Uber investors seek to oust Benchmark after 'destructive' lawsuit

Travis Kalanick co-founder and former CEO is under fire from Uber's investment firm Benchmark Capital who are suing in a bid to remove him from the board

The complaint, which was filed in DE court, accuses Kalanick of "fraud, breach of contract and breach of fiduciary duty".

The dissenting shareholder group - headed by Los Angeles billionaire Ron Burkle, Hyperloop One backer Shervin Pishevar, and music mogul Adam Leber - blasted the legal salvo from Benchmark's Bill Gurley as a "fratricidal" move against Kalanick that could jeopardize Uber's ability to raise funds and find a new CEO.

A representative for Uber declined to comment on the lawsuit.

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

If successful, the Benchmark lawsuit could kick Kalanick off the board of directors, making his return impossible. The other two are still unfilled.

What seems to have triggered the latest round of spat is Kalanick's refusal to let go of his privilege to appoint three board seats. Benchmark has about 20% of total Uber's voting power. Benchmark is also accused of being especially vengeful against Kalanick with the lawsuit seen as an attempt to prevent him from having a say in the daily operation of the company co-founded by him. "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".

'Travis will continue to act in the interests of Uber and all of its stakeholders and is confident that these entirely baseless claims will be rejected, ' the statement said.

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Benchmark also felt that Kalanick failed to satisfactorily respond to the numerous discrimination and sexual harassment instances that have cropped up with the company. Waymo sued Uber earlier this year.

In a letter, the investor even warned that an "escalation of this fratricidal course" would "interfere with fundraising" and the ongoing search for a new chief executive at Uber.

Kalanick announced an indefinite leave of absence in June, following the recommendation of an independent report from former attorney general Eric Holder regarding the company's culture.

In response, a group of Uber shareholders loyal to Kalanick asked Benchmark to step down from the company's board. Eight days later, under pressure from the board, he resigned.

The board had a meeting scheduled for Friday, Axios said.

An email to Kalanick was not immediately returned.

"It's time for a new chapter, and the right leader for our next phase of growth", he told employees. That revelation's impact was somewhat lessened by the fact that Graves would remain as a member of the board.

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