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One of Uber's Biggest Investors Just Sued Travis Kalanick for Fraud

11 Août 2017

The suit revolves around a decision past year to increase Uber's board from eight seats to 11, with those additional three seats in the sole control of Kalanick.

The pervasive cultural issues explored in Covington's investigation were known to and facilitated by Kalanick at the time of the amendments to the Certificate of Incorporation and the Prior Voting Agreement, but Kalanick did not disclose these matters to Uber's Board or Benchmark at the time.

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.

Kalanick has responded to the lawsuit saying that it is riddled with many lies and allegations and is completely out of merit.

The matter came to a head in March after a video surfaced showing him in an angry pay row with an Uber driver. Kalanick was the only person who could name someone to the board.

Reports suggested five out of major shareholders demanded his resignation, which included venture capital firm Benchmark.

Uber is now valued at US$68 billion, meaning that Benchmark, who controls 13 percent of Uber, would have a stake worth US$9 billion.

In the lawsuit, Benchmark said that it wouldn't have allowed Mr Kalanick the right to extra seats if it was aware of the "gross mismanagement and other misconduct at Uber".

Travis Kalanick resigned in June following mounting pressure from shareholders. That vote resulted in an expansion in the number of Uber's board seats from eight to 11.

Travis Kalanick may have stepped down as Uber's CEO, but he hasn't been sitting around idly since then, according to a new lawsuit.

The company is looking for a new chief executive after Kalanick was pressured to step down, following a series of business embarrassments for Uber. It further says that Kalanick failed to disclose information about self-driving auto startup Otto, which was acquired by Uber. Thanks to Uber's complicated stock and ownership structure, those holdings give him about about 16% of Uber's total voting power, according to the suit. The former CEO now holds one of those seats while the other two remain vacant.

Benchmark isn't actually suing Uber, the company itself.

The lawsuit adds to a litany of problems for Uber.

The lawsuit opens yet another sordid chapter in Uber's saga of woes, which has been battling one scandal after another starting from allegations of sexual harassment to being sued by Google's sister company, Waymo, for stolen trade secrets over self-driving cars.

Benchmark's lawsuit alleged that Kalanick was scheming to regain power by attempting to "pack the board".

One of Uber's Biggest Investors Just Sued Travis Kalanick for Fraud