Grocery delivery app Instacart has lost another attempt to halt New York City's new minimum wage law that extends pay requirements for food delivery drivers to grocery deliverers, marking the second legal defeat for the company in its ongoing challenge to the regulation.
U.S. District Judge John Koeltl denied Instacart's motion for an injunction pending appeal in a brief five-page order issued Monday night. The ruling came after the company's parent, Maplebear Inc., had already lost a preliminary injunction motion to freeze the pay requirement in December.
The new New York City law requires grocery delivery drivers to receive a minimum hourly wage of $21.44, extending similar protections that previously applied only to food delivery drivers working for platforms like DoorDash and Uber Eats.
Instacart argued it was entitled to an injunction pending its appeal to the Second Circuit Court of Appeals, claiming it had identified "complex constitutional issues" and there was a "possibility that part of all of [the Court's] decision may be reversed on appeal." However, Judge Koeltl, a Bill Clinton appointee, found these arguments insufficient.
"Instacart must show that there is a substantial possibility of success on appeal, which it has not done," Koeltl wrote in his order.
The company maintains the wage requirements will cause "irreparable harm" if allowed to stand. In a statement to Courthouse News, an Instacart spokesperson said the judge "misunderstood the applicable law and facts, which do not permit the city to impose these onerous and inflexible regulations."
"Instacart will continue its lawsuit and remains committed to opposing unlawful legislation that reduces flexibility for shoppers, increases costs and limits grocery delivery access for the communities we serve," the spokesperson added.
Instacart filed its initial lawsuit on Dec. 2, 2025, in the U.S. District Court for the Southern District of New York, attempting to distinguish itself from traditional food delivery platforms. The company argued that the city council did not have grocery delivery apps in mind when it passed the increased minimum wage requirements.
The grocery delivery service claims its business model differs significantly from food delivery competitors. Instacart employs personal shoppers who are predominantly women, caregivers, and part-time workers, according to the company. These workers are compensated through a "batch" rate system based on the estimated time and effort required for each specific order, rather than traditional hourly wages.
Instacart contends that if forced to comply with the new minimum wage rule, it would need to "overhaul" its current compensation structure. The company has positioned this potential restructuring as harmful to both the business and its workforce, arguing that the current system provides flexibility that workers value.
The legal challenge reflects broader tensions between gig economy companies and municipal efforts to extend labor protections to app-based workers. New York City has been at the forefront of such regulatory efforts, previously implementing minimum wage requirements for food delivery drivers that sparked similar litigation from companies like DoorDash and Uber Eats.
The city's expansion of wage requirements to grocery delivery represents an evolution of these labor protections, recognizing that workers performing similar services across different platforms may deserve comparable compensation standards.
Instacart's legal strategy has focused on constitutional challenges and arguments about regulatory overreach. However, the federal court's repeated rejection of the company's requests for injunctive relief suggests these arguments have not gained traction with the judiciary.
The case now proceeds on two tracks: Instacart's appeal to the Second Circuit Court of Appeals and the underlying litigation in district court. While the company continues to challenge the law's validity, the wage requirements remain in effect for grocery delivery drivers in New York City.
The outcome of this litigation could have implications beyond New York City, as other municipalities consider similar regulations for gig economy workers. Labor advocates have closely watched these cases as potential precedents for extending traditional employment protections to app-based workers.
For Instacart, the legal defeats represent mounting pressure to adapt its business model to comply with evolving labor regulations. The company must now balance its operational preferences with legal requirements while pursuing its appellate challenge.
The Second Circuit appeal will provide Instacart another opportunity to present its constitutional arguments against the wage law. However, the district court's finding that the company lacks a substantial likelihood of success on appeal suggests the path forward remains challenging for the grocery delivery platform.