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Major Uber investor sues former CEO Travis Kalanick for fraud

11 August 2017

Kalanick was trying 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", Benchmark said in the lawsuit.

In a blockbuster lawsuit, Uber Technologies Inc. investor Benchmark Capital today sued embattled former Chief Executive Travis Kalanick for fraud and breach of contract and fiduciary duty.

That vote resulted in an expansion in the number of Uber's board seats from eight to 11.

Benchmark cited all three cases in its suit as examples of Kalanick's mismanagement.

Another early Uber employee, Ryan Graves, announced Thursday that he is stepping down from a vice president role but will keep his seat on the board.

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Kalanick, the firm says, used Uber's board to secure his position at the company even after he stepped down as CEO.

The suit centers around the creation of three additional board seats at Uber in June 2016.

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 1990s. According to a change voted on by shareholders in June 2016, the three extra board seats were to be appointed by Kalanick alone, and when he resigned as CEO, losing the CEO's designated seat on the board, he simply appointed himself to one of the three open seats, and the other two remain unfilled.

An Uber spokesman told the BBC it would not comment on the lawsuit. Uber has fired at least 20 employees as a result of that investigation. It's a surprising move by a venture capital firm, but it comes amid a constant stream of news about sexual harassment, gender discrimination, a lawsuit by Google Inc. self-driving vehicle unit Waymo Inc. charging that a former Google executive's self-driving truck startup Otto acquired by Uber involved stolen trade secrets, and other issues.

Investors from Benchmark led the charge in pressuring Kalanick to resign.

Major Uber investor sues former CEO Travis Kalanick for fraud