Major Uber investor sues former CEO Kalanick

Major Uber investor sues former CEO Kalanick

File photo taken in 2016 shows the logo of online ride-hailing company Uber Technologies in front of its San Francisco headquarters.

SAN FRANCISCO — A major Uber investor has sued former CEO Travis Kalanick, claiming he usurped seats on the company's board of directors through fraudulent means to "increase his power over Uber for his own selfish ends."

Venture firm Benchmark Capital, which holds a 13% stake in Uber, alleges that when Kalanick sought to create three additional seats on Uber's board, he concealed his own "gross mismanagement and other misconduct." That includes a litany of scandals that have since become public and, in addition to embarrassing the company publicly, eventually led to Kalanick's resignation. (Kalanick appointed himself to one of the three additional seats on the board after he resigned.)

A spokesperson for Kalanick told CNBC the lawsuit is "completely without merit and riddled with lies and false allegations."

Axios first reported the lawsuit, which was filed in Delaware on Thursday.

The lawsuit cites Kalanick's role in acquiring Otto, the self-driving car start-up at Google founded by Anthony Levandowski, who was then accused of stealing trade secrets and Uber's pervasive culture of gender discrimination and sexual harassment as examples of Kalanick's failure as a CEO.

Benchmark claims if it had known about these scandals, it wouldn't have given Kalanick the three extra seats on Uber's board. The lawsuit seeks to invalidate the creation of those seats, which would effectively remove Kalanick from Uber's board. 

More: Uber's sexual harassment problem is 'substantial': women's tech group

More: Uber's first employee to step down

More: Uber CEO search intensifies as deadline nears

A spokesperson from Waymo, Google's self-driving car unit, said the lawsuit is evidence that "Uber leadership knew about Levandowski's misconduct and, rather than do the right thing, tried to conceal it."

The lawsuit is another indication of Uber's current dysfunction. The company has been battered with a seemingly endless wave of bad press in recent months as it searches for a CEO to replace Kalanick. The lawsuit claims that Kalanick is using his seat on the board — which the Benchmark says shouldn't even exist — as a way to exert his own influence and eventually come back as CEO.

'Kalanick’s improper actions, if allowed to continue, would cause irreparable harm to Uber by exposing it to reputational, regulatory and 6 other risks, and indeed, in his purported Board seat, Kalanick has already interfered with Uber’s search for a new CEO," the lawsuit states.

In response to media reports that Kalanick was planning to return as CEO, Uber co-founder and board member Garrett Camp dispelled those rumors in a company-wide email to employees on Monday.

Benchmark was one of the foremost investors leading the charge for Kalanick to resign and, according to Bloomberg, is considering selling some of its equity in Uber to SoftBank Group, a Tokyo-based telecom and internet company.

 



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