Facts

Maplebear Inc. dba Instacart is a technology company that provides a platform that enables independent contractors to work as "Shoppers" to gather groceries and other items from retail stores nationwide and deliver them to customers. In September 2019, the City Attorney of San Diego on behalf of the People of the State of California filed a lawsuit against Maplebear. The City Attorney's Office sought a temporary restraining order but the court denied the request.

PLAINTIFF'S CONTENTIONS: Plaintiff alleged that defendant unlawfully classified its Shoppers as independent contractors instead of employees and as a result, defendant avoided paying its Shoppers a lawful wage and unlawfully deferred substantial expenses to its Shoppers, including the cost of equipment, car registration, insurance, gas, maintenance, parking fees, and cell phone data usage. Plaintiff contended that defendant maintained an unfair competitive advantage by misclassifying its Shoppers since it contributed less to California's unemployment insurance, disability insurance, avoided state and federal taxes, and evaded long-established worker protections under California law.

DEFENDANT'S CONTENTIONS: Defendant denied that it misclassified any Shoppers as independent contractors and further denied any wrongdoing of any kind as alleged in the complaint.

Result

Without admitting liability, Maplebear, Inc. dba Instacart agreed to pay $46.5 million to settle the lawsuit and resolve and release the People's claims on a statewide basis.