Benchmark sues former Uber CEO Travis Kalanick for fraud

Aug 11, 2017, 00:25
Benchmark sues former Uber CEO Travis Kalanick for fraud

Venture capital firm Benchmark Capital is suing former Uber Chief Executive Officer Travis Kalanick to force him off the board of the ride services company and rescind his ability to fill three board seats, according to the lawsuit.

Benchmark says the firm wouldn't have voted for the expansion if it had known about Kalanick's "gross mismanagement and other misconduct at Uber" and that the former leader hasn't upheld his written pledge to keep those seats independent and subject to the entire board's approval.

That would kill Kalanick's seat on the board and most of his remaining influence.

Uber's troubles include a trade-secret lawsuit by Alphabet Inc's Waymo unit that led to the departure of a star engineer and hobbled Uber's self-driving vehicle program; sexual harassment allegations that led to a major internal investigation and the dismissal of several top executives; and alleged misconduct by Kalanick and other executives in handling a rape committed by an Uber driver in India.

Kalanick resigned from the company in June after a revolt from investors following two separate investigations into allegations that Uber's leadership failed to address sexual harassment complaints filed by female employees.

If Benchmark Capital's lawsuit is successful, Kalanick would be kicked off of Uber's board of directors. The suit seeks to invalidate three new board seats, included among them the one held by Kalanick.

Investor Benchmark Capital is chafing at the idea, however, and filed suit against its former colleague in DE on Thursday for fraud and breach of contract.

Graves will continue to serve on Uber's board, it said.

Benchmark's lawsuit exemplifies the level of chaos within Uber's ranks as the $69 billion company has continued its search for a new CEO.

- Kalanick owns 10 percent of Uber's stock, controls 16 percent of the voting power and has 35 percent of the class B stock.

The pioneering company has been facing pressure to rein in a no-holds-barred management style led by Kalanick, 40, and to reform its work environment.