Uber Dan Gold via unsplash Uber Technologies' board of directors was sued on Monday (22) by shareholders who accuse management and its directors of allowing the company to neglect compliance standards, which reportedly resulted in thousands of lawsuits filed by victims of sexual assault and harassment. In a lawsuit filed in federal court in San Francisco, United States, shareholders led by a Detroit pension fund claim that board members repeatedly ignored internal and external warnings about Uber's alleged failure to address cases of sexual abuse committed by drivers. Now on g1 Investors also maintain that supervisory failures contributed to lawsuits filed last year by the federal government, which accused Uber of repeatedly refusing to serve passengers with disabilities, including people with service animals or folding wheelchairs. The company also reportedly adopted deceptive billing and cancellation practices. “Uber is a repeat compliance offender,” the lawsuit states, adding that the company's reputation has been “irreparably harmed” by negative media coverage. The company, headquartered in San Francisco, did not immediately respond to requests for comment.
Lawyers for the shareholders, led by the City of Detroit Police and Fire Retirement System, also did not immediately comment. The so-called derivative lawsuit, filed on Monday, aims to force directors to indemnify Uber for alleged breaches of fiduciary duties and federal securities laws. Chief Executive Officer Dara Khosrowshahi is among the defendants. According to shareholders, over nearly nine years in office, he has been “less bold in testing regulatory limits” than his predecessor, but has still maintained cost-cutting practices regarding compliance. As of June 1, Uber faced 3,571 lawsuits in proceedings overseen by the San Francisco court, in which drivers are accused of sexual misconduct. Shareholders also claim that Uber's board was repeatedly informed that less than 40% of users believe the company takes safety seriously. Earlier this month, Uber and its rival Lyft filed a lawsuit against New York City to block a new law that, according to the companies, would make it harder to ban drivers deemed unsuitable who pose a risk to passenger safety. Uber shares have fallen more than 25% since their peak on September 22.
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