N.Y., 447 U.S. 557 (intermediate scrutiny applies to commercial speech regulations)
- Expressions Hair Design v. Schneiderman, 581 U.S. 37 (compelled speech that is not incidental to conduct triggers First Amendment concerns)
- Turner Broad. Sys., Inc. v. FCC, 512 U.S. 622 (substantial government interest required for content-based speech regulation)