TORONTO — Canada's Competition Bureau has launched a lawsuit against DoorDash Inc. and its Canadian subsidiary. The lawsuit claims that the company misleads customers by advertising lower prices for its online delivery services than what consumers actually pay at checkout.

An investigation by the Competition Bureau revealed that DoorDash customers often found themselves unable to purchase food and other items at the prices displayed on the company's websites and mobile apps. This discrepancy is attributed to mandatory fees that are added during the checkout process. These extra charges include service fees, delivery fees, and additional costs for longer distances or smaller orders.

The bureau highlighted that these fees were sometimes presented in a way that made them appear as taxes. This practice, known as drip pricing, resulted in consumers paying significantly higher prices than what was initially advertised. According to the Competition Bureau, DoorDash has been employing this drip pricing strategy for nearly a decade, generating close to $1 billion from these mandatory fees.

As part of the lawsuit, the Competition Bureau is seeking to put an end to this practice. They are demanding that DoorDash stop misrepresenting fees as taxes, pay a financial penalty, and provide restitution to affected consumers.

In response, DoorDash has stated that the bureau's requests are "misguided." The company insists that it does not conceal fees from consumers or mislead them in any manner. DoorDash maintains that it is transparent about its pricing structure and the fees associated with its services.