Uber Technologies is facing a lawsuit from shareholders over allegations of lax compliance by its management and directors, resulting in numerous lawsuits for sexual assault and harassment. The complaint, filed in a federal court in San Francisco by shareholders led by a Detroit pension fund, claims that the board disregarded warnings about Uber’s failure to address sexual abuse by its drivers.
The lawsuit also points out that oversight failures played a role in two federal lawsuits filed against Uber last year. One accused the company of discriminating against disabled passengers, while the other alleged deceptive billing practices in its subscription service. The complaint describes Uber as a repeat violator of compliance standards, with its reputation irreparably tarnished by negative media coverage.
In response, a spokesperson for Uber based in San Francisco dismissed the lawsuit as being based on misleading information from previous lawsuits that have already been addressed. The lawyers representing the shareholders, including the Police and Fire Retirement System of the City of Detroit, have not yet commented on the matter.
The derivative lawsuit seeks to hold Uber’s directors accountable for breaches of fiduciary duties and securities law violations, with any monetary recoveries benefiting the shareholders. CEO Dara Khosrowshahi is named among the defendants, with shareholders criticizing his approach to regulatory compliance during his tenure.
Uber currently faces over 3,500 lawsuits related to driver sexual misconduct in San Francisco court. Shareholders have highlighted concerns raised to the board about public perception of safety issues, with less than 40% of users believing that Uber takes safety seriously.
Recently, Uber and Lyft filed a lawsuit against New York City to challenge a new law that they argue would hinder their ability to remove drivers posing safety risks. Uber’s stock price has declined by more than 25% since reaching its peak in September last year.
