Travis Kalanick is still not out of the water and the New York Times and Axios report that venture capital firm Benchmark has filed a lawsuit against him for breach of contract and fiduciary duty. The lawsuit alleges that Kalanick gained several board seats through “material misstatements and fraudulent concealment.”
The lawsuit also said that the objective was to fill the board with allies so that Kalanick could return as CEO and escape scrutiny. Kalanick was forced out of the company in June but still remains on the board. Around the same time, the board passed a resolution to increase the number of seats from eight to 11. As part of his resignation, Kalanick had agreed to leave the two seats would stay independent, something that he has yet to codify via an amendment to the voting agreement.
Axios added that Kalanick still owns 10% of the company – with a valuation of $70 billion- and Benchmark owns around 13% of Uber’s shares.
Currently, Uber’s top level management is empty with the exception of the post of Chief Technology Officer. The company currently does not have a chief operating officer, a chief financial officer, chief marketing officer, chief diversity officer, general counsel, senior vice president of engineering.
What it means for Kalanick: Meanwhile, reports pointed out that if Kalanick is removed from the board, it is unlikely that he will be returning to the company in any substantial report. NYT added that Kalanick is not interested in helming the company as CEO and sources also told the publication that he prefers being a shadow leader.
Uber’s mounting trouble
- Trouble began when former Uber engineer, Susan Fowler alleged that she had faced sexual harassment and discrimination during her time at the company.
- Things were further complicated for Kalanick as it was revealed that current and former senior management members had obtained and held onto medical records of the Delhi rape survivor in 2014. The survivor has once again filed a lawsuit against the company and three of its current and former senior management members (including Kalanick).
- The company is also facing trade secret theft lawsuit by Waymo, Alphabet’s self-driving car unit.