A delivery app spent almost three years quietly charging hundreds of immigrant-owned restaurants more than the law allowed, renaming the fees every time it did it, and betting nobody would notice.
That bet just lost.
On Wednesday, the Mamdani administration announced that HungryPanda, a food delivery platform built specifically to serve New York's Asian immigrant communities, has agreed to pay more than $875,000 to resolve violations of the city's Third-Party Food Delivery Service Laws. The Department of Consumer and Worker Protection found that HungryPanda violated the city's Fee Cap Law, in some cases charging immigrant-owned restaurants thousands of dollars in illegal junk fees. The action marks the first time DCWP has enforced the law against a delivery app company for harming business owners.
That last part is worth sitting with. The fee cap law has been on the books since 2021. Delivery apps have been violating it longer than anyone had the time or resources to admit. It took until April 2026 for a single enforcement action to land on the restaurant side of the ledger.
To understand what HungryPanda was doing, you have to understand what the fee structure was supposed to look like. New York City's cap, which was made permanent in 2021, limits delivery fees to 15% per order, marketing fees to 5%, and transaction fees to 3%. Those numbers were not arbitrary. The average restaurant profit margin runs somewhere between 2% and 6%. In a business where a bad month of unexpected costs can wipe out three good ones, an illegal fee is a threat to the place’s survival.
DCWP found that HungryPanda "systemically" overcharged restaurants using tactics like mischaracterizing illegal overcharges, frequently relabeling charges and bundling multiple fees into a single item. This occurred between January 2022 and September 2024, when pandemic-era rules capped fees at 23%, and again before June 30, 2025, when the cap was lifted to the current 43%.
The app relabeled its fees. When a fee got scrutinized, it got a new name. It’s starting to sound a lot like the energy drink industry.
Commission fees reappeared as merchant promotion fees. An illegal overcharge got repackaged as a "promotion deduction." DCWP Commissioner Sam Levine described receipts full of "mystery charges and fuzzy math." This was a system built to take advantage of those who could not fight it. Until now.
HungryPanda, a third-party delivery platform used predominantly in New York's Asian immigrant communities, will pay more than $580,000 in restitution to more than 380 restaurants citywide, along with more than $294,000 in civil penalties and fees. That averages out to roughly $1,526 per restaurant in restitution. On a margin of 3%, getting back $1,526 means you needed to generate over $50,000 in revenue just to absorb what was taken. For a Sunset Park dim sum spot or a Flushing noodle shop running $800,000 in annual revenue, that is not a rounding error. That is a month of rent. That is a line cook's wages for six weeks.
The restaurants affected are immigrant-owned and located in neighborhoods like Sunset Park, Brooklyn, and Flushing, Queens. Both neighborhoods are economic anchors. Sunset Park's 8th Avenue corridor is one of the most densely concentrated Chinese commercial strips on the East Coast. Flushing's downtown is the largest Asian business district in the entire country outside of San Francisco's Chinatown. These aren't casual dining destinations. They are the infrastructure of entire communities, where families send remittances, fund their children's educations, and measure their own version of the American deal.
HungryPanda understood all of this. The commissioner's office noted that the app positioned itself as the go-to platform for users more comfortable ordering in Asian languages, and then used that positioning to exploit the very businesses it was supposed to serve. That's not an accident of product design. That's a business strategy. Capture a community that lacks legal resources, prefers in-language service, and has limited alternatives on the major platforms. Then charge them whatever you want because they don't know the law, and even if they did, they don't have the accounting firm to prove it.
Deputy Mayor for Economic Justice Julie Su put it plainly: "HungryPanda counted on these restaurant owners being too small and too busy to fight back."
This is also not the first enforcement action against HungryPanda in the Mamdani era. In January, HungryPanda was part of a combined $5.19 million settlement alongside Uber Eats and Fantuan for violations of the city's Minimum Pay Rate for delivery workers. HungryPanda specifically was ordered to pay $1,068,672 in restitution to more than 1,000 workers for failing to pay the minimum rate between December 2023 and January 2024. First the workers. Now the restaurants. The pattern of underpayment ran in every direction from this company simultaneously.
That pattern matters for what comes next. This settlement functions as a clear signal that regulators are moving beyond wage restitution and into merchant-level enforcement, and restaurants and apps alike should expect closer scrutiny of billing, disclosure, and contract practices in the months ahead. The big three apps, DoorDash, Uber Eats, and Grubhub, have been watching. They have more restaurants, more orders, and more creative accounting. The question is whether the city will follow the receipts the same way it did with HungryPanda, or whether this stays as a neat one-off story about a smaller player.
DCWP's aggregated data found merchant fees accounted for roughly 19% of order subtotals in its Q1 2024 dataset, which means the legal cap was already being treated as a suggestion industry-wide. The HungryPanda settlement is $875,000. The total amount extracted from New York City restaurants by platforms exceeding the fee cap, across all apps, over the years the law has been nominally in force, has never been calculated publicly. Nobody has tried to put that number on paper. Maybe we should.
Here is what the 380 restaurants that get checks know: they were right. The fees were wrong. The restitution they're receiving represents at minimum the documented overcharges DCWP was able to trace. The actual damage from three years of margin compression, from decisions made under false financial data, from operators who cut staff or skipped repairs or didn't open a second location because the numbers didn't work… those costs don't fit in a settlement.
The law existed. The violations were systematic. The enforcement arrived four years late.
If you are a restaurant owner using any delivery app in New York City and you have not audited your billing statements against the fee cap, stop reading and start pulling invoices. The DCWP complaint process is open. The city just proved it’s working.
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