New York City’s Department of Consumer and Worker Protection on Thursday filed a lawsuit accusing a delivery app, Motoclick, of stealing earnings from delivery workers and charging them illegal fees.
It was one of the first major moves by the department’s new commissioner, Samuel Levine, and came two days after the department released a report that argued that two large delivery companies, DoorDash and Uber Eats, had “engineered design tricks” in their apps to deprive workers of $550 million in tips.
Mr. Levine, who has been on the job for less than two weeks, says his actions are intended to send a clear message to companies and workers that the relatively small city department he leads will be far more assertive and forceful under Mayor Zohran Mamdani.
The mayor, who campaigned on an affordability platform, has already tasked the department with enforcing two of his first executive orders targeting deceptive business practices like junk fees and hard-to-cancel memberships and subscriptions.
In a corner office in Manhattan’s financial district, Mr. Levine has an eight-page document of his immediate priorities — what he describes as “all the problems I’m going to solve by the end of the year.”
The list includes protecting renters and immigrant New Yorkers, cracking down on junk fees, and helping job applicants by going after so-called ghost positions: postings that companies advertise but never intend to fill.
Kathryn Wylde, the outgoing chief executive of the Partnership for New York City, an influential business group, said she had been following Mr. Levine’s statements and actions and had concerns. So far under the Mamdani administration, she said, she has heard a lot about an aggressive posture toward companies and very little about economic development.
“I hope this is just a small piece of the overall strategy for how this administration will deal with the city economy and employers in general,” Ms. Wylde said. “If not, we are in for a rough ride.”
In the bureaucratic labyrinth of New York City government, Mr. Levine’s department is a small piece, with a $75 million budget and more than 400 workers. Mr. Levine hopes to double both, bringing on more data scientists and lawyers.
He said he would borrow from his previous experience as the director of the Federal Trade Commission’s Bureau of Consumer Protection in the Biden administration, another relatively small agency that pursued an aggressive agenda against major corporations including Amazon and Walmart.
His former boss at the F.T.C., Lina Khan, helped lead Mr. Mamdani’s transition team. During the transition, she directed a group that pored over New York City’s laws to find overlooked or underused mayoral authority that Mr. Mamdani could make use of quickly.
Mr. Levine said he had done a similar analysis of his department’s full authority. He wants the department, he said, to be “the tip of the spear in city government for taking on the biggest companies that are squeezing workers, that are squeezing consumers, that are driving people out of the city.”
In his first days on the job, Mr. Levine asked department employees to ramp up their scrutiny of food-delivery companies, which already face stricter regulations in New York City than anywhere else in the country, including minimum pay requirements for drivers.
In response, DoorDash and Uber Eats both changed their apps to make the option to tip delivery workers available only after a purchase had been completed. Mr. Levine had the department calculate the decline in tips that drivers for those companies had received after the changes.
The resulting report, which caught both companies by surprise, was released on Tuesday and said that $550 million in tips had been lost.
John Horton, DoorDash’s head of public policy for North America, said the report was “flat-out wrong.”
“What’s really happening is the D.C.W.P. wants to pressure consumers to tip even more,” Mr. Horton said. “Forcing people to tip may as well be a tax.”
On Thursday, the department sent letters to dozens of food- and grocery-delivery companies reminding them about new city laws that go into effect before the end of January. One will require apps to provide an option to tip at checkout, along with a suggested minimum tip of 10 percent. DoorDash and Uber Eats recently sued the city to overturn the law.
Mr. Levine also had the department move forward with the lawsuit against Motoclick, which grew out of an investigation that began nearly two years ago under the previous mayor, Eric Adams.
In the lawsuit, the city alleges that the company, which connects restaurants with delivery workers, charged drivers excessive fees, such as $10 for a canceled order, and ignored the city’s minimum pay rules. The city estimates that the number of victims could be in the thousands and that the company collected millions of dollars in illegal fees.
The city has asked a judge to bar Motoclick from operating in New York City.
Matthew Haag is a Times reporter covering the New York City economy and the intersection of real estate and politics in the region.
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