Will Travis Kalanick, the ousted CEO of Uber, ever get a break? Probably not. And he’s probably had enough breaks in his life, anyway.
Barely two months after losing his post amid the sexual-harassment and gender-discrimination scandals engulfing his company, Kalanick is being sued by one of Uber’s largest early investors, Benchmark Capital. The lawsuit accuses Kalanick of conniving to “entrench himself on Uber’s Board of Directors and increase his power over Uber for his own selfish ends.”
“Kalanick’s overarching objective is to pack Uber’s Board with loyal allies in an effort to insulate his prior conduct from scrutiny and clear the path for his eventual return as CEO—all to the detriment of Uber’s stockholders, employees, driver-partners, and customers,” the lawsuit continues. It’s a blistering accusation, not to mention an atypical one. It’s rare for a venture capital firm to sue a board member of its most prized investment. Uber is the most valuable startup in the United States, valued at about $68 billion. For perspective, the second most funded company is Airbnb, at $31 billion.
Benchmark also has a seat on Uber’s board and is in essence trying to kick Kalanick out of the company for good. Long before Kalanick was pushed out as CEO, he moved to add three seats to Uber’s board in in June 2016, increasing the count from eight to 11. Kalanick took one of those seats before stepping down. Now Benchmark is arguing that the venture capital firm would never have approved the extra board seats had it known Kalanick was such a toxic asset.
The venture capital firm says that the embattled former CEO “intentionally concealed and failed to disclose his gross mismanagement.” Specifically, Benchmark calls out “Kalanick’s personal involvement in … an Uber executive’s alleged theft of the medical records of a woman who was raped by her Uber driver in India.” Not to mention the acquisition of Otto, a self-driving car startup that allegedly came on board with stolen trade secrets from Waymo, the self-driving car project from Google’s parent company, Alphabet.
Now Benchmark wants the June 2016 board expansion overturned and Kalanick kicked off the board for good. That would mean Kalanick would have far less leverage to eventually climb back into his old seat as head of Uber, something Kalanick has reportedly been plotting since before he stepped down under board pressure. In June, before he was officially booted, the New York Times reported that Kalanick had been amassing voting rights at the company via Uber’s stock repurchasing program, which requires Uber employees who sell stock back to the company to hand over the voting rights that come with those shares to Kalanick in full. Kalanick has tried to meddle in the day-to-day operations at Uber since his ousting too, so much so that Uber’s board “reinforced a policy that all directors get the same limited access to information about Uber’s ongoing operations,” according to Recode.
Kalanick, for his part, says the accusations from Benchmark are baseless. The statement from his spokesperson was shared by numerous journalists on Twitter:
Of course, this statement is what one would expect from a former executive on his last leg, trying to claw his way back atop the company that he worked so hard to build. The problem, though, is that he built it without much of a moral backbone, and now some of the investors that backed him early on, it appears, are trying to make the company walk straight again.
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