Uber Technologies’ board is facing a lawsuit from shareholders alleging that the company has neglected compliance standards, resulting in numerous lawsuits related to sexual assault and harassment. The complaint, filed in a San Francisco federal court by shareholders led by a Detroit pension fund, claims that board members disregarded warnings about Uber’s failure to address sexual abuse by drivers.
The shareholders also point out that oversight failures contributed to two lawsuits brought against Uber by the federal government last year. One lawsuit accused Uber of discriminating against disabled passengers, while the other alleged deceptive billing practices in the Uber One subscription service.
The complaint describes Uber as a repeat violator of compliance standards, with its reputation irreparably damaged by negative media coverage. In response, a spokesperson for Uber dismissed the lawsuit as based on misleading information from previous lawsuits that have been addressed publicly.
The derivative lawsuit filed seeks to hold directors accountable for breaches of fiduciary duties and securities law violations, with any proceeds benefiting shareholders. Among the defendants is Chief Executive Dara Khosrowshahi, who is accused of failing to prioritize compliance during his tenure.
According to reports, Uber is currently facing over 3,500 lawsuits in San Francisco court related to allegations of sexual misconduct by drivers. Shareholders claim that the board has been informed multiple times that a significant portion of users doubt the company’s commitment to safety.
Recently, Uber and its competitor 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. Following these legal challenges, Uber’s stock price has dropped by more than 25% since reaching a peak in September.
