California challenge capital organization named Benchmark Capital invested $11 million in a promising more youthful startup known as UberCab. Reference to Benchmark Capital is a piece more contentious. Benchmark filed a lawsuit Thursday toward the journey-hailing business enterprise’s former CEO, Travis Kalanick, accusing him of fraud, breach of settlement and breach of fiduciary obligation
Significant to the case, 3 seats on Uber’s board of administrators that Benchmark and different board participants signed off on in a June 2016 choice, expanding the board from eight to 11 seats.
The business enterprise says it never would have authorized the seats inside the first vicinity had it recognised of the various scandals brewing on the corporation on the time and that Kalanick intentionally misled them. Benchmark’s suits seeks to get rid of Kalanick and the 2 additional board seats, which might be unfilled, thereby drasticallyreducing his effect
“Kalanick deliberately hid and failed to reveal his gross mismanagement and different misconduct at Uber,” the match argues.
Kalanick’s overarching goal is to % Uber’s Board with dependable allies with a view to insulate his in advance conduct from scrutiny and clear the path for his eventual pass again as CEO—all to the detriment of Uber’s stockholders, personnel, motive pressure–companions, and customers
Benchmark claims Kalanick changed into conscious that the coming scandals, which he’d hidden from the board, mightpressure him to renounce, so he maneuvered to feature the board seats so he may want to nevertheless wield have an effect on on the agency.
“Kalanick … knowingly hid those topics from Benchmark and Uber’s Board to obtain, for his personal advantage, the unilateral right to % the Board with 3 additional directors of his choosing,” the in shape reads.
“In doing so, Kalanick acquired a disproportionate level of have an impact on over the Board, making sure that he couldmaintain to have an oversized function in Uber’s strategic route even supposing forced to renounce as CEO.”
According to CNBC, Uber’s Ex- CEO spokesperson said that:
”The lawsuit is completely without merit and riddled with lies and false allegations. This is continued evidence of Benchmark acting in its own best interests contrary to the interests of Uber, its employees and its other shareholders. Benchmark’s lawsuit is a transparent attempt to deprive Travis Kalanick of his rights as a founder and shareholder and to silence his voice regarding the management of the company he helped create. Travis will continue to act in the interests of Uber and all of its stakeholders and is confident that these entirely baseless claims will be rejected. ”
The fit is a clear attempt by using Benchmark to boom its energy on a board tormented by infighting. Late final month, absolutely certainly one of Uber’s top applicants to update Kalanick, former Hewlett-Packard CEO Meg Whitman, withdrew herself from consideration as a minimum partly due to the warfare on the board.