Venture capital firm sues ex-Uber CEO for fraud

Venture capital firm sues ex-Uber CEO for fraud
© Getty

A venture capital firm is suing former Uber CEO Travis Kalanick for fraud and breach of contract, alleging that he tried to amass power on the company’s board and conceal from investors his “gross mismanagement and other misconduct.”

Benchmark Capital, an early Uber investor that holds a seat on the company’s board, filed the lawsuit in Delaware Chancery Court, Axios reported Thursday.

“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 filing reads.

A spokesperson for Kalanick said the lawsuit "is completely without merit and riddled with lies and false allegations."

"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," the spokesperson said. 

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.

Recode reported last month that Kalanick was telling colleagues he was “Steve Jobs-ing” — planning to make a comeback at the company akin to the one the late Apple founder made toward the end of the 1990s.

Before Kalanick resigned, Uber added three new seats to its board. Following his resignation, Kalanick claimed one of those seats for himself. Benchmark said in its lawsuit that it would not have agreed to the three extra seats had it known about the extent of the scandals under Kalanick’s leadership.

The lawsuit reads: “These matters included, among others, Kalanick’s personal involvement in causing Uber to acquire a self-driving vehicle start-up that, according to a confidential report not disclosed to Benchmark at the time (the 'Stroz Report'), allegedly harbored trade secrets stolen from a competitor; an Uber executive’s alleged theft of the medical records of a woman who was raped by her Uber driver in India; a pervasive culture of gender discrimination and sexual harassment that ultimately prompted an investigation by the former U.S. Attorney General Eric HolderEric Himpton HolderHolder to sit down with Colbert amid 2020 speculation The Hill's Morning Report — Trump, Putin meet under cloud of Mueller’s Russia indictments Eric Holder: Calls to abolish ICE are 'a gift to Republicans' MORE; and a host of other inappropriate and unethical directives issued by Kalanick.”

Benchmark wants Kalanick removed from the board and hopes to reverse the decision to create the three new openings on the panel.

Uber declined to comment. 

- This story was updated at 5:38 p.m.