Early Uber investor slaps founder Travis Kalanick with lawsuit

Benchmark Capital is suing the former chief executive for ‘fraud, breaches of fiduciary duty’ and more. The move is aimed at removing Kalanick from the company’s board of directors.

Uber’s embattled founder and chief executive, Travis Kalanick, might have stepped down—but the company’s problems are far from gone.

One of the ride-sharing company’s early and largest investors, Benchmark Capital, is suing Kalanick for fraud, saying that the former chief executive attempted to “increase his power over Uber for his own selfish ends.”

The lawsuit, which was filed this week in Delaware, aims to oust Kalanick from Uber’s board of directors and restrict him on making business decisions. The lawsuit accuses Kalanick of “fraud, breaches of fiduciary duty, and breaches of contractual obligations.”

Kalanick responded through an attorney, who called the suit, “completely without merit and riddled with lies and false allegations.”

The lawsuit comes just days after reports that Kalanick told people he’s “Steve Jobs-ing it”—meaning Kalanick would return to Uber in a similar fashion to Jobs, who returned to Apple as its chief executive in 1997.

Bloomberg reported that Benchmark’s lawsuit is “likely to paralyze the company.”

Meanwhile, Uber’s senior vice president, Ryan Graves, is stepping away from his executive position to focus solely on his role as Uber’s board director and “the selection of our new CEO.”

Speaking of the search for a new chief executive, how is Uber faring?

The Washington Post summed it up with its headline, “Uber’s search for a female CEO has been narrowed down to 3 men.” The Post reported that it’s likely not for lack of trying, stating, “a number of A-list female executives have made it clear they are not interested in the role.”

Still, for a company whose founder and chief executive was forced to resign in the midst of rampant claims of sexual harassment throughout the company, the company’s search for a new chief is not making it look good—and if these issues paint a picture of disarray within the company, perception might be reality.

Uber’s head of HR has indicated that a new chief executive will probably be chosen by mid-September.

Benchmark has asked for a temporary injunction to remove Kalanick from the board while the case is being settled. Investors and PR pros should watch for how that move affects Uber’s chief-executive search—as it might further dissuade otherwise ideal candidates.

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