SUMMARY
Irving Firemen’s Relief & Retirement Fund Has Sued Uber And Travis Kalanick For Scandal Related Losses
The troubles surrounding Uber and its former CEO Travis Kalanick seem to be never-ending. As per a recent report, a Texas-based investor of the cab aggregator has sued Uber Technologies and Kalanick for “covering up a series of ‘illicit business tactics’ while raising funds, leading to billions of dollars in losses for the ride-hailing giant’s investors.”
Update [March 2018]: Uber Founder Travis Kalanick Launches Venture Fund To Invest In India, China
The case was filed by Texas-based Irving Firemen’s Relief & Retirement Fund. As per a complaint filed on Tuesday in a San Francisco federal court, the startup and its ex-CEO have been accused of failing to reveal at least six instances of malfeasance while “successfully soliciting billions of dollars in private investment.”
The recent complaint by the Texas-based investor accuses that the scandals about the trade-secrets lawsuit by Waymo, a federal foreign bribery probe and fall-out from sexual harassment allegations, among other legal woes have depressed shareholders’ investments in Uber by 15%.
“The company’s vaunted corporate culture was revealed to in truth consist of a toxic hotbed of misogyny, sexual discrimination, and disregard for the law that threatened the company’s reputation, business and prospects,” according to the complaint filed on behalf of a Texas city’s firefighter pension fund by Robbins Geller Rudman & Dowd LLP.
A Tough Year For Travis Kalanick & Uber
In January 2017, Uber faced a social campaign #DeleteUber after it was incorrectly perceived as trying to break a one-hour taxi strike at JFK airport. Later it caught the ire of users after Donald Trump signed an executive order on immigration ban for Syrian refugees and blocked entry for citizens from seven predominantly Muslim countries. At that time Uber’s Travis Kalanick was on Trump’s business advisory council and this led to the extension of #DeleteUber.
Later in February, former Uber engineer, Susan Fowler, disclosed sexual harassment and sexism claims in a blog post about her year at Uber. The same month, Waymo, a self-driving car company spun off from Google, sues Uber alleging that Anthony Levandowski – a former top manager for Google’s self-driving car project – stole pivotal technology from Google before leaving to run Uber’s self-driving car division.
Following all these allegations, Travis Kalanick stepped down as CEO under investor pressure on June 20. His resignation came after a year of scandals for Uber. Kalanick has also been sued by early investor Benchmark Capital accusing him of fraud, breach of contract and breach of fiduciary duty.
Later in August, Uber found the captain of its ship in Dara Khosrowshahi, who led the online travel company Expedia at that time. The cab aggregator is currently facing a ban in London. Last week the transport authority for London said that it would not renew the Uber’s license to operate in the city. Responding to the ban Khosrowshahi in an open letter said, “On behalf of everyone at Uber globally, I apologize for the mistakes we’ve made.”
The recent apology coming from Uber about the London ban was definitely a change from Travis Kalanick’s aggressive strategies in the past. All these scandals have made Uber’s future murkier and left investors worried. The recent allegations by Texas-based Irving Firemen’s Relief & Retirement Fund and the lawsuit by investor Benchmark Capital are a testimony to that. These allegations will definitely interrupt the efforts by the cab aggregator to redeem its reputation by fending off lawsuits and trying to recover from a year of scandals.
(The development was reported by Bloomberg)
