New York - Venture-capital firm
Benchmark asked a Delaware judge to temporarily block
Travis Kalanick from filling two vacant company board seats, claiming
his interference hampers the search for his successor as chief executive
Kalanick, who resigned as CEO in June but remains a board member,
“continues to interfere with critical decisions at Uber,” including the
executive search, Benchmark said on Thursday in court papers filed in
Delaware Chancery Court. Benchmark sued Kalanick earlier this month
accusing him of duping the firm to gain access to three additional board
READ: Uber's Kalanick calls Benchmark lawsuit a 'fabrication'
In its filing, the firm asked the judge to bar Kalanick from filling
the seats while the lawsuit is pending. Benchmark says the block is
needed so that he doesn’t cast a decisive vote on any matter involving
Uber’s board, including the CEO search.
“It has been widely reported that Mr. Kalanick’s behavior has caused
potential CEO candidates to withdraw from consideration,” Benchmark said
in the filing. “Mr. Kalanick’s actions are chilling the search process
and threatening harm to Uber (and Benchmark’s investment) by keeping
Uber a ‘leaderless, and therefore foundering, corporation.’”
The suit is the latest development in an escalating battle between
Kalanick and Benchmark, one of Uber’s early investors which has a 13% stake. One of the firm’s partners,
Bill Gurley, led the effort to oust Kalanick as CEO. Kalanick resigned
after a series of controversies, including allegations of sexual
harassment by his employees and the use of software designed to bypass
Kalanick has called the lawsuit a “fabrication” and accused the firm
of using threats and intimidation to remove him from the company. He
said Benchmark was aware of all the events on which its claims are
based. The two parties are scheduled to appear in court in Georgetown,
Delaware, August 30.
“Benchmark’s suit relies on meritless personal attacks against Travis
Kalanick that have no basis in law or fact," Jimmy Asci, a spokesman
for Kalanick, said in response to Thursday’s filings. "Benchmark’s
shameful tactics and unfounded claims punish Uber, its employees and its
investors at a critical time when the company most needs stability and
Shervin Pishevar, a friend of Kalanick’s who holds a small stake in
Uber, has been taking steps to defend the former chief. Pishevar has
detailed his intentions to oust Benchmark from the board through a
series of published letters, including one on Thursday.
The latest letter
coincided with a formal request to join in the Delaware lawsuit so he
can be heard. He alleges that Benchmark is using the suit to gain
control of Uber, according to a copy of a filing obtained by Bloomberg.
The document couldn’t immediately be verified in court records.
Benchmark countered a contention by Kalanick, and echoed by Pishevar,
that the firm picked the “most shameful of times” - less than two
weeks after his mother’s funeral - to force him to sign his resignation
letter. During that time, the firm said, he continued to give
directions and remained “extensively involved” with the company -
including helping determine strategy on a report concerning alleged
sexual harassment and gender discrimination.
"Indeed, Mr. Kalanick was in Chicago to interview candidates for the
chief operating officer position when he was presented with the letter
signed by Benchmark and four other major investors representing
approximately 40 percent of Uber’s voting power," Benchmark said in the
Benchmark also asked the judge to deny Kalanick’s request to have the suit heard in private arbitration.
"Working with the board, Benchmark is focused on selecting Uber’s new
CEO as quickly as possible and without improper interference by Mr.
Kalanick," the firm said. "Expediting this action and entering a status
quo order are necessary to ensure Uber is protected from Mr. Kalanick’s
corrosive influence and can promptly obtain the new leadership it needs
to move forward."
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